A good operational definition of public-private partnership (PPP) is "a project that proportionally apportions the risks and rewards to the government and private entity partners." As practiced, a PPP can be considered
(i) a tool for government governance or management;
(ii) a novel approach to delivering government goods and services;
(iii) a tool for development; and
(iv) a less controversial phrase for privatization or contracting out.
PPPs recognize that governments and private entities have certain advantages relative to one another in performing specific tasks. For example, government is very effective in mobilizing resources for the poor, while a private enterprise is very successful in fostering innovation and efficiency. In bringing government and private enterprise together in a PPP, it is hoped that the advantages of each can be synergistically harnessed to provide services and products that neither one can do very well alone.
The flowchart here provides a simple way to help an organization or local government determine if it should pursue a PPP project. Because of the unique-ness and potentially politically risky consequences, it is advised that PPP be entertained only as a solution for current unmet health needs or foregone care.
PPP is not recommended if the organization is able to meet this unmet need with its own resources, or if it could access national government resources.
Further, PPP is recommended only if the private sector is able to deliver goods and services that are more cost-efficient or timely, or that have better results, than if the organization were to undertake the delivery of the same goods and services.
PPP is useful if the organization will benefit from improved technical and managerial capabilities in meeting unmet health needs, such as managing the professional and supplier accreditation process, enforcing clinical practice guidelines, credentialing personnel, handling mortalities and morbidity conferences, monitoring disease trends, controlling healthcare-associated infections, managing assets and finances, and others.