Catalyzing Public Private Partnerships For Sustainable Healthcare Innovation In Nigeria: Legal Framework, Strategies And Opportunities – Government Contracts, Procurement & PPP – Government, Public Sector

Introduction

The Nigerian healthcare system currently faces significant
challenges, from outdated infrastructure,¹ and
insufficient funding, to a shortage of healthcare
professionals.² Public health facilities are often
stretched beyond capacity, leaving many Nigerians with limited
access to quality care. These challenges, coupled with a rapidly
growing population, have made it clear that a new approach is
needed.

To address these problems, there is a growing recognition that
PublicPrivate Partnerships (PPPs) can offer practical solutions to
bridge these gaps. By leveraging the expertise, resources, and
innovation of the private sector, PPPs can help improve healthcare
delivery, modernize infrastructure, and foster sustainable
development. These collaborations allow the government to fulfill
its duty of providing essential healthcare services while relying
on private sector efficiency to drive innovation and improve
outcomes. In this article, we will explore the legal framework that
governs PPP in the Nigerian healthcare sector, strategies that can
advance its use, and the opportunities they present for creating a
sustainable and innovative healthcare system.

The Role of Public-private Partnerships in Healthcare
Innovation

In Nigeria, PPPs can play several key roles in driving
healthcare innovation, including:

1. Infrastructure Development

One of the major pressing needs in Nigeria is the development of
modern healthcare infrastructure. Through PPPs, the private sector
can contribute to the construction of new hospitals, clinics, and
specialized healthcare centers. This would be particularly
impactful in rural areas where healthcare access is severely
limited. For instance, private firms could partner with the
government to build state-of-the-art diagnostic centers or
specialist hospitals, as seen with the Royal Children’s
Hospital in Australia. This would help bridge the gap in healthcare
availability and improve patient outcomes across the country.

2. Introduction of Advanced Healthcare
Technologies

PPPs are also a powerful way to introduce advanced medical
technologies to Nigeria. By partnering with private firms that
specialize in medical devices or health technology, Nigeria can
modernize its public healthcare facilities. Imagine, for example, a
collaboration between a private medical technology company and a
public hospital to equip it with cutting-edge diagnostic tools,
such as MRI machines or robotic surgery systems. This would not
only improve healthcare services but also position Nigeria’s
healthcare sector as more globally competitive.

3. Adoption of Digital Health Solutions (Telemedicine
and Mobile Health Platforms)

Digital healthcare is a growing field, and PPPs can help Nigeria
embrace telemedicine and mobile health platforms. These innovations
are particularly useful in a country like Nigeria where healthcare
access is uneven. Through a PPP, a tech company could partner with
the Ministry of Health to develop and deploy telemedicine services,
which would allow patients in remote areas to consult doctors from
anywhere. In India, similar collaborations have allowed rural
populations to access specialists via telemedicine platforms, which
has improved the overall access to care while reducing costs and
travel times.

4. Facilitation of Research and Development (R&D)
Collaborations

PPPs provide an excellent framework for fostering research and
development in healthcare. By collaborating with private
pharmaceutical companies or research institutions, the Nigerian
government could support initiatives to develop new treatments or
vaccines for diseases prevalent in the country, like malaria.

A clear example of this global collaboration can be seen in the
development of COVID-19 vaccines, where public and private sectors
worked together to produce lifesaving vaccines at an unprecedented
pace. In Nigeria, similar efforts could focus on tropical diseases,
bringing muchneeded medical advancements to the local
population.

5. Access to Private Sector Funding for Healthcare
Projects

Funding has always been a constraint for Nigeria’s
healthcare system. The government alone cannot meet the financial
demands of large-scale healthcare projects. This is where PPPs
become critical. Through partnerships with private investors,
Nigeria can secure funding for building new healthcare facilities,
purchasing medical equipment, or upgrading existing hospitals. A
practical example would be a private consortium financing the
construction of new hospitals in exchange for long-term service
agreements with the government.

Legal Framework Governing PPPs in the Nigeria Healthcare
Sector.

The legal framework for PPPs in Nigeria’s healthcare sector
is essential for facilitating structured collaboration between the
public and private sectors. While there are general laws in place
for PPPs, specific frameworks catering to the healthcare sector are
either absent or underdeveloped. However, Nigeria has several
existing laws and regulatory bodies that set the foundation for
PPPs in various sectors, including healthcare.

1. The Infrastructure Concession Regulatory Commission
(ICRC) Act, 2005

The ICRC Act provides the overall legal framework for PPPs in
Nigeria, including infrastructure development, which extends to
healthcare facilities. Under this law, the ICRC is tasked with
regulating PPP projects across the country, ensuring transparency,
and promoting best practices in public infrastructure projects.
This Act allows government institutions to partner with private
entities for projects, which extends to healthcare projects, such
as the building of hospitals, clinics, diagnostic centers, and
other health infrastructure.

2. The National Health Act, 2014

The National Health Act outlines the legal provisions for the
management and regulation of Nigeria’s healthcare system. It
also provides a framework for the involvement of private actors in
the health sector. This Act gives the federal government the
authority to seek private-sector involvement in healthcare
services, especially in financing, constructing, and managing
health infrastructure. It mandates the use of innovative financing
models and partnerships to improve service delivery.

A limitation to this Act is that while it encourages
private-sector engagement, it does not exactly offer a
comprehensive regulatory framework for structuring PPPs, leaving
much of the details to be negotiated on a case-by-case basis.

3. Public Procurement Act, 2007

The Public Procurement Act establishes the legal guidelines for
public sector procurement in Nigeria. It mandates that all public
contracts follow competitive and transparent processes, ensuring
value for money. This Act plays a crucial role in ensuring that PPP
projects, including those in the healthcare sector, are subject to
fair and competitive bidding processes, which would help prevent
corruption and ensuring that the best-qualified private partners
are selected for healthcare projects.

4. State-Level PPP Laws

In addition to federal laws, several Nigerian states, including
Lagos, and Ekiti have their own PPP laws and regulations. These
state-level laws often provide more detailed guidance on PPP
structures, financing models, and implementation at the state
level. States have a significant role in healthcare provision under
Nigeria’s federal system. State-level PPP laws can facilitate
local healthcare projects, especially in primary and secondary
healthcare delivery, where the state governments play a more direct
role.

5. The National Health Insurance Scheme (NHIS) Act,
1999

The NHIS Act provides a legal framework for health insurance in
Nigeria and has the potential to facilitate PPPs focused on
healthcare financing. Through the NHIS, the government can partner
with private insurers to expand healthcare access, particularly for
low-income populations. The NHIS allows private insurers and
healthcare providers to work with the government in expanding
access to healthcare services, especially in underserved
communities.

6. National Policy on Public-Private
Partnerships

This policy provides guidelines for federal and state
governments on how to engage the private sector in PPPs,
encouraging transparency, risk-sharing, and innovation. The policy
provides the framework for PPPs including PPPs in the healthcare
sector by recommending approaches to risksharing, financial models,
and service delivery models that can be applied to the health
sector.

Strategies to Advance the Use of PublicPrivate Partnerships
(PPPS) in nigeria’s healthcare sector

The importance of Public Private Partnerships cannot be
overstated mainly, because of the evolving healthcare challenges on
a global scale, and PPPs can be instrumental in driving sustainable
healthcare innovation in Africa.

Here are some strategies to enhance their effectiveness:

1. Strengthening Legal and Regulatory Frameworks for
Healthcare PPPs:

Nigeria’s healthcare sector requires a robust and harmonized
legal framework to facilitate successful PPPs. While the
Infrastructure Concession Regulatory Commission (ICRC) Act of 2005
might provide a general framework for PPPs at the national level,
it lacks the specific focus and detail necessary to address the
complexities of healthcare projects. Also, many states, such as
Lagos, have their own PPP laws, which sometimes conflict with
national regulations or vary in their capacity to address
healthcare-specific challenges. For PPPs in healthcare to thrive,
it is critical that both national and statelevel laws are aligned
and sufficiently detailed. An actionable strategy would be for the
Federal and state governments to collaborate to develop
healthcarespecific PPP guidelines. These guidelines should not only
draw on existing national frameworks but also incorporate best
practices from state-level PPP initiatives and international
examples.

2. Government Incentives to Attract Private
Investment:

To attract private investment, the government needs to provide
strong financial incentives that make the healthcare sector more
appealing. Tax reliefs, reduced tariffs on medical equipment
imports, and access to land for building health infrastructure are
just a few examples of incentives that can encourage private firms
to enter into PPP arrangements.

3. Capacity Building and Skill Development:

PPPs in healthcare often involve complex structures that require
strong technical and managerial capabilities from both the public
and private sectors. Therefore, capacity building is essential to
equip government officials with the knowledge and skills needed to
manage these partnerships effectively. An actionable strategy would
be to initiate training programs, workshops, and exchange programs
for government officials and healthcare providers. Collaborations
with international organizations like the World Bank or the African
Development Bank (AfDB) could also help provide expertise in
managing PPP contracts, project monitoring, and performance
evaluation.

4. Development of Bankable Projects:

Private partners are typically interested in healthcare projects
that provide a reasonable return on investment. However, many
healthcare projects in Nigeria, especially those targeting
underserved rural areas, may not immediately appear attractive due
to perceived financial risks. The government should focus on making
healthcare projects more “bankable” by providing risk
mitigation mechanisms and creating blended financing models. This
can be done by establishing public-sector-backed healthcare funds
or guarantee schemes that reduce financial risk for private
investors. This could involve blending public funds with
concessional financing from development banks, ensuring that the
risk is shared while still allowing private investors to
participate.

5. Focus on Sustainable and LongTerm
Partnerships:

Short-term gains should not be the focus of PPPs in healthcare.
Instead, the emphasis should be on establishing sustainable,
long-term partnerships that deliver value over the lifespan of a
project. This requires comprehensive planning and ensuring that PPP
projects align with national healthcare goals, such as the
Universal Health Coverage (UHC) agenda. This can be done by
carrying out PPP projects with longterm sustainability in mind by
embedding performance-based contracts that reward private partners
based on measurable outcomes, such as patient satisfaction, quality
of care, and infrastructure improvements.

6. Public Engagement and Stakeholder
Collaboration:

The success of PPPs in healthcare also depends on public
perception and stakeholder buy-in. The government needs to engage
healthcare professionals, patient advocacy groups, and the general
public in the planning and execution of PPP projects. This will
ensure that projects are aligned with the actual needs of
communities and that there is support for their implementation. An
actionable strategy would be to create multi-stakeholder platforms
for regular dialogue between government officials, private sector
players, healthcare providers, and the public.

Conclusion

Driving Public-Private Partnerships (PPPs) for sustainable
healthcare innovation in Nigeria is key to overcoming the current
limitations in the health sector. These partnerships can bring
together the strengths of both the public and private sectors to
tackle key issues as we have highlighted in this article. The goal
is to ensure that Nigeria builds a stronger healthcare system that
is more innovative, accessible, and affordable. Despite the
challenges that exist, the opportunities for growth are
significant, and with the right approach, PPPs can play a major
role in improving healthcare delivery across the country, which
would help Nigeria move closer to achieving universal health
coverage.

Footnotes

1 US Department of Commerce, ‘Nigeria -
Healthcare’ (2023) International Trade Administration
accessed 10 September 2024.

2 Anthonia Obokoh, ‘Key Issues to Shape Nigeria’s
Healthcare Sector in 2020’ Business Day (Lagos, 10 January
2020)
accessed 10 September 2024.

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