UHC 23: Orthopedic Hospital Corporatization, Not Privatization

There have been a number of political noise about the corporatization and modernization of the Philippine Orthopedic Center (POC). Many groups are opposing its “privatization” with lots of street rallies and the petitioners going to the Supreme Court opposing the said “privatization.”

This is a typical disease of confusing and equating corporatization as privatization. The former means the government will just create a board relatively (but not fully) independent of Malacanang and Congress, with private sector presence in the board as they will inject their own money. The DOH Secretary or his/her representatives will still be on the board.

Here is one news report, more objective and non-emotional.

 The Orthopedic Center PPP,,, involves the construction as well as operations and maintenance (O&M) of a new 700-bed-capacity tertiary orthopedic hospital in the National Kidney and Transplant Institute compound in Quezon City.

It is a 25-year contract with construction is expected to take two and a half years, and the remaining 22.5 years allotted for O&M.

MPIC, Megawide, 7 others interested in Orthopedic Center PPP

www.gmanetwork.com

Nine firms have so far expressed interest in bidding for the multi-billion peso ...See More

POC will move out of its Banawe location to the Kidney Center, still in Quezon City. In exchange, the government and DOH will:

(a) get new, modern hospital at no cost to taxpayers,

(b) bigger hospital with 700 beds (vs current ____ beds),

(c) poor and sponsored PhilHealth members will get 420 beds under no balance billing (NBB) while 70 beds for indigents, non-PHIC members, and

(d) after 25 years, DOH will own this hospital and may choose zero private sector participation, back to nationalization/centralization.

The POC private sector partner will make money from (a) the land to be vacated by the current POC in Banawe, and (b) operating the POC for 22.5 years, particularly on the remaining 200 beds that are not for (i) PHIC NBB and (ii) indigents, full charity patients.

This is not a bad deal, unless there are other hidden arrangements. As a taxpayer, this is favorable to me. DOH will have a new hospital at no extra cost to me. If the bidder will put up a residential condo in the current POC in Banawe, that means additional housing units, less squatters or less rentiers in non-high rise houses. When more demand is met by more supply (of houses, etc.), then the price of that commodity will stabilize.

Corollary situations:

1. The Philippine Children’s Medical Center (PCMC, aka "Children's Hospital"), currently a government corporation,  to be corporatized modernized too, its current two-storey structures be demolished and a new, high rise hospital be constructed, to accommodate more children patients, at no substantial cost to taxpayers.

2. AFP headquarter with golf course to get out of its prime location in QC, they sell or privatize the land, AFP gets the money and move elsewhere cheaper with lots of extra money for AFP modernization, at no extra cost to taxpayers. Win-win condition.

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Two news stories below: