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A client uses Jamii, a mobile-enabled private health insurance product that provides him and his family a low-cost insurance option that covers the care they prefer at private hospitals.
Caption: A client uses Jamii, a mobile-enabled private health insurance product that provides him and his family a low-cost insurance option that covers the care they prefer at private hospitals.

Photo by Riaz Jahanpour for USAID Tanzania / Digital Development Communications

Overview

Private sector engagement (PSE) can increase client-centered care, leverage additional resources for the HIV response, increase innovation, find new ways of doing business, and lead to improved efficiency and sustainability of the overall HIV response. USAID’s HIV programs support the agency’s private sector engagement (PSE) policy by using market-based approaches to increase access to patient-centered HIV services and products in private outlets, promote access to private financing for local private health organizations, and introduce innovative and emerging technologies to improve patient outcomes.

USAID Impact

USAID’s private sector work encompasses a range of approaches to control the HIV epidemic, including:

  • private service delivery and market development
  • blended financing
  • supply chain modernization
  • government contracting
  • social enterprise development, and
  • public-private partnerships.

Many countries in which PEPFAR works have large and diverse private sectors that play a major role in overall healthcare, but a relatively minor role in HIV service delivery. To better meet the preferences of clients, USAID supports the growth and strengthening of the private health system for HIV service delivery. This work includes distribution of life-saving HIV treatment or ARVs, life-saving HIV medication or pre-exposure prophylaxis (PrEP), and HIV self-test kits at private clinics and retail pharmacies to bring services closer to where patients live and work. Where there is willingness and ability to pay for services, USAID also supports the growth of commercial markets for HIV products to ensure that long-term access is not dependent on donor assistance. When patients have more choice in where they access services, it is easier for them to know their status, access prevention, and start and stay on treatment.

Innovative financing approaches for USAID’s PEPFAR programs catalyze private investment for the HIV response using tools such as credit guarantees or subsidies that reduce risk and provide additional incentives for private financial institutions to lend to the health sector. This approach to structuring capital enables diverse investors to combine funds for financial and development impact and promotes the long-term sustainability of HIV programs.

To promote the sustainability of local private sector organizations and decrease their dependence on donor funds, USAID enables domestic governments to contract or outsource to local firms and civil society organizations, facilitates private providers’ access to health insurance reimbursements, and supports civil society organizations to develop social enterprise models. Civil society is critical to the HIV response as these specialized organizations offer tailored psychosocial support and HIV services to some of the most stigmatized members of society, such as men who have sex with men, transgender people, and sex workers.

Public-private partnerships help USAID harness additional resources and expertise to contribute to controlling the epidemic. Through a Global Development Alliance with Gilead Sciences, USAID supports acceptability and adherence research to improve access, uptake, and adherence to HIV prevention among adolescent girls and young women in Sub-Saharan Africa. With the Bill and Melinda Gates Foundation, The Global Fund, and PEPFAR, USAID also partners with the Coca-Cola Company and Project Last Mile, which leverages the private-sector expertise and business intelligence of the Coca-Cola system to improve access to life-saving medicines through supply chain and strategic marketing support.

Recent Achievements

  • USAID, through its Sustainable Financing Initiative (SFI), has leveraged over $8 million through partnerships with private companies for HIV services in Tanzania and the Caribbean.
  • As a response to COVID-19, USAID has rapidly expanded its decentralized HIV treatment distribution model, which engages private pickup points such as pharmacies and clinics to distribute donor-funded commodities. At least 20 countries are currently implementing this distribution model in the private sector.
  • In the Dominican Republic, USAID increased the financial sustainability of three non-governmental organizations (NGO) serving over 9,000 people living with HIV to contract with social health insurance and develop business plans for social enterprise ventures. One NGO is now planning to launch a dermatology wing to cross-subsidize HIV services.
  • In India, SFI supported the design of a strategic purchasing partnership with the government to increase availability and affordability of HIV services and commodities in the private sector.
  • In Kenya, SFI supported the development of a policy framework for private sector health services, which will provide a platform for greater engagement of the private sector in Kenya’s HIV programs and support goals for universal health coverage.

Additional Resources

1 Blended finance is an approach to structuring capital that uses donor or philanthropic funds to increase private sector investment in sustainable development