Assessing public hospitals' new outsourcing policy in Botswana

Background: The Government of Botswana is implementing a broad set of reforms aimed at diversifying the economy. The MoH launched a privatization plan to increase efficiencies in public hospitals by outsourcing non-clinical services and developing public-private partnerships.  

Objective: To document the privatization policy, diversification of the health sector industry, and private health market development.

Methods: Using a health policy analytical framework we examine the privatization policy from design to implementation and analyze challenges and opportunities related to: (1) governance, (2) finance and (3) institutional strengthening.

Results: A legal framework, regulation, procurement rules, and funding were in place to support the process; however, the policy was initiated in seven hospitals before all the technical instruments such as contracts, service level agreements and key performance indicators were ready. Lack of managerial experience in the procurement and management of service level agreements represented a major limitation. Major challenges include the absence of reference costs and benchmark prices, lack of communication with hospital employees, and a nascent market with very few providers for these hospital services. 

Conclusions: Outsourcing non-core services represents a major change in hospital operations seeking to improve service quality and the efficient use of public resources. This bottom-up strategy, though modest, is helping to develop a domestic private market within the larger objective of diversifying the domestic economy and addressing the volatility of its main source of domestic revenue, diamonds. These reforms also represent an opportunity to increase female labor force participation and incentivize women’s entrepreneurship in the wider economy.