The right to health in a post-COVID-19 context: learning hard lessons
The COVID-19 pandemic has put the spotlight on structural and longstanding problems that are undermining the right to health, including fragmentation and inequalities within the health system. Delivering on the Sustainable Development Goals (SDGs) and guaranteeing gender-sensitive health public services require a people-centred and feminist approach to development finance that takes account of hard lessons learned during the coronavirus crisis and beyond.
In the 1980s and 1990s, national health systems in developing countries were transformed by structural adjustments programmes provided by the International Monetary Fund (IMF) and the World Bank. This resulted in the contraction and decentralisation of public healthcare services, as well as the opening of the health sector to private providers, the introduction of healthcare user fees and an increased precariousness of health professionals’ labour conditions. These policies aggravated the commodification and privatisation of healthcare, resulting in increased inequalities.
Even though these policies have proved to be highly problematic, they have not been completely reversed. IMF austerity policies continue to undermine public health systems, while the recent World Bank’s ‘Maximising Finance for Development’ approach is an indication of the priority role given to private finance, including in healthcare, as public finance is seen as a last resort.
All this means that public health systems have been systematically underfunded, leaving them woefully unprepared to respond to a health crisis like the Covid-19 pandemic. It also means that access to healthcare today is often determined by income, gender and geographical location.
Privatisation of healthcare increases systems’ vulnerability
Recent research reveals that privatisation trends have resulted in greater vulnerability of the health system. It has led to reduced capacity in both equipment and staffing, less equitable coverage and lower adherence to medical standards. Moreover, where universal coverage is not granted, uninsured people with Covid-19 symptoms are more likely to avoid costly testing or treatment, which risks contributing to the spread of the virus.
To make matters worse, there is a clear overlap between vulnerable public healthcare systems and debt in developing countries. Eurodad research recently pointed out that many countries were already in debt distress and struggling to finance public services before the pandemic. The economic downturn has further increased debt vulnerabilities, making it even harder for governments to increase health budgets at a time when healthcare is needed more urgently than ever before.
Many are now looking at private sector actors and resources to meet the SDGs. In recent years the World Bank Group has actively encouraged governments to prepare the ground for private care providers through regulatory reforms that enable business opportunities, as well as supported companies and governments to engage in public-private partnerships (PPPs).
While PPPs are portrayed as a tool to leverage private finance, there is very little evidence that they are able to deliver on the universal realisation of the right to health. Civil society organisations and academics have repeatedly warned that health PPPs are emphasising commercial imperatives, which might undermine the right to health.
Three lessons can be learned from the experience of health PPPs. Firstly, hospital PPPs tend to be more expensive than publicly financed projects, due to the high cost of private finance, profit margins and the transaction costs associated with the negotiation of complex PPP contracts.
Secondly, health PPPs are usually risky businesses for the public sector. The delivery of healthcare is changing rapidly and the lack of flexibility in PPP contracts is a risk factor. COVID-19, in particular, could have a detrimental impact on the fiscal costs of hospital PPPs, through reduced revenue and increased costs, with a knock-on effect on already hard-pressed public finances.
The problematic experience of the Lesotho PPP hospital – supported by the World Bank – illustrates how risky PPPs can be for the public sector. It swallowed up almost a third of the nation’s health budget and the government’s bill to the private company is now reaching unaffordable levels.
Thirdly, the quest to maximise profits can have detrimental effects on women and the most marginalised people in society. There are concerns that PPPs could become a mechanism for securing revenue streams for private investors rather than contributing to high-quality and affordable healthcare, an essential condition to help secure the right to health for a large majority of women and the most vulnerable people.
What should be done?
A people-centred and feminist approach to development finance is key when it comes to rebuilding health systems in a post-COVID-19 era in order to deliver the right to health for all. Strong and accountable public health systems, with adequate financial and human resources, will allow for an efficient and equitable response that specifically deals with gender inequalities in health.
A crucial first step towards achieving such a system is to learn from past lessons. International financial institutions will need to commit to further debt cancellation and shift development finance agendas away from austerity measures and market-friendly reforms, which have contributed to countries’ vulnerability to exogenous economic shocks and risks increasing existing inequalities. Anything less will lead the world to ignore the lessons learned from the coronavirus crisis (and beyond) and to repeat past mistakes.
Iolanda Fresnillo is Senior Policy and Advocacy Officer at Eurodad – the European Network on Debt and Development – on Debt Justice. She is also involved in the spanish Citizens' Debt Audit Platform and other local and international social movements. She worked for more than 10 years as a researcher at Debt Observatory in Barcelona, and as a research consultant at MSF, Transnational Institute and several local authorities in Catalonia and Spain. She holds a MA in Development and Cooperation and a BA in Sociology, both from the University of Barcelona. Twitter: @ifresnillo
María José Romero is Policy and Advocacy Manager at Eurodad – the European Network on Debt and Development – on publicly-backed private finance and development finance institutions. She is also a PhD candidate in Development Economics at SOAS, University of London. Before joining Eurodad, María José worked at the secretariat of the Latin American Network on Debt, Development and Rights (Latindadd), based in Peru, on tax justice and development finance. From 2005-2010 she coordinated the IFIs Latin American Monitor project at the Third World Institute (ITeM), based in Uruguay. Twitter: @ma_jose_romero