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Am J Public Health. 2002 August; 92(8): 1250–1254.
PMCID: PMC1447225

Services Privatized in Local Health Departments: A National Survey of Practices and Perspectives

Privatization of public health is seemingly an oxymoron. Functions such as environmental regulation and communicable disease control would seem to be the unique purview of governmental public health departments. These services constitute public goods in that they affect entire communities, whereas personal health services are private goods, privately consumed by individuals.1 Recent pressures such as the penetration of managed care has led to shifts in personal health service provision from the public to the private sector and to various forms of public–private collaboration.2,3

However, some privatization theorists contend that public goods cannot be as effectively provided by the private sector. Others contend that even certain private goods, such as personal health services, should not be contracted out to the private sector.1 These opinions suggest that research on privatization in local health departments should examine the specific services, both public and private, that have been contracted out, a task previous studies of such health departments have not systematically addressed (L. Whitehand, M. Bechamps, and R. Bialek, unpublished data, 1997).4–15

Other articles based on the national survey of local health department directors described here have not outlined in detail the specific services privatized.16 In the present study, we examined the specific services privatized, the profit vs nonprofit status of contractors, and directors’ views about what services should not be privatized.


Our methods were described in a previous article.16 We drew a stratified random sample of 380 local health departments from the 2488 departments included in the database of the National Association of County and City Health Officials. During 1998–1999, we interviewed 347 local health department directors (a 91.3% response rate). Directors described in detail the specific services privatized, that is, contracted out or in some way delegated to nongovernmental organizations.


Specific Services Privatized

The most commonly privatized personal health service categories were primary care (28%) and communicable disease (27%). Among local health departments serving jurisdictions of at least 350 000, more than two thirds (70% ) had contracted out certain primary care services (Table 1 [triangle]). Among departments serving jurisdictions of 100 000 or more, about half had contracted out communicable disease services. HIV testing/treatment/screening was the most commonly privatized communicable disease service, followed by services related to tuberculosis and sexually transmitted diseases.

—Specific Health Services Privatized (Any Privatization), by Size of Jurisdiction

Nineteen percent of local health departments had privatized chronic disease testing and treatment. Personal health service laboratory work and home health care were contracted out by 21% and 22% of all departments, respectively. Substance abuse services were most commonly contracted out in departments with jurisdictions of at least 350 000 (32%). At least 1 health education service was privatized in 27% of departments. The most common data function contracted out was health assessment, usually on a short-term basis. The total percentage of local health departments that had privatized at least 1 environmental service was 24%.16

More than half of all privatized services were contracted to for-profit organizations. Laboratory work, associated with either personal or environmental services, was almost always contracted out to for-profit organizations. Finally, in the case of many of the environmental services privatized (e.g., water or septic services), the majority of contractors were for-profit organizations.

Services That Should Not Be Privatized

Directors were asked, “Which aspects of any local public health department services, including environmental, personal health services, data management, or outreach and education, do you think local health departments should not delegate out to a nongovernmental organization?” About 27% responded that communicable disease services should not be privatized. Roughly a third identified specific environmental health services they believed should not be privatized, and 24% responded that no environmental health services should be privatized (Table 2 [triangle]).

—Local Health Department Directors’ Views of What Should Not Be Privatized, by Size of Jurisdiction

Many directors stated that regulatory or enforcement functions should not be privatized because local health departments must not relinquish control. Directors were most averse to privatizing services that are part of health departments’ capacity to respond to disease outbreaks and to carry out enforcement functions. They worried that privatization would undermine departments’ control over services and functions, hindering their ability to respond to crises. Finally, whereas roughly a tenth of the directors stated that no service should be privatized, another tenth believed (usually with caveats) that any service could be privatized.

Services That Should Not Be Contracted to For-Profit Organizations

Directors were then asked, “Are there any services or parts of services that shouldn’t be delegated to a for-profit organization?” One view was that there are no practical differences between for-profit and nonprofit organizations. As one director stated, “I don’t see much of a difference between for-profit and non-profit organizations. All health providers are profit-driven whether they call themselves for-profit or non-profit.” Other directors believed that for-profit organizations lack a commitment to public health, that for-profit providers “have to be very concerned with their stakeholders,” and that “profit could be placed ahead of the goals of public health.” Several directors expressed their concerns even more strongly; for example, “people who need public health services don’t get them with for-profit organizations.” A very different view was expressed by a director who thought that profitable services should be kept within health departments because the extra funds could be shifted to less profitable, but vital, public health functions.


The nation’s local health departments have traditionally been responsible for disease control activities and for maintaining the capacity to respond effectively to sudden, often unpredictable threats to the health of the public, functions not historically performed by the private sector. Many of the local health department directors surveyed here were concerned that privatization would weaken health departments’ capacity to respond to crises. They were also concerned that privatization would diminish health departments’ control over performance or reduce the professional public health skill base.

In view of these concerns, it is surprising that so many local health departments have privatized services such as those involving communicable disease (27%) and environmental health (24%), services that clearly qualify as public goods.1 These findings warrant further research examining the processes and outcomes of privatization of specific public health services.


This research was funded by the Centers for Disease Control and Prevention through a cooperative agreement with the Association of Schools of Public Health.

We are very grateful to Gerald Barron, deputy director of the Allegheny County Health Department, for his advice and suggestions and for arranging the pilot testing of the instrument. We also thank staff of the National Association of City and County Health Officials for their support and advice. Finally, we thank Kim Teitelbaum and Robert Harper for excellence in data collection.

Human Participant Protection
The study’s protocol for the protection of human subjects was approved by the University of Pittsburgh (IRB no. 980634).


C. Keane developed the framework, study questions, and methods; drafted the questionnaire; designed and supervised data collection; analyzed the data; and wrote initial drafts of the brief. J. Marx worked on the study design, edited the questionnaire, and edited the brief. E. Ricci secured initial funding and edited the brief.

Peer Reviewed


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