Build and Beyond: The (r)evolution of healthcare PPPs

PPPs have become established vehicles for using private capital to build healthcare infrastructure. However, many of these arrangements have proven to be inflexible and unsustainable. A new chassis for PPPs is emerging that goes beyond the financing of the deal and into anticipating and operating more efficient care delivery. While private capital brings discipline and savings to healthcare infrastructure, future PPPs will focus on savings achieved long after the deal has closed. 

The potential market for PPPs is significant. Over the next ten years, $70 trillion dollars will be spent globally on healthcare delivery and infrastructure, much of it funded by taxpayers. Only 5 percent of that will be spent on infrastructure. The bigger amount and greater market potential is in the delivery of healthcare services, which make up the other 95 percent, or about $68.1 trillion.   

  • Fast growing, global market for private capital.  Public and private sector partnerships are emerging as a new and compelling model for financing and managing healthcare delivery.
  • An evolving business model from infrastructure finance to healthcare delivery.  A viable way of addressing larger challenges facing healthcare everywhere - reducing costs, improving quality, and expanding access to services.   
  • The public finance of private innovation and efficiency is a win-win-win for governments, private industry and patients.  It is sustainable, presents a reliable multi-year revenue stream and produces better quality healthcare for patients.
  • Beyond health reform by bending the cost curve.  The growth of the PPP market is being driven by unsustainable growth in health spending, which is consuming an increasing portion of national resources.