In most low and middle income countries the private health sector has grown to become a substantial, and in some cases the major source of health services.

In these countries, out of pocket payments to private health care providers make up most of the total amount spent on health - from over 50% in much of sub-Saharan Africa to over 80% in some Asian countries.

What do people spend on private sector health care?
Poor households may spend disproportionately more of their household income on health than richer ones. Much of this expenditure is on pharmaceuticals and private for profit providers, both qualified doctors, nurses, and pharmacists, and unqualified providers such as shopkeepers or traditional practitioners. A smaller amount of private spending is spent on buying hospital care. This is usually financed through borrowing, often at extortionate rates, which can drive middle-income families into poverty, and the poor into even deeper poverty.

What do we know about private health providers?
Private providers are sometimes the only means for the poor to access modern health care, as they are often closer than government facilities and, once costs such as lost working time, travel and unofficial user fees are taken into account, they are often cheaper than the public sector. Evidence shows that quality of care is highly variable and the poor may not be getting value for money.

We understand the private sector as covering both for profit and not for profit providers. These providers can be working directly for consumers who pay either out of pocket or via an insurance scheme; they can be working on contracts with either governments or development agencies; or in other public private partnerships, again either with governments or development agencies.

How can poor people get value for money?
HLSP is keen to better understand and to work with both demand and supply sides to help poor people get value for their expenditure. This can be done through supply side schemes such as social marketing and franchising, and provider contracting, training and regulation. On the demand side, insurance and other collective purchasing schemes, voucher programmes and consumer education are all being explored.

Our work

We have examined how working with the private sector could improve access to good quality, affordable and appropriate health services in a resource, Private sector participation in health which describes and assesses a range of approaches to strengthening public-private sector engagement.

We have also developed a review of national strategies for public-private sector engagement in malaria treatment and prevention, for WHO in 2006. The report is available on the WHO website at http://www.who.int/tdr/publications/publications/partner_malaria.htm›