Yes, PPP is workable.
-Divergent views of Partners (Public/ Private) on intent of business
-Govt focus on Primary care, private focus on tertiary care
Bed to population ratio in India stands at 0.7 per 1000 against Global average of 2.7; for India to match the global standards we need to add 2 beds per 1000 population. To align Indian Healthcare with the current global average it is imperative that policy initiatives foster PPP and stimulate investment in healthcare sector.
CII subcommittee on PPP has recommended following:
-Offer land on a lease of 99 years
-Structure PPP through equity participation or infuse debt at subsidised costs of borrowing or provide extended tax holiday from a period of 5 years to 10 years for hospitals in tier 2 and 3 cities.
-Provide budgetary grants for capital and operating expenses of the systems covered under PPP
-Ensure non compete policy within a predefined geographical limit to ensure sustenance of the model.
Public private partnership model is workable in the health sector provided the project objectives and risks associated are established clearly by both the parties. Other critical to success factors include developing performance measurement metrics, growth and expansion strategy, establishing clear and frequent communication with stakeholders and use of technology to ensure transparency.
The PPP should essentially focus on ensuring that it is not loss making (preferably profit making but not profiteering).
Limitations: Intent of the 2 partners i.e public party and private party tend to be divergent; Govt essentially leverages it to get to the vote bank whereas Private player consider it as an opportunity to get land at lower costs, build equity with Govt. Govt should essentially focus on Free primary care delivery and select Referral centers like PGI/ AIIMS. Whereas for providing enhanced quality healthcare coverage it is important for Govt to enter into PPP. (Private players shall bring Management expertise to the table).
Model needs to be well thought of as providing free care at the same cost destroys the viability.