The future of Perth’s Mount Hospital remains uncertain after the spectacular collapse of operator Healthscope, as the Cook Government stays tight-lipped on calls to add it to the jam-packed public system.
US private equity giant Brookfield handed over the debt-laden group to receivers at McGrathNicol in May last year and an ensuing 10-month sales process for its nationwide network of 37 hospitals failed to result in deals.
But in February, the receivers revealed that five assets were being sold, including to primary competitor Ramsay Health, while the NSW Government is bringing Northern Beaches Hospital in Sydney into the public system.
And for the remaining 31 Healthscope hospitals, lenders were backing a plan to create a new not-for-profit organisation to run them.
As a not-for-profit, it would be exempt from having to fork out payroll tax, which is believed to have been costing Healthscope as much as $100m a year.
Central to the plan is securing lower-rate leases with landlords — Canada’s Northwest Healthcare Properties and ASX-listed asset manager HMC Capital — which the receivers have been furiously trying to negotiate.
Reports this month suggested the landlords were backing bids by major private hospital operators including Calvary Health Care and Pacific Equity Partners to buy 28 of the hospitals — threatening to derail the not-for-profit plan and further break up the asset portfolio.
The receivers have declined to comment but it’s understood they are confident the non-denominational charitable structure will be operational by mid-year, giving certainty to 18,000 workers.
The process will be mind-bogglingly complex, however, involving notoriously tricky hospital IT systems across multiple jurisdictions, so it is expected a fair amount of work will remain to be done.
Australian Medical Association WA President Kyle Hoath did not respond to requests for comment, after previously urging the Cook Government to take the opportunity to add the 224 bed-Mount Hospital to the public system.
A State Government spokeswoman said it continued to “monitor the ongoing developments of the Healthscope receiver process, and is aware that confidential commercial negotiations are in progress to ensure operational continuity at Mount Hospital”.
Shadow Health Minister Libby Mettam said the Cook Government should be considering “every available option to increase public hospital bed capacity in the quickest time possible”.
“While the Premier and health minister continue to claim our health system is world class, it’s clear they don’t see the problem or the opportunities to fix it,” Ms Mettam said.
Meanwhile, a spokeswoman for St John of God Health Care said it continued to work with the WA Government on transitioning Mt Lawley Hospital into a State-owned facility.
“Upon finalising negotiations, we anticipate the transition of the hospital into the public health system is expected to be complete in August 2026,” she said.
“The hospital continues to provide private healthcare services, as well as public healthcare services under contract to the State.”