Making Health Markets Work for Poor People

This editorial from the id21 insights web magazine describes the weaknesses in regulation of the variety of market-based providers of health-related goods and services. Providers range from highly organised and regulated hospitals and specialist doctors to informal health workers and drug sellers operating outside the legal framework. The issue of id21 within which this article was published discusses the unregulated markets associated with porous public and private boundaries in the field of health and resulting problems with safety, efficacy, and cost in medical diagnosis and pharmaceuticals.


The authors state that weaknesses in public sector management and in governance arrangements have contributed to these problems and are affecting efforts to strengthen regulation. Experiences in managing other kinds of market relationships can inform the health sector. They indicate that strategies for constructing more effective regulation increasingly involve partnerships between government, civil society organisations, and the private sector.


One example cited here is the ‘markets for the [economically] poor’ approach developed by a regional technical assistance project of the Asian Development Bank and Department for International Development United Kingdom (DFID). The project has carried out research on the relationship between providers and users of goods and services in a number of sectors. The evidence demonstrates the influence of both formal and informal rules on this relationship and the multiple agencies that undertake supporting functions.


Recognising the diversity of contexts and influencing factors, the article recommends that strategies for change go beyond improving management of a single organisation. For example, many health-related markets are segmented, with well-regulated components used mostly by economically rich people and unregulated ones used by economically poor people. This situation seems to often be exacerbated by power imbalances; for example, providers often possess medical knowledge and expertise needed by consumers.


As stated here: "Societies have mechanisms to address this problem through a combination of regulation by the state, different forms of self-regulation and organisations that build and maintain a reputation for competent and ethical behaviour. The relevant organisations include the regulatory arms of central and local government, professional and trade associations, large service provision organisations and civil society organisations and consumer associations. Different configurations for managing information asymmetries are likely to emerge to manage poorly regulated health markets."


In short, the authors indicate a consensus on government use of public funds and regulatory powers to ensure access to certain health services as a right. They suggest using the mechanisms of insurance or subsidies for services to the economically poor. They also state that in highly 'marketised' health systems, there is equity pressure on the issue of who pays for such health service mechanisms.


Aspects of market characteristics, privatised pharmacy influence on prices, a model of wide provision of eyeglasses as social entrepreneurship, technology as a change agent for provider-patient relationships, and health insurance as a catalyst for provider behaviour are the range of topics that result from considering this topic in the id21 publication. (See source link below for access to further topics.)