7200AA21APS00005 Frontier Health Markets APS (1).pdf

Federal Agency Name: United States Agency for International

Development

Funding Opportunity Title: Frontier Health Markets

Announcement Type: Annual Program Statement (APS)

Funding Opportunity Number: 7200AA21APS00005

Catalog of Federal Domestic Assistance

(CFDA) Number:

xxx

98.001

Issuance Date: February 25, 2021

Closing Date: February 24, 2028

Questions Deadline for this

APS Document:

March 3, 2021 at 12:00 pm ET

For questions on this APS document, please submit all questions to Mrs. Jacquelin Bell via email at jacbell@usaid.gov by the deadline specified above.

Please see individual Round documents for each Round’s deadlines and submission instructions for concept papers.

For a USAID Mission or USAID/Washington Office wishing to issue a Round under this

APS, the program description must fit within Section I of this document. Please contact

Kuyosh Kadirov (kkadirov@usaid.gov) for review of the Round document - it must be reviewed before being posted publicly under this APS. All new Rounds must be posted as a

Frontier Health Market (FHM) APS Round on the USAID Business Forecast.

mailto:jacbell@usaid.gov

To Interested Applicants:

This Annual Program Statement (APS) publicizes the intention of the United States Government

(USG), as represented by the United States Agency for International Development (USAID), Bureau for Global Health (GH), to fund one or multiple awards to address the overarching APS program purpose. The purpose is to increase private health sector contributions to advancing voluntary family planning (FP), reproductive health (RH), and/or other health (maternal, newborn and child health (MNCH), malaria, tuberculosis (TB), other infectious diseases, and HIV/AIDS) outcomes.

This APS document outlines the goal, purpose, expected results, and priorities of the Frontier

Health Markets (FHM) project, and may result in multiple awards issued under subsequent APS

Rounds. Note: when referencing FHM in this document, it is referring to the full portfolio of possible awards under this overall purpose. This document is an umbrella APS and will not solicit concept papers or applications. Prospective applicants will be provided a fair opportunity to develop and submit competitive concept papers to USAID for potential funding via Rounds under this APS.

For the purposes of the FHM APS, a “Round” is defined as a specific program description that falls under the larger FHM APS goal, purpose, and results but is tailored to a certain focus. Under each

Round, applicants will first submit a short concept paper that will be reviewed for responsiveness to the overall FHM purpose, selected results, and Round’s focus and then scored according to the evaluation criteria provided in the Round document. USAID may utilize co-creation with prospective applicants during various stages of Round procurements and applicants may be invited to participate in virtual or in-person events. Following the concept paper stage (and co-creation event when called for), selected applicants (individual organizations and/or consortia developed at concept paper stage or during co- creation) will be requested to submit a Full Application, the content and format of which will be provided in greater detail by the Agreement Officer.

Publishing this APS does not commit USAID to make any awards. USAID also reserves the right not to conduct a co-creation workshop and request Full Applications from successful applicants at the concept paper stage.

As Rounds occur, notifications will be posted on Grants.gov.

Sincerely, Alisa J. Dunn

Supervisory Agreement Officer

Office of Acquisition & Assistance

TABLE OF CONTENTS

SECTION I: FUNDING OPPORTUNITY DESCRIPTION 1

A. Background 3

B. Results Framework 14

C. Legislation 15

SECTION II: AWARD INFORMATION 17

A. Estimate of Funds Available and Number of Awards Contemplated 17

B. Start Date and Period of Performance for Federal Award 17

C. USAID’s Substantial Involvement 17

D. Intellectual Property 19

E. Environmental Impact 19

F. Authorized Geographic Code 20

G. Benefiting Geographic Areas 20

SECTION III. ELIGIBILITY INFORMATION 21

A. Eligibility Criteria 21

B. Cost Share 22

SECTION IV. CONCEPT PAPER SUBMISSION INFORMATION 23

A. Concept Paper Process

SECTION V. APPLICATION REVIEW INFORMATION 26

APPENDICES:

Appendix A: FP Priority Countries

Appendix B: USAID Gender Equality and Female Empowerment Policy, 2012

Appendix C: Youth in Development Policy, 2012

Appendix D: USAID Frontiers in Development – Ending Extreme Poverty, 2014

Appendix E: USAID Multi-Sectoral Nutrition Strategy, 2014-2025, 2014

Appendix F: USAID Maternal Health Vision for Action, 2014

Appendix G: Every Newborn Action Plan, 2014

Appendix H: USAID Risk Appetite Statement, 2018

Appendix I: USAID Private Sector Engagement Policy, 2018

Appendix J: USAID Acquisition and Assistance Strategy, 2018

Appendix K: USAID Essential Considerations for Engaging Men and Boys for Improved Family

Planning Outcomes, 2018

Appendix L: US Strategy to Prevent and Respond to Gender-Based Violence, 2016 Update

Appendix M: USAID Discussion Note: Adaptive Management

Appendix N: Survive and Thrive: Transforming Care for every Small and Sick Newborn, 2018

ACRONYM LIST

ADS Automated Directives System

AO Agreement Officer

AOR Agreement Officer’s Representative

APS Annual Program Statement

BEO Bureau Environmental Officer

CA Cooperative Agreement

CII Center for Innovation and Impact

CFR Code of Federal Regulations

DDI Bureau for Development, Democracy, and Innovation

DUNS Data Universal Numbering System

EA Environmental Assessment

FAM Fertility Awareness Methods

FP Family Planning

GH Bureau for Global Health

HIV/AIDS Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome

HTSP Healthy Timing and Spacing of Pregnancy

IEE Initial Environmental Evaluation

IR Intermediate Result

LMICs Low- and Middle- Income Countries

MCH Maternal and Child Health

MCHN Office of Maternal Child Health and Nutrition

MEL Monitoring, Evaluation, and Learning

NGOs Non-Governmental Organizations

NPI New Partnerships Initiative

NUP New and Underutilized Partners

OHA Office of HIV/AIDS

OHS Office of Health Systems

PEPFAR President’s Emergency Plan for AIDS Relief

PRH Office of Population and Reproductive Health

RH Reproductive Health

SAM System for Award Management, Registration, Renewal, & Migration

USAID United States Agency for International Development

USG United States Government

WASH Water, Sanitation, and Hygiene

WHO World Health Organization

SECTION I: FUNDING OPPORTUNITY DESCRIPTION

The U.S. Agency for International Development’s (USAID) Office of Population and Reproductive

Health (PRH) is pleased to announce the Frontier Health Markets (FHM) Annual Program

Statement (APS) which aims to help achieve global U.S. Government (USG) health priorities and commitments, specifically related to preventing child and maternal deaths, controlling the

HIV/AIDS epidemic, and combating infectious diseases. FHM will improve the functioning of local health markets and will support the effective engagement and systemic inclusion of the private sector to advance voluntary family planning, maternal, newborn and child health, malaria, TB, and HIV/AIDS outcomes. FHM will leverage existing evidence and best practices, as well as catalyze new ideas, forge partnerships, and innovative approaches to foster the introduction, scale up, and sustainability of quality healthcare delivery in the private sector to achieve our ambitious global health targets and help enhance countries’ ability to fortify and diversify healthcare delivery.

The public sector health system faces many constraints and cannot meet the growing needs and market demand for voluntary family planning (FP) and other health products and services in low-and middle-income countries (LMICs) alone1. Users in LMICs are increasingly accessing health services through the private sector, but challenges remain in ensuring voluntary FP and other health markets are resilient, robust, and capacitated to deliver appropriate, affordable, quality health products, services, and information in a self-reliant manner. A robust private sector is an inextricable stakeholder in driving and sustaining outcomes capable of moving countries beyond the need for assistance, and offers much needed infrastructure, staff, networks, and other technical and financial resources to contribute to overall health systems performance. The private sector continues to play an unprecedented role in creating and shaping opportunities and reaching a scale that improves the lives of the people and communities USAID supports. An additional area of importance and key requirement for a quality health market is strengthening the stewardship capacity of the public sector to improve delivery of private sector health services for better health outcomes.

The design of FHM reflects the evolution in USAID’s private sector programming with a greater emphasis on strengthening health market systems. It is designed to enhance countries’ ability to fortify and diversify healthcare delivery and to ensure that USAID’s investments are tailored to country contexts and needs. Fundamental to FHM’s design is the premise that market-based approaches can lead to greater scale and sustainability of development outcomes.

This is based on the assumption that as long as a business case or market system exists for a good or service, it has a greater likelihood of sustaining itself without external support. FHM also recognizes that countries which received USAID support have different local contexts, from a business and health policy point of view, as well as a regulatory lens, that require unique support.

FHM will also include a greater focus on building the technical capacity, sustainability, and resilience of local partner institutions, while maintaining an emphasis on advancing the scale-up of evidence-based approaches and interventions. FHM will aim to forge new partnerships with a significant number of development actors and diversify USAID’s partner base through concentrated efforts to engage the local private sector at the country level for state-of-the-art

1 Universal Health Care Coverage Fact Sheet https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) technical expertise, local market intelligence, and service delivery.

FHM aims to leverage the expertise of established partners while also reaching, engaging, and increasing the capacity of a wide variety of new and local partners with relevant technical expertise. These could be local small-medium businesses, private sector organizations, non-governmental organizations [NGOs], private voluntary organizations, faith-based and community-based organizations [FBOs and CBOs]. FHM will use co-creation strategies to bring traditional, new, and local partners together and anticipates bids from a broad range of sectors. The solicitation will encourage the leadership and substantive engagement of new and local partners by reducing barriers to entry. For example, FHM awards will seek to issue performance-based, capacity-building, and/or innovation sub-awards and sub-grants to local organizations which may become transition awards. All sub-awards to local organizations will specify clear, achievable, and measurable outcomes mapped to priority health indicators, and connect to specific, national priorities. Country programs in particular may be well positioned to target a variety of new, local or locally established partners.

FHM builds on a long history of USAID’s involvement in public-private partnerships at the country- and local-level and incorporates lessons, data, and results from past and current private sector health projects including: Family Planning Enterprise (ENTERPRISE) and Technical

Information on Population for the Private Sector (TIPPS) (1985-1991); Promoting Financial

Investments and Transfers (PROFIT) (1991-1997); Commercial Market Strategies (1998-2004);

Private Sector Partnerships for Better Health (PSP) One (2003-2009); Banking on Health (2004-

2009); Sustaining Health Outcomes through the Private Sector (SHOPS) (2009-2016); Achieving

Sustainability through Local Health Systems (2019-2024); SHOPS Plus (2015-2021); Scale for

Impact (2016-2021); Support for International Family Planning Organizations (2010-2015);

Support for International FP and Health Organizations 2: Sustainable Networks (SIFPO2) (2015-

2020); Momentum Private Healthcare Delivery (MPHD) (2020-2025); and The New Partnerships

Initiative (NPI) Expanding Health Partnerships: NPI EXPAND (2020-2025). FHM will continue the work of predecessor projects in advancing knowledge and best practices for private sector expansion in voluntary family planning, maternal, newborn and child health, malaria, TB, HIV/AIDS and other infectious diseases. It will continue providing global technical leadership, evidence generation and dissemination, and ensure the linkages between knowledge generation, global dialogue, and country action to achieve global health goals.

FHM supports USAID’s four strategic pillars of development: 1) respecting American taxpayers’ investments, 2) advancing national security, 3) strengthening our core competencies; and 4) empowering our people to lead, by:

● Increasing coordination across the public and private sector for sustained health outcomes;

● Building capacity of local private and public health organizations, thereby strengthening the long-term effectiveness and durability of investments;

● Using a variety of assistance models to help countries effectively plan for, manage and finance a mixed health delivery system;

● Aligning USAID investments with country-owned and -led national and subnational health, social, and economic investment plans to maximize cost-efficiency and increase sustainability;

● Optimizing strategic partnerships and engagement to increase financial investments and establish long-term, enduring, and sustainable engagement by non-donor stakeholders towards mutual goals.

A. Background

As the world’s largest bilateral donor for voluntary FP/RH and TB, a global leader in MNCH, and one of the key agencies implementing the President’s Emergency Plan for AIDS Relief (PEPFAR) program, USAID partners with governments, for-profit and nonprofit organizations, faith-based organizations (FBOs) and civil society organizations (CSOs) to meet the health needs of women, men, and children. For more than 50 years, USAID programs have saved lives and improved health outcomes across the globe. Today, due in part to USAID investments, there has been: an average

30 percent increase in modern contraceptive prevalence with family size dropping to 4.4 children per woman in USAID priority countries2; 44 percent reduction in global maternal mortality3; 52 percent reduction in newborn mortality since 1990; and the global under-five mortality rate has fallen to 38 deaths per 1,000 live births4. USAID’s investments through the PEPFAR program have also helped countries advance toward the global 90-90-90 targets for HIV/AIDS, with 81% of all people living with HIV knowing their status, 82% of those knowing their status are accessing treatment and 88% of those on treatment are virally suppressed as of 20195. Since 2000, on average, in the 23 countries where the United States provides TB bilateral funding, the incidence of

TB decreased by 27 percent, mortality from the disease decreased by 44 percent, and notifications of individuals with active TB disease increased by 114 percent.6 As a part of pursuing these broader TB goals, USAID has been a leader in increasing private provider engagement in quality

TB services.7

USAID has led the introduction of a wide range of innovative interventions that contribute to improved health outcomes, including but not limited to oral rehydration therapy and zinc supplementation, doorstep delivery of contraceptives, mobile outreach, social franchising, and new contraceptive technologies. Since 2008, USAID investments helped save the lives of close to five million children and 200,000 women in 25 priority countries8. In fiscal year 2019, USAID’s

PEPFAR investment yielded over 1.2 million people newly identified as being HIV-positive and

1.1 million people newly initiated on treatment for a total of 5.9 million men women and children supported on life-saving HIV treatment9.

While FHM aims to build on the last twenty five years of work to help strengthen the capabilities

2 USAID Family Planning and Reproductive Health Programming Overview https://www.usaid.gov/sites/default/files/documents/1864/FP-program-overview-508.pdf 3 "Trends in Maternal Mortality: 2000-2017," WHO, UNICEF, WB, and UNFPA, there was a 38% reduction in MMR during 2000 and 2017. https://www.who.int/reproductivehealth/publications/maternal-mortality-2000-2017/en/ 4 Children: Improving Child Survival and Well Being Factsheet. https://www.who.int/news-room/fact-sheets/detail/children-reducing-mortality 5 UNAID Global HIV/AIDS Statistics- 2020 Fact Sheet https://www.unaids.org/en/resources/fact-sheet 6 Accelerating Action to End TB: Tuberculosis Report to Congress https://www.usaid.gov/sites/default/files/documents/1864/2020_Report_to_Congress_01-WEB-READY-FINAL.pdf 7 Engaging Private Health Care Providers in TB Care and Prevention: A Landscape Analysis.

https://www.who.int/tb/publications/2018/PPMLandscapeAnalysis.pdf?ua=1 8 https://www.usaid.gov/results-and-data/progress 9 Levels and Trends in Child Mortality https://www.unicef.org/media/79371/file/UN-IGME-child-mortality-report-

2020.pdf.pdf https://www.usaid.gov/sites/default/files/documents/1864/FP-program-overview-508.pdf https://www.who.int/reproductivehealth/publications/maternal-mortality-2000-2017/en/ https://www.who.int/news-room/fact-sheets/detail/children-reducing-mortality https://www.who.int/news-room/fact-sheets/detail/children-reducing-mortality https://www.unaids.org/en/resources/fact-sheet https://www.usaid.gov/sites/default/files/documents/1864/2020_Report_to_Congress_01-WEB-READY-FINAL.pdf https://www.who.int/tb/publications/2018/PPMLandscapeAnalysis.pdf?ua=1 https://www.usaid.gov/results-and-data/progress https://www.unicef.org/media/79371/file/UN-IGME-child-mortality-report-2020.pdf.pdf https://www.unicef.org/media/79371/file/UN-IGME-child-mortality-report-2020.pdf.pdf of the private sector to deliver health products, services, and information, FHM is also an evolution in USAID thinking to embrace a systemic, market development approach that addresses the root causes of market inefficiencies that limit the ability of the private sector to deliver quality, affordable, appropriate health information, products, and services for a range of health seekers across different market segments. Health market development approaches may include interventions aimed at increased access to financing, strategic use of subsidies, tax and other incentives, balanced application and enforcement of health policy, rules and regulations, increased availability and use of health market data, improved donor coordination and government’s stewardship of health markets, and platforms for systematic engagement between governments and private sector organizations.

FHM will build upon these premises and apply lessons from previous and current USAID and other donor health market development experiences. To maximize its impact and to ensure that future investments maintain past gains, FHM will catalyze the development of new ideas, mobilize local resources and expertise, help build additional capabilities, and accelerate progress by uniting partners around the common goal of ensuring equitable access to quality healthcare. FHM will also provide global technical leadership, evidence generation and dissemination and ensure linkages between knowledge generation, global dialogue, and country action to achieve global health goals.

Private Health Sector

The private sector landscape is large and diverse, and the ecosystem of actors include a wide range of commercial and non-profit healthcare providers and facilities, such as hospitals, labs, pharmacies, clinics and health centers, drug shops, traditional medicines practitioners/healers, community health workers, and the organizations that represent them, such as professional councils, and industry associations. The landscape also includes key enablers and supporting players that can advance and innovate in supply chain and distribution networks, those providing technology and digital solutions, health data and information for providers and clients, training and support to health care workforce, financing and insurance industries, the research sector, marketing industries, as well as manufacturers of healthcare commodities and supplies. Given this context, the private sector presents significant opportunities to improve access to and coverage of health products and services that are critical for meeting public health goals. The range of private health sector actors are broad, as illustrated in Figure 1 below, and varies from country to country.

Figure 1: Range of Private Sector Actors in Uganda’s Mixed Health System

Source: Exploring Partnership Opportunities To Achieve Universal Health Access: 2016 Uganda

Private Sector Assessment In Health

Family Planning, Reproductive Health, Maternal Newborn and Child Health

The private sector is essential for the effective provision of health information, products, and services. Data demonstrate that a large proportion of people in USAID priority countries rely on the private sector for provision of healthcare. According to Demographic and Health Survey (DHS) data, the private health sector is an important source of modern contraceptive methods and information. On average, across 36 LMICs in Southeast Asia and Africa, the majority of short-term family planning (FP) resupply methods, such as condoms and pills, are obtained from private sector sources (61 percent and 52 percent, respectively); roughly one out of three modern method users rely on private sector sources (34 percent); and approximately one-quarter of IUD users, injectable users, and sterilized women went to private sector sources for their method (29 percent, 26 percent, and 24 percent, respectively)10.

Often, more women access antenatal care (ANC) services in the private sector than delivery services. A systematic review of 57 LMICs data, found that overall, one in five women delivered in the private sector, with wide variation among countries, ranging from 9 percent to 46 percent11.

10 Sources for Family Planning in 36 Countries: Where Women Go and Why It Matters https://www.shopsplusproject.org/sites/default/files/resources/Sources%20for%20Family%20Planning%20in%2036

%20Countries-Where%20Women%20Go%20and%20Why%20it%20Matters.pdf 11 Benova, L. et al. (2015). Role of the Private Sector in Childbirth Care: Cross‐Sectional Survey Evidence from 57

Low‐ and Middle‐Income Countries Using Demographic and Health Surveys https://onlinelibrary.wiley.com/doi/full/10.1111/tmi.12598 https://www.shopsplusproject.org/sites/default/files/resources/Sources%20for%20Family%20Planning%20in%2036%20Countries-Where%20Women%20Go%20and%20Why%20it%20Matters.pdf https://www.shopsplusproject.org/sites/default/files/resources/Sources%20for%20Family%20Planning%20in%2036%20Countries-Where%20Women%20Go%20and%20Why%20it%20Matters.pdf https://onlinelibrary.wiley.com/doi/full/10.1111/tmi.12598

Secondary analysis of DHS data from 24 USAID priority countries found that 43 percent of children who receive treatment for acute respiratory infections, fever, and diarrhea do so in the private sector, but this varies greatly by region and country12. A similar secondary analysis of DHS data from 45 LMICs revealed that when newborns are sick, among caregivers who seek care outside of the home, 52 percent use public facilities, 46 percent use private sources (24 percent private facilities, 22 percent private retail outlets), and 6 percent go to other sources such as family or friends.13

Tuberculosis

In some countries with a high burden of Tuberculosis (TB), the private health sector plays an important role in TB care. Based in part on extrapolations from DHS data, it is estimated that in seven of the highest burden countries for TB, private providers are the destination for 75 percent

(67-84 percent) of initial care-seeking, private expenditure represents 61–74 percent of total expenditure on health, and private markets deliver 15–54 percent of all anti-TB drugs. At the same time, private for-profit TB notifications represent only 19 percent (5–28 percent) of total notifications and 12 percent (1–18 percent) of estimated incidence.14 These seven high burden countries account for 57 percent of the global TB incidence and 63 percent of missing TB patients.

HIV/AIDS

The private sector plays a smaller, but still significant, role in provision of HIV/AIDS services.

Analysis of AIDS Indicator Surveys from 18 countries revealed that on average 16 percent of those who received an HIV test did so in the private sector. This ranged greatly, from 1 percent of women in Mozambique to 43 percent in Haiti. In nearly all countries, men were more likely than women to test in the private sector.15

The private health sector serves both the poor and wealthy, urban and rural, and all socio-economic segments in between. Global data demonstrate that even the very poor access services from the private sector and often pay for products and services out of pocket. For example, about two in five caregivers from the poorest households rely on the private sector for care of a sick child. Secondary analysis of DHS data has shown that urban and wealthier women disproportionately use the private sector compared to rural, poorer women. According to DHS surveys conducted between 2000 and

2018, on average 24 percent of women in the highest wealth quintile delivered in the private sector, compared to 11 percent of women overall. Wealthier populations also use the private sector at greater rates for family planning, antenatal care, and treatment of childhood diarrhea and fever

12 Bradley, Sarah E. K., Lauren Rosapep, and Tess Shiras. 2017. Sources for Sick Child Care in 24 USAID Priority

Countries. Brief. Bethesda, MD: Sustaining Health Outcomes through the Private Sector Plus Project, Abt

Associates. https://www.shopsplusproject.org/resource-center/sources-sick-child-care-24-usaid-priority-countries 13 Bradley, Sarah E.K., Rosapep, Lauren. “Where Do Caregivers Take Their Sick Children for Care? An Analysis of

Care Seeking and Equity in 24 USAID Priority Countries.” Global Health: Science and Practice, October 2020 8(3):

518-533https://www.ghspjournal.org/content/8/3/518 14 Public–private mix for TB prevention and care: a roadmap. WHO/CDS/TB/2018.32 https://www.who.int/tb/publications/2018/PPMRoadmap.pdf?ua=1 15 Johnson, D., & Cheng, X. (2014). The Role of Private Health Providers in HIV Testing: Analysis of Data from 18

Countries. International Journal for Equity in Health, 13, 36. doi:10.1186/1475-9276-13-36 https://equityhealthj.biomedcentral.com/articles/10.1186/1475-9276-13-36 https://www.shopsplusproject.org/resource-center/sources-sick-child-care-24-usaid-priority-countries https://www.ghspjournal.org/content/8/3/518 https://www.who.int/tb/publications/2018/PPMRoadmap.pdf?ua=1 https://equityhealthj.biomedcentral.com/articles/10.1186/1475-9276-13-36

(Figure 2). Urban women are also 1.2–2.8 times more likely to use the private sector than rural women for child, maternal and family planning.16

Figure 2: Analysis of data for the period 2009–13 (round 6) from forty-three Demographic and Health Surveys

Source: Grepin, Kate. 2016. “Private Sector an Important but not Dominant Provider of Key Health

Services in Low- and Middle-Income Countries”

Significant variation in size and use of the private sector also exists between countries17 18 19.

LMICs such as India or Nigeria have dominant private sectors providing the bulk of health care to

16 Grepin, Karen. Private Sector an Important but not Dominant Provider Of Key Health Services In Low- And

Middle-Income Countries https://www.healthaffairs.org/doi/pdf/10.1377/hlthaff.2015.0862 17 Montagu D, Visconti A. Importance of the private sector for outpatient healthcare in LMICs. Toronto, Canada; 2011.

18 Campbell OMR, Benova L, Macleod D, Goodman C, Footman K, Pereira AL, et al. Who, What, Where: an analysis of private sector family planning provision in 57 low- and middle-income countries. Trop Med Int Health. 2015

Dec;20(12):1639–56.

19 Chakraborty, N; Sprockett, A. 2016. The relationship between wealth and use of health services in the private sector:

A literature review and secondary data analysis focusing on family planning and common childhood illness.

Washington, DC.

https://www.healthaffairs.org/doi/pdf/10.1377/hlthaff.2015.0862 a diverse population and a high proportion of out-of-pocket payments fueling both private and public service provision. Other countries, such as Tanzania or Nepal, have large public sectors offering free care and stratified private sectors composed of both formal and informal providers catering to wealthy and poor populations, respectively. In contrast, countries like South Africa or

Namibia, have a relatively small private sector that caters to the formal-sector, insured population, while the informally employed population predominantly rely on the public sector. 20

Challenges and Opportunities in Private Health Markets

The public health sector faces many constraints and cannot meet the growing market demand for

FP and other healthcare in LMICs alone. The private sector offers much needed infrastructure, staff, networks, and other technical and financial resources and many Ministries of Health (MOHs) are looking for ways to increase private sector contribution in the delivery of health products, services, and information. The Frontier Health Markets project will support market development and private sector engagement approaches that improve the functioning of the local health market, which includes all sectors: public, private, not-for-profit and informal. Most importantly, within a market development approach, the private health sector’s contribution is systematic, complementary, and enhances countries’ ability to fortify and diversify their healthcare delivery.

Hence, FHM will invest in market-based approaches, provide country-level strategic implementation and capacity building support, and facilitate engagement platforms that bring together healthcare market suppliers, consumers, financiers, and regulators from across the public and private sectors. FHM will engage these diverse players to develop a common vision for healthy local markets that improves access, affordability, and increases use of health products, information, and services in an equitable, efficient, and sustainable manner.

A health market can be defined as a system (as depicted in

Figure 3) with core supply and demand functions, as well as the rules and supporting functions that are shaped by a variety of market players. These include: individuals and entities “who demand/buy services” (e.g. consumers, governments); a wide range of private organizations “who supply/sell services” (e.g., clinics, pharmacies, NGOs); and various government and regulatory bodies, financing institutions, and development and technical assistance organizations who “enable” the systemic exchanges. Across supply, demand, rules, and supporting functions, the interplay of preferences and motivations between key actors will lead to improvements in quality, equity, and sustainability of healthcare in the private sector.

Understanding these functions as well as the root causes that influence and/or limit effective interactions among these players is critical.

20 Mackintosh, Maureen, et al. (2016). What is the private sector? Understanding private provision in the health systems of low-income and middle-income countries. Lancet 2016; 388: 596–605.

https://www.sciencedirect.com/science/article/pii/S0140673616003421

Health markets need structures to coordinate the various efforts to identify barriers and causes of market inefficiencies and facilitate a strategic response, often defined as “stewardship”. The government has a mandate for overall stewardship of the entire health system, but to be effective in stewarding the health market, structures need to be in place that amplify private sector voices and support their participation along with other key stakeholders. As a key supporting function for health markets, stewardship facilitates strategic engagements such as demand planning and commodity forecasting for the entire market, private sector access to government initiatives (e.g.

training, free commodities), and supporting sustainable data platforms that increase the visibility of the private sector landscape.

Markets also need clear rules and regulations and efficient allocation of resources to function effectively and equitably. While policy and regulatory oversight is a core government rule-making function, involvement of the private sector in developing the policies and regulations that impact them often improves adherence. Financing strategies that include the private sector are vital to the development of robust and effective local health markets and are often a mix of government budget support (e.g. government contracting), donor financing, social insurance (e.g., other government agency), out of pocket client costs and other private sources (e.g., credit, insurance, capital).

Governments, as stewards of their own healthcare systems, face many challenges in overseeing health markets, such as insufficient understanding of constraints and barriers that inhibit the functioning of local markets. In many cases, they would benefit from improved knowledge of where private providers are located, the nature and level of the services they provide, and specifically what family planning and other health products, services, and information are offered.

Government stewards may also benefit from improved human resources and market data needed to build and implement effective monitoring and supervision systems. In turn, these systems will strengthen governments’ ability to devise policies that include the private sector, to better regulate private healthcare delivery, and develop health procurement and financing strategies that support the entire healthcare market and enable strategic engagement with the broader private sector for improved health outcomes21.

Market actors, particularly private sector entities and healthcare consumers, often face numerous constraints which inhibit their full participation in the health market and limit the effectiveness of local health markets. Some of the common causes of health market inefficiencies are discussed below. FHM will address these through a combination of market development and private sector engagement approaches rather than relying on any single modality.22

Asymmetries in information negatively affect both consumers and private healthcare providers. For consumers, this lack of information results in limited knowledge of health issues in general, low demand for quality health products and services, and lack of transparency on fair pricing of products and services. For providers, limited clear information about policies and regulations constrains their ability to offer services aligned with national policies, since they are

21 Lagomarsino, Gina & Ferranti, David & Pablos-Mendez, Ariel & Nachuk, Stefan & Nishtar, Sania &

Wibulpolprasert, Suwit. (2009). Public stewardship of mixed health systems. Lancet. 374. 1577-8. 10.1016/S0140-

6736(09)61241-1.

22 Montagu, D., and Goodman, C. 2016. Prohibit, constrain, encourage, or purchase: how should we engage with the private health-care sector? https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(16)30242-2/fulltext unaware of expectations and risks. As a result, consumers cannot make meaningful comparisons in terms of service quality and affordability.

The lack of readily accessible market intelligence on the depth, breadth and location of the private sector offerings make it difficult to understand the full scope of the health market. Difficulties arise for those who want to “buy services” to find those “who sell services”, particularly limiting consumer decisions. It also makes it difficult for the private sector to demonstrate their contributions to the overall health market, advocate for resources and for the government to effectively engage with the private sector.

For-profit providers often struggle to provide quality services due to several factors. These factors include: inaccessibility of policy updates to the private sector; lack of coordination between the public and private sector; lack of information on technical updates and inability to gain new technical and clinical skills; difficulty attracting and retaining quality staff; lack of financial support for the provision of public health (vs curative) services; and lack of funds for medicines, equipment, supplies and maintenance. Lastly, these providers rarely receive any supportive supervision visits that could provide them with updated information.

Medicines are a key driver of high out-of-pocket costs for consumers. In many countries, supply chains are highly fragmented and inefficient. The cost of quality assurance is high for local wholesalers and distributors who often sell medicines to providers and pharmacies on credit with long repayment periods. Many private health businesses are small, which means they pay high prices for small volumes of medicines and other supplies. The lack of price controls and market transparency, such as a recommended retail price, mean that additional costs are added to the products as they are distributed to the last mile, resulting in clients paying high prices for their medicines and other supplies. In addition, weak regulatory enforcement leads to leakage of products between sectors, poor quality, substandard and/or counterfeit products.

Financing of health services often falls on the consumer. Out-of-pocket (OOP) spending, particularly among the poor, is a significant barrier to healthcare and may contribute to financial hardship and impoverishment23. In South Asia and West Africa, OOP spending constituted about

64 percent of total health spending in 201724. High OOP spending is correlated with large private health markets and tend to be few financial protections or social safety net programs. Research also suggests a lack of equity exists in such contexts; poorer patients are more likely to go without healthcare than wealthier patients, and to spend proportionately more of their incomes on healthcare25 26. In many countries, risk pooling and/or insurance or other financing mechanisms are nascent and often exclude for-profit providers. Strategies such as contracting out services to the private sector or use of vouchers can improve equity and access but may be limited in scope.

23 Universal Health Care Coverage Fact Sheet, https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) 24 Flows of Global Health Financing, https://vizhub.healthdata.org/fgh/ 25Where Do Poor Women in Developing Countries Give Birth? A Multi-Country Analysis of Demographic and Health

Survey Data Montagu D, Yamey G, Visconti A, Harding A, Yoong J (2011) Where Do Poor Women in Developing

Countries Give Birth? A Multi-Country Analysis of Demographic and Health Survey Data. PLOS ONE 6(2):

e17155. https://doi.org/10.1371/journal.pone.0017155 26 Gwatkin DR, Bhuiya A, Victora CG. Making health systems more equitable. Lancet. 2004 Oct 2-8;364(9441):1273-

80. doi: 10.1016/S0140-6736(04)17145-6. PMID: 15464189.

https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) https://www.who.int/en/news-room/fact-sheets/detail/universal-health-coverage-(uhc) https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0017155 https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0017155 https://doi.org/10.1371/journal.pone.0017155

While OOP spending from users or participation in health financing programs can help cover the costs of some health products and services, private sector health businesses cannot grow without capital investments. Private sector businesses (e.g., wholesalers, clinics, pharmacies) are often small and fragmented with limited business acumen, and not seen as creditworthy investments by financial institutions. In many LMICs, limited access to affordable financing options, for both nonprofit and for-profit health businesses, is a key constraint to providing quality services and growing their business.

FHM aims to address the challenges identified above to facilitate the removal of key market barriers in order to improve equitable access to high quality FP and/or other health sector information, products, and services. Some key market opportunities include, but are not limited to the following:

● Build upon growing acknowledgement by governments that the private sector is a key contributor to health in order to engage governments in market stewardship;

● Strengthen appropriate structures to enable key stakeholders to participate in the market system, particularly the MOH to fulfil their stewardship role to improve health services;

● Introduce and share models of joint regulation and oversight to ensure quality of care within the private sector without being unduly restrictive;

● Incentivize the private sector to provide quality and equitable health products, services, and information;

● Support sustainable data platforms that improve visibility of the private sector landscape and increase availability of market analytics to benefit all sectors;

● Improve service offering and price transparency information to consumers;

● Develop/scale up tools and approaches to enhance affordability of private sector services;

● Enhance access to affordable risk pooling and working capital financing.

Cross-Cutting Considerations for the Private Health Sector

Urbanization

More than half of the global population now lives in urban areas. In sub-Saharan Africa, urban areas currently contain 472 million people, and this will double over the next 25 years. Studies have found that the private health sector is largely urban based, with a lesser footprint in rural areas, except for the informal sector. Urban populations are more likely to use the private sector than rural populations. In addition, in many countries urban primary health care is governed by a city or municipal body, rather than the Ministry of Health, which can create challenges for financing and adequate supervision. Rapid urbanization could be an opportunity for the private health sector to deliver quality services, including family planning, if their capacity is built and relevant government officials are able to engage and effectively provide oversight.

Building resilience in response to COVID-19

The COVID-19 pandemic has illustrated the need to engage the private sector to build more resilient health systems to respond to existing challenges as well as future pandemics. The private health sector, especially pharmacies and drug shops, are often the first source of treatment for respiratory infections, making them front-line responders in screening, treatment, and referrals for

COVID-19. Other private providers can be leveraged to surge capacity in a crisis if there is an ability of the public sector to contract these private providers. Strengthened engagement of private providers is integral for ensuring continued delivery of essential services, including family planning, during a pandemic response. The global recession caused by COVID-19 has increased the need to leverage private capital to supplement donor and domestic government financing for health. Lastly, private sector expertise and technology can help find innovative solutions to get contraceptives, medicines, services, and information to patients more effectively and efficiently.

Engaging the private sector at all levels of the health system can serve to increase client-centered care and create more sustainable, resilient systems.

Youth

There are more than 1.8 billion young people (ages 10-24) worldwide27, with the majority living in

LMICs, primarily across South Asia and sub-Saharan Africa. Youth often face barriers in accessing products, services, and information at health facilities, such as provider bias and age restrictions.

Thus, they turn to private pharmacies and drug shops where they can more easily access condoms, emergency contraception (ECs), oral contraceptive pills (OCPs), or HIV self-test kits, and to social media for information. Youth and adolescent-friendly services, products, and information are needed to empower youth to make healthy decisions starting at a young age and to help youth avoid risky behaviors.

Gender

While gender gaps have narrowed over the past two decades, substantial inequities remain across every development priority worldwide. USAID’s Gender Equality and Female Empowerment

Policy (Appendix B), USAID’s Essential Considerations for Engaging Men and Boys for Improved

Family Planning Outcomes (Appendix K), and the United States Strategy to Prevent and Respond to Gender-Based Violence (Appendix L) highlight key USAID priorities. The private health sector can play a key role in closing gender gaps by catering to unique demographic groups. For example, although men are significantly less likely to know their HIV status or be retained in HIV care, they are more likely to access HIV testing in the private sector. Sexual minorities and other key populations (e.g. men who have sex with men, female sex workers, transgender men and women) are also more likely to access care in the private sector, particularly at non-profit/civil society organizations.

Under each Round, applicants are requested to incorporate fundamental cross-cutting principles underlying each of the outcomes of FHM’s Results Framework. These principles are:

● Implementing evidence-based approaches and interventions;

● Fostering iterative, continuous learning and adaptive management;

● Improving the quality of care provided across the continuum from household to facility;

● Promoting client-centered care by listening to and engaging individuals, families, and communities;

● Addressing the role of social norms, both as barriers and contributors to achieving health and development outcomes;

● Coordinating research, monitoring, and evaluation agenda across FHM investments for strategic alignment, learning and information exchange;

● Partnering with a range of private sector health and non-health actors;

● Promoting dignity, respect, and equity in healthcare services;

27 The Power of 1.8 Billion Adolescents, Youth and the Transformation of the Future https://www.unfpa.org/sites/default/files/pub-pdf/EN-SWOP14-Report_FINAL-web.pdf https://www.unfpa.org/sites/default/files/pub-pdf/EN-SWOP14-Report_FINAL-web.pdf

● Fostering gender equality by increasing use of approaches designed to empower vulnerable populations including women and couples, and engage men more fully in FP and/or other health areas; and

● Building and bolstering the resilience28 of populations and communities, thereby encouraging sustainability, and leveraging the work of other US government agencies and donors.

Coordination of Awards

FHM will complement and build upon other private sector engagement mechanisms within

USAID. While there are a range of awards within the agency that focus on private sector engagement, none of them engages in the development of health markets in the way that FHM will. FHM will be expected to collaborate with related awards to ensure complementarity and that there is no duplication of efforts. USAID private sector engagement awards with which

FHM may want to coordinate include, but are not limited to:

● CATALYZE (DDI/PSE Hub): CATALYZE engages with domestic and international finance providers to mobilize financing across sectors, geographies and transaction type and size. This market development approach enables enterprises to obtain the necessary investment and working capital to sustain and grow their businesses, and advance development priorities. While FHM may incorporate aspects of financing in its work, the main focus will be market development approaches for improved healthcare delivery in the private sector and improved market functioning.

● Integrated Health Systems IDIQ and TO 1 “Local Health System Sustainability”

(GH/OHS): This mechanism supports partner countries and USAID operating units to plan and implement health system strengthening (HSS) solutions with the overall goal of improving health and transitioning capacity to local partners. The mechanism focuses on overall country health systems strengthening including a mix of public and private interventions. Complementary to this focus, FHM will focus on supporting the private sector through market development approaches in voluntary family planning and/or other specific health/disease areas.

● Scale for Impact (GH/CII): Scale for Impact aims to accelerate and magnify the impact of priority global health innovations by leveraging the most successful private sector principles and practices. The objective is the rapid development and diffusion of innovations by ensuring timely and appropriate planning for and introduction of priority global health products and technologies. FHM and Scale for Impact may choose to collaborate when FHM’s market development work touches upon the rollout and scale-up of global health innovations.

● MOMENTUM Private Healthcare Delivery (MPHD) (GH/PRH): MPHD is a service delivery award seeking to expand access to - and use of - evidence-based, quality

MNCH/FP/RH information, products, and services through private providers by: (1)

28 USAID defines resilience as “the ability of people, households, communities, countries and systems to mitigate, adapt to, and…