Delhi plans PPP model to boost diagnostic services at Govt Hospitals

New Delhi: Addressing the long-standing shortage of diagnostic facilities at state-run hospitals, the Delhi government has decided to appoint a consultant to develop and execute a Public-Private Partnership (PPP) model for radiological diagnostic services across the city. 

According to health department officials, the appointed consultant will be responsible for devising the modalities of the project, which includes conducting a comprehensive assessment of selected government hospitals across the city. This assessment will evaluate each hospital’s infrastructure, patient load, connectivity and the demand for radiological diagnostic services in surrounding areas. The consultant will also help develop a detailed strategy for operations and resource deployment, in addition to assisting with the legal onboarding of private partners. 

In light of the severe shortage of diagnostic facilities in state-run hospitals, the Delhi cabinet decided last month to install MRI, CT scan, and ultrasound machines through a Public-Private Partnership (PPP) model.

Medical Dialogues had previously reported that in a bid to strengthen health infrastructure, the Delhi government is expected to decide on key proposals in a meeting scheduled on Tuesday, including outsourcing of staff through PSUs and installing MRI machines in hospitals under a PPP model, official sources said.

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Speaking to TOI, an official said, "The health and family welfare department has decided to expand and enhance diagnostic services across its health facilities. For achieving this, radiological diagnostic labs with CT scan, MRI, and ultrasound machines will be set up in select govt hospitals for providing quality services onsite at affordable user charges on a PPP mode."

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A Delhi government official stated that the consultant, also referred to as the transaction advisor, will play a key role in identifying and selecting credible private partners to operate and maintain the diagnostic services. According to TOI, "From preparing and submitting the inception report, which will serve as the core document for all activities related to the scope of services, to working out an integrated plan that covers detailed tasks and activities, and a resource deployment strategy, the transaction advisor will help at every stage," the official said.

A crucial task assigned to the consultant is conducting a detailed financial analysis of the project, a Delhi government official said. This will involve analysing capital and operational expenditure estimates, projecting potential revenue, performing a cash flow analysis, and evaluating various business models. The consultant will also assess the need for viability gap funding and examine other key financial parameters.

Speaking to TOI, an official said, "Commercial arrangements, profit and cost sharing, identifying potential risks in the PPP model, including operational, financial risks, and developing a risk mitigation strategy will be done by the consultant."