4 th Middle East Healthcare Insurance Conference

Transcription

1 4 th Middle East Healthcare Insurance Conference How to Establish an Effective Public Private Partnership? What are the Issues, Challenges and Recommendations? Lili Khairallah 2 November 2010 Beirut

2 INTRODUCTION A. Global trend towards Public Private Partnerships ( PPP ). B. What is a PPP? Variety of definitions and types; Privatization or not? A matter of definition depending on the legal system and the applicable laws; A PPP to achieve a common objective; C. Lebanese Legal Framework Constitutional requirements; Lebanese Draft Law ; Government Plans: Health projects in the Government Policy Statement; D. Lebanon: Facts and Figures 50 % of the Lebanese population has no health coverage; 21 Public Hospitals with an aggregate number of 1800 beds; Social Security covers only 23% of the Lebanese population; No Social Security pension plan; A (universal) Medical Card Project is under study; Growing interest of the private sector in the health sector; Categories of hospital patients based on the method of payment; Patients of public hospitals are those who do not have any insurance/social security coverage. E. Context This presentation is given in the absence of a law that defines and sets out the precise legal framework of PPP in Lebanon.

3 Part I. Objectives Part II. Issues and Challenges Part III. Recommendations

4 Part I. OBJECTIVES A. For the Public Sector Partner 1. Reduction of public expenditures off balance sheet; 2. Meeting growing public needs and demands; 3. Delegating operations while ensuring implementation of national health policies; 4. Exercising overall monitoring and oversight. El-Khoury & Partners/Squire Sanders

5 B. For the Private Sector Partner 1. Establishing a cost effective structure; 2. Generating reasonable return on investment; 3. Maximizing advantages of bundled services (financing, building maintenance and operation).

6 C. For the General Public: 1. Accessing equitable and affordable health care; 2. Benefiting from quality of services through state of the art facilities and modern amenities; 3. Contributing to political stability with an issue everyone can agree with: good health care.

7 Part II. ISSUES AND CHALLENGES A. Procurement Issues 1. Valuation exercise; 2. Open, transparent and competitive procurement procedure; 3. Protection of public funds; 4. Selection of qualified partner. Lebanon Investmnt Summit 200

8 B. Contractual Issues Possible Structures: Structure 1 SELECTED CONSORTIUM Health Care Provider Financier Management Company Construction Company GOVERNMENT PPP Contract SPECIAL PURPOSE VEHICLE

9 Structure 2: SELECTED CONSORTIUM GOVERNMENT Health Care Provider Financier Management Company Construction Company PPP Contract SPECIAL PURPOSE VEHICLE

10 The PPP contract should strike a balance between The preciseness and completeness of its provisions; and The need for a certain flexibility and adaptability to cope with the changes of the healthcare sector. The PPP contract should be a comprehensive detailed contract that: Defines the role and responsibility of each partner ; Allocates the risks and rewards between the two partners; Anticipates changes in circumstances; Governs events of termination and possible transfer back to the public sector ; Dispute resolution.

11 C. Managerial Issues 1. Management according to accreditation standards; 2. Management of construction, maintenance and operation risks; 3. Maintenance of the infrastructure and the buildings in a good condition; 4. Training of employees; 5. Modern Medical and Information Technologies.

12 D. Financial Issues: 1. Profit Generating Motive 2. High Cost of Health 3. High Cost of Financing 4. Financial Feasibility of Project 5. Tariff Setting 6. Collection of Receivables 7. Government Intervention

13 Part III. RECOMMENDATIONS A. Establish a Clear Legal and Regulatory Framework B. Improve Political and Administrative Governance 1. Serious commitment from the Government and the public authorities; 2. Consistent implementation of health care public policy; 3. Active on-going monitoring and oversight of the implementation by the public sector ; 4. Development of Social Security regulations.

14 C. Support the Private Sector Partners 1. Foster enabling investment environments and provide incentives; 2. Create combined governance structures; 3. Encourage not-for-profit organizations and donors; 4. Involve the private sector partner in the decision making process.

15 D. Diversify the Types of Projects 1. Expand PPP project beyond building infrastructures; 2. Allow provision of health care services; 3. Allow creation of institutions for the prevention and control of specific diseases.

16 CONCLUSION How to Establish an Effective PPP? Define and understand the objectives; Recognize the challenges; Learn from previous experiences; Act in harmony towards a goal that is the public benefit.

17 Thank You for your Attention! Lili Khairallah El-Khoury & Partners Legal Counsel Sami Solh Avenue - Hechaime Building - 5th Floor P.O. Box: Beirut - Lebanon EK Partners & Al-Enezee Legal Counsel Mazzar Street - Futuro Tower - 3rd Floor P.O Box: Riyadh Saudi Arabia