By Charalampos Karouzos,
One of the most important global health policy debates of today is centered around the structure of healthcare systems worldwide, which are faced with a common pivotal challenge: balancing efficiency, access, and fairness. On top of these issues, however, lies the importance of health equity; the idea that everyone should have a fair and just opportunity to achieve their highest level of health, a fundamental goal of any health system, regardless of the payment model. On the one hand, public health systems strive for limitless universal care, but they often struggle with inefficiencies, while fully privatized models can deepen inequalities. Between these extremes lies a promising middle ground, where partial “privatization” through non-profit private organizations can act as a catalyst, introducing innovation and efficiency while preserving the goal of health equity.
One of the most significant benefits of involving non-profit organizations in healthcare is their common mission-driven care. While the term “privatization” often evokes fears of lost rights and diminished access to care, which indeed can be seen in countries with private health care systems, it is essential to recognize that this outcome is not set in stone. The integration of non-profit organizations into the healthcare landscape does not equate to sacrificing the fundamental principle of health as a universal right, instead, it can enhance the whole system by fostering innovation, improving efficiency, and ensuring that care remains equitable. Since their focus is not on generating profit, as is the case in traditional health insurance companies, these organizations can tailor their services to community needs, reinvesting earnings into improving care, which can be especially beneficial for underserved populations who may not have equitable access to care in an entirely public or for-profit system.
Non-profit organizations differ significantly from for-profit models, as their goals are fundamentally different, focusing on community welfare rather than shareholder profits. Such a model suggests that they are more likely to prioritize reinvestment in healthcare infrastructure, services, and patient outcomes rather than revenue generation. Furthermore, many non-profit healthcare providers already exist globally, such as charitable hospitals or organizations that offer health insurance on a non-profit basis, acting as real-world examples that show that non-profit organizations can compliment the public sector in achieving health equity.
Alongside the possibility to reinvest profits in underserved population, improving equitable access to health care, another great opportunity lies close by, improving efficiency and quality of the provided healthcare services. It is a common global issue that public healthcare systems often struggle with long waiting times and strained resources, especially for elective procedures or specialist care. Introducing non-profit providers can alleviate some of this burden, offering more timely care and reducing patient backlogs. Additionally, these organizations often have more flexibility to innovate, bringing in new technologies and treatments that the public sector, with its bureaucratic processes and cost constraints, may not be able to adopt quickly.
Another point that must be highlighted in this model is the greatest availability of services people have access to, compared to the standardized set of services offered by the public healthcare system. Non-profit organizations can operate to give patients the option to select different providers or facilities, improving flexibility, thus allowing patients to access the care that may be better tailored to their individual needs, whether it be specialized care or more responsive service delivery, all while maintaining an emphasis on public wellbeing.
The overarching concept of introducing another player in healthcare emphasizes the inherent shortcomings of a fully public healthcare system, which although designed to promote fairness, can create inefficiencies and unintended inequalities. One major issue is that public systems often operate as monopolies, with the government controlling both the provision of care and its regulation, and thus without competition, there is little pressure to improve quality or efficiency. Public providers tend to become complacent, leading to lower-quality care, outdated technology, and long wait times for services.
Moreover, unfortunately public healthcare systems, although in theoretical terms autonomous, are often subjected to political and bureaucratic influences. Since available resources are de facto scarce and are often allocated on political agendas rather than the specific health needs of populations, the combination can lead to geographic disparities, where some regions receive more funding and better services than others. Additionally, individuals with political connections or social influence may find ways to bypass long wait times, even in public systems, creating informal privileges that undermine the fairness these systems strive to achieve.
Expanding on the issue of social inequality, one of the most significant criticisms of fully public systems is rationing of care, where the underfunded or overstretched public health care systems cause significant delay in providing non-emergent care to patents. This issue disproportionately affects lower-income individuals who cannot afford to wait for services, leaving them at a disadvantage despite the system’s intention of being equitable.
Despite the many advantages, partial privatization through non-profit organizations is not without its challenges, one major concern being the potential to create a two-tiered system. The issue is centred around the potential of wealthier individuals accessing faster or better-quality care, through non-profit providers while others rely on an underfunded public sector. While non-profit organizations are not profit-driven, the reality remains that they may offer services that are faster or more specialized than those available in the public sector, creating disparities in access.
Another question that has been raised lies around patient selection bias, in which non-profit providers, while focused on equity, may still tend to “cherry-pick” patients who are less costly to treat, leaving the most complex and resource-intensive cases to the public system, further exacerbating the underfunding and creating a possible imbalance, where the public system becomes overburdened with high-cost patients, further straining its resources.
Of major concern too is long-term sustainability. Non-profit organizations often rely on fundraising, donations, or government contracts to sustain their operations and thus funding streams can be unstable, particularly during economic downturns or when political priorities shift. Ensuring the long-term viability of non-profit healthcare providers requires stable and consistent funding, which may be challenging to maintain. One example is the recent pandemic, where the healthcare systems where abruptly met with unforeseen amount of pressure that couldn’t be handled by the private sector alone, whereas the public system could take a financial burden to serve the increased needs.
Expanding the conversation, another major role is to be played by adequate and fair governmental regulation which must strive for health equity by ensuring that partial privatization through non-profit organizations enhances rather than undermines global access to care. Strong regulatory oversight is necessary to ensure that non-profit providers are transparent and accountable in their resources allocation and selection of patients, guaranteeing that equitable care targets, not just efficiency ones, are met.
Moreover, governments can foster public-private partnerships, where non-profit organizations work alongside public health services to complement and strengthen the overall system. In countries like the Netherlands, where non-profit health insurers operate in a highly regulated environment, these partnerships have been successful in maintaining universal coverage while offering a level of choice and efficiency that benefits patients.
Looking at the international level, examples provide valuable insight into how non-profit organizations can function in partially privatized systems. Developed countries like the previously mentioned Netherlands and Canada, operate a healthcare system in which non-profit health insurers play a key role in delivering services, maintaining universal access while allowing for innovation and choice, proving that non-profit organizations can contribute to health equity in a regulated environment. Further, public healthcare system is supplemented by non-profit hospitals and health centres that work in conjunction with public services, ensuring that high-quality care is available without sacrificing the principle of universal access.
In conclusion, the introduction of non-profit private organizations presents a promising solution to a longstanding issue in fully public healthcare systems, where the government serves as both the provider and regulator of access to health services, leading to a conflict of interest. Particularly during times of economic strain or other challenges, this dual role allows the government, functioning as a monopoly, to limit or prioritize specific health services based on budgetary constraints rather than genuine health needs. While non-profit organizations are not without their flaws, they represent a viable model for clearly distinguishing between service provision and regulation, thereby promoting a more equitable and efficient healthcare system that better serves all individuals. If implemented effectively, this blended model could introduce much-needed competition, enhance efficiency, and offer patients greater choice, actively supporting the human right to health while addressing the shortcomings of public healthcare systems.
References
- Ethical Issues in For-Profit Healthcare. National Library of Medicine. Available here
- Largest nonprofit hospital systems. Definitive Healthcare. Available here
- For-Profit Healthcare Organizations vs. Not-for-Profit Healthcare Organizations. Board Effect. Available here
- For-Profit vs Not-for-Profit Healthcare Organizations (Differences, Pros, and Cons). Azeus Convene. Available here
- The Role of Nonprofit Health Organizations. UCF Online. Available here
