Details for Reform Option "Contracting sonography and x-ray services, Navi Mumbai, Maharashtra"
The Navi Mumbai Municipal Corporation (NMMC), which supervises an area of 162 sq km, came into existence in 1992. It is coping with a huge rise in population: 88.91% between 1991 and 2001 from 397,000 to 850,000. The 2004 mid year census projects a population of 850,000.
Despite this large population, it has just one First Referral Unit (FRU), 4 Maternal and Child Health (MCH) centres and 14 Urban Health Posts (UHPs) which are also reaching out to villages and semi-rural areas.
There was no sonography (ultrasound) facility at any of these facilities and even the x-ray services (available only at the FRU, known as the General Hospital) were understaffed and often services were unavailable due to long waiting times for official procedures to take up maintenance and repairs and recruiting new staff.
NMMC has initiated a number of Public Private Partnerships (PPPs) in the provision of health services. A successful initiative has been the NMMC’s decision to set up sonography and x-ray services at MCHs and the general hospital through PPP.
At MCH centres, both x-ray and sonography services are managed by the contractor with his own staff, consumables and maintenance. X-ray equipment belong to NMMC, but are managed and maintained (including the staff) by the contractor.
Since the x-ray services were understaffed (both in MCH and FRU), it was decided to shift the x-ray technician from the MCH to the FRU in order to manage FRU services more efficiently and bring in the private partner to provide services in MCHs. The ultra-sonography machines are owned and managed by the contractor.
At the FRU, the sonography services are run and managed by private parties while x-ray services are efficiently run by NMMC with its own staff.
Rates are pre-decided between the operator and NMMC irrespective of the number of free patients and interest is payable by NMMC on delayed payments made to the operator.
However at MCHs where the turnover of patients is comparatively less, a provision has been made to pay higher rates to the contractor to compensate for and provide an incentive to stay on with lower turnover. Similarly slightly lower rates are payable for higher caseload (a slight negotiation favouring NMMC as the higher volumes will fetch higher returns even with the lesser rate).
For emergency services outside working hours, a higher rate is given to the operator.
The NMMC is free to decide its own rates to be taken from patients. However all patients have to come through the NMMC cash counter only i.e. the contractor cannot see his own patients directly.
The contract is for a long term - 5 years. This is designed as an incentive for the contractor, as the break even point for such a business proposition would be at least two years. Moreover, the rates availed in this contract are almost 7 to 10 times less then the market rates.
Prior to this setup, there were no sonography services and the x-ray services were running inefficiently. This contract solved the problem.
Antenatal checkups have increased and there is a considerable reduction in pregnancy complications. Other departments can now provide better care in cases where ultrasounds are required.
Because the PPP venture turned out to be a win-win situation for both the contractor and NMMC and a considerable demand for colour doppler services with improvement in other supportive services in FRU was identified, the existing sonography contract was upgraded with fresh tender invitations for colour doppler and other services will formally commence from late April or early May 2005.
There is no cost to NMMC in this venture as all the costs are handled by contractor, once set up. The cost involved in setting up the contract will include salary of individuals involved in planning (number of hours utilised), fuel, survey if any, phone calls, and stationary used. The cost to setup the contract was approximately INR 2,00,000.
4 MCHs and FRU under NMMC, Navi Mumbai, Maharashtra.
Approximately 5 months to set up the contract.
Improved access: to better quality services at low costs and free of cost for the poor and at centres nearer their homes.
Utilisation: Optimum utilisation of the existing infrastructure and equipment at these centres.
Reduced costs: The savings in operational costs will be considerable.
Possible opposition: From labour unions regarding retrenchment, issues of utilising existing specialists and employees elsewhere and mixing existing staff with contractors staff (which is not recommended for issues of authority).
Willingness to experiment by the government, availability of operators in the vicinity willing to provide services, setting up standard operating procedures.
Who needs to be consulted
Municipality officials, radiologists and gynaecologists at the FRU and MCHs, private parties willing to offer services.
The venture is self sustaining, and the NMMC is earning a small revenue in this department for the first time. There does not seem to be a reason why it should not continue in future. As the venture is contractual with operator funding the same, there is no question of funding problem.
Chances of Replication
Such services can easily be replicated but a few things need to be taken into account:
(i) An important issue concerns the staff. Staff levels do not need to be cut – they can be relocated to another unit.
(ii) Mixing operational cultures should be avoided. For example care would need to be taken not to mix existing staff with new operator staff.
(iii) As far as possible, local operators should be involved to take into account linguistic and cultural issues.
(iv) Negotiations should not compromise on quality - even if it is necessary to pay more to the contractor.
(v) Standard operating procedures should be set up.
(vi) Monitoring by authorities is essential to control quality aspects.
(vii) Timely payment to the contractor is essential to motivate him to continue to provide quality services (in this case NMMC has included an interest payable for delayed payments).
Sara Joseph, Researcher, ECTA, New Delhi, February 2005.