PPP solutions for healthcare in India

1. PPP solutions for healthcare in India

2. Key healthcare challenges

3. PPP solutions – selected case studies

4. Aarogyasri Community Health Insurance Scheme • Healthcare services challenges • Lack of access for BPL families to advanced tertiary care, non-utilization of extensive private infrastructure and advanced clinical capabilities for the poor • High catastrophic expenditures, delayed care seeking behavior by the poor • Fee for service charging in the private sector – little informed choice by patients; little consensus around treatment protocols, quality • Lack of electronic medical records, facility utilization information, disabling planning efforts at state level • Solution • Unique community health insurance PPP – Public Aarogyasri Health Care Trust • defines premium package, treatment protocols, empanelment criteria • Monitors pre-authorizations, claim process, (social) auditing • Private insurance company/TPA, selected through competitive bid process , to • administer patient enrolment, hospital empanelment, • claims management, risk coverage (compensation through premium paid for by state – about US$7/family per annum, bid parameter • Network hospitals, both public and private (about 90% of procedures in private hospitals, efforts by public hospitals to improve!) – strong response by private hospitals to invest/move to district and subdistricts

5. Aarogyasri Community Health Insurance Scheme (2) • Solution (contd) • Extensive coverage achieved, since 2007 pilot, 20.4 million families; enrolment translates into strong effective patient demand, replication across India • About 15,000 patients/ day screened in free health camps, about 7,000 hospital registered (4,000 OP, 2,000 IP) • 4.1 million people screened (health camps/ primary care); about 900,000 IP/OP procedures/therapies to date, effective patient choice, money follows patient • Electronic medical records - innovative real-time online workflow solutions, integration with biometric BPL cards (poverty targeting), real time online updates • Reducedcatastrophic expenditures (floater coverage of US$3.500 per family plus special allowances)

6. Andhra Pradesh Radiology (1) • Healthcare services challenges • On-site diagnostic not available, need for external referrals; external services are (generally) low standard, informal payments to referring doctors, high cost • Age and poor condition of public medical colleges and teaching hospitals – complex upgrading needs in the imaging and laboratory environments , facilities, equipment, power supplies • Non-compliance with MCI accreditation, inability to offer related graduate courses • Non-compliance with social health insurance empanelment criteria, inability to generate insurance revenues for services rendered to poor families • Government equipment purchase recognized as problematic, difficulty to retain staff, sustain maintenance • Transaction related challenges • Consultative and decision making process - multiple stakeholders involved – state government administration, four multiple medical college administrations, deans of radiology departments • Ensure appropriate use and contain fiscal exposure • Expectation of speedy implementation tied to local political realities • Bidder universe – sector fragmented, few (large) bidders • Changes in government – ability to commit; lack of health sector specific PPP policy (addtl. IFC support)

7. Andhra Pradesh Radiology (2) • Solution • Novel PPP model – modified co-location model, for upgrading radiology services at four teaching hospitals attached to public medical colleges in Kakinada, Kurnool, Vishakhapatnam, and Warangal • Government to make available land on hospital premises, fixed viability gap funding for part of the civil works associated with upgrading • Strong competition, winning bidder global/local consortium, 7-year contract • Bid parameter was the cost of services – winning bid is half of prior local rates (based on basket of scans) • Availability of advanced services to around 100,000 patients per annum, after ramp-up • Selected structuring features • No minimum volume guarantee – bidders may often require for government to guarantee a certain payment or patient volume; this model avoids such guarantee but all public patients are being referred to the PPP • Private public patient mix – the PPP is entitled to utilize idle imaging capacity to provide services to external patients, but at same tariffs, priority for referral patients in defined windows, to reduce distortions • Explicit obligations towards enabling medical education , student access to equipment and software infrastructure

8. Closing observations.. • Government commitment is key! • Being fully informed about the implications of a PPP vs public solutions • Quick wins, starting with relatively easier projects, generate support • Knowing where the government wants the private sector to help…useful to flesh out a PPP strategy in parallel to undertaking initial PPPs, to generate a sense of direction among stakeholders • Having the skills and comfort level to manage PPPs is crucial for buy in by administrative officials, capacity building, learning is most real hands-on, on specific PPPs, should be accompanied by broader training • Reality of changes in government – broad stakeholder involvement and steering committee helpful to build institutional memory • Thank you very much for your attention, feel free to ask questions!