Social entrepreneurship & finance

Tag ‘ cegin ’

CEGIN: The video report!

June 2, 2009 | Comments Off | Enterprises, Videos

Through the use of his CEGIN clinics and his SER system, Doctor Gronda aims at providing quality healthcare to the people at the base of the pyramid. By treating over 40 000 patients, CEGIN contributes to the development of the most marginalized communities of the Jujuy Province in Argentina. As labor force is the main working tool of the farmers in rural regions, access to healthcare constitutes the basis of economic and social development.

For more information, read CEGIN’s profile

Fair Street - CEGIN from Angalio Productions on Vimeo.

CEGIN: Healthcare for all

June 2, 2009 | Comments Off | Enterprises

After problems faced by cartoneros, education and water access, Fair Street’s third report puts forward a doctor who seeks to provide the poorest of people with access to healthcare.

Problem: healthcare

In our previous report, we focused on the essential role played by education in economic and social development. Health must be considered as a second fundamental factor in constructing a sustainable future. One cannot imagine a country adopting a development policy which does not seek to improve access to healthcare services. For rural populations, whose workforce is often the main production factor relied upon for agriculture, good health is an essential basis for any progress to be achieved. In far-off regions, particularly, women and children suffer from difficult living conditions; one of the UN Millennium Development Goals is to reduce by three quarters the maternal mortality ratio by 2015. The Juyjuy Province is especially affected by this problem, with a maternal mortality ratio ten times higher than in France.


In Argentina, over half of the population does not have access to social security. But even those whose work status allows them to enjoy social security benefits often choose in addition to subscribe to a private health insurance. This is because of the inefficiency of the public healthcare system, and for this two main causes are identified. First, it is decentralized and managed at the level of provinces, which leads to strong differences between regions in Argentina. Moreover, as the State is unable to offer a complete set of solutions, workers unions tend to create their own obra social (social security), which also causes irregularities and many organizational problems. The Argentinean population thus has two options: either to resort to private healthcare systems, usually too expensive for the populations at the base of the pyramid; or to use available public services and consequently accept its inefficiencies and waiting lines that can last up to several days. But this time spent waiting prevents the patient from working, and providing for the needs of his family.

The company:

CEGIN (Centro Ginecologico Integral) is a medical center founded in 1989 which specializes in the provision of medical services to poor women from rural areas. The CEGIN center manages to offer quality services at half of the market price! In order to achieve such results, their strategy is based on the use of the economies of scale. The medical industry is faced with very high fixed costs (equipment, infrastructure…), whereas the additional cost of a new client is actually relatively low. The CEGIN center therefore targets a very large number of patients in order to spread its fixed costs. By working many hours and treating a large volume of patients (40 000 total), the center can thus guarantee a quality service whilst achieving lower rates of consultations. Rather than offering free services, the CEGIN approach is to charge the patient a low — but fair — cost. They have come to realize that the patient feels more dignified that way, and in consequence is treated with greater respect by doctors.

Five years ago, Jorge Gronda launched the SER system within the CEGIN center. It is a membership card that patients can purchase for 10 pesos (€2) per year which gives them access to the 60 CEGIN medical practices. By presenting this SER card, patients enjoy preferential rates in CEGIN centers that charge less than half of the market price for medical services (for example, an ultrasound scanner costs 20 pesos in CEGIN centers, instead of 50 pesos normally). The main idea behind the SER card, beyond increasing access to healthcare, is to create a network that will later allow its members to enjoy various advantages. By creating this network, and taking advantage of its high amount of members, the SER system can have a considerable influence on shopkeepers in the Jujuy Province. Currently, card holders already enjoy discounts in some pharmacies, and in the long term, Jorge Gronda’s ambition is to develop a system of “social franchise”, and extend the SER card’s field of action to various fields such as food, construction and transports. His aim is that necessary fundamentals for a decent life be accessible at low cost for all the people living at the base of the social pyramid.

The entrepreneur:

Jorge Gronda is a doctor originally from the Jujuy Province. First active in the public sector, he left it over 25 years ago to found CEGIN. Tired of the public healthcare system’s many gaps, he launched the CEGIN initiative with two motivations: first, he wished to offer quality healthcare to those at the base of the economic and social pyramid; and second, he wished to reduce the distance between doctors and patients. Jorge Gronda’s has earned much recognition and gratitude for his work. He was first elected Entrepreneur of the Year by the Schwab Foundation in 2005, he then received the United Nations Development Prize, and he was finally invited to share his vision of the future at the Davos World Economic Forum in 2008.

Social impact:

The social impact of CEGIN and the SER system is obvious, and can be summarized as follows: to allow the people at the base of the pyramid (by definition, those who do not have access to social security) to have access to quality healthcare. Nowadays, over 40 000 people are followed by the CEGIN clinics (including 20 000 through the SER network). Over 10 000 biopsies are carried out each year in CEGIN clinics, which is estimated to have prevented the development of more than 300 cancers.

Nonetheless, Gronda does not limit himself to the provision of healthcare services. Instead, he takes an interest in acting out of consideration for the poorest of people. During his interview, Gronda insisted several times on the important role of the SER card. First, people pay in order to subscribe for this card, therefore valuing it more than if they received it for free. This requirement has a direct impact on the level of the care they receive, as they are more inclined to share information on their health that facilitates the work of their doctors. Second, belonging to the SER networks and enjoying quality healthcare services considerably increases the self-esteem of people suffering from social exclusion. Thanks to the satisfaction of SER clients, Gronda has never had to publicize his system. The pride they take in being part of this network encourages people to talk about it in a positive way, and this word of mouth has proved to be an essential contribution to the development of CEGIN.

Financial impact:

 Support from a fund: Gronda is currently attempting to finalize negotiations with a European fund. Because of a confidentiality clause, we are unfortunately unable to divulge its name. The financial contribution from this fund should allow the consolidation and extension of the SER network. The objective is to extend the number of members from 20 000 to 50 000 over the next five years. According to Gronda, such financial support from an external organization is necessary in order to achieve this objective.

Use of microfinance: 80% of health problems can be resolved with an SER card and the consultations at half price that it allows. However, some serious problems require much more expensive surgery. In these cases, CEGIN uses the benefits of micro-credit in order for its clients to afford these operations. The most common operations they have to carry out cost on average 3 000 pesos (€ 600 +/-). A micro-credit fund financed and managed by CEGIN allocates credits equivalent to the costs of the required operations. These credits are usually reimbursed in ten regular payments. Gronda is a pioneer in the use of micro-credit for health purposes; considering that health is a basis for development, he believes that it is essential for people to have access to capital in order to extend their access to healthcare. For the worst cases that micro-credit cannot finance, CEGIN is trying to set up a micro-insurance system. Statistically, these cases only represent one in a 100 000 patients, so Gronda is trying to take advantage of the “strength in numbers” effect of the SER network; the small contributions of all members of the network would finance the treatment of exceptional cases.

The SER system rests on a fundamental financial principle: diversification. Members of the network are at the base of its success and development. That is why, by extending the network, Gronda is consolidating it. With more members, the various risks are diversified and the global risk is reduced. This diversification that reduces the system’s profile of risk also plays an essential role in financing both the workings of micro-credit and the development of a micro-insurance system.



 Interview with Jorge Gronda, founder CEGIN and SER System

Llobeta Robert, Recuperando la salud, Grupo Editorial Lumen, Buenos Aires, 2007