Summary

There are a number of more or less explicit assumptions that provide a seemingly “rational” basis for the appeals to complement or substitute the provision of maternal health care by governmental services with services offered by “private for profit sector” (PFP) and “private not for profit non-governmental organisations” (PNFP-NGO). This paper reviews the evidence-basis of these assumptions.

The first assumption has it that private providers capture a significant and growing share of the service delivery market for maternal health care. With the notable exception of China, PNFP-NGO play an important role in health care in general. To a varying degree these services also include reproductive health services. For many populations, especially in rural areas, PNFP organisations are the main if not the only providers of reproductive health care. In urban areas PNFP-NGO usually share the work with PFP providers and government services. PNFP organisations seem to have an important role in the diffusion and adoption of fertility control. PNFP-NGO provide a wide range of services and their intervention strategies take multiple forms. PFP health providers are also an important source of ambulatory care throughout the developing world. These private practices in most developing countries are notoriously unregulated.

The second assumption claims better quality of care and greater efficiency. Relevant evidence on differences in quality of care and of other determinants of health-seeking behaviour is hard to come by. Common wisdom has it that patients would prefer private providers for reproductive health problems since these are supposed to dispense better quality care. Perhaps their most visible comparative advantage is their client-friendliness. Supply induced demand has resulted in a problem of iatrogenesis, exemplified in the epidemic of caesarean sections. Over-intervention is compounded by the tendency of PFP providers to specialise and deliver only part of reproductive health packages. The lack of integration automatically leads to sub-optimal care.

The claim for greater efficiency is not based on empirical evidence. It often merely refers to a higher efficiency per output unit, not per outcome unit. At times, one definitely gets the impression that efficiency is defined, not in terms of getting most value for money, but in terms of the possibility of running a service on basis of cost-recovery.

Obviously resources make a difference. An under-funded public service without drugs, equipment and adequately trained and paid staff will not provide as a good a service as a well capitalised private one. If resources are adequate and the range of services comprehensive, the quality and efficiency comparison hinges on the (visible) productivity and client-friendliness of the staff, and on the (less evident, at least to the patient) justification of the care. Some of the evidence presented justifies a cautious claim that PFP providers may be less efficient than PNFP or public providers, in as much as they can shift the risk and the consequences of their inefficiency to the client. On the other hand, the evidence does not allow for conclusions regarding the efficiency of PNFP providers.

The third assumption claims that by ensuring uptake of services PFP and PNFP providers complement government services and ensure a more comprehensive and equitable distribution of the uptake of services. The private sector would indeed contribute most to equity in situations where public sector would act as the first mover and choose its level of investment in the health sector. The private sector would then observe the level of public investment and would invest to meet the residual demand. This in turn would allow the public sector to make the most of its limited resources, whilst still responding to its political responsibility of delivering care to its population. But the empirical evidence suggests a scenario of substitution rather than complementary. In the best of cases this means filling the void left by failing public services. Often, however, it becomes a reality of competition and poaching.

No blanket recommendations. It may be a seductive solution to have reproductive care provided through PNFP - or even PFP - organisations, when the weight of history and public perception of government failure is so strong as to make recovery of failing public services unlikely. However, the fragmentary evidence shows that blanket recommendations are inappropriate. The problem is to specify the conditions under which this can be done without loss of quality, efficiency and equity. In this context six issues needing the policy maker’s attention are addressed in the paper.

The most pressing problem is the lack of regulation of service provision by the private sector. Clients are not protected against the consequences of the asymmetry of information they face - with health- and financial consequences. As the recent evolution in a number of middle income countries points out, perhaps the most effective way to help the State to regulate the private sector is to increase pressure from civil society. From a public health point of view, privatisation only makes sense if the State and civil society are strong enough.