Development and implementation of the Alzira Model

A new health management approach

11th Primary Care Congress. Sovigliana/Vinci (Firenze) 21-23 May 2009

The Alzira Model

Public health in Spain
Public and free service for everyone. However, over 8 million Spaniards have a private health insurance, 25 of them are public servants while the other 55 pay double insurance. Authority on public health service in hands of autonomous communities since the end 2001. A reorganization of the different systems is needed Significant budget deficits faced by every regional government while Central Government struggles to balance the national budget Bureaucratic and inefficient system with high operative costs Some local governments already charging an extra-tax on gasoline to finance public health. Several Communities involved in new hospitals building process, despite the deficit

The Alzira Model

Public concessions in Valencia
Manises: 2009 Alzira: since Jan. 1999

Denia: Dec. 2008 Torrevieja: Oct. 2006 Elche: 2010

The Alzira Model

Model basis

Split between public financing, control and property and private service allowance
Public Financing: Valencian Government. Capitative payment. Public Control: Valencian Government, through the commissioner working in the Hospital.

Public Property: Property will refund to Valencian Government.

Private service allowance:
Builds new Hospital. New infrastructures and technology.

Own Medical staff

Own Management: Know how Assumes Risk transfer

Free & Public Healthcare Services

The Alzira Model

Subsidiarity. Money for Value
Lightening the burden of public expenditure in social services
Public Administration deficit Nations budget stability as a must

Private responsibility
Efficiency and efficacy Entrepreneur patrimonial responsibility

Public Control
Limited contract period. Duration and possible extensions clearly set out in the contract

Administrative granting for a private contractor to manage a public service

The Alzira Model

Capitative payment
The private contractor receives a fixed annual sum per inhabitant for the fifteen-year duration of the contract. The annual fee is 597, as of 2008, (rising in successive years in line with public health budget increase) for each of the inhabitants of the health area. In return, the company runs the entire health department and must offer universal access to its wide range of services. TRANSFERRED RISK: Expenses become fixed for Valencian Government. In effectively transferring financial risk from the public to the private sector, this measure helps control local spending thus making local government more transparent. The costs per inhabitant that the government pays the contractor are around 20% below average per person costs elsewhere in the Valencian Autonomous Community.

The Alzira Model

Capitative payment

This system is focused on financing peoples health:

Money follows the citizen, therefore Disease Prevention and Health Promotion are a must
Accordingly to patients right of access to the hospital of their choice:
Hospital has to cover the 100% treatment costs of local people who avail of hospital facilities elsewhere. On the other hand, Hospital is paid an 80% of health services given to any other health area patients.

The Alzira Model

Capitative payment Money follows the citizen
entails a patient-oriented organitazion. It is of critical importance for the organization to prevent local patients from going to other public areas by offering them the best public health service: Efficient and user friendly medical assistance at all levels (Hospital and Primary Care), with no barriers or steps to climb between different medical areas or levels Sophysticated diagnostic and therapeutic care in most specialties and subspecialties of medicine and surgery Modern buildings and hi-tech facilities supported by a shared WAN for the entire Departments No waiting lists (mean surgical waiting time: 40 days and wide timetables, from 8 a.m. to 10 pm. Quality: Hospital de La Ribera has been named the Best Spanish Large General Hospital in the 2000, 2001 and 2002, 2003 and 2005 while Torrevieja Hospital has just been elected as the Best Medium General Hospital.

The Alzira Model

Advantages for the Public Administration
Initial Investment by the Private Management: Over 600 MM euros in five health departments in the Valencian Community. Chance to build public hospitals and primary care centers without increasing local public debt. More reliable public expenditure forecast: Hospital service cost (due to capitative system) known in advance over the 15 year granting period. Public health service cost lower than other areas (> 20%) Better use of Public Resources: More efficiency, more activity, better service, higher number of citizens (voters) satisfied with the governments performance. Introduction of modern management tools in a slow and bureaucratic environment.

The Alzira Model

Advantages for the citizen
Better access to health services Integration between Hospital and Primary Care, with no disruptions in the medical assistance Wide timetables and non-stop medical assistance at both levels, Hospital and Primary Care Less reply-time from the System: Mean surgical waiting time: 40 days. Mean OP visit waiting time: 15 days Better quality services: Free choice: Money follows patient Citizen becomes a customer: Single room with companion bed: better comfort and privacy. High level of patients satisfaction: 91% are happy with the service received 95% will come back to the hospital 80% dont know the hospital management type.

The Alzira Model

Advantages for the professional
Human Resources Management: empowering professionals Stability at work Doctors manage their own time: OP, theatre, IP visits, within the hospital needs and objectives. Professional Development: Functional Units

Continuing Medical Education and Research Committee

Incentives System: Greater incomes: Objectives achievement (individual). Outcome : More activity, better results, less complications Efficency achievement (Management Units): Savings sharing Doctors Mean Income is 25% higher than the NHS doctors

The Alzira Model

Advantages for the company
Durable, profitable and reliable collaboration with the local government Achievement of the know-how of running a large general public hospital. Return on the investment guaranteed. Collaboration can be extended to other health areas. Opportunity to demonstrate that the Alzira model is a valid option for the early future of the public health system. Gains in terms of public image.

Our health integration approach

Health integration approach

What make our Health Departments different?
As well as offering modern buildings and hi-tech facilities, our health departments have embraced a range of new practices. Quality assurance mechanisms have been introduced and health professionals are expected to participate in Continuous Professional Development (or CPD). Clinicians are set fixed targets and offered pay incentives on top of their salaries. Pay rates with incentives are, in most cases, far higher than those in the public sector.

Goal-incentives system Education Committee. Management Units: self-managed units, seeking best medical practice and costcutting strategies Pharmacological guide with generic drugs Long-term agreements with providers Human Resource, Marketing and PR Management Information Systems

Ribera Salud
Motivation: medical staff get involved and participate with a greater degree of satisfaction and professional recognition. Quality: Quality-oriented processes are designed and implemented Productivity: Increases efficacy and efficiency Integration between all Department areas: Medical staff have a vision of the health department as a whole which helps to find the better way to achieve the desired outcomes. Re-organised the health department as a map of processes: Define in the department who, when, where and how will do an intervention in a defined and agreed process.

What make our Health Departments different? MEDICAL AREA

Primary Care and Hospital work together Implementation of new services in Primary Care Shared clinical pathways

Outpatient major surgery

Functional Units Hospitalists system

Professional career development

Information Systems

Integrated health areas

Some keys for a successful integration process To develop a new culture among professionals to become a flat

organization. No steps between different medical levels.

To implement integrated medical processes for the health area as a whole defining the best diagnostic, therapeutic and control place. Medical paths shared by all medical levels To provide PC professionals with required means and tools for higher

medical performance.
To increase management efficiency

Integrated health areas

Some keys for a successful integration process Doctors as links from Hospital to PC. Several specialists (internal, dermatology, urology, psychiatry, etc) acting like bridges and counselors.

Integrated Primary Care Centers: covering specialized outpatients,

scan, lab and radiology tests. With strong A&E units (number of A&E in the Hospital steadily decreasing since 2003). Pre-surgical tests made at

PC centers, etc.
To have motivated and involved professionals.

Integrated health areas

Some keys for a successful integration process Shared medical committees

Shared IS network for Hospital and PC centers: Shared information (Access

to test results on-line from all PC centers [radiology, lab, scan,etc]), , wider service offer (appointment for the specialist managed from the PC center,).

New services in PC centers: bringing more and better services closer to the
citizens homes, so they need to come to the Hospital more seldom. Investment in new infrastructure and updating: new PC centers, renovation of most existing ones, updating in IS and medical equipment, etc.

Integrated health areas

IT for higher efficiency

Monitoring Cost control Activity planning Quality control Feed-back

Clinical Mgmt.

Primary Care and Hospital Integration

Centralized Call Center Shared HIS, PACS, LIS Medical paths

Motivation Information Benchmarking Education & Research Internal Communication

HHRR Mgmt.

Patient New PRM 2.0: a new way to interact with patients

Integrated health areas

IT for higher efficiency

From an scenario where Hospital and PC professionals work separately to a brand new framework where they all share the same information.

Integrated health areas

IT for better performance Providing professional staff with easy access to critical information for higher accuracy in decision making processes. KPIs available on-line Alert system for particular situations unlikely to meet the Hospital quality standards Activity monitoring

Integrated health areas

IS to guide the patient

Inmediate patient demand analysis and its fluctuations allows for on-going resource adjustment. guiding citizens in use of resources providing information in real time to achieve better assistance and better use of resources.

Patients have on - line time information about the waiting time in all emergency centers

The company. Ribera Salud

Ribera Salud
A new health management approach
Ribera Salud is the Spanish leading company in
the growing industry of PPPs in public health . The company belongs to Spains third and fourth savings banks: Bancaja and CAM, with 50% of the shares each. The purpose of Ribera Salud is the management of hospitals and health and socio-health centres, including the integrated management of clinical services and working units.
Company Ribera Salud IDC Capio Adeslas Asisa USP Cln. Navarra Hospiten

Main Spanish hospital groups

Revenues 323,1 322 229,4 225 225 130 120 Hospitals 5 11 13 15 12 1 8 Beds 1.200 1.673 1.131 1.524 1.177 400 885

Ribera Salud
Current projects The five concessions running in the land of Valencia under the Alzira model: Alzira, Torrevieja, Denia, Manises and Elche. (main shareholder in Torrevieja an Elche).

These five public health departments mean covering nearly the 25% of the 45 million Valencia region population.
Five hospitals and over one hundred primary care centers, with 7.000 professionals. Total revenues nearly 900 million euros, on a yearly basis. A concession in Madrid under the Alzira model: Torrejn (open in 2011) The private company that covers the global MRI service in the public health system in the Valencian Community, Erescanner Salud The private company running a central clinical laboratory, which covers seven public hospitals in Madrid, which means 12 million people, BR Salud

Ribera Salud
Financial figures

COMPANY Alzira La Ribera Torrevieja Denia Manises Elche Torrejon Erescanner Salud BR Salud (central lab.)

CAPEX (in MM ) 140 120 150 131 146 130 53 4

EBITDA (projected in MM ) 147 (2008) 151 (2008) 14 (2010) 15 (2011) 15 (2012) 101 (2010) 2 (2011)

Ribera Salud
Business lines Integral management of health and socio-health services:

PPPs Model (Alzira) Private Sector Socio-health Sector Integral management of national and international projects:
Management and/or Consultancy Search for technological and financial partners Strategic alliances Institutional relations

Ribera Salud
Health Department global management. Some facts
BEDS Hospital Universitario de La Ribera Hospital de Torrevieja Hospital de Denia Hospital de Manises Hospital del Vinalopo Hospital de Torrejn TOTAL 300 264 222 220 212 250 1.468 POPULATION PROFESSIONALS* SURGERY** CAPEX*** 250.000 180.000 160.000 150.000 150.000 133.000 1.023.000 1.800 1.400 1.400 1.400 1.400 1.000 8.400 21.000 16.000 15.000 15.000 15.000 15.000 97.000 140 MM 90 MM 97 MM 137 MM 146 MM 130 MM 740 MM

* Also including public servants working in the health department ** Annual mean number for Alzira and Torrevieja. Surgery forecast for Denia, Manises, Elche and Torrejon *** As included in the contract for the concession duration

Ribera Salud.
What make our Health Departments different? Patient oriented organization Global integration between Hospital and Primary Care

Private management perspective in a traditional public system

Technology / Information systems (own HIS, keeps updated over 10 years) Patients free choice of specialists Patients right of access to the hospital of their choice Single rooms, with free extra bed for companions

Human resource management; Professional Career Development.