Future of Health Care in the Pacific Uncertain As End to Compact Funding Nears

Sep 10, 2018

Kalani Kaneko, Health Minister for the Republic of the Marshall Islands, speaks at a recent gathering of health officials from the U.S. affiliated Pacific Islands in Honolulu.
Credit Ku'uwehi Hiraishi

The clock is winding down on three decades of U.S. financial aid to certain countries in the Northern Pacific region. U.S. economic assistance under the Compact of Free Association is set to expire in five years – dealing quite a blow to the health care systems in three Pacific Island nations. HPR’s Kuʻuwehi Hiraishi reports.

Health Ministers and Secretaries from the U.S.-affiliated Pacific Islands gathered in Honolulu to discuss health care initiatives.
Credit Ku'uwehi Hiraishi

Health officials from Micronesia, Palau, and the Marshall Islands recently gathered in Honolulu to discuss the future of health care finance in their countries – pending the end to American economic assistance in 2023.

“I think there’s a lot of uncertainty about what is going to happen in 2023,” says Alex Wheatley, a Princeton University graduate student studying U.S. funding of health systems in Micronesia and the Marshall Islands.

Credit Billie Hiraishi

“Both countries were pretty heavily dependent on U.S. government financing for health,” says Wheatley, “In FSM or Micronesia, local revenues contributed just 5 percent of their health budgets and in the Marshall Islands, local revenues contributed about 15 percent.”

The rest comes from the U.S. – either through federal funds or under the Compact of Free Association or COFA. These countries along with Palau have five years to shake their financial dependence on the U.S. Here’s Kalani Kaneko, Health Minister for the Marshall Islands.

The Compacts of Free Association or COFA were established in part to compensate these Pacific Island nations for the loss of life, land, and resources as a result of nuclear testing conducted by the U.S. Military during World War II. Here's a picture of the Baker explosion at Bikini Atoll, Micronesia, in 1946.
Credit U.S. Department of Defense / Wikimedia Commons

“Pulling the plug all at once I think is really going to be a big challenge for us because by receiving the funding now, U.S. actually raised the standards,” says Minister Kaneko, “If we have to run those same programs with the challenge of limited funding, it’s gonna be a big challenge. It might be a nightmare.”

The transition is most challenging for Micronesia – where U.S. funding accounts for 95 percent of the country’s health budget. 

The Rock Islands in Palau.
Credit Mark Kenworthy / Flickr

In Palau, the government created a national health insurance program and raised what are known as “sin” taxes on alcohol and tobacco to help address the anticipated budget shortfall. Here’s Palau’s Health Minister Dr. Emais Roberts.

“You know I was joking earlier you might have to sell more alcohol and tobacco and maybe even legalize marijuana just to support some of these good programs,” says Minister Robers, “But we’ll do it one way or another.”

Kosrae, Micronesia. The United States Military controls the sea and airspace over the three COFA island nations. In exchange, these nations receive economic assistance and visa-free migration to the states.
Credit Billie Hiraishi

Under the 1986 compact, all three countries receive financial assistance and visa-free migration in exchange for U.S. strategic military control over the North Pacific region. While the economic assistance ends in five years, the migration and military provisions will continue.

“I think the ideal of these islands being self-sufficient is a really great one,” says Clifford Chang, Executive Director of the Pacific Islands Primary Care Association, “The truth is though that when you go to the Pacific, and you see that some of these places, not some of them, a lot of them, theyʻre small atoll countries right? They donʻt have a lot of resources that they can draw upon."

Palau Health Minister Emais Roberts with Palau medical students. While strides are being made in building local capacity for health care in the islands, it is one of the biggest challenges to economic self-sufficiency as 2023 nears.
Credit Pacific Islanders Health Officers' Association

Chang's organization supports community health centers in all three COFA countries.

“I don’t know what the U.S. expects at how they’re going to become self-sufficient. They just don’t have a base for that,” says Chang, “So the lack of U.S. funding and U.S. support which I believe like we’re morally obligated to continue to provide just means that they just do without or even worse, other countries will step in.”

The Chinese and Taiwanese governments have already begun investing in these Pacific Island nations.