Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Building Public/Private Partnership for Health System Strengthening Hospital Contracting Professor EK Yeoh School of Public Health and Primary Care The Chinese University of Hong Kong Bali Hyatt Hotel, Sanur, Bali 21-25 June 2010 1 Understanding the nature of hospital contracting and context under which hospital contracting may be considered; Knowledge of different models and options of hospital contracting; Understanding why and how hospital contracting works; and Developing a framework for hospital contracting 2 Discussing nature and rationale of hospital contracting Different models and options of hospital contracting from the experience of a number of countries Discussing the issues, logistics and application of hospital contracting in different countries Discussing the challenges and issues of hospital contracting and PPP programmes in the context of the health care system of Hong Kong Discussing a framework for hospital contracting 3 What is Contracting? Contracting is a mechanism for a financing entity (such as a government ministry) to acquire a specified set of services, with specified objectives, of a defined quantity, quality, and equity, in a particular location, at an agreed-on price, for a specified period, from a particular nonstate provider (such as an NGO, private sector firm, or private practitioner). Source: Benjamin Loevinsohn, Performance-Based Contracting for Health Services in Developing Countries: A toolkit. World Bank, 2008 4 What is Performance-Based Contracting? A form of contracting that explicitly includes a clear definition of a series of objectives and indicators by which to measure contractor performance, collection of data on the performance indicators, and consequences for the contractor based on performance such as provision of rewards (such as performance bonuses or public recognition) or imposition of sanctions (such as termination of the contract or public criticism). Source: Benjamin Loevinsohn, Performance-Based Contracting for Health Services in Developing Countries: A toolkit. World Bank, 2008 5 Difference between Grant, Contracting and Performance-based Contracting Grant Defining services Performance monitoring Sanction Contracting Performance-based Contracting “Loosely” defined Clearly defined Insufficient Sufficient Weak Strong 6 “the impetus for all the contracting initiatives [studied] was the inadequate quality and coverage of government services, especially for poor people.” Benjamin Loevinsohn, April Harding. Buying results? Contracting for health service delivery in developing countries. Lancet 2005; 366: p. 680. 7 Performance-based - clear objectives and indicators, - systematic data collection of the progress of the selected indicators - rewards or sanctions based on performance. Services - primary healthcare; hospital surgeries; establishing a health insurance system; setting up and operating a voucher project; providing ancillary services such as equipment maintenance, cleaning, waste management, food preparation, and security, etc. Typology - a management contract and a service delivery contract approaches - context and services specific Pay-for-Performance - focus on important objectives and uses financial rewards to reinforce good performance. Specific explicit, measurable outcomes and allows for termination of the contract for nonperformance. 8 Service design Government Provider selection Government Services management Government Infrastructure setup Government Financing Government Example Government sets up public primary health care centers Government-1 Government-1 Government-2 Government-2 Government-1 Government transfers funds from federal to provincial governments 3. Management Government contracts Government Private sector Government Governmenta 4. Service deliveryGovernment contracts Government Private sector Private sector 5. Government Private sector grants to NSPs Government or donor Private sector Private sector 6. Private sector Private sector services Consumer Private sector Private sector Arrangement 1. Government services 2. Intergovernmental agreements Government hires a private sector manager to manage existing government health services Governmenta Government hires NGO to provide services where none exist Government NGOs submit proposals to (w/ or w/o NGO government for needs identior community fied by community or NGO contribution) Consumer or ?NGO establishes health NGO/donor services in slum areas using its own funds ?For-profit providers establish private clinic Note: Government-1 and Government-2 refer to different levels of government. NGO = nongovernmental organization; NSP = nonstate provider. a. Financing may be supplemented by formal or informal user charges. Source: Benjamin Loevinsohn, Performance-Based Contracting for Health Services in Developing Countries: A toolkit. World Bank, 2008 9 Type of P4P Who receives the funds 1. Rewards for localLocal governments governments 2. Rewards National to national governments governments 3. Payment per Individual service (fee for health workers service) 4. Performance NSP bonuses 5. Performancebased payment Source: Author. NSP What the funds can Who provides be used for the funds Relationship to Contracting Programs of local governments Programs of national governments National government Development partners Performance agreements rarely true contracts Not related Personal uses Government, individuals, or NSPs Purchaser May be easier to introduce in the context of contracting with NSPs Sometimes used in health care contracting Purchaser Can be incorporated fairly easily into contracts Other programs or at the discretion of the NSP At discretion of the NSP Note: DPT3 = third dose of diphtheria/pertussis/tetanus vaccine; GAVI Alliance = formerly the Global Alliance for Vaccines and Immunization; NGO = nongovernmental organization; NSP = nonstate provider. Source: Benjamin Loevinsohn, Performance-Based Contracting for Health Services in Developing Countries: A toolkit. World Bank, 2008 10 Franchising Public authority contracts a private company to manage existing hospital DBFO (design, build, finance, operate) : Private consortium designs facilities based on public authority’s specified requirements, builds the facility, finances the capital cost and operates their facilities BOO (build, own, operate) Public authority purchases services for fixed period (say 30 years) after which ownership remains with private provider BOOT (build, own, operate, transfer): Public authority purchases services for fixed period after which ownership reverts to public authority BOLB (buy, own, lease back) Private contractor builds hospital; facility is leased back and managed by public authority Alzira model Private contractor builds and operates hospital, with contract to provide care for a defined population Martin McKee, Nigel Edwards, & Rifat Atun, Public–private partnerships for hospitals. Bulletin of the World Health Organization, November 2006; 84 (11) 11 Option PrivatePrivate sector responsibility sector Operates private wing for private patients. May provide only Colocation of private wing within or beside public hospital accommodation services or clinical services as well. Public sector responsibility Manages public hospital for public patients and contracts with private wing for sharing joint costs, staff, and equipment. Outsourcing nonclinical support services Provides nonclinical services (cleaning, catering, laundry, Provides all clinical services (and staff) security, building maintenance) and and hospital management. employs staff for these services. Outsourcing clinical support services Provides clinical support services such as radiology and laboratory services. Provides specialized clinical Outsourcing specialized clinical services (such as lithotripsy) or routine procedures (cataract services removal). Manages hospital and provides clinical services. Manages hospital and provides most clinical services. 12 Option Private management of public hospital Private sector responsibility Manages public hospital under contract with government or public insurance fund and provides clinical and nonclinical services. May employ all staff. May also be responsible for new capital investment, depending on terms of contract. Public sector responsibility Contracts with private firm for provision of public hospital services, pays private operator for services provided, and monitors and regulates services and contract compliance. Private financing, construction, and Finances, constructs, and owns new public Manages hospital and makes phased hospital and leases it back to government. lease payments to private developer. leaseback of new public hospital Finances, constructs, and operates new Reimburses operator annually for Private financing, construction, and public hospital and provides nonclinical or capital costs and recurrent costs for operation of new public hospital clinical services, or both. services provided. Sale of public hospital as going concern Pays operator for clinical services and Purchases facility and continues to operate monitors and regulates services and it as public hospital under contract. contract compliance. Sale of public hospital for alternative use Purchases facility and converts it for alternative use, depending on sales agreement. Monitors conversion to ensure adherence to contractual obligations. 13 Universal access. Funding. Consolidation. Competition. Regulation. To ensure that all public patients, particularly the poor and uninsured, have access to adequate hospital care, most contracts for private management of public hospitals require the provider to continue service to all public patients. Governments generally fund public hospitals through budgetary payments or public health insurance programs, shifting the basis for payments from historical or input costs to the clinical mix of patients to be treated. Many countries, particularly in Eastern Europe, have too many public hospitals and will need to downsize, consolidate, and close some facilities. Public-private partnerships can spur consolidation of services. Competition between hospitals stimulates improvements in the quality and efficiency of service. Public-private partnerships may impose additional public policy obligations that require monitoring, sanctions for noncompliance, and dispute resolution procedures. 14 Cost: There are significant costs for the firms bidding for a public– Quality: Trade off between cost, time and quality. Priority has been to Flexibility: Public–private contracts are often specified in details with Complexity: Projects involve many different types of stakeholders, private partnership and for the health-care provider. meet the specifications agreed in the initial contract, with a reluctant acceptance that the project may go over time or budget. large penalties for introducing changes, leading to a lack of flexibility. Some hospitals has been out of date by the time they are opened in a changing environment. such as universities and research funders. The difficulties in reaching agreement with all of the stakeholders, combined with the high costs of the projects, may eventually lead to collapses in the project. 15 • Limited health services but with “mission” clinics or other faithbased organizations • Poorly performing districts, provinces, or states with existing government health services • Uncoordinated NGO-delivered services with multiple donors (for example, post- conflict situation) • Few services of any kind, or new kinds of services required (for example, HIV prevention, nutrition services, early childhood development services) • Existing government services where improved management is needed or innovations are required • Urban health services with many different providers but limited coverage of preventive services for the poor 16 Contracting out dietary services (Bombay) Contracts to hospital security and cleaning, and ambulance services (Port Moresby, Papa New Guinea) Contract for major items, such as CT scanners (Bangkok) Contract for rural district hospitals (Africa) Contact with a mining companies for the use of their hospitals to provide hospital services in district (Zimbabwe). Source: Anne Mills To contract or not to contract? Issues for low and middle income countries. Health Policy and Planning; 1998; 13(1): 32-40. 17 Reduction of the workload on management; expected to be cheaper; reduces wastage and pilferage; avoid service interruption (type: catering; place: Bombay) Obtain cheaper; better quality service (type: cleaning; place: Bangkok) Obtain latest equipment; avoid difficulty and delays in getting government approval and funds; overcoming difficulties of maintenance (type: medical equipment; place: Thailand) Make use of private sector capital (type: building district hospital; place: South Africa) Lack of government capacity (type: contract with private hospitals with spare capacity; place: Zimbabwe) 18 Sufficient private sector capacity for efficiency gain Government offers an attractive business market Failure for the government to provide efficiently Inflexible and inefficient public provision Social, political and economic environment such as functioning legal, banking, and government procedure, resistant to corruption and patronage 19 Unclear responsibilities for contract design and for monitoring contract performance. Unclear specification of services to be contracted out Unclear incentive schemes to motivate performance 20 Strengthening healthcare financing Cost containment and efficiency gain Improve healthcare quality (such as reduce waiting time) and patient safety Development of regional medical hub 21 Step Step Step Step 1: 2: 3: 4: Conduct Dialogue with Stakeholders Define the Services Design the Monitoring and Evaluation Decide how to select contractors and establish the price Step 5: Arrange for contract management and develop a contract plan Step 6: Draft the contract and bidding documents Step 7: Carry out the bidding Process and Manage the contract Source: Benjamin Loevinsohn, Performance-Based Contracting for Health Services in Developing Countries: A toolkit. World Bank, 2008 22 Specify outputs Payment method Price/rate determined Delivery monitored Compliance Conflict resolution Incentives to induce participate Risk sharing arrangements Managing uncertainty Cost recovery and profit 23 a) the decision to contract; b) the process to contract; c) the relationship between government, public sector employees, non-government providers, and citizens 24 Why Contracting work? Focus on Results. The very act of drafting a contract can help the purchaser define exactly what services are needed and help make objectives explicit. Flexibility. NSPs have the important advantage of being less constrained by “red tape” (excessive regulation), bureaucratic inertia, and unhelpful political interference. In many circumstances, this is the largest advantage of NSPs over government delivery of the same services. Reduction of Important Aspects of Corruption. Contracting appears to reduce some aspects of corruption that plague public health care systems, such as absenteeism, theft of drugs, selling of positions, leakage of funds on their way to peripheral health facilities, and informal payments to providers. Constructive Competition. Contracting uses constructive competition to increase effectiveness and efficiency. Nonstate providers are impelled through competition to develop the most effective and efficient ways of delivering services, both during the bidding process and during implementation. 25 Why Contracting work? Improved Absorptive Capacity. Nonstate providers are usually better at overcoming “absorptive capacity” constraints that often plague government health care systems and prevent them from effectively using the resources made available. Better Distribution of Health Workers. As a result of greater flexibility and innovative approaches, NSPs can often improve the distribution of health workers and help ensure that skilled health workers are available and working in underserved areas. Managerial Autonomy. Contracts, if drafted properly, provide managerial autonomy and decentralize decision making to managers closest to the ground. Government Focus on Stewardship Role. Contracting provides a greater opportunity for government to focus on roles that it is uniquely placed to carry out, such as planning, evaluation, standard setting, financing, and regulation. 26 Singapore – Exploring the role of PPP in healthcare delivery and financing Malaysia – PPP in healthcare financing via private health insurance Hong Kong – mainly for healthcare delivery 27 Case Study PPP in Hong Kong’s Healthcare System 28 “no one should be denied adequate medical treatment through lack of means” 29 Hong Kong’s Healthcare System “Dual” health care system Public sector Private sector Food & Health Bureau Department of Health • Execute health care policies & statutory functions Hospital Authority • Statutory body responsible for management of public hospitals 30 Primary care ◦ Health promotion & disease prevention services mostly provided by the public sector ◦ Primary care curative services Service provided by Out-Patient departments of HA hospitals (26%) Service provided by private Western medicine doctors (57%) Service provided by private Chinese medicine practitioners (13%) Secondary & tertiary services ◦ Public sector is the dominant provider (79%) Source: Thematic Household Survey 2008 31 Public Sector Private Sector • Hospital Authority (HA) operates 74 general outpatient clinics and 48 specialist outpatient clinics throughout the territory • Around 3,500 private clinics providing primary & specialist medical care • HA manages 27,555 • hospital beds in 38 public hospitals 12 private hospitals, operating a total of 3,438 beds Source: Hospital Authority Statistical Report 2007-08 32 Total health care expenditure (2005/06 figures) ◦ 5.1% of Gross Domestic Product (GDP) Public sector (52%) Private sector (48%) Source: Hong Kong’s Domestic Health Accounts, 1989/90-2005/06 33 Tax-based Financing As percentage of total expenditure on health 2001 (All figures refer to calendar year) (%) 2004 (%) General Government 56.9 55.7 Social Security Funds 0 0 Private household out-of-pocket expenditure 29.5 31.1 Private insurance 12.1 12.3 All other source 1.4 1.0 Sources: Hong Kong’s Domestic Health Accounts, 1989/90-2004/05 34 Public sector: heavily subsidized (2006/07 figures) Public Hospitals & Clinics User Fees ($) Cost ($) Government Subsidy (%) In-patient (ward level – per day) 100 3,290 97.0 A&E (per visit) 100 700 85.7 SOPC (per visit) - first visit - subsequent visits 100 60 740 86.5 91.9 GOPC (per visit) 45 260 82.7 In-patient cost represents general in-patient services, excluding infirmary, mentally handicapped and psychiatric services (Sources: Healthcare Reform Consultation Document, FHB 2008) Private sector: fee-for-service, free market 35 - Pre-Hospital Authority era - Establishment of Hospital Authority - Post-Hospital Authority era 36 A mix of public hospital services provided by government departments and 15 Nongovernment Organisations on a subvented basis Overseen by the Medical and Health Department Lack of explicit services agreement and contracting Problems: over-centralization, lack of financial incentives, inflexibility, low staff moral, lack of courtesy to patients, long waiting time, overcrowding, poor coordination between government and subvented hospitals 37 The HA was found in 1990. Establish governance and management systems across all constituent hospitals. Manage HK’s public healthcare services including hospitals, specialist out-patient clinics and general out-patient clinics 38 A single corporation that manages the public hospitals in HK Explicit services agreement 39 Public Private Partnerships (PPPs) are arrangements where the public and private sectors both bring their complementary skills to a project, with varying levels of involvement and responsibility, for the purpose of providing public services or projects. Source: Efficiency unit, HKSAR Government 40 Large scale expensive long-term projects usually involving the construction of a new facility designed to deliver particular services; The Government defines the quality and quantity of services, and the timeframe in which they are to be delivered; The private sector is responsible for delivering the defined service while the government is mainly involved in regulation and procurement; A long term relationship is established, typically between 10 years and 30 years, depending on the nature of the facilities, assets or services to be delivered Source: Efficiency unit, HKSAR Government 41 Responsibilities and risks are allocated to the party best able to manage them; The private sector and/or the Government finances the project (wholly or in part). The private sector and/or the Government would recoup its investment from charges on end-users or payments made by the Government during the life of the contract; The private sector is encouraged to make use of its innovation and flexibility to deliver good quality, costeffective services throughout the project lifecycle; and The different functions of design, construction, operation and maintenance are integrated / use a whole-of-life approach. Source: Efficiency unit, HKSAR Government 42 - - Financial pressures on the government provision of public healthcare Aging population Medical technology Social expectation Continued reliance entirely on public supply and funding - sustainable? Any alternatives: financing system; expanding the role of PPP, enhancing public-private interface 43 Cataract Surgeries Programme Haemodialysis Public Private Partnership Programme General Outpatient Clinic Public Private Partnership Programme Shared Care Programme Development of private hospitals - North Lantau Hospital Phase 2 Public-Private Partnership Project Hong Kong Hospital Authority: http://www3.ha.org.hk/ppp/pppprogrammes.aspx 44 Cataract Surgeries Programme (starting from February 2008) To shorten waiting time for cataract surgery in public hospitals 45 Target Group Patients who have been on the HA routine cataract surgery waiting list as at 1 Feb 2008 Financial incentives A One-off funding (HK$ 40million) by the Government for implementation– Providing subsidy to patients to receive cataract surgery in private sector Fees and Charges ◦A maximum subsidy of HK$5,000 to patients for cataract surgery provided by private ophthalmologists. ◦Co-pay not more than HK$8,000 ◦Consists of 1 pre-op assessment, the intraocular lens in the surgery and 2 post-op checks 46 Outcome Shorter waiting time: reduce from 35.5 months to 31 months (Dec 2009) 91% of patients are satisfied with the Programme 98% of patients say: - Easy to select a suitable ophthalmologist from the pool of participating private ophthalmologists, - The Programme has helped them to receive surgery earlier. Smooth cooperation between the public and private sectors in arranging surgeries and providing follow up support service 47 Haemodialysis Public Private Partnership Programme (3-year pilot starting from March 2010) To enhance HD service for ESRF patients To enhance patients’ self care capacity and improve QoL To enhance collaboration between HA & community medical organizations 48 Target Group Patients on haemodialysis (HD) in HA hospitals with stable conditions Arrangement Fees & Charges HA will collaborate with community medical organisations to provide options for patients to receive HD in the community 1. Nephrologists assess patients conditions and invite suitable patients 2. Patients complete and sign consent 3. Patients enroll in the “Public-Private Interface-Electronic Patient Record Sharing Pilot Project” 4. Patients receive HD in the community; HA will provide follow-up, medications and examinations. Patients pay the community HD centres the same fee as charged by HA Outcome To be evaluated 49 General Outpatient Clinic (GOPC) PublicPrivate Partnership Programme - Tin Shui Wai Primary Care Partnership Project (a pilot starting from June 2008) To expand GOPC services in districts with increasing demand for GOPC services by piloting a PPP model for the delivery of primary care service and promote the family-doctor concept in the community 50 Target Group Patients suffering from specific chronic diseases such as DM, HT, COAD, etc. with stable medical conditions and in-need of long-term follow-up treatment at GOPCs Arrangement ◦HA to purchase primary care services from private medical practitioners ◦Patients to receive a maximum of 10 subsidized visits to a private doctor for treatment of specific chronic illness and episodic illnesses per each 12 month period of participation Fees & Charges ◦Patient pay for private GP services at the same fee that they currently pay for GOPC services. Outside the 10 subsidized visits, the patient can choose to be treated by private doctor at his/her own cost or attend GOPC for follow up. 51 Outcome ◦ Over 1,000 patients have been enrolled ◦ High satisfaction rate from both participating patients and PMPs. An extension phase of the GOPC PPP pilot is under consideration. 52 Shared Care Programme (Pilot to be started in mid 2010 at Sha Tin and Tai Po districts) To test a service model for public-private shared care for chronic disease patients in the primary care settings To provide patients with choices of private services outside the public healthcare system To establish long-term patient-doctor relationships in order to achieve the objective of continuous and holistic care 53 Target Group Clinically stable DM and/or HT patients who are currently taken care of by the public healthcare system Financial Incentives Subsidy in the form of electronic health care vouchers to patients to use the primary care services from private medical practitioners 54 Arrangement ◦ Patients: (a maximum subsidy of HK$1,400 per year) (i) A subsidy of HK$1,200 for at least 4 consultations/case management per year at an interval of not more than 4 months apart and drugs for treating DM and/or HT; (ii) An incentive of up to HK$200 per year for patients who can meet the preset health outcome indicators and complies with the care requirements prescribed by their private medical practitioners ◦ Private Medical Practitioners: Quality incentive of HK$200 each year for each patient under his/her care in the Programme. They must meet all process indicators in order to receive the payment. Outcome To be evaluated 55 Development of Private Hospital - North Lantau Hospital Phase 2 Public- Private Partnership Project (to commence in early 2010) To increase the overall capacity of the healthcare system of Hong Kong and facilitate the development of the medical industry through the promotion of private hospital development 56 To address the imbalance between the public and private sector ◦ 39 Public vs. 13 Private Hospitals ◦ Over reliant on public service ◦ Limited competition and collaboration and choice for patients ◦ Threat to long-term sustainability of healthcare system Development of private hospitals at sites at Wong Chuk Hang, Tseung Kwan O, Tai Po and Lantau Source: Invitation for Expression of Interest – Development of private hospitals at sites HKSAR 2009 57 Development of Private Hospitals Government to facilitate the development of private hospitals through enhanced support in hardware and software Hardware Reserving suitable sites for private hospital development (4 sites situated in Wong Chuk Hang, Tsueng Kwan O, Tai Po and Lantau) Software Continue to enhance training and development of healthcare professionals; attract oversea talents to enhance sharing of expertise and raise service standards 58 Phase one – To build a public hospital with 180 beds to meet the needs of the local community on Lantau Island Phase two – To explore the introduction of PPP for private sector to provide other medical services and facilities in the available area in the hospital site 59 The following models are ruled out: ◦ Financing: Private provider to finance the building of the public hospital. ◦ Ownership: The Government and the private provider to share the ownership of a hospital building. ◦ Operation of services: Private provider to deliver all public clinical services through a contracting-out arrangement. 60 Co-location of public and private components within the same buildings (i.e. vertical colocation) or in separate buildings on adjacent sites (i.e. horizontal co-location) 61 The private provider will finance, design, build, own and operate the private component on the land acquired from the Government. To transfer the ownership and operation of the private facilities to the Government after a pre-determined fixed period of time. Government may entrust the private provider to design and build the public component in tandem with the private development. The Government will bear the costs for the public component. 62 The land and the hospital building to be built thereon will remain the property of the Government. Part of the building (e.g. a number of floors) will be let to the private provider to operate and provide private services. The Government may entrust the private provider to design and construct the hospital building, where both the public and private components will be accommodated. 63 Purchase of services ◦ Clinical and allied health services ◦ Clinical supporting services Other contracting-out arrangements ◦ Management and administration (e.g. accounting, information technology) ◦ Building arrangement (e.g. maintenance, cleansing, security) ◦ Other ancillary services (e.g. catering, laundry, portering) Staff arrangements ◦ Cross-attachment of staff between the public and private Land disposal arrangements 64 Framework for Hospital Contracting Context ◦ Health Systems Policies Organisation Financing and payment ◦ Capacity Government − Technical − Political Private Sector ◦ Human resources ◦ Social-economic-political environment ◦ Societal values 65 Issues Priorities Objectives of contracting 66 Consider alternatives to contracting Beside options for contracting Assess impact of contracting options Seven-steps to contracting Monitoring and evaluation 67 Thank You! 68