The private sector plays an essential role in Indian primary healthcare. Funders can help support them using innovative finance to maximize impact.
India has an extensive public primary healthcare network, composed of nearly ~23,000 Primary Health Centres and ~146,000 Sub-centres that collectively cater to millions of patients’ health needs annually. This network, however, continues to be plagued by three critical issues that limit its usage: inability of patients to access centres, inability of patients to afford care, and poor quality of treatment.
Private operators can play an important part in complementing the public primary care network through offerings that plug existing gaps. However, the majority of these operators frequently face financial bottlenecks as a result of their inability to generate adequate revenues to cover their costs.
Funders, therefore, have a crucial role to play in uplifting India’s primary healthcare ecosystem by supporting these financially constrained private operators. They can maximize the impact of their limited capital through contextualized and outcome-linked, innovative finance instruments. By linking payments to achievement of select, predetermined outcomes by operators, funders can bring more accountability and transparency into the sector. For example, an investor looking to provide debt more efficiently may offer a buydown on interest rates based on the investee’s ability to meet specific, predetermined outcomes. The need of the hour is to explore the use of such non-traditional solutions to more effectively support the provision of affordable, high-quality primary healthcare on a sustained basis to underserved communities in India.
LGT Venture Philanthropy teamed up with KOIS, an impact finance company, to summarize key findings of KOIS’s study on Indian primary healthcare, exploring opportunities around supporting the sector through innovative finance. You can find the article here.