Healthcare privatisation linked with worse outcomes, higher profits: Lancet Study

NEW DELHI: Privatisation of healthcare was found to almost never have a positive effect on the quality of care, and was associated with higher profits, a research that reviewed previous studies of high-income countries (HICs) such as the US, Germany, Canada, and South Korea has claimed.

Researchers said the findings, published in The Lancet Public Health journal, challenged the theory that privatisation can improve the quality of healthcare through increased market competition, and by enabling a more flexible and patient-centred approach.

In their analysis, the researchers, led by those at the University of Oxford, UK, included long-term studies looking at increase in private providers and measuring quality of care, eventually effecting health outcomes.

The researchers also found that the higher profits at hospitals, converting from publicly-owned to privately-owned, mainly came from reducing staff and lowering the number of patients having limited health insurance coverage.

Higher levels of hospital privatisation were linked to higher rates of avoidable deaths, the authors found in some of the studies they reviewed.

As governments around the world consider their response to the continuing consequences of the COVID-19 pandemic on health-care systems, the authors found evidence suggesting a risk that governments seek short-term reductions at the expense of long-term outcomes.

“There is a risk, however, that seeking short-term reductions can come at the expense of long-term outcomes, since outsourcing services to the private sector does not seem to deliver both better care and cheaper care,” said study co-author Aaron Reeves, from the Department of Social Policy and Intervention, University of Oxford.

Outsourcing of services is a popular form of privatisation in which a publicly-funded service maintains the decision-making powers, but contracts a private organisation for fulfilling agreed services.

The researchers found evidence suggesting that outsourcing tends to worsen health outcomes.

Despite looking at HICs, the study is “very much relevant” to India, a low- and middle-income country, according to a health policy and systems researcher, Vikash R.Keshri.

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