1. Public private partnership in Iran’s Health Care System By: A. Pourreza ; M. Momensaraie TUMS & SSO Islamic Republic of Iran Key Words: contract, financing, health system, reform goals

2. Definition What the seller/provider provides, What the buyer/purchaser pays, Delivery and payment dates The time period of agreement, Renewal positions (if any), Penalties for nonperformance, and Process of resolve disagreements.

3. Assumptions for contracting out Effective Management in private sector, Sufficient number of providers allows for competition, Provider competition enhances efficiency, The benefits exceed the costs, The contractor (MOH) has the capacity to design and manage contracts/contractual arrangements.

4. C ontinue Strengthening service delivery capacity of private sector, Increases allocative and technical efficiency), Promotes transparency in trading and decentralization, Encourages planning, monitoring and evaluation, and management practices, Implement changes in Who-does-What

5. In developing countries Enough potential providers exist for creation of competition, Provider competition, without any change on the purchasing side, can enhance efficiency, Government has adequate capacity to enter and manage contractual relationships with the private sector.

6. Successful contracting In public sector: –Do there is expertise to develop specifications, make contracting decisions, write contract, and oversee compliance? –Do public hospitals have significant autonomy and independence which are essentials to a successful contract, –Are there performance-based incentives and accountability for managers in order to contract effectively.

7. Continue In private sector and wider environment: -The existence of willing/able to pay for private care groups, - The absence of great inequities, - Strong professional ethics, - Informed consumers and active consumer organizations, - Appropriate incentives and regulatory structure for health care providers, - relatively high standards of care in the government sector.

8. Contracting effects on: Access: - physical access: -quantity of services provided, population coverage, and availability of interventions. - financial access: - insurance coverage, income /affordability

9. Continue: Equity: -equity in access, financing or health outcomes, Strategies to improve equity: 1-establishing contractual arrangements that specifically encourage providers to serve the poor and underserved; 2-contracting with private providers in areas that are of predominantly poor (geographic targeting); 3- contracting out services that are of most benefit to the poor and underserved.

10. Continue: Lack of sufficient evidence from comparative studies; it is doubtful that contracted private providers are more successful in improving equity than the public providers. Contracting resulted to improving access and promoting equity through extension of subsidized services to the poor and vulnerables.

11. Quality A major goal of health systems: - improving quality helps cost containment, - improves patients’ satisfaction and, - indirectly enhances equity initiatives in health care delivery. Tendency for focus on quantity and access, makes it difficult to measure changes in quality.

12. Continue If there is no linkage between payment to contractors and the quality of their performance, providers have little incentives to improve quality. It is not clear that contracting out improves quality of care compared with direct public provision, because: - First; quality is undefined or inconsistently defined across different contracting projects. -Second; there have usually been no control group in evaluation.

13. Efficiency Contracting can be used to increase efficiency: Lower unit cost; - cost per admission in some autonomous hospitals (300JD as compare to over 1500 JD in private hospitals without contracts. Increases both technical efficiency (by saving resources), and allocative efficiency (by redirecting resources ). Efficiency more than equity motivates policy makers to out sourcing.

14. Contracting out and Iran’s Health Care System Socio-economic development plan (the third), 1999, Article 192 Circular 88 While the Article 192 emphasized mainly on privatization and contracting out clinical services, there was no clear cut between clinical and non-clinical services, in terms of contracting out, in Circular 88. The Universities of Medical Sciences Utilized the guideline they preferred, and consequently; A very sophisticated environment, particularly in terms of: - performance evaluation, - homogeneous information generation, and - policy continuity, has taken place.

15. Table: 1 Medical Sciences University Contracts with private sector Name of servicesWay of choosing private contractor (s) Methods of payment Difficulties during contracts period The way of problem solving Evaluation of services purchased Tools and Responsibles for evaluation Tehranyes-ICU, pharmacy, dentistry, laboratory, radiology, and health posts services biddingFee- for- servic +global yesNegotiation, dialog and persuation yesThrough a questionnaire/ Checklist + field visit and process evaluation OrumiehyesPHC servicesbiddingglobalyesNegotiation, dialog and persuation yesChecklist/team Meshedyes-laboratory and pharmacy services. -PHC, HIS services -open heart services biddingPer-capitayesNegotiation, dialog and persuation yesChecklist/team TabrizyesScreening/ preventive care biddingcapitationno-yesChecklist/team Lorestanyes-nursing, theatre, laboratory and radiology services -familiarity -colleagues’ advice* globalyesNegotiation, dialog and persuation yesChecklist/ weekly reports  because of limitted number of private contractors in the province (semi-monopolistic situation), bidding is not applicable.

16. Medical Sciences University Renewing contracts Nullifying contracts Who gains more from contracts, Consequences of contracts Management of contracts Overall assessment (strength)(weakness) TehranBased on the contractors’ performance -If less than 50% of requirements met. -sometimes there is no private partner for contracting,and -bidding process is too time and energy consuming. - both sides- increase access - lower unit cost The employment office of the university, in collaboration with law affaires office + deputy for treatment’s office manage contracts. -- OrumiehrebidingIn case of violation of contracts by the private partner - both sides- increase accessA team consists of aministration,evalua tion and law affaires offices managers + security officer and resposible for article 192* -provide incentives -instability of personnel -insufficient wages and salary, and -instability of laws and rules. MeshedBased on mutual satisfaction and agreements Violation of contract items, and unsatisfaction of partners results to nullifying contracts --A team consists of aministration,evalua tion and law affaires offices managers + security officer and resposible for article 192* -lack of bureaucracy -lack of experience in health care services -problematic bidding -delay on payments - unsatisfaction of staff -low service quality TabrizAccording to evaluation results Service delivery below agreed standards results to nullifying contracts University (but not so much) -increases access, equity and quality -reduces unit cost The president and 2 of his deputies+ a law expert+ an administrative expert -low cost -high quality -easy management -appropriate tool/protocols for evaluation and monitoring - one side (uni), is dominant, because of unemployment. - difficulties on payments. - no win win game Lorestan-Based on reports and checklists contents -manager and metron assessment -Based on reports and checklists contents -manager and metron assessment - basically, residents - financially, private sector -administratively, university -increases access, equity and quality -reduces unit cost -less managerial and organizational problems The president’s representative, controller, budget officer, and an experienced physician -provides competetive/creati ve environment, increase efficiency, -control costs -increases responsiveness -changing employees -using unskilled or semiskilled employees -unfair and sometimes problematic bidding -less financial incentive for staff  Article 192 represents legal and political environment in favor of privatization through the third national socio-economic plan

17. Conclusion Seven Medical Sciences Universities (study population). Preventive care, para-medical services and dentistry (respectively) were preferred services to be contracted, In many occasions universities purchase/contract for a package of services rather than a single procedure or service alone, Improvements on access, -increased efficiency, -promotion of quality of care and responsiveness, were indicated as outcomes of this strategy

18. A unified performance, in terms of contracting out, hasn’t been observed: - some universities rushed to contract out almost all clinical and non-clinical services, - others did it in a very limited framework, - the rest remained indifferent. - contracting out in health care market in Iran is at its infancy, - suffers from lack of organizational and managerial capacities, in both public and private sectors.

19. 200420032002 Total568360140 Urban H.C 1112083 Health Post 1728619 Rural H.C 24148 Radiology 152310 Laboratory 101146 Pharmacy 14114 Hospital wards 271575 Emergency wards 51366