OEC has just delivered the 15th health center, a result from Public Private Partnership between the city of Belo Horizonte and concessionaire Saúde BH. The contract executed in June 2019 has duration of 20 years and the 40 units planned will be delivered in the first 33 months. By mid-2023, this corresponds to an average of one new center every 24 days. In total, the initiative should benefit about 800,000 people.

According to Clebio Batista, OEC’s Contract Manager, responsible for the PPP projects, this model brings more comfort to the public manager as it guarantees the effectiveness of the provision of essential services to the population: "The manager can focus on the quality of medical care service, while the private partner is responsible for the management and maintenance of the units infrastructure, an activity supervised by an independent verifier, evaluated and paid on a monthly basis as long the goals previously established through performance indicators are reached. This also increases transparency before the control bodies", he says.

Cleaning and conservation services, building maintenance, security, clinical engineering (supply and maintenance of furniture and equipment), and utilities management are the responsibility of Saúde BH, the concessionaire responsible for managing the units, which is dedicated to all services that are not part of the hospital's core business. On the other hand, the services related to medical care (assistance) remain under the responsibility of the City Hall of Belo Horizonte.

The total investment in the PPP is R$ 250 million, considering construction, maintenance, and service provision in the units under the responsibility of the concessionaire, which is equivalent to R$ 12.5 million per year or 0.01% of the Gross Domestic Product (GDP) of Belo Horizonte, according to data from the Brazilian Institute of Geography and Statistics (IBGE). This makes the project economically feasible for Brazilian municipalities with more than 100,000 inhabitants. Even Itaituba (PA), which has the lowest GDP among the 326 Brazilian cities with more than 100 thousand inhabitants, would spend only 0.7% of its annual GDP to replicate the investment.

The Health Centers have reception, administrative areas, offices for Family Health Teams, pharmacy, waiting, collection, and vaccine rooms, dental offices, observation, bandage, and hygiene rooms. The project also includes the implementation of a multipurpose room, a pantry, living room, changing rooms, toilets, and spaces for community agents and epidemic control, in a total estimated built area of 40,000 m² in all structures.

The delivery rhythm of less than a month is only possible thanks to the centralization of several units in a single contract, which generates a gain of scale, and to the choice of the Light Steel Frame construction method, a technology whose main characteristic is the easy installation, with closing by gypsum board walls and/or cement plates.

Success Story

The project is a clear example of the advantages made possible by the PPP mechanism, but not the only successful case in the history of partnerships between the city of Belo Horizonte and the private sector. The InovaBH concessionaire, also together with the construction company OEC, was responsible for the construction - and continues to maintain and manage non-pedagogical services - of 51 schools (46 for early childhood education and five for elementary school), which annually offer 25 thousand vacancies in the municipal education network. The construction of each unit took only 10 months against an average time of 30 months in the traditional model. 51 schools were completed 34 months after the contract was signed, two months ahead of schedule.

Instituted in Brazil 17 years ago, PPPs have become increasingly used by public authorities because they make social interest projects feasible while managing the shortage of budget resources.

Another great differential is governance. In this contracting model, the private partner is evaluated on a monthly basis by an independent verifying entity and only then they receive consideration from the government. The company is paid and evaluated for the quality of the service provided to users based on pre-established criteria.

At the end of the concession period, the physical structures and equipment acquired all become part of the public patrimony, and are returned in a fully preserved state to the government.

Progress of PPPs in Brazil

Data from the Brazilian consultancy Radar PPP, which monitors all projects of this type registered in the country, indicate that in the first six months of 2021 alone, more than 3 thousand new partnerships between the private sector and the government were registered, a number 10% higher than in the previous year. Looking at a slightly broader horizon, the Radar PPP indicates that total PPPs grew almost tem times compared to that recorded in 2014. The trend, according to the OEC's executive, is that the total number of partnerships and sectors contemplated continues to expand, a reflection of the country's economic, political, and social conditions. Brazil is considered to be one of the countries with the greatest potential for PPPs globally, alongside powers such as Canada, France, and the USA.