We are beginning to see evidence that that the recession will bring brighter prospects for private healthcare.

Here at Healthcare Europa we’re often accused of being too gloomy. And the last two years have demonstrated that governments, keen to cut expenditure, will try to hammer private healthcare providers. Along with the pharmaceutical industry, it makes an easy and uncontroversial target.

But we are beginning to see glimmers of light.

“The last year has seen a bigger change in the French public’s attitude to private sector involvement than the previous decade,” says Christian Le Dorze, chief executive at Vitalia, the big private hospital operator which works within the French pub lic system.This, he says, has yet to filter down into policy, but he says it is changing the nature of the political debate. Politicians from the left and the right now accept that the public sector provision of services has to become far more efficient and that private involvement has a key role to play.

We sense the same cautious optimism from Alberto De Nigra, the partner who heads up healthcare at KPMG Italy: “Over the past three years politicians from many parties have understood that they need to involve the private sector in order to solve the problems of the public sector.” He expects to see a rise in outsourcing and hospital privatisation.  Any new government will have to change labour laws which shield public sector employees.

And we are hearing a similar reaction in Eastern Europe.

Slovak-based Penta Investments has probably been the most active private fund investing in the region. It has not been an easy ride (see our separate news story). But Martin Danko, director of communications says that, a year ago, Penta took the strategic decision to invest substantially in healthcare services over the next decade. “It is clear to us that governments in Eastern Europe face financial constraints which mean they can no deliver healthcare without greatly increased private sector involvement.”

It is now up to private operators to start to have a much more mature dialogue with public sector payors. All too often, private operators and their investors are content to hide behind antiquated tariff structures which deliver fat profits because they have not been changed to reflect technical advances. That is entirely understandable. If you are making a lot of money on lab tests which have been automated you may not want to shout about it from the roof tops.

But we live in a new era, one in which public payors are actively seeking out such anomalies. It is naive to assume that such pockets of profits will remain hidden from their eyes.

If private providers want to be part of the solution, then we would suggest they need to start a mature dialogue with governments to create outcomes which lead to longer-term partnerships. The alternative is a passive approach in which providers are in a constant state of funk about the next round of tariff cuts. That approach may boost short-term profits, but it reinforces the unfavourable view of the private sector held by almost all public policymakers. It also leads to short time lines and makes the building of longer-term partnerships and business plans impossible. It looks the least risky strategy in the short-term but it is not the long-term winner.