Public Ends through Private Means: Engaging the Private Sector to Improve Access to Quality Care:

 
by Alexander S. Preker
At the dawn of history, people used home remedies and private healers when they were ill.  By the second millennium B.C., the papyri, give fascinating evidence that Imhotep, archetypal physician, priest and court official in ancient Egypt, introduced a system of publicly provided health care with healers paid by the community. This early experiment in socialized medicine did not survive the test of time. The Code of Hammurabi (1792-1750 BC) laid down, inter alia, a system of direct fee-for-service payment based on the nature of services rendered and the ability of patients to pay. For the next three thousand years, involvement by the state in health care revolved mainly around enforcing the rules of compensation for personal injury and protection of the self-governing medical guild.  Only during the 20th centry did the pendulum swing back to greater state involvement. 

Do you think governments today can achieve public ends through private means?  Join the debate.

This blog and the attached Policy Note (www.businessofhealth.org) provides insights into the role of the private sector in health and tries to debunking naive beliefs in the powers of the state and blind faith in markets.

Today the private health sector plays a large role in the Africa Region in terms of both sources of funding and expenditure on health services. It often supplies 60 to 80 percent of financing and 50 percent of service delivery.

Yet many countries do not have adequate public policies to deal with the private sector. Five main barriers to be overcome to improve the functioning of the private sector in health include:

• lack of access to finance and expertise
• policies and regulations that fail to support the private sector
• lack of quality assurance and improvement
• insufficient supply of skilled health workers
• lack of financial protection or sustainable financing

 
Without new approaches to mobilize resources and delivere care, most African countries will fail to reach the Millennium Development Goals (MDGs) goals by the year 2015.

High-performing health systems are often characterized by mixed delivery of services.  Private providers play an  integral role, while maintaining a strong government involvement in securing an appropriate enabling environment, regulatory framework, and financing.

The following actions would help governments and donors engage the private sector more effectively in contributing to overall health goals:
 

• support responsible and sustainable private sector development by increasing access to finance (both debt and equity) and the expertise that comes with that finance
• improve the policy and regulatory environment, including quality standards and their enforcement, in which these private companies operate
• provide information to regulators and policy makers to permit better informed decision making
• increase the supply of well-trained health care professionals
• increase the availability of risk-pooling and other mechanisms that would help stabilize revenue flows and make health care financing more equitable 

 
The Health in Africa (HiA) team welcomes comments on this blog (also send comments to tfergo@ifc.org)
 
Alexander S. Preker
Head Health Investment Policy Analysis
Health in Africa (HiA) Initiative