Public-private partnerships in non-profit hospitals: Case study of China

The gap between supply and demand for health care services is expanding rapidly in China. In order to resolve this problem, the government has implemented supply-side reforms in the health care sector by inviting private capital to increase supply quantity and improve quality. However, health care institutions have high complexity and particular needs, while non-profit hospitals have very strong public interests. This gives rise to complications in the implementation of public-private partnerships (PPPs) for health care services. In this paper, the authors have selected one case each from three different models of non-profit hospital PPP projects in the national PPP project database, operated by the Ministry of Finance, and compared how these projects were operated to identify the differences among them. A content analysis of the vital project documents is the primary analysis technique used for this comparison. Key issues investigated include reasons for model selection, requirements for private sectors and market competition level in different models, risk identification and sharing, design of payment mechanism, operation supervision, and performance appraisal of the project. Based on the comparison, some key lessons and recommendations are discussed to act as a useful reference for future non-profit hospital PPP projects in China.