Context:

• Managing COVID-19 which is unlikely to disappear in the immediate future and ensuring a full complement of health care will require extraordinary resources and investment. 
• This unprecedented crisis has highlighted the critical need to mobilise available resources in the public sector, and the private sector in particular.

 

Current scenario:

Lack of clear policy guidelines

• There are no clear policy guidelines to use private sector resources that could complement public sector efforts, and how the payments for their services are made.

Inadequate cash flows

 

• The private sector is gasping for cash flows as it has been directed to suspend most of its services to concentrate more on managing COVID-19 cases.

 

 

Pandemic provides opportunity:

• The recent economic package announced for the health sector, of around Rs 2.1 lakh crore, envisions strengthening the health infrastructure in the immediate future.
• This is an opportunity to bring in structural changes in the health sector to rejuvenate partnerships with the private sector which will help in realising public health goals.

 

Restructuring health sector:

 

Laboratory services

 

       To scale up testing capacity the following options can be proposed

1. An accredited private laboratory can be contracted to be co-located in a public health facility preferably in tier-II/tier-III public hospitals. States that already have private laboratories under a public–private partnership (PPP) contract can be asked to add COVID-19 tests. The government may procure test kits and the private sector could charge a service fee from the government.
2. Suspect cases can be issued vouchers for testing at any empanelled private laboratories. E-vouchers generated by tele-health call centres can subsequently be reimbursed by the government.
3.  A mobile sample collection and testing facility can be operated by a private entity in high density clusters. This arrangement can be under the hub-spoke principle. The cost of tests, key performance indicators and payment system should be worked out in the purchase contract.

 

Hospital infrastructure

• Improving the infrastructure and capacity in tier II and tier III cities in collaboration with the private sector is critical.
• The latest announcement to increase viability gap funding to 30% is bound to ease the capex pressure for the private sector.

The options can be:

1. A private contractor could be hired to refurbish an existing ward in a public hospital into an intensive care unit (ICU) ward with additional beds and equipment and handover the refurbished ward to the public authority. Under this project, an ICU ward could be made available within a short time.
2. In a scenario where the district hospital does not have staff to operate an ICU ward (option 1), a private hospital partner could be contracted to provide staff and operate the ICU ward. Alternatively, a private hospital partner can refurbish, operate and later transfer the ICU ward. The Centre can provide viability gap funding to the State to support the development of such a facility.
3. The government can refer patients to empanelled private COVID-19 hospitals, at a fixed package rate. This kind of strategic purchasing or insurance reimbursement (say under the Pradhan Mantri Jan Arogya Yojana) requires clear policy directions, a robust referral system, agreement on tariffs, and a quick reimbursement mechanism.

 

Supply chain

•  Repurposing through alternate sources indigenously to meet the increasing demand for test kits, ventilators, and other biomedical supplies which cannot be met by current manufacturers or supply chain sources is the need of the hour.
• A large number of innovations and prototypes need government laboratories to test in quick time, approve and grant a licence for production which includes patenting.
• Besides facilitating quick credit access for manufacturing, the government may also give buy back guarantees and facilitate the supply chain channels.

 

Central intelligence system

• An IT system with artificial intelligence capability should be the backbone of supporting all public and private sector efforts in combating COVID-19.
• The intelligence system should seamlessly help in case identification, contact tracing, managing a tele-health centre, generating e-vouchers, authorising tests, managing referrals for isolation and hospitalisation in the private sector, payment, follow-up, etc.

 

Conclusion:

• The resources dedicated to fighting the COVID-19 pandemic have the potential to create a good health infrastructure and strengthen health systems eventually. However, these initiatives require quick policy formulation followed by guidelines for contracting/purchasing, payments, defining standards, supply chain, strengthening procurement, etc.

 

• A group of inter-disciplinary experts to guide in institutionalising the private partnership arrangements would go a long way.

 

 

Reference:

1. https://www.thehindu.com/opinion/lead/paging-the-private-sector-in-the-covid-fight/article31774337.ece