Construction and operation of Regional Multi-profile Hospital
for 300 beds in Kyzylorda city
PPP DEVELOPMENT CENTER
Main information and description
of the Project
Construction and operation of Regional Multi-profile Hospital
Project description and objectives
Information Description
Industry: The project envisages the construction and operation of a multi-profile clinical
Healthcare hospital providing a full cycle of medical care, as well as providing retraining of
doctors on the basis of modern achievements of medical science.
Project objectives:
• Creation of multi-profile The new multi-profile hospital will consist of a hospital with 300 beds. The
hospital: construction of this project is justified by the current demand for inpatient
– quality and availability of medical services and high morbidity in the Kyzylorda region.
medical care on the basis
The following activities will be carried out in the hospital:
of modern advanced
Medical service, including:
technologies. • State guaranteed benefits package
• Creation of a base for • Medical services within the Mandatory Social Health Insurance
improving the availability • Paid medical services.
of medical care, including Non-medical service, including:
• Lease of premises
highly specialized
• Catering services
medical care for residents • Services for other organisations
of Kazakhstan
The contract period is 20 years, including 3 years of construction.
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
STRUCTURE OF
MULTIPROFILE
Kyzylorda city HOSPITAL FOR 300 Regional
hospital BEDS WITH oncological center
POLYCLINIC FOR 100
VISITS PER SHIFT
71 Neironal
40
rehabilitation Chemotherapy
Neurology 30 30 30
Theraphy Radiation therapy
28 30 30
25
20 Surgery
16 Surgery
Traumatology
Regional cancer center 130
City hospital Gynecology beds
Palliative care
220 beds
© 2017 ТОО «Делойт ТСФ» Бизнес-план 4
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
Project description and objectives
1
PPP DEVELOPMENT
CENTER
Construction and operation of Regional Multi-profile Hospital
Reasons for the construction of the hospital
High demand of medical
service
Low survival rate of people with
cancer diagnosis
High demand of hospital
beds
Both on City hospital and Regional
cancer center bed capacity 2.8 m2 per
bed, instead of 9.5 m2, less than 3
Infrastructure need times by the required standards
Deterioration of existing facilities
above 90%.
Development of
preventative medicine
High level of mordibity In accordance with the Law of the
Over the past 5 years, the Republic of Kazakhstan "On social
incidence of cancer has increased protection of citizens affected by the
ecological disaster in the Aral sea
by 15. region" Kyzylorda region recognized as
the zone of ecological disaster.
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
Investment plan
Capital expenditures for construction hospital, thousand USD
Name Total
Capital expenditures
Facility 45,134
Medical equipment 40,114
Non-medical equipment 5,000
Total investment costs 90 248
Structure of capital expenditures
50% 47% 3%
3960 млн
тенге
Construction Medical equipment Non-medical equipment
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
Investment plan
Timeline of project implementation
2023
2045
2020
2020
…
• Compensation of capital expenditures
(CAPEX)will be returned within 10 years
90,248
• The term of the Contract can be
after completion of construction works
thousand
• Fulfilment of the initial
• Management fee will be paid during the
USD
Whole period of contract
• Signing PPP contract
Capital
expenditures
conditions
extended
Design and Operation period
construction period 17 years.
11 26 months
months
Total length of contract – 20 years
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
Main participants of Project
I. Investment period II. Operation period
Private partner Public partner
(Health Private partner
• The conclusion of the PPP agreement Department of
• Design and construction of the Kyzylorda
region) • Transfer of the PPP Facility to the state
Facility;
property;
• Compliance with construction • Acceptance of the Object
into state ownership; • Acceptance of the right to use and own the PPP
requirements and standards;
• The introduction of advanced • Transfer to a Private partner Object;
methods of construction; the right to use and own the • Technical operation (equipment of medical
• project financing. object of concession for equipment and infrastructure);
technical operation; • Ensuring the execution of the Project financing
Private partner has the right to
involve the General contractor • Verification of financial and conditions;
and financial organization economic activities of a • Ensuring the safety of the PPP Object;
Private partner without • The provision of medical services under the
PPP contract interference in its activities; SGBP and MSHI;
• Monitoring compliance with • Provision of paid medical services;
the terms of the Contract by • Ensuring the return of the PPP Object at the
the Private partner; end of the Contract.
Public partner (Health
• claim for compensation from
Department of Kyzylorda
region) a Private partner for
deterioration of the property
transferred to operation;
•The conclusion of the PPP • Reimbursement of the
agreement; Private partner.
•Provision of land for free use for • Provision of medical
construction; personnel.
•Monitoring of Project
implementation.
PPP DEVELOPMENT CENTER
Construction and operation of Regional Multi-profile Hospital
The payment mechanism of the Project
Payments for medical services are made by patients
in favor of a Private partner
State support measures
Private partner incomes
Remuneration for the provision of
CAPEX
quality characteristics
Additional income
Hospital construction, supply and Taxes:
maintenance services: • Wealth tax Medical service:
• Construction of the hospital • Tax and deductions on the wage fund • SGBP
• Equipment • Profit tax • MSHI
• Improvement of the surrounding area • VAT • Paid services
Remuneration: Acquisition of income: Other commercial
• For senior debt accrued during the • Return on equity activities not prohibited
investment period • Maintenance costs of assets and other by the legislation of the
• On a joint-stock loan accrued during the costs Republic of Kazakhstan.
investment period • Maintenance
• Bank guarantee during construction • Building system upgrades
• Insurance during construction Maintenance
• The costs of the Private partner • building Maintenance
• Wage fund during construction Insurance during operation
PPP DEVELOPMENT CENTER
Investment climate in Kazakhstan
State support of investments
Cost recovery to the Private partner
The sources of cost recovery of public-private partnership and income generation by the subjects of public-
private partnership are:
1) realization of goods, works and services in the process of operation of the public-private partnership object;
2) subsidies from the state in cases established by the legislation of the Republic of Kazakhstan;
3) compensation of investment costs for the public-private partnership project;
4) remuneration for the management of the public-private partnership object that is in state ownership, as well
as rent for the use of the public-private partnership object.
State support of Private partner activity
Participation of state bodies in the form of state support measures in accordance with the legislation of the
Republic of Kazakhstan is carried out including through:
1) guarantees of the state on infrastructure bonds;
2) state guarantees on loans attracted for financing of public-private partnership projects;
3) transfer of exclusive rights to intellectual property owned by the state;
4) guarantees of the state's consumption of a certain amount of goods, works and services produced during the
implementation of the public-private partnership project.
PPP DEVELOPMENT CENTER
Industry overview
Health network
Main indicators in the health sector comparatively with the average level in
Kazakhstan
1,3 times 1,6 times 1,0 year
Total mortality Birth rate The average life expectancy (the
(Region-5,54; RK-7,15) (Region-24,39; RK-21,65) lowest in the RK)
(within 5 years: -6,6%) (within 5 years: -9,7%) (Region-72,6; RK-72,95)
(within 5 years: +1,2 years)
1,4 times 1,2 times
1,4 times Mortality from diseases of the
Mortality from diseases of the Cancer mortality
circulatory system respiratory system
(Region-61,68; RK-83,90) (Region-79,55; RK-92,2)
(Region-123,5; RK-174,83) (within 5 years: -27,8%)
(within 5 years: -4,8%) (within 5 years: +3,3%)
1,9 times 1,4 times 1,1 times
Deaths from injuries and Incidence of cancer Mortality from tuberculosis
poisoning (Region-142,8; RK-197,9) (Region-3,2; RK-3,0)
(Region-35,73; RK-69,38) (within 5 year: +2,8 times) (within 5 years: -43,8%)
(within 5 years: -50,3%)
PPP DEVELOPMENT CENTER
Demographic indicators
Number and structure of population
Number and gender structure of the population
Kyzylorda city
234 736 118368 116368
Kyzylorda region
390 857 389 378
839 300
Republic of Kazakhstan
9 306 600 8 727 766
18 034 366
Age structure of the population
7% 10%
15%
23% 23%
28%
21
65%
67% 63%
Republic of Kazakhstan Kyzylorda region Kyzylorda city
Source: Statistics committee of the RK
0-14 15-64 65+
PPP DEVELOPMENT CENTER
Health indicators of the population of Kazakhstan
Number of diseases
Morbidity of the population for the first time established diagnosis per 100 people
(all types of diseases)
80
74 76
71 70 70 71
69
70 66
63 63
60 59 59 60 60
60 56 57 56
54 54 55 53 53 54
50 51
per million people
50 47 46 47 48 48 47 47
45 45 44 45 44 44 44
42 42 42 42 41
40
31
28 29
30
20
10
0
Карагандинская
Атырауская
Северо-Казахстанская
regionКостанайская
Кызылординская
Западно-Казахстанская
Жамбылская
Мангистауская
Восточно-Казахстанская
Южно-Казахстанская
Алматинская
г. Астана
г. Алматы
Акмолинская
Павлодарская
AktobeАктюбинская
Pavodar region
region
region
Aktobe region
Aktobe region
Kazakhstan
Kazakhstan
Kazakhstan
Kazakhstan
Mangystau
Karagandy
Kyzylorda
Kostanay
Zhambyl
Akmola
Almaty
Astana
region
region
region
region
South
North
West
East
2014 2015 2016
• In the context of the regions of Kazakhstan the highest incidence is • In comparison with the indicators of other regions, Kyzylorda region
observed in the ecologically problematic regions of the country: has an average level of morbidity. Moreover, the number of new cases
industrial Pavlodar region (75.7 diseases per 100 people), the decreased in 2014-2016.
southern capital (71.5) and Almaty region (70.6). In General, in the
period under review, the level of morbidity has steadily increased in all
regions of the country.
Source: Statistics committee of the RK
PPP DEVELOPMENT CENTER
Health network
The consumption of inpatient services
Indicators of the bed Fund, 2017
Republic of Kazakhstan
10 10
311 266
31 26
12 11
312 310
26 11 28
11 299
243 26
22
12
10 308
10 316 26
268 30 12
27 307
26
10
11 319
309 31
9 27
290 10
32 324
33
9
320
36 Astana Almaty
Average number of days a patient stays in bed
10 10
Average number of bed days per year 358 340
38 35
Bed turnover
• Hospitals of most regions of Kazakhstan are working with a high level of workload. The
highest level of hospital load in the country was observed in the southern regions of the
country and in Astana. At the end of 2017, the average annual employment of hospital
beds in Astana was 358 days, and in the Kyzylorda region 309 days. The lowest level of
congestion was recorded in the West Kazakhstan region.
Source: Statistical Yearbook of MOH
PPP DEVELOPMENT CENTER
Financial section
Construction and operation of a multi-profile hospital
Financial performance
Cost structure, 2024 Administrative expenses, 2024
Wage fund Tax on Wage fund 3%
Insurance 19%
during Contributions to MSHI 1%
operation Land tax 1%
20%
Municipal
services 6%
Other
expenses 6%
Repair and
maintenance
Bank
44%
guarantee 4%
Property taxes 96%
• The main share of the cost will be the cost of repairs • The main share of administrative expenses will be taxes.
and maintenance. Among them, property tax accounts for 96%.
• Costs for utility services include the cost of electricity,
heating, water, waste management, as well as
maintenance of the Laundry service and Parking.
• Other costs include other operating costs and additional
waste disposal costs.
PPP DEVELOPMENT CENTER
Construction and operation of a multi-profile hospital
Financial performance
Equity financing
25%
75%
Debt financing
• Within the framework of this project, it is assumed that the Project will be financed by the Private partner. This financing is carried out at the expense of
own and borrowed funds in the ratio of 25%:75%. At the same time, the structure of the share capital will consist of a share loan and an infusion into
the authorized capital in the ratio of 60%:40%.
Debt financing
Terms of project financing for senior debt :
- Currency – USD
- The amount of 67 686 thousand USD
- Interest rate– 14,4%
- Loan period – 20 years
• Terms of refinancing the project on senior debt:
- Currency – USD
- The amount of 33 843USD
- Interest rate– 12,4%
- Loan term-10 years
• The payment of interest on the senior debt begins at the construction stage, and the payment of the principal – from the moment of commissioning of
The public-private partnership facility. Payment of the senior debt will be made in equal installments.
Equity financing
Financing conditions provided by a Private partner
- Currency – USD
- Equity investments – 22 562 thousand USD
PPP DEVELOPMENT CENTER
Advantages and risk factors
Construction and operation of a multi-profile hospital
SWOT analysis of the project
Strength Weakness
•The project is strategic for the Republic of Kazakhstan, the •Patients ' distrust of public health services in General;
Ministry of health and the city; •Lack of qualified personnel with the desired training, experience
•The uniqueness and key value of the project will strengthen the and mentality, especially clinicians (doctors, nurses, laboratory);
image of the planned medical organization, which will attract and •Natural (expected) difficulties at opening and starting –
retain strong medical personnel; coordination and adaptation of new employees
•The recommended types of medical services are the most popular
on the market according to the current data of marketing analysis;
•The Trinity of clinical, educational and scientific activities
contribute to the involvement of the most experienced and strong
practitioners – doctors to work in the clinic.
•The absence of competitors in the market of medical servicesSin W
Kyzylorda
Opportunities O T Threats
•Population growth contributes to demand for services
•To adjust the profile of beds and number of beds in the offices
based on market conditions •Insufficient or delayed funding, delayed licensing processes –
•To win the trust of patients, to create the image of a prestigious backlog from the planned terms, the partial security of materials,
organization and high quality services equipment
•To strive for competitive quality of services in the local and •New players in the market of medical services-the outflow of
international market through JCI standards and accreditation potential patients to clinics, including foreign ones, with the best
•To introduce advanced educational methods and technologies from conditions for the price, quality of service and technical
the Anglo-Saxon model of medical education equipment.
•To develop on the basis of the clinic scientific activities at a new
level according to the standards of GCP
PPP DEVELOPMENT CENTER
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