Leveraging Private Sector Engagement in Health: Maximizing or Obstructing Progress towards Universal Health Coverage?

This Civil Society Policy Forum was sponsored by Wemos, Oxfam, Eurodad, Latindadd, Initiative for Social and Economic Rights (ISER) Uganda, UDN, SID and GI-ESCR.

Panelists:

• Maria Jose Romero, Policy and Advocacy Manager, Eurodad (moderator)
• Jessica Hamer, Public Services Policy Advisor, Oxfam GB
• Allana Kembabazi, Programs Manager, ISER Uganda
• Barbara Fienieg, Senior Global Health Advocate, Wemos
• Andreas Seiter, Lead Health Specialist, World Bank

Introductory remarks

Maria Jose Romero (Eurodad)

The conversation cannot be understood without looking at the connection between healthcare financing and the World Bank’s Maximising Finance for Development (MFD) paradigm. The Human Capital Initiative emphasises investments in human capital in health but, the MFD strategy prioritises the use of private over public sector resources (for instance in social services, such as health cover)

The way countries finance health influence the way they perform in health. Evidence shows that public finance is essential for countries to achieve universal health. A growing trend of directing public resources contribute to health quality and equity.

Session Summary

Jessica Hamer (Oxfam GB), presented an upcoming research paper based on donor-private sector engagement in health in Europe.

From the key findings she highlighted the following:

• The number of donor finance is small, but is growing.
• The majority of projects emanate from development finance institutions.
• There is significant use of finance intermediaries (FI) in these projects (with lack of consultation with local governments)
• Most of the projects use loans or equity investments.
• 90 per cent support large businesses.
• Major channels are public-private partnership-funded hospitals as well as corporate hospital chains or FI.
• Most of them are developed in medium-income countries (MICs), showing a clear gap with the needs of low-income countries (LICs). Additionally, there are clear links to private insurance and tax heavens, a focus on health tourism and on urban areas.

Hamer concluded that there is a question of policy coherence among governments, which are committed to the Sustainable Development Goals (SDGs). With these projects governments are at risk: of being attached to a contract as expending addressed to PPPs; of having/developing weak public health systems; and of focusing only on urban areas (marginalising those more in need). Donors should direct their money to rural areas and the poorest people.

Allana Kembabazi (ISER), on the case of Uganda, she highlighted that finance for health is declining and that there is an increasing focus on private for-profit finance.

Kembabazi noted that the discussions around PPPs in Uganda are numerous and even though at some point the Bank has acknowledged that PPPs may not be the solution, at the end of the day it resorts to using them. Kembabazi added that PPPs contracts are very hard to understand so access to information is almost impossible. In addition, prices are in the same range as in other countries making these services inaccessible for people in Uganda, which shows a clear focus on health tourism.

Barbara Fienieg (Wemos) analysed the Dutch “aid for trade and business” program, which focuses on healthcare in sub-Saharan Africa.

Fienieg noted that Official Development Assistance (ODA) is used as an instrument to strengthening/facilitating business, with most expenditure going to infrastructure projects. In the Netherlands, the primary receivers of these ODA types are mostly Dutch companies (to promote them in services, products and gods).

As an example, she highlighted the case of the ORIO project in Tanzania, which has been entirely developed by the Dutch Phillips (from training, to planning and implementation). The funding from this project came, 50 per cent from a grant to the Netherlands and 50 per cent mainly from debt financing. She concluded that even though the project contributed to Tanzania public health referral system, the project was expensive (for instance, it was tied to international rates), it was not really aimed at the poor and did not contribute to access for all.

As for recommendations to the Dutch government, she noted that when ODA4BusinessStrengthening is applied in health:

• Relevant criteria should be used in health system strengthening
• Policy coherence should dominate for sustainable development “first and only” (not used as promotion of Dutch business abroad)
• It should secure social accountability and
• Provide transparency

Andreas Seiter (Word Bank), responded to the above-mentioned points by saying that the reason why ODA targets rich is that governments do not have the money to pay for those services. Usually, governments cannot afford to maintain services or provide certain types. Private sector hospitals, on the other side, can provide safe services and services that public hospitals cannot as they have no funding.

He noted that it is usual that as countries bring the funding for the projects, they also want their companies to provide the services.

According to the World Bank vision, the value of money in this sector is low. Between 30-80 per cent of money spent on health in many low countries (like Nigeria or Ethiopia) is out of pocket from private money (with no control of services, or quality).

Seiter also highlighted that they are developing a primary care program based on telemedicine, in which patients do not need to go to a center, everything is digital, granting remote and therefore easier access to health services.