Manises PPP Sydney Nov 2010 Index 1 PPP Overview in Spain 2 What - - PowerPoint PPT Presentation

Manises PPP

Sydney Nov 2010

Index

1 PPP Overview in Spain 2 What is Manises 3

Manises Key Management Model

4 5

In Short Discussion

2

• 1. PPP

Overview in Spain

3

Sanitas: who we are

100% owned by BUPA (since 1989) More than 50 years of operations in Spain Integrated Healthcare Group:

• PMI: number two operator in Spain
• Hospital Group: Integrated network of 60 centres (Hospitals,

Multispecialty and dental)

• Care Homes: number two operator in Spain

Also operating in other Health services like Wellbeing, aesthetics..

4

Spanish National Health System

100% financed out of general tax Governance is decentralized through local healthcare management organisations in each of the 17 Regions Universal healthcare free of charge Benefits include:

• Primary healthcare
• Specialised healthcare, including outpatient and inpatient care
• 60% of the price of prescription drugs (some have full

coverage) Gatekeeper model

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Health System

Muface Mugeju Isfas Collaborating entities (BBVA, SCH, CAM) Private NHS Public

Insurer

Contracts PPP PFI Private

• PFI & Clinical

payment

• Capitative

payment

• Designs

Construction Financing & Operations

• NHS carries out

the clinical services

• Payment Fee

Public Infrastructure Health care Provision + infraestucture

Provider

Private Participation in the Public Health System

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Baix de Llobregat Construction Equipment Maintenance + Services No clinical Majadahonda

• S. Sebastian de

los Reyes + High Tech Burgos + Specialized Medical Care Valdemoro Torrejon + Primary Care Elche Alzira + Intermediate Care Manises

Evolution Public – Private Colaboration Model

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PPP – Why for NHS

Control health care costs by transferring risk to a more efficient private provider Allows making important investments in infrastructures and defer its payments Generate savings for the regions Easy check of the quality standards Flexibility & Innovation Capacity

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Attractive financial returns expected, non cyclical incomes & flows Help to counter the impact that any possible improvement of the NHS would have on the PMI business Participation in an emerging market in Spain, where our competitors (Adeslas, Asisa..) are Strenghten our healthcare market position

PPP – Why for Sanitas

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• 2. What is

Manises

10

We are part of the NHS

In the Valencia Community there are 23 health departments, 5 of them are working as PPP The Manises Department is functionally dependent on the local health government

Valencia Health System: Our customer

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Alborache (812)

Buñol 10.709 Godelleta (2.582) Chiva (10.857) Calicanto (57) Pecheriza (266)

Che ste (8.3 20)

Riba-Roja Turia (17.266) Logorilla (1.421) Manises (19.952) El Carmen 3.319 Xiperets 6.867 Quart de Poblet (23.973) Aldaia (25.171) Barrio del Cristo 6.749

Quart de Poblet (23.973) Manises (19.952) Aldaia (25.171) Barrio del Cristo 6.749 Riba-Roja Turia (17.266) Logorilla (1.421) Cheste (8.320) Chiva (10.857) Calicanto (57) Pecheriza (266) Godelleta (2.582) Turis (5.474) Macastre (938) Buñol 10.709 Alborache (812) Yatova (1.713) El Carmen 3.319 Xiperets 6.867

Our Health Department

• We cover an area of 20

villages

• We give assistance through:
• 20 Primary Health

Centres

• 2 Specialised Health

Centres

• We give medical assistance to nearly 200.000 people
• First hospital resulting from a concession model in an urban area. Only 8 km.

away from Valencia

• Doors opened on May 7th, 2009
• In May 2010, 44.200 persons added from Mislata

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Hospital La Fe Hospital Arnau Hospital General

Hospital Clínico Hospital Peset

Competitive Environment - The Major public hospitals are in the catchment area A new department created from three different ones

CE Aldaia Manises Hospital Military Hospital 20 CS CE Mislata

Our Health Department

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BUPA Bancaja CAM 50 % 50 % Sanitas Ribera Salud 60 % 40 % Especializada y l’Horta Manises

Government, Mayors and Community Association’s satisfaction is one of our goals

We collaborate with them to provide the best medical care We develop health programmes together The quality of our assistance is one of their objectives

Our Stakeholders

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Resources

221 Single rooms 32 Outpatient hospital Examination rooms 10 Large multipurpose

• perating

rooms 24 Post-surgical posts 53 Consultation rooms 6 Dilation rooms 2 Delivery rooms 10 Intensive care rooms 18 Dialysis stations

Manises Hospital

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Resources

Military Hospital

137 Beds 12 Outpatient hospital Examination rooms 2 Large multipurpose

• perating

rooms 28 Consultation rooms

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• 3. Manises

Key Management Model

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The structure of the management model is the key to managing a new business

STRATEGIC PLAN What do we want to achieve? OPERATING AND ORGANISATIONAL MODEL How do we operate? RESOURCES (HUMAN, SYSTEMS, INFRASTRUCTURE, EQUIPMENT) What resources are available?

Strategic Premises

Business Case High level of Satisfaction & Clinical Safety HR: FTE + Remuneration Model Services, Technology & Infrastructure Clinical & Quality Governance Efficiency: Scorecards

SH Model

Manises Management Model

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P&L

Business case: P&L

Profit & Loss (M. €) Total revenues 43,7 108,7 125,5 131,5 137,3 143,4 Operating costs 50,5 94,5 107,4 111,3 115,3 119,4 EBITDA

• 6,9

14,2 18,0 20,2 22,0 24,0 EBIT

• 11,9

5,8 8,7 10,4 12,0 13,7 2009 2010 2011 2012 2013 2014

300 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Total Revenues EBIT

50 100 150 200 250

Profit & Loss Account (M. €)

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CAPEX IRR: 12,3 %

Business Case: Capex & Return Analysis

Capex (M. €) Construction Phase Total Reinvestment Total Capex Manises Hospital 101,8 46,5 148,3 Military Hospital & Manises 15,1 15,1 Total investment 101,8 61,7 163,4

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Other customers: Traffic Accidents Insurers, Mutual Insurers…

Revenue Structure

Revenue Positive Intercentres invoicing: Activity from non capitative population Capitation Revenue: 116,7 M.€ (192.329 inhabitants x 607,14€) Complementary revenue: Parking, Vending machines, TV, etc…

85% 12% 22

PPP´s: Valencia and Madrid models

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Services included Services explicitly excluded Personnel

• Outpatient and inpatient specialised care
• A&E
• Pharmaceuticals provided with inpatient care
• primary care
• rgan transplants
• ambulance services
• xygen therapy
• addiction rehabilitation
• family planning services
• pharmaceuticals
• All hospital personnel are

employees of the company responsible for managing the health area

Contract length

• 30 years beginning with the signing of the

contract, therefore including the construction period (~21 months)

• Primary care
• Outpatient and inpatient specialised care
• A&E
• Pharmaceutical management across all

centres managed (but only responsible for cost of inpatient pharmaceuticals)

• Addiction rehabilitation and family planning
• Does not include the cost of prosthesis,

ambulance or oxygen therapy

• All statutory personnel currently working in

primary health centres included in the health area continue to be employees of the state, although managed by the company responsible for the health area

• 15 years, extendable an additional 5 years by

mutual consent, beginning once the hospital is

• perational

Valencia Madrid

PPP´s: Valencia and Madrid models (II)

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Subcontracting Construction period

• Cannot subcontract medical services
• 18 months from issuance of planning permit

Payment

Bidders define:

• A capita payment to cover medical services

provided

• A fixed fee to cover the cost of the construction

and maintenance of the infrastructure

Other revenue streams

• Commercial activities (parking,

restaurant, flower shop)

Inter-centre costs

• 90% of list price for incoming activity
• 100% of list price for all services

provided to health area residents

• utside of managed centres (except

excluded services)

• Cannot subcontract medical services
• 25 months from signing of contract

Capita established by CAV

• Incentive for reducing pharmaceutical´s
• Commercial activities (parking,

restaurant, flower shop)

• Maximum of 85% of list price for incoming

activity, could be reduced in the bid terms presented

• 100% of list price for all services provided

to health area residents outside of managed centres (except excluded services)

Valencia Madrid

PPP´s: Valencia and Madrid models (III)

Price increase mechanism

• 85% of inflation growth in hospital

spend in the Community of Madrid

Return on investment

• No Cap
• Annual increase based upon the lower of:
• growth of Valencian government health

budget

• average growth national health budget
• Capped at 7.5% for medical

services

Valencia Madrid

If our protected population receives health services by other health departments, we would have to take up the following costs:

The negative Intercentres invoicing can come from:

Patients who decide to be assisted by specialists of other public hospitals

• Patient’s choice
• Waiting list

Patients with pathologies not included in the Service Portfolio of Manises Hospital This is not the case in primary care

It is being more difficult to reduce the negative Intercentres than other concessions

Our population transferred from other nearby hospitals, which are still functioning, and one of which is the largest hospital in the Valencia Region. We are around a densely populated area, nearly 1,5 million people

On the other hand, we have more capacity to generate positive intercentres than other concessions in the near future

Negative intercentres charges

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Scorecards

MANISES 2010 YTD Q1 HOSPITAL AC 2009 YTD Q4 DEV HEALTHCARE EFFICIENCY RATIOS Ratio of day patient surgery 52% 56%

• 7,1%

Ratio of cesarians 16,00% 17,00%

• 5,9%

Ratio of surgical difficulty 3,80% 3,70% 2,7% Average Stay 4,2 4,3

• 2,3%

Ratio of reentries 5,10% 4,70% 8,5% A&E pressure 80,00% 76% 5,3% OCCUPATIONAL RATIOS Consultation occupancy ratio 56,00% 44,71

• 98,7%

Theater occupancy ratio 50,00% 31,12% 60,7% Hospitalisation occupancy ratio 76,00% 91%

• 16,5%

ICU occupancy 75,30% 74,78% 0,7% NICU occupancyAppointment ratio 35,50% 25,43% 39,6% Appointment occupancy ratio 109% 106,00% 2,7% MANAGEMENT RATIOS Total productivity ratio 2,39 2,19 9,1% Doctor productivity ratio 5 4,54 10,1% Absenteeism ratio 2,70% 2,50% 8,0% FTE 675 633 6,6% Medical cost ratio 14,70% 0,148

• 0,7%

Property cost x m2 47,3 55,8

• 15,2%

OTHERS % Specialities with consultation waiting list higher than 30 days 10,80% 15,90%

• 32,1%

Specialities with surgeries waiting list higher than 60 days higher than 15% 38% 35,89% 5,9% Portfolio of services 40 39 2,6% Total complaints 61,6 65

• 5,2%

% of clinical complaints/total 0,092 0,0998

• 7,8%

% of A&E complaints/total 0,358 0,3742

• 4,3%

% of complanints per patients attended 0,0023 0,0027

• 14,8%

Headcount May 2010

100 200 300 400 500 600 700

Employees Civil Servants

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• 4. In short

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In Short

• 1. We provide healthcare to nearly 200.000 inhabitants
• 2. Long term partnership with Public health system ensuring :
• Efficiency
• Innovation
• High Quality Standards
• 3. Much more than a hospital:
• 20 Primary centres
• 2 Speciality Centres
• Manises Hospital
• Intermediate Care Hospital
• 4. Great opportunity to develop and improve our hospital management

model

• 5. Diversify Sanitas’ operations
• 6. Counter the impact of NHS on our PMI business
• 7. Attractive financial returns expected

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• 5. Discussion

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Manises PPP Sydney Nov 2010