Policy and Regulatory Options for Private Participation

The range of options A government seeking to encourage private participation in health care provision can choose among six basic policy and regulatory options that vary widely in the risks and responsibilities borne by the private (for-profit or nonprofit) entity. At one end of the spectrum the private sector takes on limited responsibilities while the public sector remains the primary provider of health care services (table 1). At the other end, the government establishes a policy environment in which qualified private entities may freely enter and exit the health care market. In this option private providers assume the full risks and responsibilities associated with service provision, and the public sector limits its role to regulation. The responsibilities that make up comprehensive health care provision can be divided into five main categories: ▪ Service delivery—providing specific services relating to health care. ▪ Management—coordinating services and administering the operation of clinics or hospitals, responsibilities that may or may not include the authority to make employment decisions. ▪ Asset maintenance—maintaining public facilities such as hospital buildings. ▪ Construction and rehabilitation—investing in constructing and rehabilitating facilities (excluding the purchase of equipment needed to provide services). ▪ Asset ownership.