Moving towards in-depth knowledge on the private health sector in low- and middle-income countries

The past two decades have seen a steady growth in attention to the private sector role within the overall health systems of low- and middle-income countries. Since the 1990s researchers have worked to call attention to the previously unrecognized scale of private medical services in the developing world (Berman and Rose 1996; Brugha and Zwi 1998; Hanson and Berman 1998; Preker et al. 2000; Uplekar 2000; Berman 2001; Mills et al. 2002; Harding and Preker 2003). As cross-country datasets have become available, the evidence has become increasingly clear that the private sector plays a major role in financing and provision of care in low- and middle-income countries (LMICs) (Zwi et al. 2001; Ha et al. 2002; Liu et al. 2006; Konde-Lule et al. 2010). In parallel, a half-dozen multi-centre projects supporting research on the private sector in LMICs have been implemented (De Costa and Diwan 2007; Access Health International, n.d.; PSP, n.d.; PSP-One, n.d.; Results for Development Institute, n.d.). Evidence and analysis has also pointed to the challenges and opportunities that the private sector poses to health and health sector development (Lonnroth et al. 1998; Lonnroth et al. 2001; Travis and Cassels 2006). The result of this growth in evidence is a general acknowledgement of the private sector and acceptance of its existence and important role in health care for many people in low- and middle-income countries. Consequently, the focus in research and policy development has moved from measurement to nuanced assessment of policy options and interventions for engagement of the private sector in public policy goal attainment (Montagu 2002; De Costa et al. 2008; Dimovska 2009; Lagomarsino 2009; Kangwana et al. 2011). As a result, in 2010 the World Health Assembly passed a resolution calling on countries to ‘constructively engage the private sector in providing essential health-care services’ (WHO 2010). The British development agency, DFID (Department for International Development), has supported a series of recent systematic reviews addressing voucher-based payments for care, the quality of private provision, and health outcomes in public vs private facilities in LMICs (Madhavan 2010; Montagu 2010; Meyer 2011). Health system thinking is increasingly acknowledging, and measuring, the scale of private provision. While documentation and guidance on policies and analysis are still in limited supply, the field is expanding. A further indication of this is the growing body of researchers addressing issues of private health care in LMICs and sharing their evidence in public fora and in peer-reviewed journals. In 2007 an informal gathering of researchers on the private sector met for lunch at the VIth World Congress of the International Health Economics Association (iHEA) in Copenhagen. From this group a small committee was formed to organize a symposium on the Role of the Private Sector in Health Care in conjunction with the 2009 VIIth iHEA congress. Around 100 participants attended the symposium. The papers in this supplement were presented at that 2009 Symposium. They are indicative of the growing sophistication and depth of research being conducted on issues of private health care provision in LMICs. Ann Levin and Miloud Kaddar have conducted a literature review on the role of the private sector in low- to middle-income countries in the delivery of immunization services. Overall, there are few studies of the subject but the authors find that the private sector is contributing to immunization service delivery and helping to improve access to basic vaccines in some low-income countries. They find that not-for-profit facilities are more likely to be coordinated with public services than the private for-profit sector. The contribution of this sector is poorly documented, leading to a lack of recognition of its role at national and global levels. The study finds evidence that private for-profit services tend to be used more by people with higher income and educational level. Consumers of non-governmental organization (NGO) services, on the other hand, are more likely to be from lower-income backgrounds. The study reveals many geographical and thematic gaps in the literature on the role and regulation of the private sector in the delivery of immunization services in low- to middle-income countries, and calls for further research on how to engage the private sector for increased coverage of immunization services. In order to improve understanding of the preconditions for successful implementation of contracting with the private sector, Anna Heard et al. assessed large-scale contracting of NGOs for delivery of basic health services in Uttar Pradesh. The main objective of the study was to identify criteria for selecting effective partners. Data on characteristics of the NGOs (intake data) and performance/outcome monitoring indicators were combined to identify correlations. The results showed that NGOs selected were generally small but well-established, had implemented at least two large projects, and had more non-health experience than health experience. Training experience, proposal quality and having ‘health’ contained in the objectives of the organization were statistically significant predictors of good performance. A combined training plus proposal score was highly predictive of outcome score. The study provides valuable guidance for selection of partners in programmes based on large-scale contracting to NGOs. Sachiko Ozawa and Damian Walker used focus groups and household surveys to compare trust in public versus private health-care providers in rural Cambodia. The study found that villagers’ trust in and relationship with providers is one of the important considerations affecting where they seek care. Public providers were considered by the respondents to be ‘honest’, ‘sincere’, to ‘explain the disease’ and have good skills and abilities more often than private providers. The latter were graded higher for being ‘comfortable and easy’, ‘friendly’ and ‘easy to make contact with’. The study illustrates the importance of trust as a unique concept that could affect people’s choice of health care providers in a low-income country. Bruno Meessen et al., in their study, conduct secondary data analysis of household surveys from Cambodia to explore if such survey data can provide a comprehensive description of the health sector that includes both public and private providers. The study confirms that the health care sector in Cambodia is now highly pluralistic, and that the great majority of people seek health care outside the public health system. The analysis also shows that the disaffection of the population with public health facilities varies across places, socio-economic groups and health problems. The paper illustrates how knowledge from surveys can allow stewards to better identify challenges for existing or future health policies, taking into account the existence of and contributions by all health care providers, including those outside the public sector. A significant, yet often overlooked, part of the private health sector is the one represented by informal providers. These providers operate largely outside the formal regulatory framework, which can have major implications for patient safety and cost of treatment. Gerry Bloom et al. discuss the challenges related to making health markets work for poor people, using the example of informal health care providers in Nigeria and Bangladesh. They conclude that in order to improve performance of informal providers, the roles of different actors and the incentives they face must be better understood. That private providers need to make a profit is an issue for debate in high-income as well as in low-income countries. Nguyen Ha et al. address the topic through a principal-agent problem analysis of the Vietnam health sector using household data from the national health survey. The principal-agent problem in health care asserts that providers, being imperfect agents of the patients, will act to maximize their profits at the expense of patients’ interests. The study shows that private providers were able to induce demand by prescribing more drugs than public providers, private providers were significantly more likely to prescribe injection drugs to gain trust among patients, and patients’ education as a source of information and empowerment enabled them to mitigate the demand inducement by providers. The findings also suggest that regulation and checks from a third party, whether it is an authoritative body in charge or an insurance agency, can provide another guard against provider-induced demand in the health care market in Vietnam. It has been documented that the private sector can be engaged for reaching public sector goals. Nirali Shah and colleagues propose a multi-metric framework to evaluate performance of family planning services with regard to efficiency, access by the poor and quality. The authors apply their framework to field data from family planning programmes in Ethiopia and Pakistan, comparing different types of providers and different modes of operations, including social franchising. Using the paradigm of a three-legged stool, the authors posit that balanced achievement of multiple policy objectives is paramount for programme success. They present evidence that franchised systems of private family planning providers, with their carrot and stick approach of demanding standards and establishing supply chains, can greatly improve the quality of care in family planning. The accessibility of franchised private clinics to the poor can be similar to that of non-franchised private clinics. Thus the study supports a conclusion that quality improvements in the private sector can be delivered to the poor in some settings. Private sector investment in health can be a crucial factor in order to sustain health programmes in low-income countries. Sara Sulzbach and colleagues examine trends in private investments in HIV/AIDS in five sub-Saharan countries using national health accounts data. They find that total resources had increased in all five countries and out-of-pocket spending decreased in four countries. With escalating donor influx, NGOs increasingly control a growing share of resources relative to other stakeholders, whereas private-for-profit entities manage fewer HIV/AIDS resources. The private-for-profit sector is therefore partly crowded out by the not-for-profit sector. The authors argue that this raises questions about donor dependence and the sustainability of HIV/AIDS control over time as there may not be active for-profit providers to work with when donor funds cease to arrive. In many countries there is still a lack of recognition of the private sector by policy makers. Funding for research on the role of the private sector in health systems is also scarce. Most of the studies in this supplement were carried out within the framework of other researcher programmes or programme implementation. Still, the articles illustrate that private health sector research has moved beyond classifying and counting providers and users to the assessment of mechanisms for harnessing the private sector and identifying conditions for their successful application. There is a growing acknowledgement that health systems development for improved health and health care must include private actors. Researchers are gradually filling the gaps in knowledge necessary for this inclusion. The eight papers in this supplement provide an important contribution to coherent frameworks for analysing and developing health systems in different contexts in low- and middle-income countries. Part of this work was supported by grants from Rockefeller Foundation and the Swedish International Development Cooperation Agency (SIDA).