The feds will help families affected by the imminent closure of Healthscope’s private maternity services, but there will be no Whyalla-style rescues.
Despite the imminent closures of two privately-run maternity services at Healthscope hospitals, federal minister for health Mark Butler has again refused to countenance any Whyalla-style bailout for the private hospital sector.
Healthscope announced the closures in Hobart and Darwin last week, citing a drop in birth rate, and staffing challenges as the reasons for the decision.
Speaking in Launceston today, Mr Butler said he had spoken with the Tasmanian health minister Jacquie Petrusma about the Hobart closure and the need to support affected families going forward, but stopped short of offering any financial support for the private sector.
“Healthscope has taken a commercial decision,” he said.
“We’re not in position to bail them out and have taxpayers, frankly, under a commercial operation run by international private equity firms.”
Healthscope is owned by Brookfield, a Canadian PE firm that bought the company in 2019 for $4.1 billion.
In March Healthscope faces the probability of breaching debt covenants on loans worth $1.6 billion. In November 2024 lenders gave the company an extra five months to facilitate funding arrangement negotiations with private health insurers. That grace period expires at the end of next month.
In recent weeks rumours of a takeover bid have swirled around the company, with rivals Ramsay Health Care and private insurer Bupa mentioned in dispatches.
“What our job is, is to ensure that people get the healthcare that they need, including maternity services,” said Mr Butler today.
“There are challenges, frankly, in the private maternity services market.
“We’ve put some ideas to the industry in its broader sense … for improving the operation of the private maternity services market, and I want to see those ideas continue, but in the short term, we have a challenge here in Tasmania.
“Tasmania has relied more on the private maternity services market than many other states, a higher share of families having private births.
“This is going to leave a bit of a gap. I know the Tasmanian government recognise that, and we’ve got a job to try and ensure that no one falls between the cracks.”
Related
As he has done previously, Mr Butler laid the responsibility firmly at the feet of the private insurance funds.
“Frankly, the primary obligation, though, does rest with insurers,” he said.
“Families pay their private health insurance premium gold cover to get maternity cover, and insurers need to come to the party as well to ensure that those families who have laid down their hard-earned cash for a private health insurance policy that has maternity services cover are looked after as well.
“Now, we’ll do what we can … but I do say again, I think insurers do recognise this, they need to come to the party as well and reward and repay the investment that those families here in Tasmania have made.”
Mr Butler was in Launceston to announce the funding of extended hours at the Launceston Urgent Care on an ongoing basis, seven days a week, from 9am to 8pm, from 1 July.
“This will mean dozens more patients being able to be seen over the course of a week, delivering high-quality care quickly and effectively to those patients, but also taking more and more pressure off the emergency department at the Launceston General Hospital,” he said.
Mr Butler also opened the new Launceston Shepherd Centre, providing support for children with hearing loss, with wraparound care with specialist early intervention services from audiologists, family and child counsellors, and listening and spoken language specialists.
This is the third centre to be delivered as part of the federal government’s $6.5 million investment to address gaps in hearing services available for children, with centres open in Hobart and Oran Park, Sydney.