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close this book16. Is There a Case for Privatising Reproductive Health? Patchy Evidence and Much Wishful Thinking
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View the documentSummary
View the documentIntroduction
View the documentPrivate for Profit and Private non for Profit
Open this folder and view contentsA Large and Growing Share of the Market
View the documentAccessibility, Quality, Effectiveness and Efficiency.
View the documentPrivatising with Conditionalities
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Privatising with Conditionalities

No blanket recommendations. It may be an obvious 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, one thing that emerges from the fragmentary evidence is that blanket recommendations are inappropriate. There is a case for support of the private sector where this serves the public’s interest and allows redirection of scarce resources. If that is not the case, support has no rationale. The private sector should not be supported merely because that is a fashionable option in international development circles. Support, but also mere control, carries costs for the public sector administrative machinery. The costs of the “new” state responsibilities must be compensated for savings resulting from gains from efficiency improvements (Brugha et al. 1999, Mcpake and Hongoro 1995). In short, support of the private sector should be subject to conditionalities.

Conditionalities. If one wants to make sure that the private sector will not in fact siphon off resources from the public sector, the minimum is to make sure that it has infrastructural pre-conditions (Mcpake & Hongoro 1995), that it provides cost-effective interventions (Potts & Walsh 1999), that it has an adequate access to drugs and diagnostic facilities (Brugha et al 1999), and that information systems are adequate to monitor contractual obligations (McPake & Hongoro 1995). Preference should be given to private providers with a track record on managing resources efficiently and on tracking service data and finances efficiently and professionally (Potts & Walsh 1999). There are strategic considerations as well. Governments should guard against contracted private providers attaining powerful bargaining positions, if there are no viable competitors and the government does not itself retain capacity to offer an alternative service.

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 need to be addressed.

First, one has to find a way to encourage that PFP and/or PNFP providers provide the full range of priority services, preferably in an integrated way. Given the tradition of specialisation and niche-filling of both PFP and PNFP, and the lack of authority of Ministries of Health in many countries, this is no mean task.

Second, one has to find a way to ensure access for those in need, including the poor. Many would moreover be reluctant to see this happen in a two tier-system with a perceived quality of care that is different for the rich and the poor.

Third, adherence to quality standards has to be ensured, including mechanisms to avoid over-medicalisation and iatrogenesis.

Fourth, conflicts of interests, particularly in situations where one sector depends on another for some of its resources need to be acknowledged and explicitly addressed.

Fifth, all efforts should be undertaken to ensure multiple and independent channels of accountability, through penalties for not satisfying contractual obligations, through channels of accountability to professionals councils and associations, and to the public.

Lastly, all the effort of investing in the private sector is to reinvest the gains of complementarity. Whether this happens in practice is a matter of speculation: empirical evidence is just not available. A government would be expected to make sure that the evidence of real gains can be documented. This is not easy, and the paradox is that precisely those countries whose public services are dysfunctional- and thus are the first-hand candidates for a switch to PNFP or PFP - are also those where the state apparatus, research resources and competencies are in the worst position to make sure that the population actually gains from the switch.

Governments have a number of regulatory tools at their disposal that could be used more effectively. These include accreditation, independent quality assurance testing, but also the power to regulate payments and subsidies and to establish taxes and duties. Good legislation is not enough. The state must have the means to enforce it. In India, for example, private clinics and mobile teams promote pre-natal sex examination by advertising in local newspapers, in spite of government prohibition of the practice (United Nations 1998). There are experiences that point the way to financing schemes that ensure that the private sector has a complementary role to that of the state (Potts & Walsh 1999).

Counter-power. In the past decade the private care agenda gained momentum on the basis of rhetoric and wishful thinking. Nevertheless, it is a fact. The main issue now is that the private sector develops without control and supervision. Clients are not protected against the consequences of the asymmetry of information they face - with health- and financial consequences. The State cannot or does not take advantage of the “complementarity” to reallocate its resources to those most in need. Regulation is something more easily said than done. As the recent evolution in a number of middle income countries such as Thailand (National Forum on Health Care Reform 2000) - and from the history of the workers movement in Europe - 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.