In June 2009, a new Health in Africa Fund was launched by the International Finance Corporation (IFC), the branch of the World Bank group mandated with supporting and expanding the private for-profit sector. This Fund will be managed by Aureos Capital, a private equity fund manager focusing on emerging markets. Through investment in small- and medium-sized private providers, the Fund will attempt to’[help] low-income Africans gain access to affordable, high-quality health services.’ The Fund targets initial commitments of US$ 100–120 million and intends harnessing private capital and private sector providers to improve quality and coverage of health services. But it is unlikely to improve access or quality of care unless it is complemented by initiatives to strengthen the public sector capacity to regulate, train, oversee and sub-contract (where appropriate) private providers. In addition, the Fund would also require the development of risk-pooling and subsidy mechanisms, so that privately-provided services can be offered free at the point of delivery. If it fails to do so, there is a concrete risk that, contrary to its objectives, it will contribute to the entrenchment of two-tier health-care systems and to a further concentration of human and financial resources in services catering to affluent urban dwellers.
Public-Private Mix
The question of why privatisation and commercialisation of public services is taking place is a hotly contested one. Neoliberal analysts have argued that privatisation occurs because states fail: state officials are rent-seeking, inefficient, unaccountable, inflexible and unimaginative. Privatisation is seen as a rational and pro-poor policy choice, obvious to anyone willing to look at the track record of public versus private sector delivery: The authors here argue, by contrast, that the privatisation of public services has not happened because it has been inspired by some renewed sense of cultural enthusiasm for the market, but rather that it has become a necessity imposed on the state by economic circumstances: reduced public borrowing; cuts in state spending; liberalisation; and the opening up of new economic fields for intensified capital accumulation. Not surprisingly, some of the biggest boosters of privatisation are the private companies themselves, which have spent considerable time and effort trying to secure new market opportunities. They have actively sought contracts around the world, and consultancy firms, such as PriceWaterhouseCoopers and KPMG, have been actively promoting privatisation efforts and lobbying for the expansion and acceleration of the General Agreement on Trade and Services (GATS).
Social franchising is argued to be a way of rapidly scaling up clinical health interventions in developing countries. Building upon existing expertise in poor and isolated communities, social franchising organisations engage private medical practitioners to add new services to the range of services they already offer. Specific examples are provided, such as the Confiance programme in the Democratic Republic of the Congo that provides a toll-free hotline for answering family planning-related questions and making referrals. It is reported to have been effective in addressing family planning concerns raised by men. This paper argues that standardisation, quality monitoring and scalability make social franchising one platform for the expansion and improvement of a wide range of medical services.
This report focuses on the contribution of AIDS-related public-private partnerships to the six building blocks of health systems: service delivery; human resources; information; medicines and technologies; financing; and leadership. A desk review and interviews were conducted with representatives of private and public organisation stakeholders, as well as development partners. Interviewees identified mutual understanding as an important precondition for the implementation of efficient and successful partnerships. The private sector at times lacks profound knowledge of the complex stakeholder landscape in the HIV response and health care provision. To develop flourishing partnerships, honest and wide-ranging dialogue to inform and secure agreement in joint planning is essential from the very earliest stages. Such planning will of course consider issue such as sustainability, follow-up, and monitoring, essential to flourishing partnerships. Health financing mechanisms, HIV and tuberculosis treatment and mobile health technology are areas which are of interest to the private sector and which require further technical expertise and promotion.
This book is about a new form of philanthropy dubbed 'philanthrocapitalism'. Philanthrocapitalists believe that foundations and non-profit civil society organisations should operate like market-oriented businesses. They believe that success in the business model can be emulated to make a similar impact on social change. The author concedes that it should certainly help to extend access to useful goods and services, and it has a positive role to play in strengthening important areas of civil society capacity, but social transformation requires a great deal more. Philantrocapitalism is a sign of a severely disordered and inequitable world. The author asserts that there is need for public debate between philanthrocapitalists and their critics about the complexities involved in social transformation. The book suggests a number of commitments that should be made: commitments to transparency and accountability, to democracy, to modesty and to devolution by investing in civic capacity and voice, and promoting the long-term financial independence of civil society organisations through long-term support.
This paper from the Harvard Health Policy Review examines the ways in which public and private sectors can cooperate to improve the quality and accessibility of primary health care (PHC) to the poor in developing countries. The authors argue that the promise of alternative business models lies in their ability to accomplish several important functions in PHC. Business-style contracts can organise small providers into units that are large enough to yield returns to scale in investments in physical capital, supply chains, and in worker training and supervision. In order to understand the problems that business models can help solve, this paper sets up a simple economic model of public private interests in health care. The model identifies two key social interests in health care markets: quality of service provision and access to care by disenfranchised groups. The authors finish with policy proposals for future consideration which include a recommendation that supporting the coordinating organizations through government revenue is only one option. A more creative approach to supporting the coordinating bodies would be to allow them to exploit their comparative advantage in obtaining capital.
The concept of franchising for health services is similar to franchises in business. A franchiser develops a way to provide health services, and then other franchisees copy the model. Each franchisee has to follow the original model. There is usually specific training, protocols and standards to follow, monitoring, and a brand name or logo that identifies that the provider is part of a franchise. Early work reports that social franchising may improve the spread of health services across low- and middle income countries. The review does not find any rigorous evidence to demonstrate the effect of social franchising on access to and quality of care in low- and middle-income countries. Well designed studies are needed.
The author describes events in Lesotho and South Africa where public-private health partnerships have not produced the desired results and notes that these incidents are not isolated, but part of a wave of new privatisation initiatives that uses donor dollars for public health by shuttling them into private contractors in poor countries. Advocates of private-public partnerships are noted to cite selective data from specific privatisation schemes, ignoring the costs of contracting and the broader impact of their initiatives on communities. The author questions the idea that foreign health policy analysts know better than local providers and patients, and points to the irony of poorer performance in public health relative to resources in the United States, the country with the greatest number of health policy analysts per capita.
This paper, by the Department for International Development DFID Health Resource Centre, looks at the extent of DFID’s engagement with non-state actors (NSAs) in the health sector and what is known about the value for money of working with different types of NSAs in various ways. The paper details how DFID provides most of its support to health to the public sector. However there are cases where DFID provides funding directly to NSAs. In other cases, DFID support goes to the government, which then uses some of those funds to fund service delivery by NSAs. The author argues that, in addition to seeking value for money, it is important to consider equity. The evidence suggests that all income groups use non-state services but, as in most public sectors, there is higher use by the relatively better off. Whether working with the non-state sector provides better value for money will substantially depend on the quality of design and implementation. There is growing experience in contracting, social franchising, vouchers and performance incentives. The paper outlines various aspects which DFID might want to consider for the future including that in developing or reviewing health sector plans, they should consider opportunities to improve NSA efficiency and effectiveness and as a way to enhance access.
This report focuses on the contribution of AIDS-related public-private partnerships to the six building blocks of health systems: service delivery; human resources; information; medicines and technologies; financing; and leadership. A desk review and interviews were conducted with representatives of private and public organisation stakeholders, as well as development partners. Interviewees identified mutual understanding as an important precondition for the implementation of efficient and successful partnerships. The private sector at times lacks profound knowledge of the complex stakeholder landscape in the HIV response and health care provision. To develop flourishing partnerships, honest and wide-ranging dialogue to inform and secure agreement in joint planning is essential from the very earliest stages. Such planning will of course consider issue such as sustainability, follow-up, and monitoring, essential to flourishing partnerships. Health financing mechanisms, HIV and tuberculosis treatment and mobile health technology are areas which are of interest to the private sector and which require further technical expertise and promotion.