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Public health sector reforms to benefit low income earners
Source: Business Daily
Source Date: Wednesday, June 08, 2011
Focus: Electronic and Mobile Government, Citizen Engagement, Internet Governance
Country: Kenya
Created: Jun 08, 2011

Low-income earners are set to benefit from affordable healthcare as the government moves to tap cheaper innovations from the private sector.

Under the health sector reforms being implemented in partnership with the International Finance Corporation (IFC) and the Bill Gates Foundation, the government has committed to reform the health sector to attract more expertise, technology, and capital from the private sector.

Experts view public private partnerships in health care as the avenue needed to overcome financial barriers to accessing quality healthcare.

“This commitment will open the health sector for more investment,” Mr Jean Philippe, IFC’s director for East and Southern Africa, said at the launch of the Healthy Partnership Report which captures the status of Public Private Partnership (PPP) in health sectors across Sub Saharan Africa.

The PPP model seeks to inject private sector discipline in the management of public health institutions such as clinics, hospitals, diagnostic centres, laboratories and training institutions. Its immediate aim is to improve corporate governance and promote use of cheaper innovations to lower the cost of medical services. The health facilities that meet these criteria are expected to benefit from cheaper credit extended by IFC and its partners in partnership with local banks. The financiers have also proposed to acquire substantial stakes in some of the public facilities that fail to meet the agreed thresholds through selected international private equity firms which will then effect the changes from within.

The move is likely to appeal to millions of unemployed and low income earners who do not have medical schemes to meet the rising cost of healthcare services in the country. According to the PPP report, 77 per cent of health expenditure in Kenya constitutes out of pocket expenditure, the highest level in the East African region.

The World Bank’s PPP report shows that many governments in sub Sahara Africa work with the private sector in individual programmes but fail to engage them in a systematic way.

Thirty nine out of the 45 sub Saharan African countries covered by the study have a policy towards the private health sector; only 12 of them are implementing the policy. In the EAC region, only Rwanda has contracts with the private health sector.

“None of the EAC countries carry out inspection of the private health sector as it is on the policy paper,” said Mr Scott Featherston, IFC’s senior investment officer.

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