Sri Lanka’s public health system, long regarded as one of the most equitable in South Asia, is undergoing a quiet but consequential transformation. The JYP-led NPP government’s decision to outsource key diagnostic and testing services to private hospitals under public–private partnerships (PPPs) is being justified as a practical response to rising demand and limited resources. However, evidence suggests this policy risks weakening the very foundations of universal healthcare.
Advanced diagnostic services CT and MRI scans, cardiac catheterization, automated laboratory testing, and dialysis are undeniably under strain in government hospitals. Long waiting lists and delayed diagnoses have become common, particularly as non-communicable diseases increase. Yet transferring these essential services to private providers, with the government paying per test, shifts the system from a service-driven model to a profit-oriented one.
The private sector does not invest without guaranteed returns. PPP contracts typically assure fixed or minimum payments over defined periods, obligating the state to prioritize private invoices regardless of fiscal pressures. When governments struggle to meet these commitments, private providers respond by limiting services, delaying appointments, or renegotiating terms. In such scenarios, it is patients especially those without alternatives who bear the cost.
Claims that the government lacks funds to purchase diagnostic equipment are also contentious. Budgetary records indicate that substantial portions of allocated health funds have gone unutilized and were returned to the Treasury. This raises a troubling contradiction: if resources exist but are poorly deployed, outsourcing cannot be credibly framed as an unavoidable necessity.
Equally problematic is the assertion that procurement complexity makes private provision more efficient. In practice, long-term service contracts involving sophisticated technology are often more complex, less transparent, and harder to audit than direct equipment purchases. Such arrangements create fertile ground for inflated costs, weak oversight, and corruption, particularly when performance-based payments are involved.
The proposed expansion of dialysis services through PPPs further illustrates these risks. While private partners would supply and manage machines and consumables, the government would retain infrastructure responsibilities and clinical oversight. This fragmented accountability makes it difficult to assign responsibility when services fail or standards slip.
