Open Doors Africa Private Healthcare Initiative
Health Finance Coalition (HFC), a group of leading health donors, investors, and technical partners seeking to scale blended finance solutions to achieve SDG3 and Universal Health Coverage in Africa, created The Open Doors African Private Healthcare Initiative (ODAPHI). It is the first of its kind of loan guarantee facility that worked to make working capital loans available to frontline healthcare facilities in five African countries (Kenya, Nigeria, Ghana, Tanzania, and Uganda) during the COVID-19 pandemic and early-post pandemic period.
Loans made to healthcare companies
Thousand people impacted
Percent of population served are women & girls
Percent of population served are low income
Creating blended finance loan guarantees
In sub-Saharan Africa, private sector healthcare providers deliver nearly 50 percent of all healthcare, and economic instability in the private healthcare sector could significantly affect access to healthcare.
The COVID-19 pandemic, and associated economic shutdowns and stay-at-home policies, caused a decline in service demand and revenue for healthcare providers, particularly in the private sector. This downturn threatened the viability of operations at a time when healthcare accessibility was already challenged. Consequently, numerous SME healthcare facilities, which typically maintain adequate cash flow to satisfy standard criteria of credit underwriting, had found themselves financially constrained due to the pandemic's impact.
The ODAPHI program, established by HFC, had provided blended financing through guarantees to support financing to SME healthcare facilities in need for working capital urgently to continue essential healthcare operations during the pandemic. The ODAPHI program has two guarantee structures: a private sector-led guarantee funded by the Skoll Foundation, Rockefeller Foundation, and MCJ Amelior Foundation and administered by HFC, and a public entity guarantee funded by the U.S. President's Malaria Initiative (PMI) and the U.S. Development Finance Corporation (DFC) and administered by DFC.
HFC thinks of this program as a blended finance structure, as the private philanthropic capital provided was used to unlock the participation of the public sector guaranteed funding. Together, 19.2 million USD in guaranteed capital secured up to 30 million USD in loans provided by Medical Credit Fund (MCF) – the only fund dedicated to financing SME healthcare enterprises in Africa.
The outcomes and evaluation of HFC's initiatives
Since January 2021, loans to 8 companies have impacted an estimated 170,000 patient visits per month, for an estimated total of 2,040,000 patient visits per year. Of these patients, the majority are from traditionally under-served or disadvantaged demographic groups.
Of the patients treated by the recipients of the loans guaranteed by the guarantee program, most of the patients served were either women (58%) or children (11%). Additionally, most patients served were low income, with 42% of patients classified as low income, and 19% classified as very low income. This performance either exceeds or meets the targets set at the start of the ODAPHI program for each target demographic group.
