Although the private sector is an important health-care provider in many low-income and middle-income countries, its role in progress towards universal health coverage varies. Studies of the performance of the private sector have focused on three main dimensions: quality, equity of access, and efficiency. The characteristics of patients, the structures of both the public and private sectors, and the regulation of the sector influence the types of health services delivered, and outcomes. Combined with characteristics of private providers—including their size, objectives, and technical competence—the interaction of these factors affects how the sector performs in different contexts. Changing the performance of the private sector will require interventions that target the sector as a whole, rather than individual providers alone. In particular, the performance of the private sector seems to be intrinsically linked to the structure and performance of the public sector, which suggests that deriving population benefit from the private health-care sector requires a regulatory response focused on the health-care sector as a whole.
This paper analyses private for-profit (PFP) providers currently offering services to the poor on a large scale, and assesses the future prospects of bottom of the pyramid models in health. The authors searched published and grey literature and databases to identify PFP companies that provided more than 40,000 outpatient visits per year, or who covered 15% or more of a particular type of service in their country. For each included provider, the authors searched for additional information on location, target market, business model and performance, including quality of care. Only 10 large scale PFP providers were identified. The majority of these were in South Asia and most provided specialised services such as eye care. The characteristics of the business models of these firms were found to be similar to non-profit providers studied by other analysts. They pursued social rather than traditional marketing, partnerships with government, low cost/high volume services and cross-subsidization between different market segments. There was a lack of reliable data concerning these providers. The authors observe that there is very limited evidence to support the notion that large scale bottom of the pyramid PFP models in health offer good prospects for extending services to the poor in the future, while successful PFP providers often require partnerships with government or support from public funding.
The private for-profit sector's prominence in health-care delivery, and concern about its failures to deliver social benefit, has driven a search for interventions to improve the sector's functioning. The authors review evidence for the effectiveness and limitations of such private sector interventions in low-income and middle-income countries. Few robust assessments are available, but some conclusions are argued to be possible. Prohibiting the private sector is said by the authors to be unlikely to succeed, and regulatory approaches face persistent challenges in many low-income and middle-income countries. Attention is therefore turning to interventions that encourage private providers to improve quality and coverage such as social marketing, social franchising, vouchers, and contracting. However, evidence about the effect on clinical quality, coverage, equity, and cost-effectiveness is inadequate. Other challenges concern scalability and scope. This indicates the limitations of such interventions as a basis for universal health coverage, though they can address focused problems on a restricted scale.
This article explores the areas of likely comparative advantage of the private sector in delivery of health care services for public health goals. It finds that there is a considerable body of evidence on the private provision of healthcare in low- and middle-income countries, often focusing on SSA. However, the evidence base is not robust. Evidence is often mixed and sometimes conflicting and policy implications are unclear. The arguments in favour of private healthcare suggest it is more responsive and efficient, while arguments in favour of public services suggest they are more equitable and better equipped than the market to respond to health needs. Some studies find that the private sector is unregulated, has financial incentives for inappropriate healthcare, and is expensive. There is very little evidence on the comparative cost-effectiveness of the private sector. This varies considerably across country contexts and types of services. There is no conclusive evidence that the private sector is more cost-effective or more efficient than the public sector. The literature warns that increased use of private services may crowd out or decrease the funding available to the public sector. The major criticism of private sector services is that their higher user fees create inequality of access, limiting their use by the poor. The author suggests that the literature is quite clear that private for-profit health services create inequality. Private non-profit, or services run by NGOs, appear to mitigate some of the inequality effects. In practice, boundaries can be blurred between public and private; both formal and informal cost recovery schemes operate at public facilities. NGOs providing healthcare are generally seen as private, although they may not charge for their services. It is observed that the difference between free-at-the-point-of-use NGOs and out-of-pocket-expenditure on private doctors can be enormous, and that it is important to differentiate between the types of providers when reviewing the evidence on private health care.
Private health care in low-income and middle-income countries is noted to be extensive and heterogeneous, ranging from medicine sellers, through millions of independent practitioners—both unlicensed and licensed—to corporate hospital chains and large private insurers. Policies for universal health coverage (UHC) must address this complex private sector. However, no agreed measures exist to assess the scale and scope of the private health sector in these countries, and policy makers tasked with managing and regulating mixed health systems struggle to identify the key features of their private sectors. In this paper, the authors propose a set of metrics, drawn from existing data that can form a starting point for policy makers to identify the structure and dynamics of private provision in their particular mixed health systems; that is, to identify the consequences of specific structures, the drivers of change, and levers available to improve efficiency and outcomes. The central message is that private sectors cannot be understood except within their context of mixed health systems since private and public sectors interact. The authors develop an illustrative and partial country typology, using the metrics and other country information, to illustrate how the scale and operation of the public sector can shape the private sector's structure and behaviour, and vice versa.
Medical savings accounts (MSAs) allow enrolees to withdraw money from earmarked funds to pay for health care. The accounts are usually accompanied by out-of-pocket payments and a high-deductible insurance plan. This article reviews the association of MSAs with efficiency, equity, and financial protection. The authors draw on evidence from four countries where MSAs play a significant role in the financing of health care: China, Singapore, South Africa, and the United States of America. The available evidence suggests that MSA schemes have generally been inefficient and inequitable and have not provided adequate financial protection. The impact of these schemes on long-term health-care costs is unclear. Policymakers and others proposing the expansion of MSAs should make explicit what they seek to achieve given the shortcomings of the accounts.
The author writes that the health sector is predicted to be the largest source of job creation for the next decade globally. Its growth is being driven by increasing numbers of older people and by the expansion of the global middle class. As these two groups grow, the higher levels of healthcare they demand will cause seismic shifts in the amount of money being spent in the health sector, driving employment. Even without these trends, the world would need millions more health workers. Despite increased training, it is not meeting population demand. The world no longer dominated by infectious diseases requiring episodic treatment, and is instead becoming dominated by non-communicable, chronic diseases such as heart disease, diabetes, cancer, and mental-health conditions, which require continuous treatment. Unlike traditional employment sectors such as agriculture and manufacturing, which shed jobs as technology advances, healthcare tends to add jobs with increasing technology. The author argues that the health sector will be an economic engine that not only creates new jobs and business but, by making workers in other sectors healthier and more productive, will enable those sectors to grow faster creating tens of millions of new jobs.
This issue of the African Newsletter on Occupational Health and Safety examines infectious disease and occupational health. Marie-Paul Kelly explores governance and leadership, both at regional and global levels in preventing health emergencies. The issue explores guidance to workplaces and occupational health professionals in prevention of occupational infections and examines the workplace as an arena for raising awareness on infectious diseases. Further papers look at protecting front-line health care workers and enterprise workers from Ebola. Jeanneth Manganyi and Kerry Wilson author a paper on the importance of respirator fit testing and proper use of respirators. Further articles in the issue explore food-borne illnesses at workplaces, the effectiveness of personal protective equipment to prevent Ebola transmission and the use of blunt suture needles to halve the risk of needle stick injuries among surgeons.
The high cost of private health care in South Africa was profiled in a February 2016 health market inquiry amid revelations that South Africans pay six times the international average for hospital stays. A World Health Organisation study on price levels for private hospitals found that 42% of the funds spent on private voluntary health insurance in South Africa were equivalent to 4% of the country’s gross domestic product. This is six times the average in the Organisation for Economic Cooperation and Development (OECD) countries, despite the expenditure in SA only covering 17% of the population. The report found that South Africans stayed in hospitals for an average of 3.9 days compared to 5.1 days in OECD countries and paid an estimated R20bn in out-of-pocket payments for healthcare. Speaking on the sidelines of the inquiry, Health Minister Aaron Motsoaledi said that healthcare prices were "exorbitant" and that needed to change.
This study investigated the level and determinants of out-of-pocket (OOP) spending among individuals reporting illness or injury in Ouagadougou, Burkina Faso and who either self-treated or received healthcare in either a private or public facility. A cross-sectional study was conducted with a representative sample of 1017 households in 2011. Among the surveyed sample, 29.6% persons reported a sickness or injury. Public providers were the single most important providers of care, whereas private and informal providers accounted for 29.8 and 34.0%, respectively. Almost universally (96%), households paid directly for care, with an average expenditure per episode of illness of 17.4USD. The total expenditure was higher for those receiving care in private facilities compared to public ones and the insured patients’ bill almost tripled uninsured. Medication was the most expensive component of expenditure in both public and private facilities. OOP was the principal payment mechanism of households. Considering the importance of private healthcare in Burkina Faso, the authors argue that regulatory oversight is necessary and an extensive protection policy to shield households from catastrophic health expenditure is required.