Transcript Ministry of Health and Social Welfare Public Private Partnership for replacing the national referral hospital Dr Mphu K Ramatlapeng Minister of Social Welfare Dr.Health Mphu K.and Ramatlapeng Ministry of Lesotho Health.

Ministry of Health
and Social Welfare
Public Private Partnership for replacing the national
referral hospital
Dr Mphu K Ramatlapeng
Minister of
Social Welfare
Dr.Health
Mphu K.and
Ramatlapeng
Ministry of Lesotho
Health & Social Welfare
rd
3 October
2007
July 7, 2007
Background
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As part of the Health Sector Reforms, the referral system in the health
sector needed to be greatly improved to meet the clinical needs of the
country
The current national referral hospital QEIII could no longer fulfill this
function satisfactorily because of its derelict infrastructure
In 2002 Boston University, as part of the reforms agenda, was tasked by the
MOHSW to critically look at QEII Hospital and come up with
recommendations as to the way forward
The Boston University report Economic Study of the Referral Health
Services in Lesotho: The Future of QEII Hospital recommended the
construction of a new hospital at a new site as the only option that would
make economic sense.
The New Referral Hospital would provide a higher level of service and
quality
The benefits of the hospital would be felt throughout the health sector due
to in country high quality of specialist care thus reducing the referrals to
neighboring South Africa, and training of health workers and
A Public Private Partnership was the preferred route to the provision of the
new referral hospital
Slide 2
How did we get here?
 Urgent need for replacement of existing hospital, Queen II
Existing service unsatisfactory due to dilapidated building, over 50years old
- Less expensive to replace than repair
- Clinical service offered is of poor quality for an apex hospital
 Public Private Partnership option taken by GOL in 2005
-The PPP partner will design, build, fully maintain and operate the new public
hospital and 3 urban Filter Clinics for Government under an 18 year contract
-The PPP allows Government to shift operating risks of the hospital project
to the PPP Partner
- PPP partner will bring operational experience in hospital
 IFC main advisor on this PPP
management
Slide 3
Hospital PPP
Private
Operator
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Ministry of Health
PPP Agreement
Detailed designs
Capital financing
Construction
Medical supplies & equipment
Clinical services
Maintenance
Non-clinical services
Staffing and Training
New
Hospital
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• Sector Policies and Strategy
• Service Package
• Reimbursement for all clinical and
non-clinical services
• Performance monitoring
• Joint Services Committee
Slide 4
Why the PPP Model for Lesotho?
• Increased need for better services as expressed by both the
public and government
• Private Sector can deliver the results Government and the
public are seeking
 Government is increasingly focusing on accountability and
results
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Government intends the New Hospital PPP Project to provide -Modern approaches to health management, clinical procedures,
medical equipment
-Training for the health sector
-Predictable expenditure – to stay within Government’s Unitary
Payment
Slide 5
Guiding Principles for the Project
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The New Public Hospital serves two equally important functions:
Training resource for health sector
High quality services for all Basotho
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Balance what is needed with what is affordable:
Use current operating budget as a baseline
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Maintenance of buildings and equipment
Suitability, durability, ease of maintenance and minimum life-time cost
for the building and equipment
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Maximum value for money spent on this project
Slide 6
What is the Project?
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Project Requirements:
Higher volume of patients and meet GoL affordability
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Site & Building:
~150,000 hectare site at a new site ; 29,000m2 building, designed for future
expansion
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Project Cost:
M438m/$62.5m (M550m/$78.5m incl VAT) for design, construction & fully
equipped for operation
Description:
GoL will contract through a competitive, transparent process with a PPP
Partner for an 18 year contract of full Design-Build-Finance-Operate
Capacity:
390 bed modern apex hospital for the country
Slide 7
What is included in the New Hospital PPP?
Unitary Payment by GOL in exchange for the PPP Partner providing following –
1. Initial services
- Design, construction and partial financing of the new hospital
-Refurbishment and re-equipping of three filter clinics, initial staff training
2. Operational Services at the filter clinics and new hospital include:
- Non-clinical services
- Clinical Support Services
- Clinical Services
- Private Patients
The Operator will integrate public and private clinical services (amenities being only
difference)
3. Managing Referrals and adds-ons for full Oncology unit and other services
- The PPP Partner will assist Government in managing the effectiveness and cost of referrals to South
Africa especially oncology.
Slide 8
What is included in the New Hospital PPP? (cont)
2. Operational Services at the filter clinics and new hospital include:
- Non-clinical services
- Clinical Support Services
- Clinical Services
- Private Patients
The Operator will integrate public and private clinical services (amenities being only difference)
3. Managing Referrals and adds-ons for full Oncology unit and other services
- The PPP Partner will assist Government in managing the effectiveness and cost of referrals to South Africa
especially oncology.
Slide 9
Current Project Funding
Sources of Funds
•Private sector (banks, investors, project company)
Providing 20% of capital costs
•Multilateral
Global Partnership for Output-Based Aid (GPOBA)
Grant of M43.75m /$6.25m, payable over first five years of project, to
augment the Unitary Payment. Administered by World Bank
Partial Risk Guarantee (PRG) has been requested from the World
Bank by Government – this provides the operator with partial coverage
(at their expense) should Government fail to make the unitary payment
•Donors
IFC and Donor trust funds have supported technical consultants
•Government
Providing 80% of capital costs, saving large debt service costs and
significantly improving project risk profile
Slide 10
Current budget for QEII Hospital
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The budget for QEII hospital in 2007/08 was137 million Maloti
This included the Filter Clinics
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This budget has been tripled over the past 3 years but with no
commensurate increase of service levels. In fact services are decreasing
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Government is spending as much to operate QEII today as it will spend for
the new hospital which will have a higher level of service and quality
Slide 11
How to Avoid the Same Problems in a New
Building?
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Overcrowding with patients needing lower level care
- Emphasize primary care and routine outpatient services at the filter clinics
- Fully functioning filter clinics
- Triage – patient management on entry at clinics and hospital
- Strong referral policy
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Equipment and Supplies
- Servicing, supply and maintenance contracts
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Human Resources / Staffing
Staff complaints to be addressed include
– lack of supplies, equipment, and training
- low salaries
- PPP Partner is contractually required to have full staffing
- Partner prepared to provide better working conditions
Slide 12
How will the New Hospital Affect the Health
Sector?
 Higher level of medical services at New Hospital
 Greater access to services – more patients can be
seen
 Better referral resource for district hospitals
 New Hospital will serve as a training resource for the
health sector
 Fewer referrals expected to South Africa over time
 Fits in Government’s affordability envelope
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Other Concerns
 Cost of public services will remain the same – cost to public patients
does not increase
 Government is not reducing the Ministry’s budget to pay for the new
hospital
 WB to provide support to Government to develop capacity for contract
management
 Other benefits to Basotho from the project include Local Economic
Empowerment (LEE)
 Recruitment should minimize disruption to staffing in the district
hospitals and elsewhere
 Existing staff at Queen II will be offered the choice of transferring to
other Government facilities and transferring to the private operator
Slide 14
The National Scale-up Plan for ART services in
Lesotho
Thank you for
your attention !
Slide 15