Losses at Mater private hospital group symptom of future ills
Owner Oval Topco posted loss of €23m for five-month period to end December 2018
Mater group comprises hospitals in Dublin and Cork and advanced cancer centres in Limerick and Liverpool
Accounts for the Mater private hospital gives a snapshot of trading since its acquisition in May last year by a fund managed by InfraVia Capital Partners. It also offers a view on likely Irish healthcare costs into the future, and it’s not a pretty one.
Oval Topco Ltd, which is owned by InfraVie, recorded a loss of €23 million for the five-month period to the end of December 2018. This was largely made up of a substantial goodwill write-off and interest payments. It posted turnover of just under €100 million and an operating profit of €316,000.
The group comprises hospitals in Dublin and Cork, advanced cancer centres in Limerick and Liverpool and a number of out-patient clinics in locations around Ireland. It employs 1,452 full-time equivalent staff.
The directors report offers little cheer for patients on the likely costs they will face in future years. It notes that private health insurers are now requiring additional justification to support “medical necessity” for treatment and are challenging pre-existing conditions and hospital length of stay.
“It will no longer be possible . . . to absorb the higher risk associated with unpaid or part-paid insurance claims from private health insurers and this will drive increasing costs back to patients.”
This could mean patients having to pay substantial sums themselves for certain treatments, undermining the benefit of private health insurance where you pay an annual premium and your bills are settled (for the most part at least) by the insurer.
The bad news doesn’t end there. It also notes the State’s Sláintecare plan to phase out private treatments from public hospitals over the next decade.
“This will require significantly more investment in the private sector. It is also expected that there will be higher operating costs, driven by medical advances and inflation as well as further demands on pay inflation for medical staff in the coming years as evidenced through escalated nursing union action in early 2019.”
Challenging times ahead, not just for patients, but for private hospital operators and insurers, too.