The failure of private health services: COVID-19 induced crises in low- and middle-income country (LMIC) health systems

Abstract

For decades, governments and development partners promoted neoliberal policies in the health sector in many LMICs, largely motivated by the belief that governments in these countries were too weak to provide all the health services necessary to meet population needs. Private health markets became the governance and policy solution to improve the delivery of health services which allowed embedded forms of market failure to persist in these countries and which were exposed during the COVID-19 pandemic. In this article, we analyse the manifestations of these market failures using data from an assembled database of COVID-19 related news items sourced from the Global Database of Events, Language, and Tone. Specifically, we identify how pre-existing market failure and failures of redistribution have led to the rise of three urgent crises in LMICs: a financial and liquidity crisis among private providers, a crisis of service provision and pricing, and an attendant crisis in state-provider relations. The COVID-19 pandemic has therfore exposed important failures of the public-private models of health systems and provides an opportunity to rethink the future orientation of national health systems and commitments towards Universal Health Coverage.