TEMPLATE DESIGN © Public-Private Partnership in Funding Public Health: The European Experience José Luis Navarro Espigares 1,2, Elisa Hernández Torres 1, José Aureliano Martín Segura 2. 1 Virgen de las Nieves University Hospital, 2 University of Granada (Spain). PPP IntroductionResults 2Discussion Policy Implications and Conclusions Results 1 Contact information The increased efficiency of individual projects does not mean that at the aggregate level the financial burden of such projects is bearable by the public purse. Guidelines and national regulations on PPP procedures should incorporate: 1.efficiency of individual projects (as a neccesary condition) 2.overall budget restriction (as a necessary and sufficient condition). In Europe, sometimes PPP is only seen as a way to privatise healthcare services. Nevertheless, it can also be viewed as a new form of regulation of private activities in this field. Thus, PPP implementation could deter excessive pressure within public systems to move towards privatisation. PPP definition An agreement between the government and one or more private partners according to which the private partners deliver the service in such a manner that the service delivery objectives of the government are aligned with the profit objectives of the private partners and where the effectiveness of the alignment depends on a sufficient transfer of risk to the private partners (OECD, 2008). Governments introduced PPP for various reasons: to improve the value for money in public service delivery to obtain private finance to public service delivery The regulatory framework plays a critical role in assuring and promoting the quality of services Good practices Legal framework Critical views about PPP in healthcare service The existing PFI schemes are a source of financial difficulty for NHS trusts The cost of PFI contracts for most trusts is greater than the capital they are provided with through the NHS resource allocation mechanism Payment by Results (PbR): the current system of resource allocation for England’s NHS Trusts receive the bulk of their income through a standard tariff for each patient who receives treatment This standard tariff for treatments includes an element for capital costs, designed to equal the average capital cost of all English trusts, based on 5.8% of trust income However, the capital costs of trusts with PFI schemes average 8.3%, with the result that they are under-funded This under-funding has led to the emergence of crucial financial deficits and plans for further service cuts. Recent evolution of PPP in Europe During the past two decades, some countries have seen a huge increase in the use of private-public partnership as a mode of public service. We can observe: Developed countries with extensive PPP experience: The United Kingdom. Countries that have experience with PPP: France, Germany, Hungary, Italy and the Nordic countries. Recent large players: Spain and Portugal. Why we chose the United Kingdom? 1.This country is a pioneer in PPP implementation 2.The UK offers the most extensive example of participation by local authorities 3.The UK experiences can be seen as a case study by other countries 4.The availability of data The UK Her Majesty’s Treasury publishes regularly an updated list of PFI projects Objectives To present the British experience in PFI projects related to healthcare services In particular ▫ Number of projects ▫ Capital value ▫ Departments involved ▫ Trends ▫ Operational period of contracts ▫ Charge payments in near future ▫ Final costs and internal rate of return Methodology Scope Geographical: The United Kingdom Functional: Private Funding Initiative (PFI) Temporal: Source: HM Treasury UK Databases: PFI Signed Projects List – March 2008 Analysis Classification Department Type: Health – Local - Other Descriptive Number of projects Capital value José Luis Navarro Espigares Virgen de las Nieves University Hospital University of Granada (Spain) Hospital Universitario Virgen de las Nieves Avenida Fuerzas Armadas Granada - Spain T: F: E1: E2: OPTIONAL LOGO HERE