Partnerships with the Private Sector in Health: Strengthening Health Systems in Developing Countries

Center for Global D

evelopment

Partnerships with the Private Sector in HealthWhat the International Community Can Do to Strengthen Health Systems in Developing Countries

April Harding, Chair

November 2009

Final Report of the Private Sector Advisory Facility Working Group

Independent research & practical ideas for global prosperity

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Partnerships with the Private Sector in HealthWhat the International Community Can Do to Strengthen Health Systems in Developing Countries

April Harding, Chair

November 2009


Independent research & practical ideas for global prosperity

Working Group Members

Daniella Ballou-Aares, Partner, Dalberg Global Development Advisors James Cercone, President, Sanigest Internacional, Costa Rica Scott Featherston, Investment Officer, Health and Education Department, International Finance CorporationArnab Ghatak, Partner, Non-profit practice, McKinsey Gargee Ghosh, Senior Program Officer, Bill & Melinda Gates Foundation April Harding (chair), Visiting Fellow, Center for Global Development Ishrat Husain, Senior Advisor, Africa Bureau, U.S. Agency for International DevelopmentBarry Kistnasamy, Executive Director, National Institute for Occupational Health, South AfricaRuth Levine, Vice President for Programs and Operations and Senior Fellow, Center for Global Development Dominic Montagu, Global Health Group Lead, University of California–San Francisco Stefan Nachuk, Associate Director, Rockefeller Foundation Barbara O’Hanlon (project consultant and facilitator), Senior Policy Adviser, PSP-One Project Malcolm Pautz, Infrastructure Project Finance Division, Nedbank Capital, South AfricaAlex Preker, Lead Economist, Africa Region, World Bank Julian Schweitzer, Director, Health, Nutrition and Population, World Bank Guy Stallworthy, Senior Program Officer, Bill & Melinda Gates Foundation Hope Sukin, Public Health Director, Africa Bureau, U.S. Agency for International Development Jurrien Toonen, Senior Advisor, Royal Tropical Institute, the Netherlands Gerver Torres, Senior Scientist, Gallup International Jim Tulloch, Principal Health Advisor, Australian Agency for International Development (AusAID)Juan Pablo Uribe, Executive Director, Fundación Santa Fe, Colombia Working group staff: Danielle Kuczynski, Program Coordinator, Center for Global Development

* Institutional affiliations are listed for informational purposes; members participated in their individual capacities.

Members of the working group participated in a personal capacity and on a voluntary basis. The report of the working group reflects a broad consensus among the members as individuals, though all members may not agree with every word in the report. This text does not necessarily represent, and should not be portrayed as representing, the views of any single working group member, the organizations with which the working group members are affiliated, the Center for Global Development, or the Center’s funders and board of directors, or any other organizations mentioned within.

Center for Global Development1800 Massachusetts Ave. NWWashington DC 20036

www.cgdev.org

http://www.cgdev.org

“It is becoming clearer every day that many countries will not be able to reach the health MDGs without bringing the private health sector into public health initiatives. The recommendations of this working group respond to country needs and demands and suggest a practical solution to making this happen.”

Professor Eyitayo LamboCEO, International Management & Health

Consultants, NigeriaFormer Minister of Health, Federal Republic of

Nigeria

“The United Kingdom and a few other countries contract with Marie Stopes International (MSI) to deliver health services on their behalf to provide free or subsidized health services to many more people than they could on their own, and particularly among the poor and underserved. Yet such a formal partner-ship with governments is hard to achieve in developing countries. The private and not-for-profit health sector is too often perceived to be outside the health system, and thus is neglected by host governments and donors. With the type of support the advisory facility would provide to governments, I believe MSI, other health NGOs, and the private health sector could dramatically expand their reach and impact in developing countries, especially for poor people. I welcome this initiative.”

Dana HovigCEO, Marie Stopes International


Contents Preface vii

Acknowledgments ix

ExecutiveSummary x

AbouttheReportandWorkingGroup xiii

PartnershipswiththePrivateSectorinHealth 1

WhyWorkwiththePrivateSector 1

LinkingthePublicandPrivateSectors 3

TheWorkingGroupTask:IdentifyaSolution 7

DemandforSupport? 7

TheAdvisoryFacilityConcept 8

CharacteristicsofaGlobalPrivate-SectorAdvisoryFacility 8

MakingtheGlobalFacilityaReality 15

Conclusion 21

ReferencesandOtherResources 22

AnnexesA: Working Group Members 25

B: Key Concepts for a Private-Sector Advisory Facility 34

C: Discussion and Design of Key Components for a Global Private Sector Advisory Facility 36

D: Organizational Structure and Institutional Home 39

E: Create a New Entity or Build On an Existing One? 42

vii


vii

PrefaceRarelyvisitedwhendevelopmentagencyrepresentativestaketothefieldandoften overlooked in official pronouncements about health priorities, healthproviders from the vast and diverse private sector play a role—often a keyrole—in delivering care Private health care is not just the province of thewealthy;inmanypoorcommunities,privatedoctors(withvaryingdegreesoftraining),drugsellers,andotherserviceprovidersarethefirstlineofresponsewhenpeoplerequirecare Unfortunately,governmentsinmostcountriesareunabletomakethemostofthepotentialofprivatehealthservicesortomiti-gatetheproblemsthatoccurinalargelyunregulatedenvironment Despiteunprecedented levels of interest by donors in improving health conditionsindevelopingcountries,veryfewsourcesofdevelopmentassistancehelptopromoteorimprovetherelationshipbetweenthepublicandprivatesectors

The development community has paid scant attention to the private sectorfor decades Policymakers consistently find far more donors who can helpbuild and equip public diagnostic labs than can help establish an effectivelab-accreditationprogram Yetbotharedesperatelyneeded

Can and should the international community, particularly agencies activein providing development assistance for health, help developing-countrygovernments deal with the private components of their health systems?Toexaminethisquestion,theCenterforGlobalDevelopmenthostedaworkinggroupfrom2008to2009madeupofadiverserangeofpeoplewithwidelyvaryingperspectivesandbackgroundsandlongexperienceworkinginglobalhealth

Membersoftheworkinggroupquicklyagreedthereisaneedforsuchsupport Theyconductedinterviewswithabroadrangeofstakeholderstoascertainthedemandforsuchsupportandthenatureofthesupportdesired Theworkinggroupthendevelopedaconsensusrecommendation:acallfortheestablish-mentofanewsourceoftechnicalandimplementationsupporttostrengthendeveloping-countrygovernments’capacity toworkwith theirprivatehealthsectors Recognizing the complex and crowded field of sources of supportfor health development assistance, they delved deeply into how to set upsuch a new mechanism The recommendations have already gained signifi-cant support, including in the report issued by theTaskforce on InnovativeInternational Financing for Health Systems chaired by Gordon Brown andRobertZoellick 1

1 See “More Money for Health, and More Health for the Money,” the final report of the Taskforce on Innovative International Financing for Health Systems, May 29, 2009.

viii

The recommendations to establish a new source of support for developingcountriesshouldbequicklytranslatedintoactions—actionsthatunambigu-ouslyconveythatdonorsareabletolookatthereal-worldconditionsofthehealth sector with clear eyes and respond to needs expressed by partnergovernments

RuthLevine VicePresidentforProgramsandOperations CenterforGlobalDevelopment

ix

AcknowledgmentsThemembersoftheworkinggroupprovidedthemaininputsofthisreport Meeting over a number of months, the group diligently hammered out apractical solution to a long-standing problem: how to provide support todeveloping countries in dealing effectively with the private components oftheir health systems It was not an easy task, but was made easier by thedynamicandcongenialpersonalities

ThanksgotoRogerEnglandforhisworkonthedemandsurvey,thefindingsofwhichformedanimportantplatformforthethinkingofthegroup,andtoLilyDormentforherparticipationandcontributionstoourlastmeeting

Additionally,IthankRuthLevinefortheinvaluableexpertisethatshebringsin both chairing working groups at the Center for Global Development andunderstandingtheglobalhealthenvironment

Very special recognition goes to Barbara O’Hanlon, the facilitator of theworking group, for brilliantly bringing this work together both during themeetingsandinthisreport

As always, I thank the team at the Center for Global Development for theirsupport AcknowledgmentgoestoHeatherHainesforherassistanceinplan-ningtheworkinggroupmeetings,andLawrenceMacDonald,JohnOsterman,andthecommunicationsteamfortheirsupportinpublishingandpositioningthereport

Finally,IwouldliketothanktheRockefellerFoundationandtheBill&MelindaGates Foundation for intellectual contributions and financial support thatfacilitatedthiswork

AprilHarding VisitingFellow CenterforGlobalDevelopment

x

Executive Summary Theprivatesectorplaysasignificantroleindeliveringhealthcaretopeopleindevelopingcountries Bysomeestimates,morethanone-halfofallhealthcare—even to the poorest people—is provided by private doctors, otherhealth workers, drug sellers, and other non-state actors This reality createsproblems and potential By and large, developing-country health policy anddonor-supported health programs fail to address the problems, or capturethe potential of the private sector in health Interest is growing, within thedonor community and among policymakers in developing-country govern-ments, to find ways to work with the private sector to accelerate progresstoward high-priority health objectives However, governments in many low-andmiddle-incomecountrieslacktheessentialskillsandtools(forexample,public-privatepartnershipguidelines) todothiseffectively Recognizingthisconstrainttohealth-systemdevelopment,theCenterforGlobalDevelopment(CGD) convened a working group to design a practical way for donors andtechnicalagenciestosupportsuccessfulpublic-privateinteractions,focusingonthedesignofanadvisoryfacility

Advisoryfacilities,whichprovidearangeoftechnicalsupportandknowledge-sharing services, have succeeded in other sectors, such as infrastructuredevelopment Forexample,thePrivateParticipationinInfrastructureAdvisoryFacility(PPIAF)housedattheWorldBankhelpsgovernmentofficialsindevel-oping countries involve the private sector in the provision of infrastructureservicesandfacilities ThePPIAFoffersstrategicsectoranalysis,implementa-tionsupport,andtrainingandtechnicalassistanceinhowtoworkwiththeprivatesector Withadaptation,thePPIAFmodelmayservewelltobridgethecapacitygapinthehealthsector

Butistheredemandforsuchservices?Theworkinggroupconfirmedstronginterestinthetypesofservicesthatcouldbeprovidedbyanadvisoryfacility,expressedbyawiderangeofindividualsindevelopingcountries,frommiddle-incomecountriessuchasIndia,Brazil,andotherLatinAmericancountriestothepoorestdevelopingcountriesinAfricaandAsia

Theworkinggroup,comprisingexpertsfrombilateralandmultilateralorga-nizations,foundations,consultants,theprivatesector,andacademia,definedthe aims and organizational structure of a global advisory facility Theydeterminedthattheadvisoryfacility’smainpurposeshouldbetostrengtheninterested developing-country governments’ capacity to collaborate withprivate practitioners and organizations to achieve public health objectives The advisory facility will support developing-country clients by brokeringknowledge, serving as an agent for change, providing strategic advice, and

xiWhat the International Community Can Do to Strengthen Health Systems in Developing Countries

offering technical and implementation support for engagement strategies2(for example, contracting, social franchising, and accreditation) Mobilizingexpertsandorganizationalpartners,theadvisoryfacilitywillprovideawiderangeofservicestargetedtoassistinggovernmentsindevelopingcountriestocreate,evaluate,orstrengthenpublic-privatepartnershipsinhealth Theadvi-soryfacilitywillhaveastrongfieldpresencetobetterrespondtodemandindevelopingcountriesthroughahub-and-spokeorganizationalstructurewithacentralmanagementunitlocatedinahostorganizationinWashington,D C ,andfieldpresenceinregionalhubs

To ensure the quality of activities and maintain accountability to donorsand clients, the working group proposes a three-pronged governance andmanagement structure: a council to oversee management and operations;regionaltechnicaladvisoryboardstoreviewregionalstrategies;andanopera-tional unit to manage daily operations, financial operations, and technicalactivities The working group estimated that launching the advisory facilitywillrequireapproximatelyUS$3 5millioninstart-upfundswithanadditionalUS$16millionoverfouryearstoexpanditsoperationsandmeetanticipatedcountrydemand

Theworkinggroupgavecarefulconsiderationtothequestionof theappro-priateinstitutionalsetupfortheadvisoryfacilityandhasdetermineditbesttobuildtheadvisoryfacilitywithinanexistinginstitutionratherthanaddtothealreadyovercrowdedfieldofglobalhealthinitiatives IthasconcludedthatthemostpromisinghostinstitutionwouldbetheWorldBank–InternationalFinanceCorporation(IFC)onthebasisofitsrelatedHealthinAfrica(HIA)initia-tiveaswellasitssuccesswithasimilaradvisoryfacilityintheinfrastructuresector(thePrivateParticipationinInfrastructureAdvisoryFacility,discussedinbox4) ThemembersrecommendsomemodestmodificationsforHIA:harmo-nizingHIAandaglobalfacility’svisionandmissionbyclearlyspecifyingwhatsuccesswilllooklike;emphasizingtransferofcapacitytodeveloping-countryexpertsandorganizationsasaguidingprinciple;andformalizingseparationof investment-accelerating activities from policy, analysis, and implementa-tionsupportinaglobalfacility

The working group members strongly believe that the creation of a globaladvisoryfacilityestablishedalongtheparametersoutlinedinthisreportwillberesponsivetoexpresseddemandandwillmakeasignificantcontributionto achieving public-health goals in developing countries Furthermore, theworkinggroupmembersbelievethathousingthefacilityattheWorldBank–IFCisthebestapproach If,however, theWorldBank–IFCdecidesnottohostthe facility, the working group proposes returning to the short list of other

2 In this report, “private sector engagement” and “engagement strategies” refer to a range of policy tools, such as contracting, social franchising, or accreditation, that can be used to influence and collaborate with private-sector actors as productive counterparts in efforts to achieve sector goals.

xiiPartnerships with the Private Sector in Health

possiblehostinstitutions,suchastheGlobalFundtoFightAIDS,TuberculosisandMalaria,theWorldHealthOrganization,andothers

Giventherealmomentumtowardcreatingconstructivepartnershipsbetweenthe public and private sectors, and the value of contributing to the broaderdiscussions regarding health-system strengthening, there should be nobacking away from the imperative to create a global facility to address theprofoundneedfortechnicalassistanceonhowtoengagetheprivatehealthsector

xiii

About the Report and Working GroupTheprivatehealthsectorindevelopingcountriesiscomplex ItisAravindEyeCare, providing high-quality cataract surgery to hundreds of thousands ofpoorpeople in India,subsidizingcarefor the indigentwithpaymentsfromricher patients It is Hygeia, a Nigerian health maintenance organization,providing high-quality insurance and health care coverage to a growingnumberofpoorpeopleunderagovernmentsubsidyprogram Itistheprivatedoctors in the Indian state of Gujarat, whose participation in a voucherprogramforpoorwomenenabledadramaticincreaseinattendeddeliveriesandreducedmaternaldeaths Itisthecontractednongovernmentalorgani-zations(NGOs),faith-basedandsecular,thattookoverprovidingcareinmanyareasofruralAfghanistan,dramaticallyincreasingaccesstohealthcareforpeoplewhohadverylittlebeforetheirarrival Itisalsodrugsellerswhoareknowingly and unknowingly selling counterfeit malaria drugs throughoutsub-Saharan Africa, and unqualified practitioners who miss the warningsigns of serious illness in children or are unable to manage complicationsduringpregnancyanddelivery

The private health sector presents many unparalleled opportunities toimproveaccesstoandcoverageofservices—servicescriticallyneededtoreachthehealth-relatedMillenniumDevelopmentGoals Italsonecessitatesinter-vention,typicallybythestate,toprotectpeoplebyaddressingthemostseriousshortcomingsinthequalityofcareandhealthproducts Healthprogramsinmostcountrieswillonlyreachtheirobjectivesbyengagingarangeofprivateparticipantsinthesector—toharnessandexpandthebenefitstheyprovideand, at the same time, to reduce harm The need for such action has beenclear for years, but effective policy interventions such as regulatory reform,contracting,risk-pooling,andpolicydialogue,tonameafew,havebeenfewandfarbetween Inmostdevelopingcountries,thepublicandprivatesectorsof the health system work separately, much to the detriment of the peoplewhorelyonthem

Whydoesthissituationprevail?Ideologicalperspectivesontheroleofgovern-mentinprovidingandfinancinghealthservicesand,often,alackofawarenessoftheextentandimpactoftheprivatesector,undoubtedlycontribute Byandlarge,though,thebiggestconstraintisthatpolicymakersandpublicofficialsin government agencies lack the technical know-how and managementsystemstoengagetheprivatehealthsector Policies,suchasthoserelatedtocontractingoraccreditation,thatengageandinfluencetheprivatesectorarecomplex and challenging They require specialized skills and new practicesbuilt on experiences in other countries and basic principles of economics,regulation, business, and other fields The technical assistance available to

xivPartnerships with the Private Sector in Health

publicofficialsindevelopingcountries,however,typicallyofferslittlesupportandexpertiseonprivate-sectorengagement

The Center for Global Development convened a working group to examinethenatureofthisproblemandidentifythecharacteristicsofasolution Thegroupwastaskedwithexploringpracticalandfeasiblewaysfordonorsandtechnical agencies to support improvements in public-private interactionindevelopingcountriesasameanstoacceleratetheachievementofwidelyagreed-upon social objectives: reduced mortality and expanded and moreequitableaccesstohealthservicesandessentialmedicinesandproducts Theworkinggroup,whoseworkwassupportedbygrantsfromtheBill&MelindaGates Foundation and the Rockefeller Foundation, included a broad rangeofindividualswithexpertiseinthepublicandprivatehealthsectors,actingon a voluntary basis and in their individual capacities, from bilateral andmultilateral organizations, foundations, consultants, the private sector, andacademia (see annex A for brief biographies) The working group met threetimesbetweenAugust2008andApril2009

Thisreportpresentsthebackgroundcontextforthegroup’stask,therationaleforframingthedeliberationsthewaytheydid,andtheirspecificrecommen-dationsforinternationaldonorsandfoundations

1

Partnerships with the Private Sector in HealthIn most countries, the government cannot fully meet the health needs ofthepeoplewithpublicresourcesalone Whileuniversalaccess tokeyhealthservices such as family planning, maternal health care, and prevention ofHIV/AIDS and other sexually transmitted infections is critical to achievingtheUnitedNation’sMillenniumDevelopmentGoals,3 thataccess is farfrombecoming a reality The private sector provides a complementary means toexpand health services, products, and infrastructure (box 1) However, theprivatesectorisanotareplacementforeffectivepublic-sectoraction Ineverysetting,bothsectorshaverolestoplayinaddressingthecomplexanddifficultchallenges faced by developing countries to expand access to high-priorityhealthservicestounderservedpopulations

Why Work with the Private Sector

Developing-countrygovernmentshavemuchtogainbyengagingtheprivatehealthsectorforseveralreasons:

• THE PRIVATE SECTOR ALREADY PLAYS A LARGE ROLE IN HEALTH CARE InAfricaalone,nearly50percentofthosewhoseekcareoutsidethehome go to a private provider (figure 1) About half of the US$16 7billionspentonhealthinsub-SaharanAfricain2005wasspentintheprivatesector(WorldBank,2009)

• PATIENTS OFTEN PREFER THE PRIVATE SECTOR Household decision-makersindevelopingcountriesoftenchooseprivateprovidersbecausetheyrespondmoretopatients’needsorpreferences Peoplevaluetheconvenience,flexiblepaymentplans,andeaseofaccesstohealthcareproviders and drugs at private health services They also value the

3 Adopted by world leaders following a UN summit in 2000, the goals aim to reduce poverty and improve quality of life. http://www.un.org.

Box 1. What Is the Private Health Sector?

The private sector in health includes for-profit (both informal and formal) and not-for-profit (NGOs, faith-based organizations, community-based organizations, and the like) entities as well as a range of for-profit financial institutions (banks, health insurance companies, and so forth).

http://www.un.org

2Partnerships with the Private Sector in Health

closer locationsandmoreresponsiveservices (BrughaandZwi 1998;Millsetal 2007;Hetzeletal 2009)

• THE PRIVATE SECTOR DELIVERS SERVICES TO THE POOR The privatesector fills important gaps in health services and products to thoseunderservedbythepublicsector AcrossSouthAsia,forexample,80percentofchildrenfromfamiliesinthelowestincomequintilewhoseekcareforrespiratoryillnessuseaprivateprovider InIndia,privatehealthservicesaccountedfor56 5percentofutilizationinthepooresthouseholds(Petersetal 2002)

• THEPRIVATEHEALTHSECTORCANINCREASETHESCOPEANDSCALEOFSERVICES In many developing countries, the private sector owns andmanages40to50percentormoreofthecountry’shealthinfrastruc-tureanditisoftentheprimaryemployerofhealthcareprofessionals Manyoftheseservicesarelocatedinremoteandruralareas Thepublicsector can extend its reach by contracting with these providers or byundertakingquality-enhancingactivitiessuchasaccreditation(box2)

• PRO-POOR STRATEGIES CAN WORK THROUGH PRIVATE-SECTORENGAGEMENT Public health services in developing countries oftenbenefit better-off people more than the poor Policy interventions,suchasvouchersorinsurancepremiumsubsidiesforpoorpeople,canpreferentiallyexpandaccessforpoorpeopletohigh-priorityservicesorproducts

• ENABLING POLICY CHANGES CAN MOTIVATE INCREASEDMANUFACTURING, DISTRIBUTION, AND RETAIL OF HIGH-PRIORITYHEALTHPRODUCTS Inmanycountries,excessiveandpoorlydesignedregulatory and tax policies discourage investment in important

Figure 1. Health Care Sought from Private Sector

100

Percent

Bangladesh

a. Percentage of women seeking select health services in private sector in three

South and Southeast Asian countries

b. Percentage of women seeking select health services in private sector in three

African countries

India

% family planning users

% mothers seeking care for child with diarrhea

% mothers seeking care for child with cough/fever

Indonesia Ghana Kenya Nigeria

806040200

Source:PSP-One2006

3What the International Community Can Do to Strengthen Health Systems in Developing Countries

subsectors Strategic policy changes (for example, changing entryregulationsortaxprovisions)canprovideincentivesforexpansioninthesesubsectorsandincreaseaccesstoanduseofimportanthealthgoods, including bed nets, diagnostic tests, medical equipment, andpharmaceuticals

• PRIVATE-SECTORINVESTMENTANDGROWTHOFTENREQUIRESPUBLIC-SECTORLINKSTOREACHPEOPLEINLOWER-INCOMEHOUSEHOLDSORUNDERSERVED AREAS Without contracting or insurance arrange-ments,orsubsidiesforpoorerpatients,muchgrowthofthecommercialprivatesectorwilloccurinthesubsectorsprimarilyservingthebetter-offportionsofthepopulation(forexample,urbanhospitals)

Linking the Public and Private Sectors

The public sector can use a wide range of policy instruments to engageand create partnerships with the private sector in health (table 1) Theseinterventions, which include contracting out, licensing and accreditation,socialfranchising,socialmarketing,andvouchers,haveprovensuccessfulinadvancing health priorities, including family planning, tuberculosis treat-ment,malariapreventionand treatment,andchildandmaternalhealth,aswellasinreducingimpoverishmentthroughhealthcarepaymentsubsidies

Takingadvantageoftheexistenceoftheprivatesectortoservepublichealthobjectives is challenging The barriers are both conceptual and operational,andinclude

• a lack of common definitions and disagreement over what role theprivatesectorshouldplay;

Box 2. Fighting Tuberculosis: A Successful Example of Public-Private Collaboration

The World Health Organization’s Stop TB Strategy explicitly recognizes the private sector’s role in stopping tuberculosis on the basis of several cases in which the private sector participated in national Directly Observed Treatment – Short-course (DOTS) programs. In Delhi and Hyderabad, India, the Public-Private Mix (PPM) DOTS program showed that DOTS treatment in the private sector is affordable and that the private sector reached more patients than the public (Floyd et al. 2006). In Bangladesh, the Damien Foundation trained more than 2,000 village doctors in DOTS, expanding coverage to 26 million people in rural Bangladesh (Salim et al. 2006).


Table 1. Public-Private Interventions in Health Care Delivery

Intervention Description Expectedresults Whereitishappening

Contracting out Governmentscontractwithprivateproviders(nonprofitandfor-profit) Canexpandprivate-sectorcoverageofparticularservicesviapublic Afghanistan,Bangladesh, todeliverhealthservices fundingandmayimprove(throughcontractspecification)thequality Cambodia,Guatemala,Haiti, ofcare;canimproveefficiencyandqualitythroughcompetition Pakistan,Senegal,South Africa,mostofcentral EuropeLicensing and Governmentscanextendlicensingandaccreditationsystemstoinclude Canstrengthenqualityofprivatehealthservicesandhelpgovern- Brazil,SouthAfrica,Tanza- accreditation provisionsforprivate-sectorproviders mentsmonitorthecarethatprivateprovidersoffer nia,Zambia

Regulation Byupdatingandharmonizinglaws,policies,regulations,andprocedures, Canpromotecompetitionandorganization(forexample, Tanzania governmentscanauthorizeprivateprovisionofservicesandproducts multi-pharmacychains)moreconducivetoqualityorlowerprices bycertainhealthprofessionalsinspecificsettings Canincreaseprivate-sectorcontributionbyremovingobstaclesand creatingincentivesthatmotivatetheprivatesectortoprovide publichealthservicesandproducts

Provider networks Networksandfranchisesgrouphealthcareprovidersunderanumbrella Ensuresstandardqualityandpricesandencouragesindividual Bangladesh,Benin,Camer- and franchises structureorparentorganization privateproviderstoscaleuptheirservices oon,Ethiopia,Ghana,India, Kenya,Lesotho,Madagascar, Malawi,Mali,Pakistan,Phil- ippines,Rwanda,Sierra Leone,SouthAfrica,Swazi- land,Togo,Vietnam, Zimbabwe

Public-private Privateprovidersandbusinessesjoinwithgovernments,international Leveragesprivate-sectorresourcesandexpertisetodeliverhealth Brazil,CzechRep ,India, partnerships organizations,ornonprofitstoaddresssocialneeds productsandservices Lesotho,Mexico,Romania, SouthAfrica,Republicof Yemen

Social marketing Usecommercialmarketingtechniquestomakesubsidizedproducts Increasesaccesstoanduseofessentialhealthproducts Manycountries,forfamily programs availablemorewidely Theprogramscandistributeandpromoteproducts planningproductsand suchascontraceptives,oralrehydrationsalts,andinsecticide-treated servicesandbednets bednets

Training and continuous Avarietyoftrainingtechniques—includingdirecttraining,long-distance Canimproveprivateproviders’knowledge,skills,andthequalityof India education for private learning,continuousmedicaleducation,anddetailing—canimprovethe thecaretheyprovideinareasthataddresspublichealthobjectives providers knowledgeandskillsofprivatehealthcareproviders

Vouchers Governmentcangivevoucherstotargetpopulationstosubsidizethe Canincreaseconsumerchoiceandmakeprivate-sectorcaremore Ghana,India,Indonesia, priceofhealthservicesandproducts,whichmakesthemmoreaffordable affordablethroughsubsidies Vouchersalsocreatefinancialincentives Nicaragua,Tanzania andmorelikelytobeused toprivateproviderstoofferservicesandproductstheymightnot otherwisedeliver Canmotivatequalityimprovementviaprovider eligibilityrequirements

Insurance Government-fundedinsurance,commercialinsurance,and Canexpandfinancialprotectionandeaseburdenonhouseholds Colombia,Ghana,India, community-basedmutuellespoolfinancialriskacrosslarge payingoutofpocketforhealthservices Insurancecanreduce Mali,Namibia,Nigeria, populationgroups financialbarrierstoseekinghealthcare,especiallyforpreventive Rwanda,Senegal healthservices

Sources:O’Hanlon2009;LagomarsinoandSinghKundra2008


Table 1. Public-Private Interventions in Health Care Delivery

Intervention Description Expectedresults Whereitishappening

Contracting out Governmentscontractwithprivateproviders(nonprofitandfor-profit) Canexpandprivate-sectorcoverageofparticularservicesviapublic Afghanistan,Bangladesh, todeliverhealthservices fundingandmayimprove(throughcontractspecification)thequality Cambodia,Guatemala,Haiti, ofcare;canimproveefficiencyandqualitythroughcompetition Pakistan,Senegal,South Africa,mostofcentral EuropeLicensing and Governmentscanextendlicensingandaccreditationsystemstoinclude Canstrengthenqualityofprivatehealthservicesandhelpgovern- Brazil,SouthAfrica,Tanza- accreditation provisionsforprivate-sectorproviders mentsmonitorthecarethatprivateprovidersoffer nia,Zambia

Regulation Byupdatingandharmonizinglaws,policies,regulations,andprocedures, Canpromotecompetitionandorganization(forexample, Tanzania governmentscanauthorizeprivateprovisionofservicesandproducts multi-pharmacychains)moreconducivetoqualityorlowerprices bycertainhealthprofessionalsinspecificsettings Canincreaseprivate-sectorcontributionbyremovingobstaclesand creatingincentivesthatmotivatetheprivatesectortoprovide publichealthservicesandproducts

Provider networks Networksandfranchisesgrouphealthcareprovidersunderanumbrella Ensuresstandardqualityandpricesandencouragesindividual Bangladesh,Benin,Camer- and franchises structureorparentorganization privateproviderstoscaleuptheirservices oon,Ethiopia,Ghana,India, Kenya,Lesotho,Madagascar, Malawi,Mali,Pakistan,Phil- ippines,Rwanda,Sierra Leone,SouthAfrica,Swazi- land,Togo,Vietnam, Zimbabwe

Public-private Privateprovidersandbusinessesjoinwithgovernments,international Leveragesprivate-sectorresourcesandexpertisetodeliverhealth Brazil,CzechRep ,India, partnerships organizations,ornonprofitstoaddresssocialneeds productsandservices Lesotho,Mexico,Romania, SouthAfrica,Republicof Yemen

Social marketing Usecommercialmarketingtechniquestomakesubsidizedproducts Increasesaccesstoanduseofessentialhealthproducts Manycountries,forfamily programs availablemorewidely Theprogramscandistributeandpromoteproducts planningproductsand suchascontraceptives,oralrehydrationsalts,andinsecticide-treated servicesandbednets bednets

Training and continuous Avarietyoftrainingtechniques—includingdirecttraining,long-distance Canimproveprivateproviders’knowledge,skills,andthequalityof India education for private learning,continuousmedicaleducation,anddetailing—canimprovethe thecaretheyprovideinareasthataddresspublichealthobjectives providers knowledgeandskillsofprivatehealthcareproviders

Vouchers Governmentcangivevoucherstotargetpopulationstosubsidizethe Canincreaseconsumerchoiceandmakeprivate-sectorcaremore Ghana,India,Indonesia, priceofhealthservicesandproducts,whichmakesthemmoreaffordable affordablethroughsubsidies Vouchersalsocreatefinancialincentives Nicaragua,Tanzania andmorelikelytobeused toprivateproviderstoofferservicesandproductstheymightnot otherwisedeliver Canmotivatequalityimprovementviaprovider eligibilityrequirements

Insurance Government-fundedinsurance,commercialinsurance,and Canexpandfinancialprotectionandeaseburdenonhouseholds Colombia,Ghana,India, community-basedmutuellespoolfinancialriskacrosslarge payingoutofpocketforhealthservices Insurancecanreduce Mali,Namibia,Nigeria, populationgroups financialbarrierstoseekinghealthcare,especiallyforpreventive Rwanda,Senegal healthservices

Sources:O’Hanlon2009;LagomarsinoandSinghKundra2008


• mistrust, lackofcommunication,andnegativeattitudestowardtheprivate sector, which often inhibit collaboration between the publicandprivatesectors(Bennettetal 2005);

• therealityandperceptionoftradeoffsbetweenfor-profithealthcareandaccessforthepoor,andhealthcareasa“publicgood”;

• adiverseandfragmentedprivatesector,whichmakesfindingarepre-sentativeentityorgroupwithwhomtocollaboratedifficult4;

• scant information on who private providers are and what servicestheyoffer;and

• alackofpublic-sectorskillsandexpertiseindevelopingandmanagingstrategiestoinfluenceandcollaboratewiththeprivatesectors

This final challenge was the focus of the majority of the working group’sdeliberations Although evidence and experience are growing about how toworkwiththeprivatehealthsector,manygovernmentagenciesindevelopingcountrieslacktheknow-howandskills Historically,thetasksofpublichealthofficials have not included competitive procurement and health-servicescontractmanagement Norhavemosthealthofficialshadexperienceimple-menting or overseeing facility or professional accreditation in the privatesector Moreover, includingprivate-sectoractors inpolicyandplanning,andmanagingmeaningfulinteractionswiththeprivatehealthsector,requirenewskillsandpracticesthatarenottaughtinmedicalorpublicpolicyschools

Thetechnicalsupportofferedbytheinternationaldonorcommunitytodevel-oping-countrygovernmentshassofardonelittletoaddresstheseskillgaps Multilateral agencies active in health are staffed primarily by people withpublichealthandclinicalexpertise Bilateralagencies,withafewexceptions,tendtoprovidesupportinthecontextofhealthprograms,whichareusuallyimplementedwithinthepublicsystem Wherebilateralagenciesdopossessexpertiseandsupportprivate-sectorengagement,itoftentakesplaceoutsidetheremitofpublicofficials(forexample,NGO-administeredfamilyplanningprograms) Becauseofhistoricalpatternsandthegovernment-to-governmentnature of most aid programs, funders typically direct the majority of theirfunds to public-sector programs In Africa, for example, National HealthAccounts(NHA)datain10countriesfrom1997to2004revealthatlessthan5percentofdonorfundsflowtoactorsoutsidethepublicsector:themajorityof donor funds are directed to public-sector initiatives and, in a few cases,NGO activities In many instances, donors’ decisions about what to support

4 The private health sector typically is characterized by a small number of large, high-quality private hospitals, clinics, and providers serving higher-income groups working alongside a larger number of small-scale private (and often informal) providers offering services to a wide range of income groups including the poor.


andhowaremadewithlittleregardtowhatroleprivateprovidersarealreadyplaying—oftenatthecostofunderminingprogramperformance,andsome-timesattheexpenseofunderminingthehealthsystemasawhole ThesameNHAdatashowthatthegreatinfluxofGlobalFundmoneyin2003and2004wiped out the nascent private-sector role in HIV/AIDS provision (Sulzbach,Wang,andO’Hanlon2009)

The Working Group Task: Identify a Solution

In response to the need in developing countries for capacity building, CGDestablished a working group in August 2008 with a mandate to develop acharterforanagencyorcollaborativemechanismthatcouldaddressthisgapinskillsandprovidetechnicalassistancetodeveloping-countrygovernments The group conducted its work through regular teleconference calls, e-mail,andthreein-personmeetings

Demand for Support?

A set of structured interviews was conducted to inform the group’s delib-erations on the critical question of whether there was need and demand forsupportand,ifso,whatkind Interviewswereconductedwithadiversesetof36respondents,includingpotentialclients Theresponsesconfirmedtheneedfor,andinterestin,technicalassistancetobettercollaboratewiththeprivatesector Theinterviews,carriedoutviae-mailandtelephoneinOctoberandNovember2008,elicitedopinionsontheformationofaninternationalmechanismthatcouldoffer technicalandfinancialsupportfordevelopingcountriestobetterengagetheprivatesectorforpublicbenefit Inadditiontoidentifyinganumberofbarrierstoengagingtheprivatesector(box3),thesurveyfoundthatrespon-dentsbelievethatministriesofhealthindevelopingcountriesrequireawiderangeofsupporttotapintothefullpotentialoftheprivatesector,including

• evidence supporting how the private health sector can address thechallengesandissuesconfrontingthepublichealthsector;

• strategic advice on what the potential areas for public-privateengagementareandwhatstrategiesareeffectiveinmobilizingtheprivatesector;and,

• technical assistance in strategy development and program designthat will help developing-country governments implement public-privatepartnershipsinhealth

Moreover, the same public-sector officials asked for technical assistance inbuilding political support to work with the private health sector amongministryofhealthstaff,othergovernmentofficials,andinternationaldonors


The survey confirmed that there is demand from officials in a wide range ofdevelopingcountries, includingmiddle-incomecountriessuchasIndia,Brazil,andotherLatinAmericancountries,tothepoorestdevelopingcountries,suchasthoseinAfrica Workinggroupmembers,fromtheirownindividualandorgani-zationalperspectives,furtherconfirmedtheglobalcharacteristicofdemandforanadvisoryfacilityonprivate-sectorinteractionsinhealthsystems

The Advisory Facility Concept

Theconceptoftheentityormechanismtoencourageprivate-sectorengage-mentrapidlyfocusedonsomeformofanadvisoryfacility Theworkinggroupexamined thePPIAF in theWorldBankandidentifiedseveralcharacteristicsthat corresponded to the type of mechanism they envisioned for providingtechnicalassistancefordevelopingcountriestoengagetheprivatesectorinhealth(seebox4) Theworkinggroupdeterminedthatthemechanismshouldbeabletoreceivefundsfrommultiplesources;providetechnicalsupportonanon-demandbasis; focusonbuildingpublic-sectorcapacity indevelopingcountries;providethetypeandrangeoftechnicalassistanceneededforthepublicsectortoengagetheprivatesector;buildonanexistingorganization’sstructure,governance,financialmanagement,andprocedures;andleverageWorldBankandIFCstafftoestablishcontactsinkeydevelopingcountriesandtohelpgenerateawarenessofavailableservices

Characteristics of a Global Private-Sector Advisory Facility

Theworkinggroupforgedagreementonthedifferentcomponentsofaglobaladvisoryfacilityontheprivatesectorinhealth Theconsensusvisionforthe

Box 3. Developing-Country Policymakers Speak up on the Private Health Sector

In interviews commissioned by CGD, policymakers, and leaders in several ministries of health acknowledged the barriers to engaging the private sector:

• poor information on the private sector• lack of capacity by government to work with the private sector• resistance from ministry staff• lack of political will• no policy framework for private-sector engagement• limited interest within the private sector to work with the public sector• little support available for implementing new policies to include the private sector


main features of a global advisory facility is described below (for a morein-depthdiscussionoftheseareas,refertoannexesBandC)

Vision and Mission

The global private-sector advisory facility’s mission shall be to strengtheninteresteddeveloping-countrygovernments’capacitytoworkwiththeprivatehealth sector to achieve public health goals (see vision statement in box 5) Thesegoalsmight include increasingaccess tohigh-priorityhealthservices,reducing maternal mortality, improving child survival, and others Ideally,clients primarily will be government ministries or agencies in the poorestdevelopingcountries However,thefacilitywillalsoofferservicestoalimited

Box 4. The PPIAF as a Model Mechanism for Helping Developing Countries Engage the Private Sector

The Private Participation in Infrastructure Advisory Facility (PPIAF), now supported by 15 donors, has successfully helped developing countries use the private sector to build infrastructure and provide services in the power, water, transport, and telecommunications sectors. PPIAF activities focus on five areas:

• Strategic analysis to identify promising approaches to bringing the private sector into key high-priority areas

• Direct support to elaborate and implement necessary policy or regulatory improvements• Training and on-the-job support to help public officials develop the capacity to handle

new tasks related to working with the private sector• Technical assistance to support public officials to implement transactions unfamiliar in the

local context• Support to build consensus related to the implementation of private partnerships, policies,

or strategiesThe PPIAF is housed in the World Bank, which permits it to connect with developing-country

governments through Bank staff. PPIAF management reports to its own board, however, ensuring that funds are spent in keeping with PPIAF priorities and criteria. With guidance from its board, PPIAF tracks the performance and effectiveness of its technical assistance activities.

PPIAF has 16 staff members; half are in Washington, D.C, and half are split among four regional offices. As of 2007, PPIAF had delivered 87 technical assistance grants and funded a total of 269 training workshops for governments, the private sector, and civil society since its inception in July 1999. In fiscal year 2007, PPIAF’s operating budget was US$19.5 million.

Box 5. The Advisory Facility’s Vision

Helping improve the health of people in developing countries by strengthening health systems through better integration of the private health sector.


numberofmiddle-incomecountries(representingapproximatelyone-quarterof its total portfolio of technical assistance) because they provide a wealthof experience that can be adapted and applied to other client countries Moreover,thetotalnumberofpeoplelivingbelowthepovertylineinmiddle-incomecountriesexceedsthatinlow-incomecountries

Available Services

Theglobalprivate-sectoradvisoryfacilityshalldeliverthefollowingsupport:

• knowledgebrokeragetoassembleinformation,tools,methodologies,and good and bad practices on strategies for developing-countrygovernmentstotapthefullpotentialofpublic-privatepartnerships

• changeagenttopromoteinclusionoftheprivatesectorinhealthbyfosteringdialoguebetweenthepublicandprivatesectorsandraisingawarenessofthefacility

• strategic sector analysis to identify high-priority health areas andpromisingapproachesforprivate-sectorengagement

• technical assistance and implementation support to provide devel-oping-country governments the capacity to design sustainable,country-specific, private-sector engagement strategies that willimprove health and to help them implement specific policies andregulatoryandinstitutionalreforms

The group agreed that the facility should undertake knowledge manage-mentandoperationalresearchrelatedtothetopicsonwhichitwillprovideanalytical and technical support Doing so will allow it to quickly integrateand share insights and lessons learned from its own work, and ensure thatsupportwithincountriesreflectsthemostup-to-dateresearch

Comparative Advantage

Group members took into account existing activities when they outlined thehighvalue-addingareasuponwhichthefacilityshouldfocusitsefforts Existingmechanismstoexpandtheprivatehealthsector’scontributiontosocialobjec-tivesarelimitedtoacceleratingentryandgrowthofhealthcarebusinessesbyincreasingaccesstofundsforinvestment TheIFCandtheEuropeanBankforReconstruction and Development, for example, increasingly invest in privatehealth care organizations in the health sector Such mechanisms typicallycannotreachthesmallbusinessesthatoftenmakeupmostoftheprivatehealthsector in developing countries (for example, clinics, pharmacies, laboratories) Norcantheyhelpestablisheffectivepublicfundingorsubsidyarrangementsthatcanallowcorporatehospitalsandotherserviceproviderstoservelower-


income households The advisory facility will be able to support engagementoftheprivatesectorinwaysthatcanmostdirectlyreachthepoorandachievehigh-priority social objectives (refer to table 1) It will also provide support toenablepolicychangesthatcancomplementsuchlarger-scaletransactions(forexample, establishing service-purchasing agreements in conjunction with apublic-privatepartnershipforaneworupgradedhospital,asinLesotho)

How the Global Advisory Facility Will Deliver Services

Theworkinggroupagreedonseveralprinciplesthatwillguidetheglobaladvi-soryfacility’sactivitiesandmannerofdeliveringservices (box6) Operatingthrough expert consultants and partnerships with organizations that havewide-rangingexperienceinworkingwithdevelopinggovernmentsonprivatesector engagement, the advisory facility will provide the following types oftechnicalassistance:

• Conduct private-sector assessments and offer recommendations forimprovingtheroleoftheprivatesector

• Collectdatatoanalyzeandbetterunderstandtheprivatehealthsector

• Establishandfacilitateconsultativeforumstofostergreatercommu-nication,cooperation,andcollaborationbetweenpublicandprivatestakeholders

• Review policies and regulations and recommend policy actions toexpand private-sector contributions to health-system performance,sustainability,andothergoals

Box 6. How the Global Advisory Facility Will Pursue Its Mission

The following principles would guide the activities of the advisory facility:• Strategicandselective. Technical assistance should focus on policy support to the

private sector where it will yield the greatest health impact, and address inequities in access to quality health services.

• Complementaryandcollaborative. Activities should foster creative partnerships that recognize the potential contribution of both public and private sectors.

• Responsive. Activities should be demand-driven, and respond quickly to a developing-country government by providing flexible, situation-specific technical support that meets its needs.

• High-qualitypolicyadvice.Technical assistance should address a client’s most pressing health priorities and strengthen its capacity to implement strategies.

• Leadershipandknowledge.The facility should be a credible information source and be committed to advancing the international development community’s knowledge on private sector engagement in health.


• Explorepotentialforpublic-privatepartnershipsinhealthandhelptoestablishandfacilitatethesepartnerships

• Provide training in core policy areas supporting the private healthsector,suchascontractingout,voucherschemes,risk-poolingmecha-nisms,accreditation,andcertification

• Undertakeoperationalresearchrelatedtoprivate-sectorpoliciesandpractices

• Create a knowledge clearinghouse on public-private interactions inhealth,goodpracticemodels,andexamples

• Assist in scaling up proven models and strategies to engage theprivatesector

• Assistinnegotiationsinvolvingcomplexcontractsforhealthservicesorpioneeringtransactionswiththeprivatehealthsector

Global Advisory Facility Implementation Model

The advisory facility will have a strong field presence To better respond todemandindevelopingcountries,andtobecomefamiliarwithregionalpriori-tiesandpolicychallenges,thefacilitywillhaveahub-and-spokeorganizationalstructure(seefigure2),withacentralmanagementunitlocatedinahostorga-nizationandfieldpresenceattheregionallevel Attheoutset,thefacilitywillexploreestablishingoneortworegionalhubs,dependingondemand

Inadditiontohelpingcountriesidentifyandimplementbetterpolicies, it iscritical that thefacility transferprivate-sectorengagementskillsandexper-tise to the field The regional hubs will serve as incubators to identify andgrowcapacityofprofessionalsandorganizationsintheregiontoeventuallyprovidetheservicesofferedbytheglobaladvisoryfacility

Global Advisory Facility’s Governance Structure

Toensurethequalityofactivitiesandmaintainaccountabilitytoparticipatingdonorsandclients,thefollowinggovernancestructureisproposed:acounciltooverseemanagementandoperations; regional technicaladvisoryboards;andanoperationalunittomanagedailyoperations,financialoperations,andtechnicalactivities

The council, composed of representatives from contributing donors (forexample, bilateral and multilateral organizations and foundations), willoverseetheglobaladvisoryfacility’smanagementandoperations Toensurea breadth of perspectives, the advisory facility will encourage developing-


country governments to participate in the council also. The council should meet annually to review the strategic direction of the facility’s activities and achievements and to provide financial oversight.

The global advisory facility will be supported by regional technical advisory boards, to be established and convened as needed on the basis of work volume and distribution. Advisory boards will provide strategic advice and technical direction and will offer political support for the advisory facility in a specific region by reviewing and commenting on its regional strategy and by assessing whether its activities and achievements are in keeping with agreed-upon priori-ties and are within budget. Members of the technical advisory board will be selected for their expertise in private-sector engagement modalities and will serve in a voluntary capacity.

An operational unit, which should remain small, will be responsible for the advi-sory facility’s daily operations, financial management, and, primarily, technical activities. Technical experts in policy instruments used to engage the private health sector (contracting, regulation, quality control, and so forth) and private-sector health care operation will be responsible for setting the facility’s technical direction, ensuring the technical quality of the facility’s products and services, and reviewing and synthesizing experiences and lessons of engaging the private health sector. Most country support should be contracted out and delivered by international and regional experts, whether individuals or organizations.

Figure 2. Global Advisory Facility Hub-and-Spoke Model

The CouncilTechnical Advisory Board (World Bank,

World Health Organization,others)

GlobalManagement

Unit

Sub-SaharanAfrica

Regionalspoke

EasternEurope

Regionalspoke

AsiaRegional

spoke

Middle Eastand

North AfricaRegional

spokeLatin Americanand the

CaribbeanRegional spoke


A New or “Build-On” Entity?

Oneofthetoughestissuesworkinggroupmembersconsideredwaswhethertheadvisoryfacilityshouldbeanew,stand-aloneentityoronecreatedwithinanexisting institutionworkingonrelatedissues Allwereconsciousofhowcrowdedandfragmented theglobalhealthfield is Toresolve this issue, thegroupreviewedthestrengthsandweaknessesoffourorganizationalmodelsthathavebeenusedtoestablishanddeliversimilartypesofsupport:

• OptionA,“Subsidiarymodel”:Ahostedsubsidiarywithinamultilat-eralorganization

• OptionB,“Partnershipmodel”:Ahostedpartnershipwithinamulti-lateralorganization

• OptionC,“Contracting-outmodel”:AprojectmanagedbyanexistingNGOorprivateentity

• OptionD,“Stand-alonemodel”:Anewlycreatedindependententity

Thegroupconcludedthatitwouldbepreferabletobuildtheadvisoryfacilityfromwithinanexisting institution ifasuitablehostingarrangementcouldbeestablished TheanalysisofthestrengthsandweaknessesandexamplesofeachoptionarepresentedinannexD

Thegroupconductedascopingexercisetoidentifyallentitiesactiveonpoli-ciesrelatedtoprivatehealthsectorengagement—bothtoensurethefacility’sscopeofworkisappropriatelydefined(thatis,notduplicatingsupportthatalreadyexistsfordevelopingcountries)andtoassesspotentialhostingoppor-tunities ThefindingsofthescopingexercisearepresentedinannexE

The scoping exercise identified one initiative in particular with strongsimilarities to the envisaged advisory facility—the Health in Africa (HIA)initiativelaunchedin2008bytheWorldBankandtheIFC Attheendoftheexercise, the working group concluded that the HIA initiative is the mostpromisingfoundationonwhichtobuildaglobaladvisoryfacility Membersagreedthatoneglobaladvisoryfacilityshouldbecreated,whichbuildsonthe solid foundation and early successes of the HIA initiative Having twodistinct entities with such similar scope and purpose would only confusedeveloping-country counterparts and possibly duplicate efforts Moreover,in response to requests from countries in other regions, HIA managementis already exploring moving beyond sub-Saharan Africa, and creating theglobalfacilitywouldhelpbringaboutsuchamove Also,theexperienceoftheWorldBankandIFCwithestablishingandoperatingthesuccessfulPPIAFindicated to the group their capability to undertake a similar initiative inthehealthsector


Making the Global Facility a Reality

Financial Requirements to Launch the Global Advisory Facility

Ideally,theadvisoryfacilitywillhaveadiversefundingbasefromfoundations,bilateral and multilateral organizations, and developing-country govern-ments Launching the advisory facility will require approximately US$3 5millioninstart-upfunds Theseedfundswillcoverthecostofrecruitingfourtosixstaffintheoperationalunitwiththefollowingresponsibilities:

• Developthetechnicalapproach,identifyandadapttoolsandmethod-ologiestobeused,andgeneratetechnicalinformation

• Develop and implement a business and operational plan for theglobaladvisoryfacility

• Mobilizedemandforitsservices

• Buildmanagementandoperationalsystemstodeliverservices

• Establishandconvenethecouncilandtechnicaladvisoryboard

Duringthefirstyear,agroupofkeystakeholderswillworkwiththeadvisoryfacility staff to finalize its terms of reference, help generate client demand,anddevelopastrategytohosttheadvisoryfacilitywithinanorganization

In addition, assuming the global advisory facility takes a business-develop-mentpathsimilartothatofthePPIAF,itwillneedanestimatedUS$16millionoverfouryearstoestablishitselfandlaunchcountry-supportactivities

The proposed funding levels for start-up and for four years of operation areestimatedonthebasisofthebudgetparametersandaveragetaskcostforPPIAF(figure3) Withanestimated16country-supporttasksperyearatanaveragecostofUS$195,000each,countrysupportwillcostUS$3 12millionperyear Iffacilityknowledge management and administration costs are proportional to PPIAFcosts(23percent,seefigure3),theywillrequireanestimatedUS$920,000

Thefundswillbeusedtoconsolidatetheadvisoryfacility’soperationalplat-form; open regional offices as needed; and vet, grow, and establish workingrelations with a diverse and qualified group of international consultants,organizations,anddeveloping-countryinstitutionstodeliveritsservices Also,theglobaladvisoryfacilitystaffwillbuildawebsiteandreferencelibraryandconvene and participate in technical meetings and workshops on private-sectorengagementinhealth


Incremental Approach

The private sector working group members endorsed establishing a globaladvisoryfacilityfromabaseoftheexistingHIAinitiativeoftheWorldBank–IFC This unique global advisory facility will add value beyond the HIA andother initiatives working with the private health sector by filling identifiedgapsintechnicalassistance,supportingactivitiesthatwillbedemand-driven,forgingcollaborativeandresponsiverelationswithdeveloping-countryclientsthrough a strong field presence with a central and regional hub-and-spokemodel,andtransferringtechnicalcapacitytoindividualsandorganizationsintheregionswheretheglobaladvisoryfacilityworks

Thisapproachwaspreferredforseveralreasons:

• Itbuildsonanexistinginitiative thathasactivitiessimilar to thoseproposedforaglobalfacility

• Itreducesthepossibilityofconfusingdeveloping-countryclientsandduplicatingeffortsofsimilarinitiatives

• Creating theglobaladvisoryfacilitywithinanexistingorganizationismorecost-effective—acriterionagreeduponbytheworkinggroupmembers

The working group recommends locating the advisory facility in theWorldBankGroup EstablishingtheglobaladvisoryfacilitywillinvolveextendingtheemphasisofHIAbeyondAfricaandmakingafewchangestotheHIAmodeltoreflectfindingsoftheworkinggroup

Figure 3. PPIAF Annual Budget by Categories$20millionperyear

Knowledge management

Consulting services (including task management)

Administration

10%13%

77%

Source:PrivateParticipationinInfrastructureAdvisoryFacilityAnnualReport2008


HIA Goes Global . . . With a Few Modifications

The existing HIA operational framework is similar, but not identical, to theideal parameters identified by the working group Table 2 contrasts theexistingHIAmodelwiththegroup’srecommendationsfortheadvisoryfacilitymodel Theworkinggroup’srecommendedmodificationsfollow:

• Harmonize HIA’s and the global facility’s visions and missions by defining success. The two initiatives have similar visions and missionstatements,butwithdifferentemphases Keyconceptssharedbybothinitiatives include mainstreaming the idea of private-sector engage-ment in all relevant aspects of public-sector policy and planning,providing quality technical assistance that is responsive to and addsvaluetopublic-sectoreffortstoworkwiththeprivatesector,andencour-agingprivate-sectorengagementandpublic-privatepartnershipsthatcontributetoincreasedaccesstoqualityhealthservicesforunderservedpopulations Draftingaclearstatementoftheglobalfacility’sdefinitionofsuccessthatbuildsontheHIAexperience,ratherthanspendingmoretimetocomeupwithnew,consensusvisionsandmissionstatements,wouldhelpreconcilethesmalldifferencesinwording

• Make transferring capacity to regional and local experts and orga-nizations a guiding principle for the global facility. One of thedistinguishingcharacteristicsoftheglobaladvisoryfacilitywouldbeitsstrongemphasisonbuildingthecapacityofindividualsandorga-nizationsintheregionswhereitworkstoprovidetherangeofservicesoffered by the global facility Initially, the global advisory facility willworkthroughpartnerstooffertherangeofserviceswhilesimultane-ouslyworkingtoidentifyindividuals,organizations,andnetworksintheregionstowhichtotransferprivate-sectorexpertiseandskills

• Formalize the decoupling of investment from policy and analysis. TheHIA initiative includesactivities toexpandaccess toequityanddebt finance Group members did not envision the global facilityproviding this type of support, although they agreed that acceler-atingaccesstoequityanddebtcancontributetohigh-priorityhealthgoals (forexample,expandedservicecoverageor improvedquality) Groupmembersdiscussedtheriskofrealorperceivedbiasinpolicyadvice—where there is an interest in improving the enabling envi-ronmentandprofitabilityofaparticularsectorororganization—andconcurredthatsomeseparationofinvestmentactivitiesfrompolicyand analysis would be appropriate The HIA initiative already hasestablished a separate and independent management structure forits equity finance activities; the working group supports this evolu-tionandsuggestsformalizingthisseparationinthegovernanceandmanagementarrangementsfortheglobalfacility


Table 2. Analysis of the HIA Initiative and the Global Advisory Facility

HealthinAfricainitiative Advisoryfacility(proposed)

Vision/Mission VisionHIA’smissionistoincreaseaccesstoqualityhealthservicesandproductsinAfricaandtoimprove Helpingimprovethehealthofpeopleindevelopingcountriesbystrengtheninghealthsystemsfinancialprotectionagainsttheimpoverishingeffectsofillnessesbyengagingtheprivatehealth throughbetterintegrationoftheprivatehealthsector sector HIAfocusesonunderservedpopulationgroups Mission Strengtheninginteresteddeveloping-countrygovernments’capacitytoworkwiththeprivate healthsector

Purpose Purpose• Policyandanalytics:toimproveknowledge,informdecisions,andbenchmarkperformance • Knowledgebrokerage:assembleinformation,toolsandmethodologies,andgoodandbad Outputsincludeflagshipreports,countryassessments,thematicstudies,shortpolicybriefsand practicesonstrategiesfordeveloping-countrygovernmentstotapthefullpotentialofpublic- technicalarticles,andpolicymakertoolkits privatepartnerships • Technicalassistance:countryassessmentsinfourcountriesandearlyprivate-sectorprojectsin • Changeagent:promoteinclusionoftheprivatesectorinhealthbyfosteringdialogue GhanatoaccreditprivateprovidersandinNigeriatoimplementNationalHealthInsurance betweenthepublicandprivatesectors SchemeITandreformbusinesspractices • Strategicsectoranalysis:identifyopportunitiestoexpandtheprivatesector’scontribution• Equityvehicle:multipleinvestors(IFC,DEG,GatesFoundation) FundwillbemanagedbyAureos tohealth-sectorgoalsandstrategiestoaddressproblems(forexample,poorquality);develop BasictermsincludehavinginitialfundsavailablerangingfromUS$100milliontoUS$120million strategicplanswithgovernmentstoaccelerateprogresstowardhigh-prioritygoals(for Expecttoinvestin25–30projectsfromaroundUS$50,000toUS$5million Investmentsfocused example,healthservicesaccessforthepoorandunderserved;reducematernalmortality)via onlower-incomepopulation privatesectorengagement • Debtvehicle:HIAcurrentlyhasapipelineofUS$100millionwithatargetofUS$500million • Technicalassistanceandimplementationsupport:provideexpertiseandbuilddeveloping- overfiveyears,withEco-Bankidentifiedasapartnerfortheregionalfinancial-marketsprogram countrygovernmentcapacitytodesignsustainableprivate-sectorengagementstrategies andGhanaandBurkinaFasoaspotentialcountries Ghana,Nigeria,Tanzania,andZambiaare thatimprovehealthoutcomesandworkwithdevelopingcountrygovernmentstoimplement first-phasecountries specificpoliciesandregulatoryandinstitutionalreforms,andsupporttheimplementationof engagementstrategies • Doesnothaveequityordebtvehicles

Organizational structure Organizational structure• JointWorldBank–IFCproject(locatedinInvestmentClimateAdvisoryServicesdepartment) • Hub-and-spokeorganizationalstructurewithacentralmanagementunitlocatedinahost• HeadquartersinNairobiwithadditionalstaffinWashingtonandDakar organizationinEuropeortheUnitedStates • Activitiescontractedouttoexpertsandimplementingpartners • Strongfieldpresenceindevelopingcountries;couldinitiallyexploreoneortworegionalhubs• ActiveinAfricaonly;hasreceivedrequestsfortechnicalassistancefromotherregions dependingoncountrydemand

Governance Governance • GovernedunderWorldBankandIFCstructures;theformationofanadvisoryboardisnow • Acouncilwilloverseetheadvisoryfacility’smanagementandoperations Thecouncilwill underdiscussion compriserepresentativesfromcontributingdonorsandthehostinstitution • Multipleregionaltechnicaladvisoryboardswillberesponsibleforprovidingstrategicadvice andtechnicaldirection • Amanagementteamwillberesponsiblefortheadvisoryfacility’sdailyoperationsand financialmanagement


Table 2. Analysis of the HIA Initiative and the Global Advisory Facility

HealthinAfricainitiative Advisoryfacility(proposed)

Vision/Mission VisionHIA’smissionistoincreaseaccesstoqualityhealthservicesandproductsinAfricaandtoimprove Helpingimprovethehealthofpeopleindevelopingcountriesbystrengtheninghealthsystemsfinancialprotectionagainsttheimpoverishingeffectsofillnessesbyengagingtheprivatehealth throughbetterintegrationoftheprivatehealthsector sector HIAfocusesonunderservedpopulationgroups Mission Strengtheninginteresteddeveloping-countrygovernments’capacitytoworkwiththeprivate healthsector

Purpose Purpose• Policyandanalytics:toimproveknowledge,informdecisions,andbenchmarkperformance • Knowledgebrokerage:assembleinformation,toolsandmethodologies,andgoodandbad Outputsincludeflagshipreports,countryassessments,thematicstudies,shortpolicybriefsand practicesonstrategiesfordeveloping-countrygovernmentstotapthefullpotentialofpublic- technicalarticles,andpolicymakertoolkits privatepartnerships • Technicalassistance:countryassessmentsinfourcountriesandearlyprivate-sectorprojectsin • Changeagent:promoteinclusionoftheprivatesectorinhealthbyfosteringdialogue GhanatoaccreditprivateprovidersandinNigeriatoimplementNationalHealthInsurance betweenthepublicandprivatesectors SchemeITandreformbusinesspractices • Strategicsectoranalysis:identifyopportunitiestoexpandtheprivatesector’scontribution• Equityvehicle:multipleinvestors(IFC,DEG,GatesFoundation) FundwillbemanagedbyAureos tohealth-sectorgoalsandstrategiestoaddressproblems(forexample,poorquality);develop BasictermsincludehavinginitialfundsavailablerangingfromUS$100milliontoUS$120million strategicplanswithgovernmentstoaccelerateprogresstowardhigh-prioritygoals(for Expecttoinvestin25–30projectsfromaroundUS$50,000toUS$5million Investmentsfocused example,healthservicesaccessforthepoorandunderserved;reducematernalmortality)via onlower-incomepopulation privatesectorengagement • Debtvehicle:HIAcurrentlyhasapipelineofUS$100millionwithatargetofUS$500million • Technicalassistanceandimplementationsupport:provideexpertiseandbuilddeveloping- overfiveyears,withEco-Bankidentifiedasapartnerfortheregionalfinancial-marketsprogram countrygovernmentcapacitytodesignsustainableprivate-sectorengagementstrategies andGhanaandBurkinaFasoaspotentialcountries Ghana,Nigeria,Tanzania,andZambiaare thatimprovehealthoutcomesandworkwithdevelopingcountrygovernmentstoimplement first-phasecountries specificpoliciesandregulatoryandinstitutionalreforms,andsupporttheimplementationof engagementstrategies • Doesnothaveequityordebtvehicles

Organizational structure Organizational structure• JointWorldBank–IFCproject(locatedinInvestmentClimateAdvisoryServicesdepartment) • Hub-and-spokeorganizationalstructurewithacentralmanagementunitlocatedinahost• HeadquartersinNairobiwithadditionalstaffinWashingtonandDakar organizationinEuropeortheUnitedStates • Activitiescontractedouttoexpertsandimplementingpartners • Strongfieldpresenceindevelopingcountries;couldinitiallyexploreoneortworegionalhubs• ActiveinAfricaonly;hasreceivedrequestsfortechnicalassistancefromotherregions dependingoncountrydemand

Governance Governance • GovernedunderWorldBankandIFCstructures;theformationofanadvisoryboardisnow • Acouncilwilloverseetheadvisoryfacility’smanagementandoperations Thecouncilwill underdiscussion compriserepresentativesfromcontributingdonorsandthehostinstitution • Multipleregionaltechnicaladvisoryboardswillberesponsibleforprovidingstrategicadvice andtechnicaldirection • Amanagementteamwillberesponsiblefortheadvisoryfacility’sdailyoperationsand financialmanagement


Going Global

OncetheWorldBank–IFChasagreedtoadvancetheefforttoestablishaglobaladvisory facility from the base of the existing HIA initiative, the followingprocesstoestablishandlaunchtheglobalfacilityshouldbeundertaken:

1. Develop a strategy and plan to go global.AcoreteamwillneedtobeassignedtoplanandmanagetheincrementalexpansionofHIAtogoglobalsothattheadvisoryfacilitycanbelaunched Thestrategywilladdresshowtocompleteseveralnecessarytasks, includingcreatinga global advisory facility organizational structure that responds totheworkinggroup’srecommendationsyetfitsintobothHIAandtheWorldBank–IFCstructure;mobilizingcountrydemandforthefacility;determining the terms of reference andstaffingplan for the globalfacility’s management unit; establishing and convening the councilandtheinitialtechnicaladvisoryboard;andidentifyingsomeoftheinitialtechnicalandsupportactivities Thecoreteamshouldconveneasmallgroupofexpertstoprovideinputandguidethedevelopmentofthisstrategy

2. Secure additional donor funding.Considerableinterestexistsamongpotentialdonorstoprovideinitialfundingtoestablishaglobaladvi-soryfacility AfterBankGroupapprovalwillbeanopportunetimetorestartdiscussionswith thesepotential funders tosecureadequatefundingtostarttheglobaladvisoryfacilityoperationsinoneortworegions, depending on demand The working group members couldplayaleadershiprolebypromotingthefacilitywithpotentialfunderswhenhelpful

3. Promote the global facility. Keytotheglobalfacility’ssuccesswillbethelevelofinterestinanddemandforitsservices Initially, thecoreteamwillneedtodedicatetimeandefforttoincreasingawarenessofthe global facility and promoting its services to developing-countrygovernments Workinggroupmemberswillalsoplayaroleingener-atingawarenessanddemandforsupportthroughtheirnetworksofcontactswithdeveloping-countrycounterparts

If There Is No World Bank Approval

Thereisnoguaranteethattheworkinggroup’srecommendationstoestablishanadvisoryfacilityintheWorldBankGroupwillbeimplemented IftheideaofgrowingandadaptingHIAasoutlinedaboveisrejected,itwillprovetobea major setback to the growing number of developing countries that haveexpressedaninterestinandarereadytocollaboratewiththeprivatehealthsector Thesegovernmentswilllosetimeastheystruggletofindaninstitutionor donor that could respond to their technical assistance needs in a timely

21

fashion;theywillmissopportunitiesandpotentialsolutionstosomeoftheirpressinghealthchallenges

If this situation arises, the working group will have to reconvene and reex-amineotherpotentialhost institutions Aprocessofsolicitingproposals forhostingcouldpotentiallybelaunchedatthattime

Conclusion

Workinggroupmembersconcluded theireffortswithasharedsenseof theimportanceofestablishinganadvisory facilityasoutlinedhere Supportingsuchafacilitycouldhelpdevelopingcountriesuseallavailableresources tomeettheirhealth-sectorgoals Indeed,inmanycountries,suchsupportmaymakethedifferencebetweensuccessandfailureofcriticaleffortstoreducematernal and child mortality and to bring infectious diseases like AIDS,malaria,andtuberculosisundercontrol Workinggroupmembersconfirmedtheir commitment to using the momentum created by the CGD workinggroup to establish some means of providing this much-needed support todevelopingcountries


References and Other Resources

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Bennett,S ,K Hanson,P Kadama,andD Montagu 2005 “WorkingwiththeNon-StateSectortoAchievePublicHealthGoals ”MakingHealthSystemsWorkSeriesWorkingPaperNo 2,WorldHealthOrganization,Geneva

Boone,P ,andZ Zhan 2006 “LoweringChildMortalityinPoorCountries:ThePowerofKnowledgeableParents ”CenterforEconomicPerformanceDiscussionPaperNo 751,CenterforEconomicPerformance,LondonSchoolofEconomics

Brugha,R ,andA Zwi 1998 “ImprovingtheQualityofPrivate-SectorDeliveryofPublicHealthServices:ChallengesandStrategies ”HealthPolicyandPlanning13:107–20

Bustreo,F ,A Harding,andH Axelson 2003 “CanDevelopingCountriesAchieveAdequateImprovementsinChildHealthOutcomeswithoutEngagingthePrivateSector?”BulletinoftheWorldHealthOrganization81:886–95

DFID(DepartmentforInternationalDevelopment) 2009 “OpenSpaceConferenceonMaternalandSexualandReproductiveHealthandRights ”ReportoftheOpenSpaceSessionoftheConferenceonMaternalandSexualandReproductiveRights,theRoyalCollegeofObstetriciansandGynaecologists,RegentsPark,London,January12,2009

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Floyd,K ,V K Arora,K J R Murthy,K Lonnroth,N Singla,Y Akbar,M Zignol,andM Uplekar 2006 “CostandCost-EffectivenessofPPM-DOTSforTuberculosisControl:EvidencefromIndia ”BulletinoftheWorldHealthOrganization84(6):487

GlobalHealthForecastingWorkingGroup 2007 ARiskyBusiness:SavingMoneyandImprovingGlobalHealththroughBetterDemandForecasts ReportoftheGlobalHealthForecastingWorkingGroup,chairedbyRuthLevine Washington,D C :CenterforGlobalDevelopment

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Salim,M A H ,M Uplekar,P Daru,M Aung,E Declercq,andK Lonnroth 2006 “TurningLiabilitiesintoResources:InformalVillageDoctorsandTuberculosisControlinBangladesh ”BulletinoftheWorldHealthOrganization84(6):425–504


Sulzbach,S ,W Wang,andB O’Hanlon 2009 “AssessingtheRoleofthePrivateHealthSectorinHIV/AIDSServiceinEthiopia ”TechnicalReportNo 11,PSP-One,Bethesda,MD

SulzbachS ,W Wang,andS De 2009 “ExaminingtheRoleofthePrivateSectorinHIVPreventionandTreatment:FocusingonFinancingandUtilization ”HIV/AIDSResearchBrief,PSP-One,Bethesda,MD

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http://www.who.int/workforcealliance/about/task

25

Annex A: Working Group Members

• DaniellaBallou-Aares,Partner,DalbergGlobalDevelopmentAdvisors

• JamesCercone,President,SanigestInternacional,CostaRica

• ScottFeatherston,InvestmentOfficer,HealthandEducationDepartment,InternationalFinanceCorporation

• ArnabGhatak,Partner,Non-profitpractice,McKinsey

• GargeeGhosh,SeniorProgramOfficer,Bill&MelindaGatesFoundation

• AprilHarding(chair),VisitingFellow,CenterforGlobalDevelopment

• IshratHusain,SeniorAdvisor,AfricaBureau,U S AgencyforInternationalDevelopment

• BarryKistnasamy,ExecutiveDirector,NationalInstituteforOccupationalHealth,SouthAfrica

• Ruth Levine, Vice President for Programs and Operations and SeniorFellow,CenterforGlobalDevelopment

• DominicMontagu,GlobalHealthGroupLead,UniversityofCalifornia–SanFrancisco

• StefanNachuk,AssociateDirector,RockefellerFoundation

• BarbaraO’Hanlon(projectconsultantandfacilitator),SeniorPolicyAdviser,PSP-OneProject

• MalcolmPautz,InfrastructureProjectFinanceDivision,NedbankCapital,SouthAfrica

• AlexPreker,LeadEconomist,AfricaRegion,WorldBank

• JulianSchweitzer,Director,Health,NutritionandPopulation,WorldBank

• GuyStallworthy,SeniorProgramOfficer,Bill&MelindaGatesFoundation

• Hope Sukin, Public Health Director, Africa Bureau, U S Agency forInternationalDevelopment

• JurrienToonen,SeniorAdvisor,RoyalTropicalInstitute,theNetherlands


• GerverTorres,SeniorScientist,GallupInternational

• JimTulloch,PrincipalHealthAdvisor,AustralianAgencyforInternationalDevelopment(AusAID)

• JuanPabloUribe,ExecutiveDirector,FundaciónSantaFe,Colombia

• Workinggroupstaff:DanielleKuczynski,ProgramCoordinator,CenterforGlobalDevelopment

Institutional affiliations are listed for informational purposes; membersparticipatedintheirindividualcapacities

Daniella Ballou-Aares leads Dalberg’s Health Practice and the firm’s NewYork office Ballou-Aares has spent more than 10 years as a managementadvisoringlobaldevelopment,designinginnovativeinitiativesandfinancingmechanismsandadvisingorganizationsonstrategicpositioningandorgani-zationalchangeefforts Ballou-Aareshasuniqueexpertiseinthehealthandagricultural development sectors, with a particular emphasis on improvingfinancing structures and supply chains in Africa Ballou-Aares has recentlysupported the development of several financing mechanisms in the healthsector, including the Affordable Medicines Facility for malaria (AMFm) andthe Pledge Guarantee for Health Ballou-Aares’s clients include multilateralorganizations,foundations,NGOs,andcompaniesactiveindevelopingcoun-tries BeforeDalberg,Ballou-AaresworkedforBain&CompanyintheUnitedStates,theUnitedKingdom,andSouthAfrica Ballou-Aareswasalsoafellowwith the International Rescue Committee in Liberia and is a term memberat the Council on Foreign Relations Ballou-Aares has an MBA from HarvardBusinessSchool,anMPAfromtheKennedySchoolofGovernment,andaBSinOperationsResearchfromCornellUniversity

James Cercone is an economist and president of Sanigest Internacional, ahealthcaremanagementandconsultingcompanywithofficesinCostaRica,the United States, and Europe Cercone developed his interests in healtheconomics and health reform through engagements with the World Bank(from 1990 to 1994) and the government of Costa Rica (from 1994 to 1997) Cerconehasmorethan16years’experienceinthehealthsector,withparticularemphasis in Latin America and transition countries He is currently servingontheboardofdirectorsoftheLatinAmericaAssociationofPre-PaidHealthInsurancePlans(ALAMI) Cercone’sexperiencecoversmorethan40countrieswithabroademphasis Hehasworkedextensivelyonthedesign,implemen-tation, and evaluation of projects for the World Bank, the Inter-AmericanDevelopmentBank,theInternationalLabourOrganisation,andotherdevelop-mentorganizations Inthepastfiveyears,Cerconehasalsobeeninvolvedinthestart-upofseveralventurecapitalfundsfocusingonhealth-sectorinvestmentsandhasprovidedinvestmentadviceforclientsaroundtheworld


Scott Featherston isaninvestmentofficerat the IFC’sHealthandEducationdepartment,wherehefocusesprincipallyonAfricaandSouthAsia Featherstonled the IFC’s recent work on health in Africa, including the report “TheBusiness of Health in Africa: Partnering with the Private Sector to ImprovePeople’sLives ”FeatherstonhaspostgraduatedegreesfromtheuniversitiesofMelbourneandSydneyinAustraliaandfromJohnsHopkinsUniversityintheUnitedStates Helecturespart-timeattheJohnsHopkinsSchoolofAdvancedInternationalStudiesinWashington,D C

Arnab Ghatak isaprincipalintheNewJerseyofficeofMcKinsey&Company He first joined the firm in 2000 with a degree in molecular biology fromPrinceton University, an MD from the University of Pennsylvania MedicalSchool,andanMBAfromtheWhartonSchool,wherehemajoredinhealthcare Since joining McKinsey, Ghatak has worked in the nonprofit andfor-profit health arenas In the nonprofit sphere, Ghatak has extensiveexperience with large multilateral technical institutions, governmentaldepartments, and stand-alone NGOs In the private sector, he has focusedon business development and strategy for pharmaceutical, biotech, andmedicaldevicecompanies GhatakwasapastfellowinMcKinsey’sNon-ProfitPractice,specializinginglobalpublichealth Hisrecentworkincludesstra-tegicdesignforaleadingglobalinstitutiontosupportthedevelopmentofhealthcareinsub-SaharanAfricathroughfinancinginvestments;strategicdesignandimplementationsupportforcreationofanewmultilateralfundfocused on lowering drug prices and improving access in specific nichesacross HIV, tuberculosis, and malaria initiatives; and innovative strategicplanning for key departments within a large multilateral technical publichealthinstitution

Gargee Ghosh is a senior program officer at the Bill & Melinda GatesFoundation She manages the foundation’s portfolio of work in innovativefinancingfordevelopment,creatingnewandeffectivefundingmechanismsto channel resources to health and development In that capacity, and inher prior role at Gates in the Global Health Program, she has been involvedin establishing the International Finance Facility for Immunization of theGlobalAllianceforVaccinesandImmunization,designingtheAdvanceMarketCommitmentconcept,supportingthepilotofaGlobalFundDebtConversioninitiative,and,mostrecently, launchingadouble-bottom-lineprivateequityfundfor investment inhealthcare for thepoor inAfrica Before joining theBill & Melinda Gates Foundation, Ghosh was a consultant with McKinsey& Company in New York and London working on health care and financialservicesprojects ShewasoneofthefirstemployeesoftheCenterforGlobalDevelopment’s Global Health Policy Research Network, where she manageda portfolio of work on incentive mechanisms to stimulate product develop-ment GhoshhasgraduatedegreesineconomicsfromtheUniversityofOxfordand in international relations from the Georgetown University School ofForeignService


April Harding (chair) is an economist and health-systems specialist whojoined the Center for Global Development from the Human Developmentdepartment in the Latin America and Caribbean region of theWorld Bank Forthepreviouseightyears,sheledtheBank’sworkrelatedtopublicpolicyin the private health sector Harding also has done extensive research andoperationalworkrelatedtohospitalreformandgovernanceofhealthservicesindevelopingandtransitioncountries Beforesheshiftedherfocustohealthsystems, Harding worked for seven years on private-sector development intransition economies This work included providing advice and technicalassistancetogovernmentsinmorethan13countries BeforejoiningtheWorldBank, Harding was a research fellow in economic studies at the BrookingsInstitution Harding is writing a book on how the most important globalhealthprograms(forexample,programsrelatedtomalaria,tuberculosis,andchild health) can be improved by increasing the private-sector contributionto program goals Harding holds a doctoral degree from the University ofPennsylvaniaandhaspublishedwidelyonhealthpolicyandhealthsystemsindevelopingcountries Sheistheco-editoroftwobooks,PrivateParticipationinHealthServices(WorldBank2004)andInnovationsinHealthServiceDelivery:TheCorporatizationofPublicHospitals(WorldBank2003)

Ishrat Z. Husain isaneconomistworkingwiththeU S AgencyforInternationalDevelopment(USAID)assenioradvisorinpublichealthintheAfricaBureau She is responsible for theReproductiveHealth,HumanCapacityandHealthSystems programs and specializes in multisectoral approaches to HIV/AIDSand health as well as in private-public partnership She organized the firstroundtablewiththeprivatesectoronHIV/AIDSforUSAIDinthelate1990sandhasbeenhelpingmobilizetheprivatesectorforHIV/AIDSandhealththroughhighly successful health sessions at the African Growth and OpportunitiesAct forum organized by the U S Department of State Most recently, sheorganized the session on Private Investment Opportunities in Health andpreparedapaperonbusinessmodelsinhealth Shewasalsoresponsibleforhelping the USAID missions in Nigeria and East Africa to develop private-public partnerships in health Before joining USAID, Husain worked at theWorldBank,startingin1970,intechnicalandmanagerialcapacities,includingthe management of multi-million-dollar population, health, and povertyoperations ShehasadoctorateineconomicsfromIndiaandhadpostdoctoraltrainingatPrincetonUniversity

Barry Kistnasamy is currently the executive director of the NationalInstitute for Occupational Health in South Africa He has 20 years’experienceinpublichealthpolicyandpracticewithinSouthAfricaandinter-nationally He spent 10 years as a senior manager in the public health andhighereducationsectors Healsohasinsightandknowledgeofthenongov-ernmentalandprivate,for-profithealthsectorsinSouthAfrica Hisexperienceencompasses strategic and operational planning, providing advice at apoliticalandtechnicallevel,andthetranslationofpolicyintoaction Hehas


worked with bilateral and multilateral agencies in South Africa and abroad(especiallywithinAfrica)andalsoispartofanextensivenationalandinterna-tionalhealthnetworkthroughthepublichealthacademiccommunity Hehasanactiveinterestinandisprovidingsupportforpublic-privateinteractionsinthehealthsectoraswellastheprovisionoftraininginhospitalmanage-ment Heisaspecialistinpublichealthmedicineandhashadfurthertrainingin health economics (York University–UK), occupational and environmentalhealth(UniversityofMichigan),andhealthleadership(Cambridge)

Danielle Kuczynski (program coordinator) joined the Center for GlobalDevelopment in September 2007 Before joining CGD, Kuczynski worked inTanzaniawiththeUniversityofToronto’sHIV/AIDSInitiative–Africaasaknowl-edgenetworkofficer Inadditiontootheroverseasexperience,herworkinthepublic sector includes a 2006 policy analyst post with the Ontario Ministryof Health Promotion In 2005, Kuczynski completed an MS in internationalhealth policy at the London School of Economics and Political Science, whereshewroteherdissertationonperceivedbarrierstoantiretroviraladherenceinSouthAfrica Additionally, sheholdsaBSwithhonors inpsychologyfrom theUniversityofWesternOntario

Ruth Levine is a health economist with more than 15 years’ experienceworkingonhealthandfamilyplanningfinancingissuesinEastAfrica,LatinAmerica,theMiddleEast,andSouthAsia BeforejoiningCGD,Levinedesigned,supervised, and evaluated health-sector loans at the World Bank and theInter-American Development Bank From 1997 to 1999 she served as theadviseronthesocialsectorsintheofficeoftheexecutivevicepresidentoftheInter-AmericanDevelopmentBank LevineholdsadoctoraldegreefromJohnsHopkinsUniversity,haspublishedonhealthandfamilyplanningtopics,andistheauthororco-authorofseveralbooksandreports,mostrecentlyStartwithaGirl:ANewAgendaforGlobalHealth(CGD2009),PerformanceIncentivesforGlobal Health: Potential and Pitfalls (CGD 2009), and Millions Saved: ProvenSuccessesinGlobalHealth(CGD2004),whichhasbeenontherequiredreadinglistatmorethan33schoolsanduniversitiesintheUnitedStatesandabroad

Dominic Montagu isanassistantprofessorofepidemiologyandbiostatisticsand lead of the Health Systems Initiative at the Global Health Group of theUniversityofCalifornia–SanFrancisco Hisworkisfocusedonprivatedeliveryofhealthservicesindevelopingcountriesandonmarketfunctionforhealthservices and health commodities He holds master’s degrees in businessadministrationandpublichealthandadoctorate inpublichealthfrom theUniversity of California–Berkeley He has worked extensively in Africa andAsia,primarilyinVietnam,wherehewasthecountrydirectorfortheAmericanFriendsServiceCommitteeandcountryadviserforthePopulationCouncil

Stefan Nachuk hasbeenanassociatedirectorwiththeRockefellerFoundationsinceFebruary2007 Inthisrole,heconcentratesondevelopinganinitiativeto


transformhealthsystemsglobally,withspecificcomponentsfocusedonstra-tegiccapacitybuilding,leveragingtheprivatesector,anddevelopingeHealthplatforms Thisworkcentersonsupportingasmallnumberofcountries,andonsettingaglobalagenda Inaddition,Nachukalsoparticipatesinaclimatechange adaptation initiative, with a special focus on developing modelsof climate resilience in selected cities within Thailand, India, Vietnam, andIndonesia Before joiningRockefeller,Nachuk livedandworked inSoutheastAsiaforapproximately14years,withabroadfocusondecentralization,gover-nance,andsocialdevelopment NachukwasaseniorpolicyspecialistwiththeWorldBankinIndonesiafrom2003through2006

Barbara O’Hanlon (facilitator) isarecognized leader in internationalhealthpolicy and implementation with over 24 years’ experience providing policy-related technical assistance in 26 countries spanning Latin America, theMiddleEast,Africa,andtheformerSovietUnion Inthelastsevenyears,herworkhasfocusedonmobilizingsupportforpartneringwiththeprivatehealthsector O’Hanlon’spolicyexpertisefocusesonanalysistosupportpolicydesignandevidence-baseddecisionmaking,advocacy,andstrategiccommunicationto create favorable policy environments for key health issues; participatoryandstrategicplanningtoimplementhealthpoliciesatnationalandregionallevels; and legal and regulatory analysis to identify policy constraints toservice implementation O’Hanlon has over nine years’ experience in seniormanagementasavicepresidentanddeputydirectorfortwoUSAID-fundedprojects After15yearsofincreasingtechnicalandmanagementresponsibility,O’Hanlonformedherowncompanytoprovidestate-of-the-arttechnicalassis-tanceinhealthpolicyandmanagement O’HanlontrainedatUC–BerkeleyinpoliticalscienceandHarvard’sKennedySchoolforPublicPolicy

Malcolm Pautz is currently with the Infrastructure Project Finance DivisionofNedbankCapital inSouthAfrica Before joiningNedbank,hewasaseniorprojectadvisorintheMinistryofFinancePublic-PrivatePartnership(PPP)Unitin South Africa and was involved in the development and implementationofmanyhealthcarePPPs Hewastheseniorprojectadvisorfortheplanninganddevelopmentof theChrisHaniBaragwanathHospitalRevitalizationPPPproject Pautz has been asked to provide strategic input and comments byvarious organizations and parties involved in improving health outcomes indeveloping countries Pautz has made a number of presentations to healthcareinsuranceproviders,hospitalmanagementservices,andpharmaceuticalcompaniesonprojectsinvolvingpublic-privatepartnershipsandinteractions Pautz iscurrentlypartofa technicaladvicesubcommitteefor theCentreforDevelopmentandEnterprise (CDE),based inSouthAfrica, foraproject titledCDEProjectonHealthPolicyinSouthAfricaandtheRoleofthePrivateSector;heisinvolved,throughhispresentemployer,inthefinancingandadvancementof social infrastructure, both locally in South Africa and throughout Africa PautzisalsoanexecutiveboardmemberfortheSouthAfricanInstitutionofCivilEngineeringandischairmanoftheirProjectManagementDivision


Alexander S. Preker is the head of health investment policy and lead econo-mist with the Investment Climate and Investment Generation department ofthe World Bank Group Preker coordinated the team that prepared the WorldBank’s Sector Strategy for Health, Nutrition, and Population in 1997 Whileseconded to theWorld Health Organization (WHO) during 1999–2000, he wasoneoftheco-authorsoftheWorldHealthReport2000,HealthSystems:MeasuringPerformance,andsubsequentlyservedasamemberofWorkingGroup3oftheWHOCommissiononMacroeconomicsandHealthin2001 IncollaborationwithUNICEF, the International Labor Organization, and several bilateral donors, herecentlyhelpedtheWHOregionalofficeinBrazzavilleprepareahealthfinancingstrategyfortheAfricaRegionandwasontherecentGlobalTaskForceonScalingUpEducationandTrainingforHealthWorkers PrekerhaspublishedextensivelyandisamemberoftheeditorialcommitteefortheWorldBank’sexternaloperationspublicationdepartment HeisadjunctassociateprofessorintheDepartmentofHealthPolicy&ManagementatColumbiaUniversityandtheWagnerSchoolofPublicPolicyatNewYorkUniversity HeisamemberoftheteachingfacultyatUC–BerkeleyandontheexternaladvisoryboardfortheLondonSchoolofEconomicsHealthGroup HistrainingincludesaPhDineconomicsfromtheLondonSchoolofEconomicsandPoliticalScience,afellowshipinmedicinefromUniversityCollegeLondon,adiplomainmedicallawandethicsfromKing’sCollegeLondon,andanMDfromUniversityofBritishColumbia/McGill

Julian Schweitzer isthedirectoroftheHealth,Nutrition,andPopulationdepart-mentoftheWorldBank Immediatelypriortohiscurrentappointment,SchweitzerwasthedirectorofthehumandevelopmentsectorintheSouthAsiaRegionoftheWorldBank DuringhiscareerintheBank,hehasalsoworkedintheMiddleEast and North Africa, Latin America, and the transition economies of Europe,managing operations in health, education, and social protection He has alsoworkedastheoperationsdirectorintheBank’sEastAsiaandPacificregionandastheBank’scountrydirectorbasedintheRussianFederation WhileworkingintheSouthAsiaRegion,hefocusedondevelopingsector-wideapproachestomobi-lizingexternalfinancingeffectivelyinsupportofasingle-countryhealthstrategy SchweitzerrestructuredandstrengthenedtheBank’sregionalHIV/AIDSengage-ment with clients and external partners while also strengthening the Bank’sadvisoryandfinancialrole Hehasextensiveoperationalandmanagementexpe-rience with health and development issues in different parts of the world Hishealthsectorinterestsincludehealthfinanceandhealth-systemstrengthening BeforejoiningtheBank,SchweitzerworkedinthepublicandprivatesectorsintheUnitedKingdomandIndia HeholdsaPhDfromtheUniversityofLondonandhasauthorednumerousarticlesandessaysoneconomicandhumandevelopment

Guy Stallworthy is senior program officer of strategic business planning attheBill&MelindaGatesFoundation Stallworthycametothefoundationwith25years’experienceinavarietyofhealthanddevelopmentprogramrolesintheNGOsector HejoinedthefoundationinJanuary2007afterworkingfor11yearsinsocialmarketingwithPopulationServicesInternational(PSI);during


this time he spent five years as country director of the Burma/Myanmarprogram Stallworthy has dedicated a large part of his career to developingandapplying innovativestrategies thatengage theprivatesector todeliverhigh-qualityandpro-poorhealthservicesindevelopingcountries,especiallyfor HIV/AIDS, malaria, tuberculosis, and family planning As an executivedirectorforPSI-Europe,StallworthydirectedspecialprojectsforUNAIDSandRollBackMalariainadditiontoleadingPSI’sengagementintheMicrobicideDevelopment Program funded by the UK Department for InternationalDevelopmentandorganization-wideinitiativesonsustainabilityandpoverty-focusedprogramming Stallworthyhasprofessionalexperienceinmorethan25 countries in Africa, Asia, and Latin America, including long-term assign-ments in Bangladesh, Chad, the Dominican Republic, Bolivia, and Burma/Myanmar Stallworthy holds a master’s of health sciences and a master’s ininternationalaffairsandeconomicsfromJohnsHopkinsUniversity

Hope Sukin is the senior health advisor for the Africa Bureau of USAID andleads the Africa Bureau Health Team She provides strategic and technicalguidance to the 25 USAID missions in Africa that manage and implementhealth programs Her technical specialties include nutrition, maternal andchildhealth,HIV/AIDS,andhealth-systemstrengthening ShealsorepresentsUSAIDasoneofthedeputyprincipalstothePresident’sEmergencyPlanforAIDS Relief She has directly provided technical support to countries acrossAfrica includingBenin,Ethiopia,Ghana,Guinea,Mali,Malawi,Mozambique,Nigeria,Senegal,Tanzania,Zambia,Zimbabwe,andothers SukinhasanMPHfromtheUniversityofMichiganandaBAfromtheUniversityofPennsylvania She received the Mike White Memorial Award in 1996 for developing newprogramsandpartnershipstoimprovehealthcareinAfrica

Jurrien Toonen is a public health specialist focusing on health-systemdevelopment, institutional development, health reforms, aid effectiveness,service-deliverymodels,healthfinancing,andmonitoringandevaluation Hehas25years’experienceinpublichealthattheinterfacebetweenpolicydevel-opmentandimplementation HeiscoordinatorofthehealthsystemgroupintheRoyalTropicalInstitute(KITinAmsterdam) Beforethis,heheldlong-termpositionsinBolivia(fiveyears)foranNGOattheoperationallevel,andinMali(four years) supporting the public sector at the intermediate level For fouryears,hehasbeentheteamleaderforKIT’ssupporttoaprivate-sectororga-nization inBangladeshandvicechairof the task forceof theDutchprivatemedical equipment industry for overseas development assistance He hasexperienceinhealthinsuranceandhasparticipatedinvariousevaluationsofprivate-sectorinterventions HeisnowbasedinAccra,Ghana

Gerver Torres works for the Gallup Organization developing a new product,theWorldPoll HismainfocusisinLatinAmerica HeisadirectorofLeadershipandVision,anNGOestablishedin1995toenhanceandpromotebetterlead-ership in Latin America He has been a consultant for the World Bank, the


Inter-American Development Bank, the Latin American Economic System,and the United Nations on different economic and social issues includingprivate-sectorparticipationinthesocialsectors HeservedasdirectoroftheInternational Monetary Fund representing Spain, Mexico, Central America,and República Bolivariana de Venezuela He has served as minister of theVenezuelan Investment Fund, professor of economics at the UniversidadCentraldeVenezuela,andeditorofElDiariodeCaracas,anationaldailynews-paperinVenezuela Hehaspublishedseveralbooksandmanydifferentarticleson economic and social topics including, Un sueño para Venezuela (2000);Municipal Privatization (World Bank 1998);“TheThirdWave of Privatization:Privatization of Social Services in Developing Countries,” (World Bank 1996);¿Quiénesganan?¿Quiénespierden?LaprivatizaciónenVenezuela(1994)

Jim Tulloch, ofAdelaideUniversity,hasworkedondeveloping-countryhealthfor more than 30 years in more than 50 countries, including Bangladesh(1975–77)inmaternalandchildhealthclinicsandlaterthesmallpoxeradica-tionprogram;PapuaNewGuinea(1981–82) inmalariaresearch;Timor-Leste(2000–01)asheadofthehealthsectorintheUNTransitionalAdministrationandmanagerofamultidonorWorldBank–administeredhealthproject;andCambodia(2002–05)astheWHOCountryRepresentative From1990to1999,hewasdirectorofdiarrhoealandacuterespiratorydiseasecontrolandthendirectorofchildandadolescenthealthanddevelopmentatWHOheadquar-tersandoversawthedevelopmentoftheWHO/UNICEFstrategyforintegratedmanagementofchildhoodillness Since2005hehasbeentheprincipalhealthadvisorattheAustralianAgencyforInternationalDevelopment

Juan Pablo Uribe wastheexecutivedirectorofFundaciónSantaFedeBogotáinBogotá,Colombia,whileparticipatingintheworkinggroup 5Healsoheldthe position of corporate manager director at the same organization HisotherexperienceinColombiaincludesservingasviceministerofhealthforthe Colombian Ministry of Health from 1998 to 1999, national director ofpublichealthattheministryin1994,andtechnicalcoordinatorandheadofthe health arena for the Fundación Corona–Bogotá, Colombia, from 1995 to1998andfrom1999to2000 Uribewasalsoanassistantprofessorofpreven-tive medicine at Pontificia Universidad Javeriana Medical School–Bogotá,Colombia, from 1994 to 2000 Uribe holds a medical degree from PontificiaUniversidadJaverianaandmaster’sdegreesinbothpublichealthandpublicadministrationfromtheUniversityofMichigan Uribeisaboardmemberforvariousorganizations,bothpublicandprivate,andaconsultantandexpertinvitedtospeaknationallyandinternationally

5 In June 2009, Uribe began a new position as sector manager for health, nutrition and population at the World Bank.

34

Annex B: Key Concepts for a Private-Sector Advisory Facility

Eachof theworkinggroupmembersbroughtadifferentperspectiveon theprivate health sector Given the diverse composition of its members, theworking group began its task by defining important concepts to reach acommonstartingpointindesigninganeffectivefacility

Definition of the private sector

Asinanydeliberationontheroleoftheprivatesectorinhealth,theworkinggroup members used their common understanding to develop a workingdefinitionoftheprivatesector Initially,theworkinggroupmembersfocusedonindividualsandorganizationsoperatinginthehealthsectoranddrewonotherexamples TheIFC’snewHealthinAfricainitiative,forinstance,isalsoconcerned with investment opportunities for the private health sector andthereforeworkswithnon-health-relatedentities,includingbanksandinsur-ance companies Taking into account this broader scope, the working groupexpandeditsdefinitiontoalsoincludetheseimportantstakeholders “Privatesectorinhealth”isthetermthattheworkinggroupdecidedtousetodescribethisdiversegroupofstakeholders

Operational definition of technical assistance

Another key concept was technical assistance The donors, as well as theconsultinggroupswhocontractandprovidetechnicalassistance,haddifferentideasaboutwhattechnicalassistanceis Asagroup,themembersreachedacommonunderstandingofthisterm(seebox7)

Description of the facility’s clients

The principal clients will be developing-country governments But whileministries of health are clear and natural partners, group members agreedthatfocusingonthemwouldbetoolimited Infact,therearecasesinwhichother public-sector agencies, such as ministries of planning and ministriesof finance, are equally involved in engaging the private sector in health Consequently, theclientcategorywasexpandedtoincludeawiderrangeof

Box 7. What Is Technical Assistance?

Advisory and consulting services spanning from policy design to implementation; includes strategic thinking, problem solving, and knowledge sharing.


governmentagencies Initially,thefacilitywillfocusondevelopingcountrieswhere there is a strong interest in working with the private sector and agreaterlikelihoodofimpact(box8)

Additionally,theworkinggroupmembersdiscussedwhethertoincludeotherstakeholders Althoughthefacility’sfocuswillbehowtoworkwiththeprivatesector, the working group members decided that the private sector shouldparticipate in, but not be the focus of, the facility’s activities—for example,the private sector should be involved in public-private dialogue, but not bethe“client ”

Box 8. Who Is the Client?

Appropriate government ministries or agencies in countries eligible for assistance are those classified as developing and transition countries by the Development Assistance Committee of the Organisation for Economic Co-operation and Development.

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Annex C: Discussion and Design of Key Components for a Global Private Sector Advisory Facility

The working group members identified four core roles for the facility byexamining the range of activities that it will perform: (1) knowledge broker,(2)changeagent,(3)strategicadviser,and(4)technicalandimplementation-supportadviser(box9) Groupmembersagreedthatoneofthedistinguishingfeaturesofthefacilityshouldbetheintenttotransferthecapacitytoconductthesefourfunctionstolocalandregionalorganizations Asaresult,thefunc-tions below consider activities in anticipation of this eventual transfer ofcapacityandroles

1 Neutral knowledge broker Meeting participants acknowledged thatthis could be an enormous task and consume the facility staff Therefore, they agreed that all knowledge-brokering activities willbe limited to the topics and issues related to the technical areas ofstrategic advice offered to country clients The activities include thefollowing:

• Assemble existing information about working with the privatesector

• Encourageothergroupsbuildingevidenceandresearchtoincludetheprivatesector

• Includelessonsonbothsuccessesandfailuresaspartofknowl-edgebuilding

• Expandcollectionandanalysisofbasicinformationaboutprivate-sectoractivitiesincountries

• Developtoolsandmethodologies thatcanbeusedacrosscoun-triesandregions

• Develop training approaches that can be integrated into otherregionalorganizations’capacity,therebybuildinglocalorregionalorganizations’capacitytoassumestrategicadviceandtechnicalassistanceroles

• Integrate the private sector into other training and capacity-buildingactivities

2 Change agent There was discussion about whether being a changeagentisanappropriateroleforafacility However,mostagreedthat


given the deep-seated suspicion and mistrust toward the privatesector,thefacilitywillhavetoplaysomepromotionandadvocacyroletoraiseawarenessandfosterdialoguebetweenalltherelevantstake-holders Change-agentactivitieswillincludethefollowing:

• Advocate for inclusion of the private sector where relevant, byworkingwithboththepublicandprivatesectors

• Championandpromotethemainstreamingoftheprivatesector,potentiallythroughcreationofunitsorinstitutionsin-country

• Raiseawarenessoftherespectiverolesofthepublicandprivatesectorsinpartnershipsforhealth

3 Strategic adviser All group members consider strategic advisoryand technicalsupport (seebelow) tobe thefacility’score functions Activitieswillincludethefollowing:

• Conduct stakeholder analysis to identify all relevant actors,existingnetworks,andorganizations,andeffectivemechanismstobridgethetwoworldstogether

• Conductprivate-sectorassessmentstoidentifyopportunitiesforpublic-privatecollaborationtowardhigh-prioritysectorgoals

• Makerecommendationsontypesofpublic-privateengagement

• Identify key actors and suggest processes to initiate public-privatedialogue

Box 9. What Are the Functions of the Facility?

Knowledgebroker Assemble information, tools, and methodologies, and good and bad practices on strategies governments can use to tap the full potential of public-private partnerships. ChangeagentPromote inclusion of the private sector in health by fostering dialogue between the public and private sectors and raising awareness of the facility.StrategicadviceAnalyze public-sector strengths and private-sector capacity, framing strategies that will take full advantage of private-sector involvement and recommend actions to better integrate the private sector’s contribution.TechnicalassistanceandImplementationsupport Provide expertise and build a government’s capacity to design sustainable public-private partnerships that improve health outcomes. Work with governments to implement specific policies and regulatory and institutional reforms, and to support the design and start-up of public-private partnerships.


• Designframeworksandsystemsforpublic-privateinteraction

• Helptheprivatesectoralignwithpublic-sectorgoals

• Make matches between types of strategic advisers needed andexpertsavailabletocorrespondtotheneed

• Identifylocalandregionalcapacitytoassistwithstrategicadviceand implementation support and design strategies—such aspartnering with organizations to provide strategic advice ortraininginkeytechnicalareas—tobuildinstitutionalcapacity

4 Providerofimplementationsupportandtechnicalassistance Workinggroup members agreed on the need to partner with the facility’sclientstobuildtheclients’capacityinrelevantskillareasrequiredbydeveloping-country governments so they can effectively work withtheprivatesectorinhealth Additionally,theyagreedthatfacilitystaffwill provide technical assistance as the clients are learning how toimplementtherecommendationsofferedinthestrategicadvice Butallagreedthattechnicalassistancewillextendonlytoalimitedpoint,after which the developing countries can hire consulting firms toeitherprovideassistanceoractuallyimplementtherecommendation(for example, a country could hire a firm or individual consultantsto implement training programs, perhaps at the subnational level) Finally,thefacilitywillneedtohaveclearentranceandexitstrategiesforitsinteractionswithclientgovernmentstopreventbeingcarriedtoofarintotheimplementationphaseofprojects

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Annex D: Organizational Structure and Institutional Home

The working group conducted a cost-benefit analysis of different organiza-tional structures This analysis, building on an organizational frameworkdeveloped by working group member Daniella Ballou-Aares, presented fourtypes of organizational models used by organizations working the in thedevelopmentfield(seebox10andtable3)

Groupmembersidentifiedseveralkeymanagementandorganizationalchar-acteristicsappropriatefortheenvisagedfacility:

• independent, but housed within an existing organization with theopportunitytospinofftobecomeanindependentorganization(forexample,PROvention,theAllianceforHealthSystems,theCouncilonHealthResearchforDevelopment,theGlobalDevelopmentNetwork)

• funded by multiple donors from start-up phase with, ideally, devel-oping-country representatives brought on as board members andpotentialfunders

• offers a combination of “free” strategic advice and technical assis-tancewithsomebuy-infromdevelopingcountries

• requires a light board or governance structure that offers flexibilityandtheabilitytoadapttofielddemand

• ensures independence to have credibility with developing-countryclientsandprivate-sectorpartners

• lookstocreatecapacitywithinregionalorganizationsthatcouldeven-tually,withtimeandsupportfromthefacility,assumethefacility’srole

After much discussion, group members converged on Option A: Subsidiarymodel

Box 10. Four Options for Organizational Structure

Option A, “Subsidiary model”: Hosted subsidiary within a multilateral organizationOption B, “Partnership model”: Hosted partnership within a multilateral organizationOption C, “Contracting-out model”: Project managed by existing NGO or private entityOption D, “Stand-alone model”: Newly created independent entity


Table 3. Comparison of Organizational Models

OptionA OptionB OptionC OptionDComponents “Subsidiarymodel” “Partnershipmodel” “Contracting-outmodel” “Stand-alonemodel”

Organization Entity embedded in a Partnership embedded in a Project or contract managed by an existing Distinct entity created as an independent structure multilateral organization multilateral organization NGO or private firm not-for-profit or for-profit organization

Governance Reportstoownboard;hasitsown Secretariatcomposedofstafffrom ProjectmanagedbyexistingNGOorprivate Reportstoitsownboard;hasitsownboard managementstructure partners;reportstoownboardandhas firmmanagers;reportsto“client” itsownmanagementstructure

Administration Fundsitsownstaff;shares Partnershipfundsitsownstaff;shares Projectemploysstaffandexpertiseofexisting Createsnewmanagementsystemsand administrativeinfrastructure administrativestructurewithhost NGOorprivatefirm;sharesadministrative administrativeinfrastructure withhost infrastructure

Funding Realizecost-sharingininfra- Realizescost-sharingininfrastructure Requiresdonorcommitmentforsettime Requiresdonorcommitmenttoforwardfund requirements structureandpossiblystaff; andpossiblystaff;requiresdonor period(5–10yrs)tofund;donorsprovide start-upcostsandinitial2–3yrsbudgetfor requiresdonorcommitmentfor commitmentforshortertimeperiod fundsinannualallotments implementation shortertimeperiodfor forimplementation implementation

Pros and Cons Pros:Leveragesexistingcapacity Pros:Legitimacylinkedtomembersin Pros:Leveragesprivateentity’sexpertiseand Pros:Moreindependenceandflexibility; andoperationsofhostorganiza- partnership staff;manageasacontractforservices;high allowsforbranding tion;legitimacylinkedtohost Cons:Partnershipsaredifficultto independence;moreflexibility;potentially Cons: Hugestart-upcosts;higheroperating organization manage;challengingtoreconcile loweroperationalcosts costs;lagtimetostartupandstaffup;risk Cons:Assumesorganizational differentorganizations’expectations; Cons:Doesnothavesameinfluenceand ofunknownwithnewentity cultureofhostentity;possible possibleinefficiencieslinkedtolarge accesstoclientasamultilateralorganization inefficiencieslinkedtolarge bureaucracy;weakcoordination bureaucracy;lowtomoderate capability independencedependingonhost

Examples PrivateParticipationinInfrastructureRollBackMalaria,StopTB,Reproductive USAIDcontractingPSP-One;Rockefeller InternationalInitiativeforImpactEvaluation, AdvisoryFacility(PPIAF),HLSP HealthSuppliesCoalition contractingResultsforDevelopment AfriStat

Source:AdaptedfromDalberg“FourOptionsCanBeConsideredforStart-UpandManagementofNewInitiativesintheInternationalSystem”andEvaluationGapWorkingGroup(2006)


Table 3. Comparison of Organizational Models

OptionA OptionB OptionC OptionDComponents “Subsidiarymodel” “Partnershipmodel” “Contracting-outmodel” “Stand-alonemodel”

Organization Entity embedded in a Partnership embedded in a Project or contract managed by an existing Distinct entity created as an independent structure multilateral organization multilateral organization NGO or private firm not-for-profit or for-profit organization

Governance Reportstoownboard;hasitsown Secretariatcomposedofstafffrom ProjectmanagedbyexistingNGOorprivate Reportstoitsownboard;hasitsownboard managementstructure partners;reportstoownboardandhas firmmanagers;reportsto“client” itsownmanagementstructure

Administration Fundsitsownstaff;shares Partnershipfundsitsownstaff;shares Projectemploysstaffandexpertiseofexisting Createsnewmanagementsystemsand administrativeinfrastructure administrativestructurewithhost NGOorprivatefirm;sharesadministrative administrativeinfrastructure withhost infrastructure

Funding Realizecost-sharingininfra- Realizescost-sharingininfrastructure Requiresdonorcommitmentforsettime Requiresdonorcommitmenttoforwardfund requirements structureandpossiblystaff; andpossiblystaff;requiresdonor period(5–10yrs)tofund;donorsprovide start-upcostsandinitial2–3yrsbudgetfor requiresdonorcommitmentfor commitmentforshortertimeperiod fundsinannualallotments implementation shortertimeperiodfor forimplementation implementation

Pros and Cons Pros:Leveragesexistingcapacity Pros:Legitimacylinkedtomembersin Pros:Leveragesprivateentity’sexpertiseand Pros:Moreindependenceandflexibility; andoperationsofhostorganiza- partnership staff;manageasacontractforservices;high allowsforbranding tion;legitimacylinkedtohost Cons:Partnershipsaredifficultto independence;moreflexibility;potentially Cons: Hugestart-upcosts;higheroperating organization manage;challengingtoreconcile loweroperationalcosts costs;lagtimetostartupandstaffup;risk Cons:Assumesorganizational differentorganizations’expectations; Cons:Doesnothavesameinfluenceand ofunknownwithnewentity cultureofhostentity;possible possibleinefficiencieslinkedtolarge accesstoclientasamultilateralorganization inefficiencieslinkedtolarge bureaucracy;weakcoordination bureaucracy;lowtomoderate capability independencedependingonhost

Examples PrivateParticipationinInfrastructureRollBackMalaria,StopTB,Reproductive USAIDcontractingPSP-One;Rockefeller InternationalInitiativeforImpactEvaluation, AdvisoryFacility(PPIAF),HLSP HealthSuppliesCoalition contractingResultsforDevelopment AfriStat

Source:AdaptedfromDalberg“FourOptionsCanBeConsideredforStart-UpandManagementofNewInitiativesintheInternationalSystem”andEvaluationGapWorkingGroup(2006)

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Annex E: Create a New Entity or Build On an Existing One?

Groupmemberswereconsciousofhowcrowdedandfragmentedtheexistingglobal health space is They weighed seriously the need for a new entityagainstwhatmightbepossiblewithincrementalchangestoexistingsourcesof technical support (for example, the WHO, the World Bank, various bilat-eralresourcecenters) Onthebasisoftheanalysisbelow,theworkinggroupdecidedtoexplorehowtheIFC’sHealthinAfricainitiativecouldbeexpandedtohaveaglobalfocus

Facility’s niche

Memberswerealsoconcernedthatthefacility’sactivitiesshouldbedefinedinawaythatwillavoidoverlappingwithothersworkinginthespace Hence,theyconductedagapanalysistoidentifyorganizationsandprojectscarryingout related technical activities with developing-country governments Thepurposeofthisanalysiswastwo-fold:

1 demonstratepotentialoverlapaswellasgapsintechnicalassistancethatdefinethefacilitynicheandfocus,and

2 determinethefacility’scomparativeadvantage

Table 4 provides an overview of different activities being carried out byexisting projects and organizations, broken down by the key functionsproposedforthefacility Theseorganizationsrangefromtime-limitedentitieslikeUSAID’SPSP-Oneproject,tolonger-terminitiativeshousedinfoundationsormultilateralorganizations,toavailablesupportof localandinternationalconsultingfirms

Relativetootherglobalhealthareas(forexample,HIV/AIDS,malariacontrol),thereareveryfewactorsoperatinginthisspace Thereis theUSAID-fundedprojectthatperformsmanyoftheproposedfunctionsofthefacility,butonlyinthesubsectorsoffamilyplanningandHIV/AIDs TheRockefellerFoundationhastakenaleadershiproleinfosteringglobaldialoguewithdonorsandtheWHO using their sponsored research And both PSP-One and the RockefellerFoundation implement private-sector-related activities in developing coun-tries: PSP-One is in over 36 countries with a focus in Africa; Rockefeller willinvestinthreetofiveAfricanandSouthAsiancountries


There are a few investment actors, such as the Overseas Private InvestmentCorporation(OPIC)andotherLatinAmericanequityfirms,offeringequityorriskguaranteestoprivatefirmsorinvestorsworkinginhealth 6

The IFC’s HIA initiative is the most similar in scope to the proposed facility Realizingthispromptedfurtheranalysisofhowthetwoentitiescouldbestbecoordinatedormerged

6 OPIC is a U.S. government entity that promotes investment by U.S. companies abroad through the allocation of risk guarantees.


Table 4. Organizations Working on Activities to Strengthen Private Sector Engagement in Health

PrivateSectorProgramPSP-Onea (forfamilyplanningandHIV/AIDS) RockefellerFoundation IFC OPIC

FirstorderoftheumbrellaPrivate Foundationprovidinggrantsand Appliedstrategyforimprovinghealthcare IndependentU S governmentagencythat SectorProgram(PSP)ofUSAID,a othersupportinanumberofhigh- inAfricabyengagingtheprivatesector, mobilizesandfacilitatesinvestmentofU S private five-year,time-limitedproject priorityareas,includingharnessing includingfinancialsupport,adviceon capitalandskillsintheeconomicandsocial focusedonpromotingand theprivatesectorasanentrypoint regulationsandreforms,andassessment developmentofless-developedcountriesandareas, expandingprivate-sector intohealth-systemtransformation ofthefinancialclimateincountriesand andcountriesintransitionfromnonmarketto programming indevelopingcountries,withafocus acrossthecontinent marketeconomies onsub-SaharanAfricaandSouth- eastAsia

Function

Knowledge broker • Conductsresearch • Sponsorsstudies • Createslocallearningrelatedto • Writesbriefs • Intendsto strategicadvice • Holdsmeetingsandworkshops –facilitateSouth-Southlearning • Mapsprivatesector • Hostswebsite –provideintermediatefunding • Developsbusiness-environmentindicators –trackmechanisms

Change agent • Conductsmainstreamingactivities • Fostersglobaldialoguewiththe • Fostersdialogueonpolicyenvironment toraiseawarenessandpromote WHO,donors,andgovernments • Producedthe“BusinessofInvestingin workingwithprivatesector • Createsanetworkhub HealthinAfrica”;willproceedwith follow-onactivities

Strategic adviser • Conductsprivate-sectorassessments • Willinvestin3to5placesin InAfrica: • Designsstrategy(howto) AfricaandSouthAsia • Providestechnicalassistanceand • Fostersdialogue strategicadviceonpolicyenvironment • Designsprivate-assessmentstrategies • Conductsanalysisofbusinessenvironment • Providesadvicetobusinesssector

Provider of • Learnswhiledoing • Offersdebtandequitytofirms • Offersequitytofirmsimplementation • Buildscapacity • Providestechnicalassistancetofirmssupport and • Strengthensdialogue toimprovebusinesspractices technical assistance

a ThecurrentUSAID-fundedprojecthasbeenrenamedStrengtheningHealthOutcomesthroughPrivateSector Theactivitieslistedherearecontinuingunderthenewcontract


Table 4. Organizations Working on Activities to Strengthen Private Sector Engagement in Health

PrivateSectorProgramPSP-Onea (forfamilyplanningandHIV/AIDS) RockefellerFoundation IFC OPIC

FirstorderoftheumbrellaPrivate Foundationprovidinggrantsand Appliedstrategyforimprovinghealthcare IndependentU S governmentagencythat SectorProgram(PSP)ofUSAID,a othersupportinanumberofhigh- inAfricabyengagingtheprivatesector, mobilizesandfacilitatesinvestmentofU S private five-year,time-limitedproject priorityareas,includingharnessing includingfinancialsupport,adviceon capitalandskillsintheeconomicandsocial focusedonpromotingand theprivatesectorasanentrypoint regulationsandreforms,andassessment developmentofless-developedcountriesandareas, expandingprivate-sector intohealth-systemtransformation ofthefinancialclimateincountriesand andcountriesintransitionfromnonmarketto programming indevelopingcountries,withafocus acrossthecontinent marketeconomies onsub-SaharanAfricaandSouth- eastAsia

Function

Knowledge broker • Conductsresearch • Sponsorsstudies • Createslocallearningrelatedto • Writesbriefs • Intendsto strategicadvice • Holdsmeetingsandworkshops –facilitateSouth-Southlearning • Mapsprivatesector • Hostswebsite –provideintermediatefunding • Developsbusiness-environmentindicators –trackmechanisms

Change agent • Conductsmainstreamingactivities • Fostersglobaldialoguewiththe • Fostersdialogueonpolicyenvironment toraiseawarenessandpromote WHO,donors,andgovernments • Producedthe“BusinessofInvestingin workingwithprivatesector • Createsanetworkhub HealthinAfrica”;willproceedwith follow-onactivities

Strategic adviser • Conductsprivate-sectorassessments • Willinvestin3to5placesin InAfrica: • Designsstrategy(howto) AfricaandSouthAsia • Providestechnicalassistanceand • Fostersdialogue strategicadviceonpolicyenvironment • Designsprivate-assessmentstrategies • Conductsanalysisofbusinessenvironment • Providesadvicetobusinesssector

Provider of • Learnswhiledoing • Offersdebtandequitytofirms • Offersequitytofirmsimplementation • Buildscapacity • Providestechnicalassistancetofirmssupport and • Strengthensdialogue toimprovebusinesspractices technical assistance

a ThecurrentUSAID-fundedprojecthasbeenrenamedStrengtheningHealthOutcomesthroughPrivateSector Theactivitieslistedherearecontinuingunderthenewcontract

PARTNERSHIPS WITH THE

PRIVATE SECTOR IN HEALTH

What the International Community Can Do to Strengthen Health Systems in Developing Countries


Copyright © 2009 Center for Global Development

ISBN 978-1-933286-45-7

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Documents

Partnerships with the Private Sector in Health: Strengthening Health Systems in Developing Countries