The Ministry of Health of Turkey

1. The Ministry of Health of Turkey HEALTH CAMPUS PROJECTS Erkan Topal, Ph.D. May 3, 2012 Istanbul

2. The background The Ministry of Health of the Republic of Turkey (MoH) has developed and been implementing a plan to expand and improve its medical education, training and service delivery by creating a new, modern and efficient public health infrastructure To achieve this vision, it is calculated that a large number of important projects are required totalling an investment of more than €10billion which the MoH plans to implement within a 5 year period The main challenge for the MoH, will be to procure such projects in the most efficient, cost effective and rapid manner, without overburdening the public finances and straining the limited public resources Lead by the successful examples of similar programs that were implemented in some European countries, and in particular in the UK, the MoH has decided that a carefully designed Public Private Partnership program would be the best way to effectively realize the project of creating a modern and efficient health infrastructure in Turkey

3. Legal Framework • Fundamental Law on Health Services, No. 3359 of 1987 • Supplementary Article 7 to the above law as introduced by Law No. 5396 of 2005, authorizing the MoH to contract with the private sector for long durations for building health units and providing non-clinical support services in return for yearly rentals • Regulation on “the construction of health facilities and management of non clinical services” Law No. 26236 of 22 July 2006 (Regulation)

4. Legal Framework – The Regulation The Regulation provides for: • new healthcare facilities to be built and existing healthcare facilities to be refurbished and renovated as indicated by the Higher Planning Board of the MoH • the transfer by the Treasury of the land where the above facilities are located to the MoH • the possibility for the Project Company to obtain a building lease right for a duration not exceeding 49 years (ownership of the assets), to be used as a security to banks (the building lease right can be subject to a mortgage) • a typical DBLOT kind of structure associated with an availability type of payment mechanism

5. Legal Framework – The Regulation • the right for the private sector to carry out non-clinical services within the hospital facilities and other functional areas • the right for the private sector to establish joint ventures in the form of either business partnerships or consortiums to bid for the contract • the ratio of equity capital to be provided by the Project Company of not less than 20% • the duration of the contract: not exceeding 49 years

6. The Project - Structure

7. The Project - Structure

8. Contracted

9. Tenders Finalized

10. Tenders in progress

11. Tender (to be announced)

12. SUMMARY • 34 Packagesprepared, estimated€10 billion • 16 packageshavebeentendered (68%) • Constitutesfor 25,283 beds • 8 tendersfinalized, 13,930 beds (38%) • 8tenders in progress, 11,353 beds (30%) • Bytheend of 2013, allwill be finalized

13. Particapants of PFI

14. Risk Allocations

16. Design

17. Contruction

18. Operations and Maintenance

19. Legal

20. Financial Matters

21. Thanks…