PPP

Public-Private Public-Private Partnerships in HealthPartnerships in Health

Keerti Bhusan PradhanKeerti Bhusan Pradhan

[email protected]@aravind.org

Overview of the PaperOverview of the Paper

Definition of Public-Private Partnership Definition of Public-Private Partnership (PPP) in Health(PPP) in Health

Evolution of PPP in HealthEvolution of PPP in Health

Current Focus of PPP in HealthCurrent Focus of PPP in Health

Successful ModelsSuccessful Models

Challenges to overcome Challenges to overcome

ConclusionConclusion

Public Private Partnerships Public Private Partnerships (PPP) in Health(PPP) in Health

PPP in health is an approach to addressing PPP in health is an approach to addressing public health problems through the combined public health problems through the combined efforts of public, private and development efforts of public, private and development organisations complimenting each other by organisations complimenting each other by contributing or sharing their core competencycontributing or sharing their core competency

This synergy leads to better outcome of goalsThis synergy leads to better outcome of goals


Government/Public SectorGovernment/Public Sector– Government sector finds it difficult to Government sector finds it difficult to

support healthsupport healthEg. 1.1% of GSDP was the health Eg. 1.1% of GSDP was the health expenditure in 1993-94 in 14 States in expenditure in 1993-94 in 14 States in IndiaIndia70% of budget allocation is spent on 70% of budget allocation is spent on resource maintenance like Human resource maintenance like Human ResourcesResourcesHas to lead to decreased capital Has to lead to decreased capital investmentinvestment


Private SectorPrivate Sector– 80% of well qualified medical 80% of well qualified medical

professionals work in private sectorprofessionals work in private sector– State-of-the-art facilitiesState-of-the-art facilities– Private health care expenditure is Private health care expenditure is

around 4.25% of the GDP; increase @ around 4.25% of the GDP; increase @ 12.5% per annum12.5% per annum

– Private Sector Share is significant: Private Sector Share is significant: Hospitals - 57% & Beds - 32%Hospitals - 57% & Beds - 32%

Current PPP in IndiaCurrent PPP in India

Contracting out to manage clinical and Contracting out to manage clinical and non-clinical services; health projectsnon-clinical services; health projects

Joint ventures; private capital to set up Joint ventures; private capital to set up hospitals hospitals

Incentives system to influence desired Incentives system to influence desired geographic distribution of health geographic distribution of health facilities – qualified providers through facilities – qualified providers through contract mechanisms in rural areascontract mechanisms in rural areas

Current Focus of PPP in HealthCurrent Focus of PPP in Health Develop strategies to utilise untapped resources Develop strategies to utilise untapped resources and strengths of the private sectorand strengths of the private sectorEnhance the capacity to meet growing health needsEnhance the capacity to meet growing health needsReducing financial burden of government Reducing financial burden of government expenditure on tertiary careexpenditure on tertiary careReducing geographical disparity in provision of Reducing geographical disparity in provision of services and its accessservices and its accessReaching remote areas; target specific group of Reaching remote areas; target specific group of populationspopulationsImproving efficiency through evolving new Improving efficiency through evolving new management structuresmanagement structures

Some options & examplesSome options & examples

Partnership in disease surveillance (CMC-Partnership in disease surveillance (CMC-Kerala)Kerala)

Partnership in pharmaceutical procurement Partnership in pharmaceutical procurement & supply (TNSMC)& supply (TNSMC)

Partnership in managing high-risk Partnership in managing high-risk pregnanciespregnancies

Partnership in promotive care Partnership in promotive care (IEC-HIV/AIDS)(IEC-HIV/AIDS)

Partnership with communities & industriesPartnership with communities & industries

Models…Government’s initiativesModels…Government’s initiatives

RajasthanRajasthan– Acknowledged the inability to develop Acknowledged the inability to develop

service delivery systems to tackle service delivery systems to tackle chronic diseaseschronic diseases

– Categorization of medical institutions Categorization of medical institutions and awarding benefits accordinglyand awarding benefits accordingly

– Subsidised initial set up costs in rural Subsidised initial set up costs in rural areas (offering land at a lesser cost)areas (offering land at a lesser cost)

– Fiscal incentives in acquiring medical Fiscal incentives in acquiring medical equipment and machinery - sizable tax equipment and machinery - sizable tax exemptionsexemptions

Presence of a catalyst-A catalyst can bring partners Presence of a catalyst-A catalyst can bring partners together and offer expertisetogether and offer expertisePublic sector backing-reassurance to private sectorPublic sector backing-reassurance to private sectorExistence of a vibrant private sectorExistence of a vibrant private sectorCommitment of private sector decision-makersCommitment of private sector decision-makersRoad MapRoad MapOwnershipOwnershipUnderstanding roles, responsibilities, expectationsUnderstanding roles, responsibilities, expectations

Critical Success Factors from Critical Success Factors from OthersOthers

NGO’s contributionNGO’s contribution

Aravind Eye Hospitals, a private trust Aravind Eye Hospitals, a private trust contributes to the State by performing contributes to the State by performing high volume, a staggering 42% of total high volume, a staggering 42% of total surgeries in the State relieving its surgeries in the State relieving its burdenburden

IssuesIssues

Involvement of private sector will improve Involvement of private sector will improve efficiency; however no concrete steps efficiency; however no concrete steps have been taken to initiate thishave been taken to initiate thisClarity in policies to effect the Clarity in policies to effect the partnerships is still evolving partnerships is still evolving Lack of appropriate regulatory and Lack of appropriate regulatory and monitoring mechanisms have raised monitoring mechanisms have raised doubts about PPP in health – still poor are doubts about PPP in health – still poor are not taken care of…not taken care of…

Policy constraintsPolicy constraints

Weak regulatory regimes to monitor Weak regulatory regimes to monitor private health sectorprivate health sector

Weak capacity of GovernmentWeak capacity of Government

Lack of a research and information Lack of a research and information base on the dynamics of private sectorbase on the dynamics of private sector

Lack of a policy framework for Lack of a policy framework for promoting private health sectorpromoting private health sector

PUBLIC

SECTOR

PRIVATE

SECTOR

Free Provision of Products and Services

Unsustainable for Government & Donors

Unsustainable for Consumers

Profit Maximization

Break Even

Goal is to create financially sustainable system

Challenges AheadChallenges AheadInvolving private providers in managing various Involving private providers in managing various components of health sector programmescomponents of health sector programmesDeveloping joint ventures or inviting private Developing joint ventures or inviting private capital to set up hospitalscapital to set up hospitalsContracting out services (Catering, Cleaning, Contracting out services (Catering, Cleaning, Security, Laboratory…..)Security, Laboratory…..)Consumer Protection Act (Safeguarding the Consumer Protection Act (Safeguarding the interest of consumers)interest of consumers)Regulation and Accreditation of private Regulation and Accreditation of private providers by Governmentproviders by Government

ConclusionConclusion

Public-Private partnerships in health Public-Private partnerships in health are at very early stagesare at very early stagesWill need significant institutional Will need significant institutional development work in terms of financial development work in terms of financial analysis capabilities, monitoring and analysis capabilities, monitoring and evaluations systemsevaluations systemsAppropriate regulations to check the Appropriate regulations to check the unintended outcomes of private sector unintended outcomes of private sector growth in healthgrowth in health

Documents

PPP