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Moscow Hospitals To Be Run By Private Owners

25.09.2012 22:31 / vedomosti.ru

The Moscow officials are going to transfer the city hospitals’ estate to concession, told Leonid Pechatnikov, Moscow Deputy Mayor for Social Development, in his live interview to the “Echo of Moscow” radio station.

Concessionaries will be selected through a contest – choosing the very best of the offered business plans. A winner will take a right to manage hospital estate and will receive a part of the city order, including provision of services in frames of the compulsory medical insurance (CMI) program. Moscow will see a high quality medical institution working for the city, but won’t bear the costs of supporting and maintaining it, Pechatnikov explained the idea to Vedomosti.

A federal act “On concessional agreements” enables to transfer the healthcare facilities’ property to concession. There are already some examples of the state healthcare institutions managed privately in Russia. In 2011 the city administration of Novosibirsk transferred the Maternity Hospital No.1 to the “Avicenna” private clinic for 22 years under the concession contract, and CJSC “Dental Polyclinic No.6” obtained a dental clinic. Under the contract concluded with the city, “Avicenna” is obliged to conduct 48 annual extracorporal fertilization procedures and provide them to those state employees, who need this procedure, while the dental polyclinic shall provide free of charge services to 300 social security beneficiaries per year.

The same year the Ministry of Land and Property Relations of the Republic of Tatarstan transferred to concession office spaces of the Pre-conception Clinic to the “Ava-Peter” Company (an owner of “Ava-Peter” and “Scandinavia” clinics). Meanwhile, the government of Ulyanovsk region plans to start construction of the surgical complex on the territory of the regional hospital under a concessional agreement; a contest aimed to select a concessioner is to be held in early 2013.

According to the report of the Department of Healthcare, Moscow numbers 97 city hospitals, including hospitals for children, specialized clinics, etc. Answering a question on what share of these hospitals will be transferred to concession, the Department official did not specify it. A list of hospitals to be transferred to concession is not specified yet, Pechatnikov says.

Today there is a particular hospital concession claimant; an investor plans to invest up to 150 mln EUR in its reconstruction, as Pechatnikov said in his interview to the Echo of Moscow. It is a municipal clinical hospital No.63, Mira Avenue, that has been a subject of interest for a number of other contestants, including the European Medical Center (EMC), Pechatnikov informs. According to his representative, tendering may start later this year or in early next year.

Today the Municipal Clinical Hospital No.63 is a therapeutic healthcare institution that hasn’t seen any reconstruction for 30 years, Gapeev says; on its base, the EMC suggests to create four hi-tech medical centers with a total area of about 30,000 square meters: a perinatal center, a center of endovascular surgery, rehabilitation and positron emission tomography centers. 40% of the total hospital facilities will be used to provide services to patients with the obligatory medical insurance (after reconstruction the hospital will be able to service a number of such patients similar to their current number due to implementation of new technologies) and high-tech medical care; the rest will be used to service patients with voluntary medical insurance (VMI) and for cash payments. Total reconstruction of the hospital, as Gapeev estimated, will need 140-150 mln EUR. The EMC will finance the project at its own and third parties’ expense. The concession period will last for several decades; they do not provide precise evaluation yet, but it will be presented in contest documentation, Gapeev says.

According to Pechatnikov, the city has already received offers from nine investors, including some insurance companies.

“We are following this issue and actively negotiate with Moscow administration,” comments Vladimir Skvortsov, Alfa-Insurance Company Director General. “It is obviously interesting for us as a company that has a network of its own polyclinics and actively operates at the OMI and VMI markets. We are currently studying all the possible additional opportunities, conduct investment evaluation and investment efficiency.”

The Alliance does not participate in the process, says Alexander Pilipchuk, VMI Deputy Director and Head of the Company’s Medical Service Center: “Our concept is to build up relations with the best healthcare institutions at the market without managing them. Insurers organize medical care, while appropriate specialists execute treatment.”

The Joint-Stock Financial Corporation “Sistema” (the main owner of the “Medsi” network of clinics) and “Clinic 31+” haven’t received such proposals from the city, their representatives informed. “We might be interested in such an opportunity of participating in this process, but everything will depend on the terms the government of Moscow will offer to private investors in this collaboration,” explained Alexey Moryakov, “Clinic 31+” Executive Director.

Strategy of the JSC “Medicina”, according to its President Grigory Roytberg, doesn’t allow to think about concession yet: the company conducts two large investment projects; moreover, it works in a premium segment and could not have supported an appropriate level of medical healthcare having an excessively high growth speed.

Maria Dranishnikova, Alexey Rozkov

Project Group №6