Syed Yusuf Saadat
Research Associate, Centre for Policy Dialogue
Corruption is prevalent in all sectors of the economy. Healthcare is by no means an exception. From mis-invoicing the price of medical equipment to pretending to be doctors, corrupt individuals have adopted many methods to use public resources for their private gain. This pervasive nature of corruption tends to reduce the effectiveness of government spending in healthcare. As a result, the quality of healthcare is appalling and the quantity of healthcare is inadequate.
Although healthcare is a perennial development issue, it has recently been brought to the limelight though the United Nations Sustainable Development Goals (SDGs). SDG 3 emphasizes the importance of healthcare by stating that ensuring healthy lives and promoting well-being at all ages is a key objective for all developing countries. On the other hand, SDG target 16.5 calls upon nations to reduce corruption and bribery in all its forms. These aforementioned goals and targets can be best achieved in tandem.
The impact of corruption on public health expenditure can be analysed using a simple model. In the absence of corruption, the government provides healthcare services at a price which maximizes social welfare. However, if public healthcare services are dispensed through a government official, then the official in charge is susceptible to corruption. Under such circumstances, the government official may behave like a monopolist and restrict access to healthcare services. Thus quantity of healthcare services offered to the public with corruption is lower than the quantity of healthcare services provided without corruption. Moreover, instead of charging the government mandated price, the government official charges a bribe which is lower. Thus the government official succeeds in completely superseding the government and becomes the de facto provider of healthcare services. Since the government is deprived of the revenue from the sales of healthcare services, its ability to fund healthcare expenditure in the future is seriously hampered. Furthermore, the effectiveness of government expenditure in healthcare is reduced since fewer people benefit from healthcare services in the presence of corruption.
Research has shown that corruption can reduce the returns to investment in healthcare. The incidence of high infant mortality rate and low birth-weight of babies can both be decreased by curbing corruption in public healthcare services. This implies that corruption stands in the way of achieving the better health outcomes. In Bangladesh, studies have revealed that patients are incentivized to pay bribes through the promise of better quality healthcare in public hospitals.
Improving the quality of healthcare and reducing the influence of corruption are both important objectives for Bangladesh, especially considering its commitment to ‘leave no one behind’. In order to resolve the problem of corruption in the healthcare sector, a holistic approach is required that involves general anti-corruption policies coupled with specific healthcare sector measures. Moreover a social paradigm shift is necessary so that rejection of corruption becomes the norm. As Bangladesh graduates out of Least Developed Country (LDC) status, it is imperative to defeat the dragon of corruption that has entangled its healthcare sector. Otherwise, the productivity of the workforce and the competitiveness of the economy will invariably be compromised.