Propaganda about PPP benefits doesn’t stack up with evidence

Propaganda about PPP benefits for health care doesn’t stack up with the evidence

“Private investment interests can try spinning the benefits of public private partnerships however they like but the international evidence shows quite clearly that they’re a flawed, expensive funding model,” says Ian Powell, Executive Director of the Association of Salaried Medical Specialists (ASMS).

He was commenting on the response of Instructure New Zealand chief executive Stephen Selwood to ASMS criticism of the PPP funding model as applied to public hospitals, including the possibility of it being used for the Dunedin Hospital rebuild: https://www.odt.co.nz/news/dunedin/health/dunedin-doctors-should-stay-out-rebuild-plans.

Health Minister Jonathan Coleman has indicated that all funding options for Dunedin’s new hospital – including a PPP – will be explored:https://www.beehive.govt.nz/release/dunedin-largest-new-hospital-build-nz-history.

ASMS has called on the Government to fully fund the public hospital instead of allowing private investors to profit at the expense of patient care:https://www.asms.org.nz/news/other-news/2017/08/21/flawed-public-private-partnership-model-needs-ruled-new-dunedin-hospital/. ASMS has also previously raised concerns about the funding model for a new medical centre in Westport: https://www.asms.org.nz/news/asms-news/2017/05/18/dhb-pushed-funding-deal-will-take-money-patient-services-full-disclosure-independent-scrutiny-required/.

Mr Powell says the comments by Stephen Selwood that senior doctors should stick to surgery and keep out of the Dunedin Hospital are ludicrous.

“It’s the clinical staff of a hospital and their patients who have to deal with the real-life fallout from shoddy funding decisions which result in taxpayers eventually shouldering more of the cost of public health care while private investors drain the pockets of local communities,” he says.

“It is simply not possible to design and build new hospitals without senior doctors as part of the leadership of this design. They know much more about designing hospital facilities to best meet patient needs that Mr Selwood and the vested interests he represents will ever know.

“Senior doctors, and other health professionals, are strong advocates for equitable access to good quality and well-resourced public health care. We’ve already got a significant problem with unmet health need in New Zealand, and senior doctors are seriously concerned that going down the road of PPPs will simply take more money away from cash-strapped public hospitals.”

Mr Powell pointed to a report from a working group, assisted by an expert panel, to the European Commission in 2014 on its health and economic analysis of PPPs in health across Europe (https://ec.europa.eu/health/expert_panel/sites/expertpanel/files/003_assessmentstudyppp_en.pdf). Overwhelmingly, PPPs are used in the United Kingdom (mainly England) and Portugal (up to 40% of health investment), compared with 1% in the rest of Europe.

In the report, the expert panel made the following points about PPPs:

• Public disclosure of data and analyses behind PPP investments is very poor, inconsistent and not standardised

• It could not find scientific evidence that PPPs are cost-effective compared with traditional forms of public and managed provision of health care

• A common shortfall of all projects is that no formal evaluation of the outcome has been planned into the project

• PPP in most of its forms does not eliminate a public budget fiscal constraint; the state will eventually need to pay

• The public sector can borrow more cheaply and PPPs were more expensive than traditional models in the long term. If the PPP provider takes risks, the interest rate increases.

“This is a contemporary analysis and provides a very strong counterpoint to claims that health PPPs have been successful overseas,” says Mr Powell.

“I would rather rely on an expert group reporting to the European Commission than an organisation representing vested interests which seeks to make profits out of public hospitals – and I hope the Government also looks to the experts for a clear indication of what to avoid.”

ENDS

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