The healthcare reform debate continues to rage in Washington as private healthcare companies and public system advocates lock horns about the specifics of reimbursement schemes, insurance provisions, and cost control. But private companies have also found a new “emerging market” in those countries that have heretofore had a problem of healthcare access that far exceeds that in the United States. Lobbyists from private healthcare companies are now flying over their typical Western European or East Asian destinations, and finding themselves stationed in cities like Durban, Delhi, or Dakar, as part of an initiative to privatize the healthcare systems of the world’s poorest countries.

Following a decade of AIDS activism, the magnitude of global health aid from the U.S. and Western Europe to poorer nations has increased exponentially. Global health aid has quadrupled from $5.6 billion in 1990 to $21.8 billion in 2007, mostly in the form of publicly-financed aid [1]. Yet more than $5.4 billion of these dollars were expended outside of recipient countries’ government-based public health systems, with a declining fraction of aid dispensed by multilateral institutions like the United Nations, and increasingly larger shares of the funds administered through “private-public partnerships” [1]. This massive body of aid and investment in poor countries’ health systems provides a new market for private companies seeking to define their share in the health systems of the future.

The implication of increasing privatization of healthcare services is being felt in a variety of the world’s poorest and sickest communities. In Lesotho, the household incomes of a large sector of the population depend on migrant labor to South Africa’s gold mines, resulting in a 27% HIV prevalence among pregnant women as migrant male laborers become infected at work in the mines and bring back infections to their wives [2]. In all-male hostels on the gold and mineral mines, alcohol and prostitutes are regular techniques to prevent unionization and rebellion against hostile working conditions [3]. Lesotho’s miners are forbidden from bringing family members with them, being denied property rights or rights of family entry by South Africa’s unchanged apartheid-era laws on labor migration [4]. The resulting high HIV rates have led to an epidemic of tuberculosis, since HIV increases the risk of active tuberculosis [5]. In this context, the country’s largest public hospital, the Queen Elizabeth II, is being privatized. The goal of this privatization, according to the country’s “Private Sector Advisory Committee” of industry and government representatives, is to “ensure activity at the Hospital which would ensure the use of its facilities to full capacity, and to subsequently make the Hospital a viable entity which can then be returned to the private sector in due course” [6]. Attached to the initiative are the usual claims that the private sector will be more efficient, accountable, effective, and relieve the bureaucratic and overburdened government–rhetorical claims that I will address with actual evidence, below. The consequences for the poor are dire – by its very nature of turning to a for-profit model in which those most able to pay will be most facilitated to enter the hospital (and vice versa), and given the absence of equity provisions in the health financing deal, the poor will face the greatest burden in finding new avenues for healthcare as they become the least profitable potential patients, and the least able to pay user fees associated with healthcare services. US taxpayers effectively sealed this deal, having provided the global health aid to create the advisory committee and associated contracting services to convert the public hospital into a private one.

Those in Lesotho do not need to travel far from home to find a warning about the consequences of such “public-private partnerships”. The Republic of South Africa recently turned over its medical laboratory testing to a private company, during the course of its own drug-resistant tuberculosis epidemic. Under the previous public system, the government considered the laboratory a public service to hospitals around the country, and a vital source from which to obtain accurate data about where physicians and scientists should be deployed to monitor tuberculosis outbreaks. As a result, hospitals would need to simply send their samples for testing to determine if tuberculosis patients had deadly drug-resistant forms of the disease. Once privatized, however, the laboratory started to charge for each drug-resistance test any hospital delivered. As a result, only two hospitals—both associated with US research institutions conducting studies on the prevalence of drug-resistant tuberculosis in the region—sent their samples to the laboratory [7, 8]. The other hospitals had no incentive, and were too poor, to test their patients. Hundreds of patients have now died at these facilities as a result of being untested for an otherwise treatable disease [9]. The laboratory also no longer had incentive to maintain its most skilled workers, who required adequate salaries; as an indication of the competence of the new “efficient” staff, testing equipment was mis-ordered at the facility, leading to architectural failure of the laboratory building as heavy machines were placed on a floor that cracked under their weight, requiring extensive and costly structural repairs. South Africa now reports the world’s largest epidemic of “extensively drug-resistant” (XDR) tuberculosis [9].

The events in Lesotho and South Africa are not isolated, but part of a wave of new privatization initiatives that make use of donor dollars for public health by shuttling them into private contractors in poor countries, such that the engineering-firm Bechtel contracts for supply chains instead of UNICEF [10]. In a recent 55-page comprehensive review of data concerning healthcare privatization programs in poor countries, the international relief agency Oxfam reported that “despite the poor performance of private sector-led solutions, there has been a noticeable increase in efforts in recent months by a number of donors and influential organisations, to encourage and fund an expansion of health care by the private sector. The idea is that those who can afford it should buy their own health care in the private sector and governments should contract private providers to serve those who can’t…[yet] the evidence in favour of private-sector solutions is weak. On the contrary, there is considerable and increasing evidence that there are serious failings inherent in private provision which make it a very risky and costly path to take…a growing body of international research reaffirms that despite their serious problems in many countries, publicly financed and delivered services continue to dominate in higher performing, more equitable health systems. No low- or middle-income country in Asia has achieved universal or near-universal access to health care without relying solely or predominantly on tax-funded public delivery” [11].

Upon release of the report, Oxfam was lambasted by complaints from the World Bank, the Center for Global Development, and other institutions invested in private-public partnerships; one group accused Oxfam of making an argument based on “bias” and “ideology”, though the accusers receive millions of dollars from the Gates Foundation to expand private-public partnerships in poor countries, with supplemental funding from Exxon-Mobil [12]. Most of the counter-claims made by those favoring the private model have centered on a few key arguments, which Oxfam addressed: (a) that most of the poor already receive their care from private sources in regions where the government has not reached; (b) that the private sector will relieve and avoid the inefficient bureaucracies of government; and (c) the private sector will be more accountable and effective [12].

The first of these claims—that the majority of healthcare among the poor is provided by private practitioners—is indeed true. Anyone who has spent time in poor areas of resource-denied countries is well aware that people commonly go to local pharmacists and untrained providers posing as physicians (who usually have no opportunities for training) and are sold drugs of dubious quality. More than half of the healthcare provided in the sub-Saharan Africa is thought to be through the private sector, and this is also true in India [13-15]. Almost 40% of the care is through small shops selling unregulated medicines [14]; less than half of the poorest-fifth of the population actually see a physician when they obtain care from the private sector, according to a recent study in 15 sub-Saharan African countries [11]. While these neighborhood storefront operations are the majority of accessible providers, they are not the foreign contractors who have been making use of the massive pool of new global aid funds. The private hospital system in India is expanding under such contractors, often catering to foreign medical tourists who obtain surgeries and organ transplants often under suspicious circumstances [16], yet nearly two-thirds of India’s mothers are denied healthcare during childbirth and are not permitted inside these “model facilities” [17]. Oxfam gave the analogy that private security firms provide the majority of security services in failed states, but does this imply that our overseas aid should go to these firms instead of to the development of a public police force? The response from those invested in privatization schemes was that the poor have more faith in private systems [18]; ironically, the voices of the poor were absent from this argument, which relied on the idea that the voices of billions of poor people on the planet could be captured singularly by a wealthy health policy analyst in the U.S., absent of any study or evidence (indeed, “poor people want…” is a common refrain among those who claim to speak for billions of people who they have never met). It also ignores the fact that those supporting the further building of public health systems with development aid, rather than its diversion toward private contractors, are not trying to “ignore” the private sphere or claim that storefronts should have no role because all healthcare must be government based, but rather to bolster the sphere of healthcare delivery that has an explicit mandate to treat those most vulnerable and most ill; after all, this is the very basis for redistribution, the purpose of aid. Those supporting privatized health in poor countries still claim that the support of the private contracting initiatives is a new path to success, because government-sponsored programs have already failed “despite decades of investment” [19]. In fact, this claim may sound accurate, but is fundamentally untrue. Those Asian countries that have built a strong public health system have done so very recently, with strong overall mortality reductions across all sectors [11]. Women in Sri Lanka now have nearly the same life expectancy as women in Germany, in part due to government-supported skilled birth attendants [20]. Meanwhile, most government systems have actually received limited investment, as the poorest of countries have been restricted in their spending due to international lending rules [21]. Much of the capital required for investment in the post-colonial era was wasted by dictators and prop-governments supported by Western powers for the continued extraction of mineral resources. As a result, countries dependent on international lenders, the World Bank and International Monetary Fund (IMF), for capital to invest in rebuilding healthcare infrastructure. Yet these two banks themselves promoted privatization within their loans. Hence, decades of investment have actually been focused on the private sector in poor countries. A particularly intriguing set of data to examine the impact of these efforts are available from the recent privatization of healthcare among Eastern European countries. Prior to the IMF’s contracting with these nations, tuberculosis rates were falling or stable in these countries. A longitudinal statistical analysis of all 21 countries revealed that the IMF’s programs were related to a massive rise in tuberculosis rates [22]. When countries ended their participation in the IMF programs, tuberculosis rates fell by close to the same amount as they had risen upon IMF participation. Both greater size and duration of the IMF programs were linked to greater tuberculosis rates (a "dose-response relationship"). The IMF’s reforms were found to reduce healthcare resources identified as critical for tuberculosis control, including government spending on healthcare, the number of doctors per person, and access to the World Health Organization’s recommended anti-tuberculosis treatment approach. The healthcare provision had been privatized under the IMF’s direction, with epidemic-level impact. Non-IMF ("control group") loans of similar size, duration, and timing had the opposite effects as the IMF loans and were, in some cases, related to lower tuberculosis rates. To isolate the effect of the IMF programs, the statisticians corrected for numerous potential social or economic determinants of tuberculosis rates, such as falling GDP, bank crises, unemployment, inflation, or war, as well as other health measures such as HIV, which can make people more susceptible to tuberculosis. (Interestingly, instead of choosing to respond in the peer-reviewed scientific journal, the IMF distributed a number of false statements over the Internet after this study was published [23]. First, they claimed the study did "not take into account that the economic and social instability following the collapse of the Soviet Union may have had a direct impact on TB." This is false, as the effect was found to be statistically independent of these other factors. Second, the IMF cited two papers to suggest that IMF-supported programs were associated with improved public health. Their first citation actually suggested the opposite of the IMF’s claim, and the second citation was misreported by the IMF. Neither had to do with the studied countries.) Further statistical studies have indicated mass privatization as a major determinant of mass death in the former USSR [24], though a few groups, particularly those led by economist Jeffrey Sachs who was involved in these privatization schemes, have strongly denied the data [25].

The other common claims about private healthcare—that it reduces costs and improves outcomes—are also untrue. Private healthcare provision in poor countries is in fact associated with higher expenditures (as it is in the U.S.) [11]. Countries based on privatized health systems spend about twice those with public systems, yet experience two to three times the infant and maternal mortality rates as the countries with primarily public health systems [26-28]. The privatization of health in many regions has also reduced incentives to provide preventive healthcare, which is usually seen as a public good for which little profitable testing or pharmaceutical fees can be charged. Upon privatization of parts of its health system, China’s immunization rates dropped by nearly 50%, with subsequent rises in polio and measles–both costly diseases from the perspective of lost work and wages [29, 30].

Many of those supporting private-public partnerships cite selective data from specific privatization schemes, ignoring the costs of contracting and the broader impact of their initiatives on communities. For example, about one-fifth of Cambodia’s privatized healthcare provision has resulted in lowered costs (absent of data on equity), but the common reporting of this statistic by the World Bank and other privatized healthcare supporters does not include the caveat that the overall health program had to shrink by 40% and as much as one of every five dollars of health spending also went to the costs of contracting [11, 31, 32]. Even this further caveat ignores the cost of regulation as a result of fraud and corruption in private schemes; as much as $23 billion per year are spent in the US due to healthcare fraud from private contractors [11]. Against this backdrop, the concerns about equity and quality have yet to be addressed by those supporting privatized initiatives in poor countries. While only 37% of sexually transmissible diseases are treated correctly by private contractors in Lesotho, about 60% or more are properly cared for in public institutions [33]. Furthermore, levels of inequality, as measured by the degree of exclusion of the poor from treatment services, are higher among more privatized countries according to a review of 44 low- and middle-income nations [34].

In response to this data, those in support of the privatized initiatives have launched a barrage of claims. They first argue that this evidence is merely “association not causation”, since it is of course impossible to prove that a specific privatization initiative resulted directly in a person’s death; the evidence is based on “anecdote rather than evidence”, which is a convenient claim since all real-world experiments are indeed anecdotes; and they claim that criticism of their initiatives is “ideological”, harking back to a time when private and public initiatives were diametrically opposed [18, 35]. Of course, the ideology implicit in trying to profit from healthcare delivery rather than provide healthcare with an explicit mandate of equity and human rights is not concerning to some. But these groups are constructing their own “model programs” to reveal “new evidence” about the efficacy of their programs. None of this appears very forthcoming (the evidence is always “pending”), and seems more rhetorical than based in the day-to-day reality that our patients face when they are unable to access the hospitals and clinics formed by these programs. Those of us who treat these patients are aware of their daily realities, and the often-manipulative manner in which “evidence” is constructed in public health circles. The reality is that health policy is not simply about amassing statistics—it is also about politics, and the question of what we want our society to look like.  As Dr. Matthew Anderson of the Albert Einstein College of Medicine remarks about the debate over the Oxfam report, “This debate seems to be framed as one of evidence and not politics. But I wonder if this does not misread the fundamentally political nature of health policy. Evidence is clearly central to any discussion. But health policy also – and correctly – addresses political concerns arising from the different social visions of different social actors… the question of whether health care is a right is not a question that can be decided in an objective scientific way, although evidence might help determine the likely consequences of such a decision. However, there is an important consequence to framing this debate as a purely technical one. It authorizes decisions on health policy to be made by ‘experts’ instead of political bodies” [35].

Increasingly, the “evidence” used to support favored public health initiatives are based not on evidence of actual outcomes or population-level statistics, but on modeled constructs (the subject of my own PhD). The year 2000 World Health Report, the World Health Organization’s annual flagship publication, created a “health system index” that rates the efficiency, equity, and effectiveness of various health systems [36]. It hired numerous foreign contractors and consultants, producing a health system “score” that seemed neither connected to the lived experiences of people nor helpful in improving health systems. For example, Haiti and China had the same health system score (but what does this actually mean, and how does that imply how the systems should improve?). Spain had a very high score, in spite of the massive protests and numerous community-based evidence suggesting many faults in its system [37]. Those supporting privatized initiatives are increasingly reliance on these scoring systems; these studies employ numerous analysts, provide extensive research grant funding, and can be manipulated to offer particular conclusions. A recent paper, for example, supported a high-cost surgery over diabetes screening numerically, in spite of the fundamentally illogical conclusions of the piece [38]. The basis of the argument was the common cost-effectiveness rubric of quality-adjusted life-years (QALYs), a measurement of how many years of life an intervention could avert, corrected for the “quality” of that life. The system is meant to provide “comparative effectiveness” between interventions, the basis of so much recent funding and claims that such assessments will dramatically reduce healthcare costs [39]. Critical assessments of the field of cost-effectiveness analysis in public health revealed that the aggregate measures used in these analyses, subject to numerous assumptions and subjective judgments, are difficult to calculate with reasonable reproducibility by different analysts, usually have weak statistical validity, and allow for gross manipulation [40, 41]. As a result of their focus on immediate benefits and costs, cost-effectiveness analyses often fail to account for the down-stream consequences of disease, or of the failure to make needed public health investments – consequences in the shape of the transmission of diseases to others (for communicable diseases) or in terms of the social and economic consequences of leaving diseases untreated until a public health problem became more severe (and potentially more costly). [42] These scoring rubrics and other devices ignore the more democratic and community-based methods of assessing the impact of healthcare services or public health measures, such as access to a physician, the quality of such services in terms of prescribing correct medications or performing appropriate care activities, and replicable public health indexes such as the changing prevalence of particular diseases, access to piped water, waiting times for critical services, typical costs of services to patients and their families, and the number of trained healthcare providers for a given community [37, 43]. But these rubrics require connections to a community, long-term commitment, and do not employ numerous health policy analysts who can perform these jobs at their desks in Boston or Washington DC under large research grants for invested institutions.

What does the use of evidence of this nature imply for the people affected by healthcare reforms in their communities (whether in the US or abroad)? Increasingly the debates over what should happen to their hospitals, who will control them, and how they will be viewed as “models” or examples of “failure” will not be based on their own lived experiences. Rather, they will be increasingly based on constructs that are thought to be objective and fair to those in health policy circles, but have limited connection to the day-to-day realities of the affected patients.

One of the gravest dangers as the privatization wave hits poor countries is that the discussion of such complex rubrics of “evidence” is fundamentally undemocratic. In the case of South Africa, for example, the privatization of laboratory services implied that no one could adequately oppose the changes to the tuberculosis drug-resistance testing system. A private corporation was able to change policies at its own will, and there is little that patients could say about it, particularly in the face of reports constructed by the laboratory indicating its own high performance. On the other hand, the mismanagement resulting in poor HIV programs in prior years was a public system failure. As a result of the publicity associated with this poor management, members of the public were able to vote for a different candidate for office, resulting in replacement of the Health Minister with a more qualified candidate who has since bolstered the program [44].

But the idea that democracy is not necessarily best for health—the idea that foreign health policy analysts know better than patients—is pervasive (in spite of the irony that the US, the country with the greatest number of health policy analysts per capita, seems to be doing rather poorly in its public health provision). Among the most recent catch phrases is the claim that public democracy and civil society participation has led to excessive attention on HIV/AIDS and not enough on other health problems. Indeed, HIV has received much attention and funding (though only a portion of this funding has actually reached patients and improved their access to critical care). The idea that other diseases and conditions should receive funds is appropriate; HIV activists demonstrated that not all poor people need to remain unable to access critical treatments and services, and that this inequality can be fundamentally changed. Shouldn’t we now also extend that lesson to malnutrition, women’s healthcare, occupational and environmental health, and the prevention of diabetes? Certainly. But in a gross manipulation of these progressive sentiments, the desire for such “system wide” improvements has been diverted by those favoring privatization schemes. Rather than addressing the influx of poor-quality foods into poor countries, risking both malnutrition and diabetes in the same households, the WHO’s executive director left his post to be employed at PepsiCo as a global health policy advisor; the subsequent policy constructs lack critical awareness of the irony between ongoing food company trade policies and rhetorical claims about fulfilling corporate social responsibility by donating money to health funds or privatizing markets for food aid [45-47]. The World Bank has meanwhile supported “sector-wide approaches” (or “SWAps”) for health sector improvement, which sound rhetorically sound, but are actually massively draining funds from actual healthcare services to provide foreign contractors with opportunities to train health ministers in seminars that have unclear value and no reportable results [48-50]. The SWAps resulted in collapse of part of the tuberculosis control program in Zambia as a result of diverting funds to seminars and related programs for Ministry of Health elites [51].

The importance of introducing more community-based democracy into these “expert” recommendations and reforms could not be clearer. One of the most pervasive and common forms of democracy has mediated between the clash of governments and the private sector, into a realm in which government elites are required to be more responsive to communities while the public sector system is built for greater equity. In some communities those participating in this democratic influx are referred to as “activistas”, in others as “monitoras”, or “shastho shebika”. In most places they are simply referred to as “community healthcare workers” (CHWs). Often mobile and roving between households in their community, CHWs have increasingly become a face of health access and health democracy in poor places. They are often members of a community (typically older women) who provide preventive healthcare services, bring household members into formal clinics or hospitals when they are ill, and support families through illness and support communities during times of strife with government ministers, their lobbyists, or other institutions seeking to change the community character of public health and healthcare delivery. A recent comprehensive review of CHWs found that their effectiveness in a wide range of countries was not based on the scope of diseases they covered (ranging from complex treatments to health education), but on their continued support from the government (through steady salaries and adequate provision of needed supplies), and their support from the community (in terms of how close they seemed to community members’ actual problems) [52]. They serve as a mediator between private hospital programs and government programs that have not reached the poor, and offer among the most effective resources for healthcare delivery [53, 54].

CHWs do not pose a dramatic solution to all poor-country health problems. The poorest of regions still need operating rooms with qualified surgeons, reliable drug supplies with knowledgeable prescribers, and good power grids to provide adequate electricity to clinics and hospitals. But CHWs reflect the desire for community members to participate and be heard as part of a process to restore democracy in healthcare decision-making—indeed, to be a decision-maker rather than a recipient of so many foreign constructs about “what works” and “what doesn’t”. The danger in the privatization of global health is not only in whether it will work or won’t work; it is also in the very idea that it is acceptable to experiment with whole communities, to foist untested “models” onto whole societies, especially those with the heaviest burdens of poverty and disease, and determine whether they will float or sink. In medicine, we have a mandate to “first do no harm”. Until the mass privatization of healthcare services and public health activities can be demonstrated to follow this mandate, it should be approached with extreme caution and the demand for more democracy in decision-making, accountability, and results.

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Sanjay Basu, MD, PhD, is a physician in the Department of Medicine at the University of California, San Francisco and the San Francisco General Hospital. He is also a co-founder of Nyaya Health, a program working with the Nepali government and community members to rebuild public health infrastructure in rural Nepal.

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