Development of Healthcare Network in Kazakhstan: Restructuring and Investment Planning in Accordance with International

1. Ministry of Healthcare and Social Development of the Republic of Kazakhstan Department of Investment Policy and Development of Public-Private Partnership Planning, investment managementand development of public-private partnership Astana, 2015

2. The strategy of development of the network of healthcare organisations in accordance with international standards «Sanigest International» • Restructuring regional networks of healthcare organisations in accordance with international standards • 1.Improving the standards for healthcare infrastructure planning in accordance with international standards • 2. Developing master-plans of restructuring regional medical organisations • 3. Increasing the potential for investment planning in respective organisations at the various healthcare levels • 4. Producing recommendations on the application of PPP mechanisms in the healthcare sector Aim: • To establish a rational network of healthcare organisations for the provision of affordable high-quality medical care to people in accordance with international standards Actions • Developing an algorithm of phase-in implementation of restructuring regional networks of healthcare organisations Tasks • Developing a rational and efficient investment policy in the context of developing the network of healthcare organisations in accordance with international standards Total numbers of healthcare facilities Long-term plans of development of the network of healthcare organisations for 2015-2025 by regions of the RK

3. Healthcare challenges and development priorities Challenges Priority tasks • 1. Minimal social standards • Prioritized development of PHC • Optimizing and refocusing of hospital organisations • The increase of public costs of implementing new medical technologies • 5. Developing private medicine • 6. Developing new forms of PPP • 7. Adopting the mandatory medical insurance system • THE NATION’S PLAN – 100 concrete steps to implement the 5 institutional reforms “KAZAKHSTAN -2050” STRATEGY New policy of an established state Draft project of The National program of healthcare development in the Republic of Kazakhstan “Densaulyk” for 2016-2019 “…Our primary goal is to become one of the 30 most developed countries of the world by 2050 …The creation of an efficient private sector of the economy and the development of public-private partnership.. …Establish the environment for the growth of private medicine.. …improve and unify the supply of equipment and materials to medical institutions…” • 80.Implementation of mandatory social health insurance. Priority financing of the primary health care • 81. Development of private health care, implementation of corporate management in medical facilities. • Implementing a new healthcare policy based on an integrated approach to disease prevention and control • Ensuring the efficiency of management and financing of healthcare • Rational use of resources and optimization of the system’s infrastructure Strategic healthcare targets (The strategic plan for development of the Republic of Kazakhstan until the year 2020) • Increasing life expectancy to 73 years by 2020 • Increasing the accessibility and quality of medical services • Improving the financing and management system in healthcare

4. Kazakhstan’s healthcare system in comparison with OECD countries

5. The history of public and private sector cooperation in Kazakhstan

6. EXPANDING THE INVOLVEMENT OF PRIVATE MEDICAL ORGANISATIONS In the provision of medical services within the framework of the guaranteed volume of free medical care (GVFMC) through the provision of various government support measures Investment projects planning The National program of healthcare development in the Republic of Kazakhstan “Densaulyk” for 2016-2019 TRANSFERRING THE MANAGEMENT OF NATIONAL AND LOCAL HEALTHCARE ORGANISATIONS PRIVATE CAPITAL RAISING UPDATING THE SERVICE CONTRACT EQUIPMENT For the construction and management of healthcare facilities (PPP, concession), including the creation of a favourable environment for placing PHC organisations on the ground floors of apartment buildings Surgical complexes, dialysis centers, oncological centers To private companies, including foreign ones (on the basis of standard bidding documentation) Implementing the master-plans developed by «Sanigest International» Development of master plans for restructuring medical organisations 2010-2014 2015 2014 2016 Developing the Action plan for PPP in Healthcare of the Republic of Kazakhstan • Development and approval of long-term plans based on the master plans* • Improving the long-term plans* • Monitoring the implementation of long-term plans* * Long-term plans of development of the network of healthcare organisations for 2015-2025 by regions of the RK

7. The forms of public-private partnership in healthcare Potential types of PPP contracts in the healthcare sphere Within the “On public-private partnership” Act Within the “On concessions” Act Construction/reconstruction of healthcare facilities with utilization Trust management of healthcare facilities Renting healthcare facilities from private partners Shared management of healthcare facilities Construction/reconstruction, maintenance, renting and trust management of healthcare facilities. Shared management of healthcare facilities Life cycle contracts. Service contracts for the maintenance of medical and non-medical equipment. Outsourcing selected types of medical and non-medical services. Purchasing, renting/leasing equipment. Small-batch production of medical products and medicines. Implementing innovations. Private initiative projects. The possibility of implementing “small” PPP projects, which are executed on the regional level.

8. The action plan for PPP in the healthcare of the Republic of Kazakhstan Based on the recommendations of the Standard of National policy on PPP in healthcare of the European Economic Commission of UN • The foundation: • Critical need for updating the healthcare infrastructure • The draft of the «On public-private partnership»Act and the “On concessions” Act • The development of private medicine (step number 81 of the institutional reform) • A draft policy standard of PPP in healthcare of the European Economic Commission of UN • Recommendations on PPP in healthcare provided by the European Bank for Reconstruction and Development • Developing the Action plan for PPP in healthcare • Shaping the vision of the Local Executive Authorities (LEA) • Formation and approval of the catalogue of prospective PPP projects with preplanning of the scheme • Improving the industry-specific legislation due to the following necessities: • Flexible tariffs for medical services (the possibility of withholding the utilization component) • Changes in equipment and medical appliances purchasing for PPP • A warranty system of the volume of services for LEA and the compensation of the loss of profit to ensure the return of investments • Domestic financing of small and large PPP projects without hard collaterals • Attracting private operators and investors • The outcome of developing the Action plan: • Marketable projects (for which funds may be raised) with payment mechanisms and a basis for assessing the cost of each service. • Changes to the industry-specific legislation in order to provide an opportunity to structure the principal schemes of PPP contracts • Cost cutting at the development stage and ensuring the consistency of approach within the regions • Improving the quality of development, decreasing the possibility of failed tenders • Developing interest in the projects pool from the private sector and a PPP scheme that may be accepted by the investors • Regarding the service contract and transfer to trust management contract drafts - a basic template stipulating the terms by which efficiency is achieved on the public part • The stability of the implementation of PPP projects and its conformity to the plan • The end result • Fulfilling the needs of the population and the healthcare sector

9. Thank you for your attention!