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Healthscope, a significant private health group, has entered receivership and is looking to sell all its hospitals. However, it assures that there will be no immediate effects on patients and staff thanks to a $100 million financial aid package.
Backed by the Canadian private equity firm Brookfield, which acquired the company for $5.7 billion in 2019, Healthscope ranks as Australia’s second-largest private hospital network, owning 37 hospitals nationwide.
However, it is currently saddled with some $1.6 billion in debt.
Today, McGrathNicol was appointed as the receiver for Healthscope. Despite this development, the company, with support from creditor Commonwealth Bank, which provided a $100 million funding package, claims there will be no disruption for its staff and patients.
“We want to make it clear that the subsidiaries that own and operate Healthscope’s network of hospitals are not affected by our appointment to the shareholding companies,” receiver Keith Crawford said in a statement.
“Our immediate focus is to engage constructively with all key stakeholders to ensure uninterrupted operation of Healthscope hospitals and continuity of best practice standards of patient care.
“We will also work closely with Healthscope management to support any operational funding requirements via access to $100 million of new funding from Commonwealth Bank while we pursue an orderly transition of ownership of Healthscope’s hospitals.”
McGrathNicol said it plans to sell all hospitals without any closures or redundancies.
Beyond its financial woes, Healthscope has faced heavy scrutiny in recent months following the death of two-year-old Joe Massa at its private-public Northern Beaches Hospital.
The toddler’s death sparked a parliamentary inquiry and a police investigation and led the NSW government to ban public-private hospital partnerships.
In a statement, Joe’s mother Elouise Massa said the receivership provided a chance to ensure Northern Beaches Hospital becomes publicly owned.
“We have witnessed first-hand the tragedy that unfolded when Healthscope and Brookfield prioritised profit over patient care â resulting in the avoidable death of our beloved Joe after we took him to Northern Beaches Hospital, where he should have recovered, but did not,” she said.
“This moment presents the NSW government with a renewed opportunity to put Northern Beaches Hospital into public hands.”
