Public-Private Partnership for Healthcare in China: The Effectiveness on the Regional Cities of Healthcare Service

Public-Private Partnership for Healthcare in China: The Effectiveness on the Regional Cities of Healthcare Service

Poshan Yu, Yifei Xu
Copyright: © 2022 |Pages: 21
DOI: 10.4018/978-1-7998-8486-6.ch018
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Abstract

In order to ensure the sustainable development of public private partnership (PPP) model and make the PPP health project ultimately meet the public expectation, the budgetary control and performance evaluation for PPP project is an important research topic. Budgetary control and performance evaluation is not only an important basis for project performance improvement, but also an important means for public departments to monitor and manage PPP health projects. This chapter aims to examine the effectiveness of PPP projects on the healthcare service provision in China. By analyzing the regional government finance and performances, this chapter attempts to elaborate the current dynamic of Chinese healthcare resources allocation by using PPP, and how this dynamic could be associated with the changing landscape of local economic conditions, in particular whether the application of PPP would help those regions with poor economic performance to close a gap in healthcare delivery.
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Literature Review

Definition of Healthcare PPP

BThe PPP model refers to the co-operative relationship between the government and social capital parties in the form of signing contracts to provide public services or products to achieve risk sharing and benefit sharing. There are four characteristics which are long-term, public demand-oriented, risk-sharing, and benefit-sharing (Ou & Jia, 2017).

There are three models of healthcare PPP:

  • Model 1: The adoption of the PPP mode is mainly based on the interests of the private party, and the purpose is to realize the financing, construction, and maintenance of hospital infrastructure.

  • Model 2: It focuses on the operation and maintenance of the hospital and the provision of discrete medical services by the social capital side.

  • Model 3: The third mode is the most complicated one. It has surpassed the scope of simple hospital construction and expansion, and expanded the business to transform the professional skills and scientific management mode of social capital to manage the normal operation of the hospital and service. Simply put, it combines the functions of model 1 and model 2. (Abuzaineh et al., 2018)

In this connection, model 1 is commonly adopted in regions in the European Union (Pereira et al., 2020) PPP. The application of the healthcare PPP in the medical and health field is mainly based on the construction of hospitals. Ding and Meng (2018) indicated that the current medical and health system in China is mainly composed of hospitals, primary medical and health institutions, and professional public health institutions.

Key Terms in this Chapter

Project Identification: The PPP project identification stage includes a preliminary assessment of potential projects. The purpose is to determine whether a feasibility study should be carried out.

Project Implementation: Project implementation is the stage when the PPP vision and plan become a reality.

Project Procurement: Project procurement helps PPP management to find the required resources and manage them throughout the life cycle of the project. PPP management, during project procurement stage, defines, plans, implements, controls activities, and transforms them from current state to future state.

Value for Money: The objective of value for money method (VFM) is to tell stakeholders (including government and private investors) whether the proposed project is more suitable for PPP or other more “traditional” methods.

Project Handover: “Handover” occurs at the end of the PPP project. The objective of the project handover stage is to hand over the project to the new project manager to ensure the timely completion of the PPP project.

Project Preparation: Project preparation is the procedure of developing and analyzing the PPP project concept into the final project preparation and implementation.

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