The Hindu Business Line : Setting up AIIMS-like hospitals — Pvt cos want good return on investments

PUBLIC-private partnership is the way to go with the private health sector willing to partner whole hog with the Government to set up six AIIMS-like hospitals, as suggested recently by the Prime Minister. But it would like to seek adequate return on the investment.

Ms Suneeta Reddy, Director, Finance, Apollo Hospitals Group, said, "The Apollo Group would certainly be interested in participating in such a project in principle, and could be open to the right kind of partnerships, subject to its objectives being met both socially and financially."

The erstwhile National Democratic Alliance had announced the setting up of such healthcare centres in Bihar, Chhattisgarh, Madhya Pradesh, Orissa, Rajasthan and Uttaranchal under the Pradhan Mantri Swasthya Suraksha Yojana, but funding for these had not been finalised.

At a recent review meeting, the Prime Minister, Dr Manmohan Singh, suggested pursuing the public-private partnership model for the setting up of six AIIMS-like hospitals.

"Since the investments for setting up the AIIMS-like hospitals is expected to be very high, the Prime Minister suggested the public-private partnership arrangement," said Ministry sources.

The Health Ministry will now work on a plan to get the private sector involved.

Apollo, Max Healthcare, is also interested in partnering with the Government, and has started working with the Delhi State Government.

"Under the Bhagidari scheme of the Government of Delhi, ways to encourage private partnership in healthcare infrastructure are being explored. At present, Max Healthcare has not received any proposal from the Health Ministry on setting up super-speciality hospitals like AIIMS across the country," said a company official.

Ms Reddy said that public private partnership could be a successful one. "The possible models could be joint ownership model involving strategic partnership, both financial and technical or pure management model with no equity involvement," she said.

The private sector could bring in management expertise, standardisation of protocol, training, health insurance, financial structuring and marketing expertise.

However the private sector, given its dependence on market capital, will be looking to earning adequate returns of the financial stakeholders such as banks, financial institutions and equity shareholders. "Therefore, one of the primary considerations would be economic viability for the financial stakeholders," said an industry analyst.

Ministry officials said the challenge would be ensure that healthcare is affordable to people from all walks of life.

"The private sector would be concerned about the returns to investment and therefore, the right balance has to be struck," said the officials.

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