Expanding Markets While Improving Health in Indonesia: The Private Health Sector Market in The JKN Era

Indonesia’s national health insurance scheme (Jaminan Kesehatan Nasional, or JKN) supports the government’s commitment to promoting health and wellbeing among its citizens. Responding to the demand for health services created through JKN will require strong partnership between the government and the private health sector. How have JKN policies affected the private health sector? Has the private sector’s responses expanded access to high-quality healthcare at an affordable cost? Do JKN processes support the private health sector remaining robust and continuing to invest and grow?

The U.S. Agency for International Development (USAID)-funded Health Policy Plus (HP+) project and Indonesia’s National Team for the Acceleration of Poverty Reduction (TNP2K) conducted an analysis to explore these questions, focusing on JKN’s impact on pharmaceutical and medical device companies and private hospitals. We reviewed whether new actors have joined the market following JKN implementation—especially in geographical areas that were not well-served previously—whether the private sector’s products or services have diversified, and whether JKN has motivated healthy competition between companies and hospitals.

HP+/TNP2K collected data through three approaches: (1) a survey of 73 private hospitals in 11 provinces, (2) 27 key informant interviews with private health sector leaders, and (3) a desk review of publicly available secondary data. The facility-based hospital survey gathered detailed quantitative trends on the volume and diversity of service provision, profitability, and perceptions on competition. Key informant interviews and a desk review allowed us to analyze trends to better understand market movements in the private health sector.