Suitable collaborations depend on current demand in healthcare

July 18, 2023 | 08:30
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Mechanisms and policies on medical development regulate that public medical examination and treatment establishments and public medical universities may cooperate to implement their projects via two methods – they can borrow capital to build new establishments in the current precinct, and decide on the organisational apparatus and appropriate management methods; or they can establish joint ventures with investors to build new medical treatment establishments operating as enterprises.
Suitable collaborations depend on current demand in healthcare
Nguyen Khanh Phuong - Vice director, Health Strategy and Policy Institute

The life of joint ventures or partnerships shall be discussed by parties in accordance with the law. In this way, they and private partners will operate the project under healthcare public-private partnerships (PPPs).

PPP can be classified into five common types, depending on the roles and responsibilities that the private sector takes. There is no optimised collaboration method. Selecting the collaboration type depends on the demand of the existing exam and treatment systems and what they require, including financial sources, human resources, technology transfer, and the demand on improving management capacity.

Each type has certain advantages and disadvantages. A managed equipment service PPP enables major suppliers to own and manage all equipment required for related facility operations. Under an operation and management services PPP, a private partner is contracted to operate and manage a hospital, health facility, or health network in exchange for a management fee.

Regarding the advantages, this method will mobilise more resources for the health sector, and simultaneously reduce spending from the state budget. Moreover, this method contributes to improving the effectiveness of investment and the quality of services, improving professional and management capacity, and promoting technology transfer. Furthermore, it will provide additional choices for patients who can afford better services.

Regarding disadvantages, the PPP method will put the cost of medical examination and treatment at a higher level and may cause uncontrolled state management over private medical activities. Besides that, it will be difficult to clarify between the responsibilities and benefits between parties, thus impacting fairness in healthcare and treatment activities.

Another concern is that skilled health employees may leave public facilities to work for private institutions with high wages and better working conditions.

Thus, to select suitable collaboration methods, we can refer to international lessons. It is necessary to create a political consensus and an adequate legal framework for the PPP model. Furthermore, it needs to put the state’s responsibility and role at a higher level in managing and offering technical standards, allocating resources, ensuring social security, determining the appropriate healthcare package, legal aid, and control of corruption.

Another lesson is to continuously improve the technical and management capacity of state institutions in PPP projects. The budget of a state institution should not be cut when these state authorities participate in a PPP project. While promoting private participation, it needs to strengthen the competition capacity of public medical examination and treatment facilities similar to the private sector, simultaneously taking advantage of private sector strengths.

Last but not least, ensuring the exchange of information between partners is a crucial key to the success of such partnerships.

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