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Will Hospital Nationalization Help the Developing World respond to COVID-19?  Practical Guidelines for Middle-Income Countries

Dominic Montagu, Professor Epidemiology and Biostatistics, School of Medicine, University of California, San Francisco

Last week I wrote an article which highlighted some of the lessons about private hospital engagement that could be gleaned from recent experience in Europe. To be more explicit in what this means for middle-income countries I’ve condensed the advice down to five practical guidelines:

  1. Don’t call it ‘Nationalization’.  What has happened in Europe has been mostly the continuation of existing contracting arrangements, adjusted to facilitate governmental direction of service planning, instructing private facilities to halt non-essential services to make space for COVID-19 patients, or for patients shifted to allow for COVID-19 care in other facilities.  This is very different from the appropriation of infrastructure, or the imposition of external managers, which are the hallmarks of wartime, or despotic, ‘nationalization’.
  2. If you must call it ‘Nationalization’, define the term quickly.  Political expediency might lead a government to talk publicly about ‘nationalizing’ private hospitals.  That will generate public support, demonstrate that the government is doing something dramatic, and communicate to the private sector that this is a serious issue.  If this is your government, move quickly to clarify what is meant by ‘nationalization’ to the private hospitals, doctors, and consultants in your country.  Don’t waste energy and lose an opportunity while they worry that perhaps you mean the wartime/despotic version of the term.
  3.  Communicate, communicate, communicate.  The European experiences which have been most smooth have built on well-established systems for contracting and service integration with public sector.  Even when that works, the challenges of COVID-19 mean hospitals will need to arrange procurement systems (PPEs, Ventilators, plasma etc), patient transfers, protocol updates, staff sharing, patient reporting, and a large number of other issues which aren’t part of normal operations.  That might work well within and between public institutions.  It will be new to the private hospitals.  Ensure twice-weekly video conferences, at least, at all levels of specialization, and if any conference isn’t productive, change who is leading it.  From finance, to facility sanitation, to procurement, to clinicians, all of the operational groups need to talk across institutions regularly.
  4. Have trust first, validate later.  Hospitals in Europe are being asked to provide services ‘at-cost’.  It is unclear whether that means at the marginal cost pre-COVID-19, or ‘at-cost’ when all other profitable services have been largely stopped, and all overhead and staffing must be allocated expenses to the new COVID-19 patients.  The former will be somewhat expensive, the latter will be exorbitant (but also reflect real costs for the hospitals).  We propose that something between the two is probably fair: everyone will be undergoing hardships during this time.  The government should not be required to make-whole every private hospital.  At the same time, to pretend those un-covered costs don’t exist and drive private facilities and consultants to bankruptcy and closure, is in nobody’s interest.  Clarify intent.  Start working together.  Let accountants decide what is ‘fair and appropriate’ later on within broad parameters set out up front.
  5. Manage your expectations.  If you have an established system of contracting private providers, this will go well.  If you don’t, or if the private hospital system is small or focused on outpatient services, then including them in the national response is important, but the burden for most cases will remain with the government for some period to come.  Good contracting, communication, and trust will all help to shorten the learning curve of collaboration and maximize the national benefit from private providers at a time when it is very much needed.


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