The price of certainty: Benefits and costs of public–private partnerships for healthcare infrastructure and related services

Research output: Contribution to journalArticlepeer-review

Abstract / Description of output

Although the use of PPPs is endorsed by agencies at the national and supranational levels, there is little guidance for decision-makers on what good outcomes look like and the circumstances in which such outcomes are likely to occur. Enhanced understanding of these issues can improve the governance of large-scale contracting in the health sector. Drawing on a narrative review of the available theoretical and empirical research, this paper evaluates: (1) the benefits that PPPs generate compared to alternative mechanisms of delivery; (2) their additional costs; and (3) the endogenous and exogenous factors that influence these outcomes. The evidence shows that PPPs hold promise for decision-makers who prioritise certainty. However, PPPs are also associated with additional transaction and financing costs. The key decision that policymakers and managers need to make about their use of the PPP model is, therefore, how much extra they are prepared to pay to achieve predictable cost, quality and service outcomes. How much they will have to pay is a function of a set of contextual variables which are readily amenable to policy action.
Original languageEnglish
Pages (from-to)35-39
Number of pages5
JournalHealth Services Management Research
Volume29
Issue number1-2
Early online date19 Apr 2016
DOIs
Publication statusPublished - 16 May 2016

Keywords / Materials (for Non-textual outputs)

  • public private partnerships
  • PPP
  • private finance
  • benefits
  • costs
  • costs of capital

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