Expert Speak Health Express
Published on Apr 08, 2019
Bringing Universal Health Coverage centre-stage will prove too ambitious for many countries without co-opting the private sector.
East Africa and BIMSTEC: Aligning private sector to public health goals Many countries are committed to the United Nation’s Sustainable Development Goal (SDG) of “healthy lives for all” by 2030 (SDG goal # 3.8). The SDG#3.8 promises Universal Health Coverage (UHC): people receive essential health services without being exposed to financial hardship. UHC is central to the health-related targets of the SDGs. Bringing UHC centre-stage will prove too ambitious for many countries without co-opting the private sector. There is a pressing need to leverage the private sector for its existing capacity, investments and innovations that will allow many regions in the world to achieve their goals in the space of public health with fewer resources.

Challenges for UHC are varied and complex, but the private sector can help

The resourcing requirement, in terms of health spending and the availability of the health workforce and infrastructure, is enormous for achieving the UHC goal. Most governments of low-and-middle-income countries (LMICs) will struggle to meet these requirements alone. For these reasons, among others, it is essential to look at the role that the private sector can play. Let's have a look at East Africa and the BIMSTEC (Bangladesh, India, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan) region as an example of both the challenges and opportunities ahead. The private sector has a significant presence in the health industry in East Africa and BIMSTEC. In Sub-Sahara Africa that includes all five focused countries, for-profit organisations account for as much as 50 percent of health care provision, and their role is growing (On an average, nearly 35 percent of health financing (in PPP terms), predominantly out-of-pocket, comes from private sources in the five focused East African countries. In the BIMSTEC region, the private sector is large and dominant, except for Thailand and Sri Lanka where public health care provision is much stronger. On average, 45 percent of health financing in the BIMSTEC region comes from private sources. Moreover, if one were to include the upstream segments of the healthcare industry, i.e. pharma, medical devices and equipment, medical education and training and so forth, the role of the private sector is even more overwhelming.

Key areas of alignment 

Pharmaceuticals: Pharmaceuticals is one of the significant items of health expenditure, accounting for 20 to 40 percent of total health spending. Therefore, making pharma products affordable is essential to meeting the UHC goal. India, for example, spends nearly 35.4 percent of its current health expenditure on pharma (NHA Oct 2017) almost exclusively produced by the private sector. India has emerged as one of the major global players in pharmaceutical manufacturing: the country is an important supplier of medicines to the two regions. The Indian government has done a good job of aligning the domestic pharma industry to public health goals through the promotion of generics (over patented drugs) among other measures. On the other hand, East Africa relies heavily on the import of pharma products. Local production of pharma will be to Africa's advantage; benefits include developing a more reliable source of pharma supplies, lowering of pharma costs. Although the African region has come up with the Pharmaceutical Manufacturing Plan for Africa to guide members to set up efficient pharma production firms, policymakers need to provide incentives and an enabling environment for the domestic pharma industry to prosper.

Health workforce

Almost all the countries in the two regions have a shortage of workers in the health sector. In East Africa, where this shortage is somewhat more significant, a thorough revamp of the eco-system around the production of the health workforce will best address this challenge. Technology can help by speeding up the process of training through e-learning modules, combined with hands-on training, provided necessary rules, regulations and standards are put in place to encourage e-learning. Pan African e-network on Tele-Education, which is, in fact, a joint undertaking of the Government of India and the African Union (AU) High Commission, is an excellent example of how quality medical education could be imparted. With the right kind of incentives, the governments can rope in the private sector for giving medical education and training through e-learning methodologies.

Leveraging private care

Most countries in both regions have mixed healthcare-delivery systems with the private sector playing an important role as a care provider too. Excess capacity in private health facilities, particularly in secondary and tertiary facilities, could be utilised by the government for meeting public health goals. Indeed, some governments are opting for strategies and delivery models to harness the capacity of private providers. For example, government-sponsored national health insurance programs in India and Kenya are designed to purchase publicly-funded care from both public and private providers. Similarly, the public sector is engaging with the private sector through other arrangements such as public-private partnership and contracting in and out.

Tech start-ups and social entrepreneurship

The recent emergence of tech start-ups and social entrepreneurship has brightened the prospects of lower-income countries for improving the equity, efficiency, affordability, and the quality of healthcare. Digital health, the ability to track and manage an individual’s health through technology such as wearables, is influencing the health industry in numerous ways: at the patient level, at the level of teams providing care, and at the system level. This development in the health industry has not only enhanced the scope of public-private engagement but has made this engagement indispensable. Alignment of the private sector to public health goals is partly happening on its own in so far as the private sector is finding solutions to public health problems. Also, this alignment is partly being facilitated by impact investors who are scouting to support health start-ups having a potential for social impact and an outlook for reasonable long-term returns. While it is true that health care represents a significant investment opportunity in both regions, such an opportunity may not necessarily align with public health goals at the desired scale. The scale of alignment required to meet the demands of the 2030 agenda to achieve the UHC goal is enormous and wouldn't come about without a pro-active role of government. Tapping the interest of such investors and entrepreneurs for health impact requires a fundamentally new way of engaging with them. This engagement has to be in the spirit of a partnership, involving the government and the affected communities, to ensure that such engagement is thoughtful, responsible and sustainable in the long-term. The success of partnerships will depend on the extent to which partners trust each other and can leverage the core competencies of each other. Perhaps a good example of this engagement is India's Med-tech Zone – the first of its kind in the country.  To reduce India's heavy dependence on imported medical devices, the government of Andhra Pradesh (a state in South India) set up the Andhra Pradesh Med-tech Zone that provides excellent public infrastructure and the right incentives (such as preference in government purchases) needed by med-tech multinationals to make their products in India.

Innovative models

Besides new way of engaging, the private investment and entrepreneurship have to be in innovative business models that support scale and standardisation, not fragmentation and variation; models that support ‘last mile' access to the poorest and most vulnerable, not promote urban islands of excellence; models that increase affordability rather than cost. Innovative business models can deliver returns and accelerate progress towards UHC and deliver significant health impact by tapping into opportunities of “health for all.” Many promising private investments with an eye on development impact exist in both regions that are worth building; these ideas can be replicated, scaled up and expanded. Some of the core ideas of these successful business models are, hospitals with cross-subsidisation (e.g., CCBRT in Tanzania, Arvind Eye Care in India), high-volume and low-cost hospitals (Selian Lutheran Hospital in Tanzania), network models of primary and secondary care clinics/services (Christian Health Association in Kenya, Merrygold Health Network in India), hospitals offering in-house insurance (Selian Lutheran Hospital in Tanzania) and so forth (IFC 2016). Similarly, there are some exciting examples of public-private partnerships in both regions. A couple of examples from the East Africa region are (i) Babyl – a digital platform commissioned by the government of Rwanda that is available to three-quarters of the population free of cost. This platform is much more than an e-consultation platform; it also provides diagnostics, appointment bookings, e-prescriptions and e-records. (ii) The African Health Markets for Equity Program (AHME) – this program has been able to turn a fragmented market into a coherent network of private providers for people who can pay. It does this by aggregating, training, and contracting small-scale, low-cost primary care providers under a single brand (WISH 2018). A couple of examples from BIMSTEC region are: (i) Mohalla Clinics – Delhi government initiative to create lean primary care clinics under public-private partnership – have rapidly expanded in Delhi, India. These clinics provide a package of essential health services, including diagnostics, medicines and consultation free of cost. The Delhi government bears the infrastructure and operational costs of these clinics, and private doctors are empanelled to serve in these clinics. Doctors are paid a fixed fee for every patient examined by them. Several other Indian cities are learning from this initiative and trying to replicate it (Lahariya 2019). (ii) Telenor Health is again a digital healthcare platform that has more than 5 million members across Bangladesh. It is a doctor-led healthline that is available round-the-clock, and helps patients navigate the system, offers discounts at 1700+ provides who are enrolled and also provides personalised wellness information. Initially, it was launched as a value add for the Grameenphone subscribers. But it is now exploring an option to adapt the business model to make it free public service funded by the government (WISH 2018). The health space is bubbling with many promising innovations. Going by the pace of these innovations, countries will have multiple options to choose from in solving varied health sector problems. However, a few systemic constraints need to be addressed before countries can deploy proven solutions at scale. These constraints have to do with adequate health sector funding, promoting risk-pooling programs, developing and enforcing quality standards, conducive policies, effective and efficient regulations to foster the role of private sector and improve access to capital for budding innovators and tech-entrepreneurs.


To sum up, the role of the private sector is indispensable in most LMICs if these countries are to achieve SDG goal # 3.8 which deals with "healthy lives for all" by 2030. To leverage the capacity and resources of the private sector, new forms of partnerships and rules of engagements are needed to encourage new business models. Harnessing the power of digital technology and social entrepreneurship for improving access, quality, and affordability of healthcare hold promise to bring solutions within reach of the focused countries. An enabling environment is a pre-requisite for successful models and partnerships to thrive. Governments need to play their stewardship role in providing this enabling environment.
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Rajeev Ahuja

Rajeev Ahuja

Rajeev Ahuja is a development economist formerly with the World Bank.

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