Challenging the Privatization Dogma

Oxfam International just released a sweet report titled, Blind Optimism: Challenging the myths of private healthcare in poor countries. You can see the full report here, or the executive summary here.

Money quote:

… a growing body of international research reaffirms that despite their serious problems in many countries, publicly financed and delivered services continue to dominate in higher performing, more equitable health systems. No lower middle-income country in Asia has achieved universal or near-universal access to health care without relying solely or predominantly on tax-funded public delivery. Scaling-up public provision has led to massive progress despite low incomes. A Sri Lankan woman, for example, can expect to live almost as long as a German woman, despite an income ten times smaller. If she gives birth she has a 96 per cent chance of being attended by a skilled health worker.

They continue to dismantle the six most common arguments in favor of promoting private healthcare system scale-up as well as provide recommendations:

  • For donors:
    • Rapidly increase funding for the expansion of free universal public health-care provision in low-income countries, including through the International Health Partnership. Ensure that aid is co-ordinated, predictable, and long-term, and where possible, is provided as health sector or general budget support.
    • Support research into successes in scaling-up public provision, and share these lessons with governments.
    • Consider the evidence and risks, instead of promoting and diverting aid money to unproven and risky policies based on introducing market reforms to public health systems and scaling-up private provision of health care.
    • Support developing-country governments to strengthen their capacity to regulate existing private health-care providers.
  • For developing country governments:
    • Resist donor pressure to implement unproven and unworkable market reforms to public health systems and an expansion of private-sector health-service delivery.
    • Put resources and expertise into evidence-based
      strategies to expand public provision of primary and secondary services, including spending at least 15 per cent of government budgets on health, and removing user fees.
    • Ensure citizen representation and oversight in planning, budget processes, and monitoring public health-care delivery.
    • Work collaboratively with civil society to maximize access and improve quality of public health-care provision.
    • Strive to regulate private for-profit health-care providers to ensure their positive contribution and minimize their risks to public health.
    • Exclude health care from bilateral, regional or international trade and investment agreements,
      including the General Agreement on Trade in Services negotiations in the World Trade Organisation (WTO).
  • and for civil society organizations:
    • Act together to hold governments to account by engaging in policy development, monitoring health spending and service delivery, and exposing corruption.
    • Resist pressure to commercialise operations and call on rich country donors and government to strengthen universal public health services.
    • Ensure health services provided by CSOs complement and support the expansion of public health systems, including by signing on to the NGO Code of Conduct for Health Systems Strengthening.

3 Responses to “Challenging the Privatization Dogma”

  1. 1 Ron February 18, 2009 at 11:17 pm

    Great post Jon!

    You’re absolutely right in characterizing privatization as a “dogma.” While it definitely serves its purpose for many industries, the key problem issue is whether or not health is a commodity. One of the fundamental assumptions that that the free market makes is that the “good” that is traded is a commodity, where the quantity and availability should be based on supply and demand. So the question is: is health a commodity that simply increases an individual’s utility when possessed, but could also be taken away given the market conditions? Or is it an intrinsic right? If health truly is considered to be the latter, then any system that denies universal coverage should be completely out of the question, regardless of the financial implications.

  2. 2 Julian H February 19, 2009 at 12:02 pm

    How is support for private delivery any more dogmatic than ‘blind’ support for state delivery?

    As discussed on the Center for Global Development blog, Oxfam is reverting back to outdated socialist dogma.

    There are copious examples of private sector delivery working far more efficiently than state-delivered aid.

    Just one example for now: in Cambodia NGOs have competed since 1999 to provide health services to the rural poor. Coverage and standards improved so rapidly the government has rolled the program out to cover one in 10 Cambodians. In 2005, The Lancet compared 10 different contracting programs around the world and found the majority out-performed the government in cost, quality and coverage, finding “improvements can be rapid” in countries as diverse as Bangladesh, Guatemala, Haiti, India, Bolivia, Madagascar and Senegal.

    This kind of system is especially beneficial for the rural poor, typically neglected by government services that are captured by the urban political elite.

    Should such examples be ignored and even criticised, purely to cling onto socialist obsessions?

  3. 3 jonshaffer February 19, 2009 at 3:41 pm

    Hi Julian,

    Thank you for your thoughtful dissent. I agree that it important to not become dogmatic about particular ideology, and this blog (although definitely slanted) will hopefully be able to drive a decent dialogue and be a learning experience for everyone involved.

    That being said, I think there are serious problems with relying solely on private providers in the construction of health systems for the developing world. From my albeit limited research and experience, the trend seems to be that while privately based health care systems may drive efficiency and “cost effectiveness,” (although I think that this can definitely be disputed – the US is a case in point) they do so by excluding the poorest and sickest members of a given society. Sacrificing a fair and equitable system for an “efficient” system that achieves its efficiency by excluding the people who rely on it most, is not something that I think is good or that should be supported.

    However, I do not mean to say that the civil society and NGOs have no role to play within health systems. American and European based NGOs have tremendous resources at their disposal and can bring technical expertise which may be lacking in the developing world. However, I think that these organizations will be most effective when working within a structure and system organized by an government run health ministries. Presumably, the health ministry has a “big picture mindset” and can ensure that NGOs work within a framework that minimizes overlap and maximizes coverage.

    It seems to me that partnership between NGOs and governments must be the name of the game. A prime example of this type of partnership is Paul Farmer’s Partners in Health in Haiti ( They have been able to develop a model that provides very high quality, comprehensive health care for the rural destitute poor while working with the Haitian government (no small feat) every step of the way. In this way they are building a health infrastructure, not owned by wealthy western donors and NGOs, but rather by the Haitian people themselves.

    I’d love to hear what y’all think.

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Welcome to the Students for Global Health Equity (SGHE) blog. Published by university students, the SGHE blog seeks to explore news and issues related to global health.

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