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Health Ministry seeks investor

THE HEALTH Ministry made another step towards building a brand new university hospital in Bratislava which would replace the failed Rázsochy project, a state-of-the-art medical facility in Bratislava whose construction began under the communist regime in the 1980s. The ministry announced the competition on January 7 to find a private investor to finance the hospital’s construction and operate the facility for 30 years while being allowed to retain a portion of the profit. The announcement came two months after originally planned due to changes at the post of health minister, the Sme daily reported.

There are, however, still questions about the project.

“The pre-competition talks confirmed that the construction of the first hospital of a new generation in our region is an attractive opportunity for the local, regional and international private sector,” said Health Minister Viliam Čislák, as quoted in the ministry’s press release.

The ministry’s plan calls for a private investor to build the hospital, while the state would own the facility and would guarantee a long-term contract with health insurance companies. It should have about 880 beds and be able to handle approximately 44,000 annual hospitalisations. The hospital’s construction will be the first project in which a PPP (private-public partnership) scheme will be used in the health-care sector in Slovakia.

The ministry predicted the new hospital will cost €200 to 250 million while the entire PPP is valued at €6.3 billion. This amount includes not only the expected construction investment but also the sum of annual revenues for 30 years. The hospital’s annual revenue should be €130 million at the beginning and over the course of 30 years it should grow to €250 million, Sme wrote.

Former health minister Richard Raši, however, expects the price of building the hospital to be €500 million or more, Sme wrote. Ján Králik of the Institute for Health Policy of the Health Ministry told the daily that they do not know how he came up with such an amount.

Peter Visolajský, chair of the Medical Trade Unions Association (LOZ), pointed to the fact that similar hospitals built in Great Britain had been overpriced. Ivan Poprocký, head of the Institute for Health Policy, agreed but added that in Great Britain a private company had constructed the facility but did not then run it, adding that for this reason the private firm designed a big building for which the state had to pay a large sum. Poprocký said the situation in Slovakia is different, as the private investor will also have to run the facility and generate profits, Sme reported.

The new hospital should also serve as a centre for education and research. It will be part of the BioMedPark project and is expected to be situated on the current premises of St Michal’s Hospital in Bratislava’s Patrónka neighbourhood.

During the pre-competition dialogue, the ministry talked with 26 companies from 12 countries, including J&T Real Estate, Svet Zdravia owned by Penta, Agel, Erste Group AG, ČSOB and ING Bank, Sme wrote.

 

Experience required

 

The ministry will carry out the tender in the form of a competitive dialogue. By the end of March it will choose the participants to include in the dialogue, who must apply before the end of February. The talks will concern preparation of the project and competition conditions. The number of participants will be limited to 10, as the ministry does not have the capacity to hold talks with more applicants, Králik explained, as reported by the SITA newswire.

One of the conditions when selecting the participants in the dialogue will be that they must have experience with designing, constructing and running a tertiary hospital worth at least €100 million, with 200 beds or more and 13,000 completed hospitalisations a year, the ministry press release states.

The result of this dialogue is expected to be comprehensive materials necessary for holding the competition, which will include agreements defining details of the hospital as well as the commitments of both the private and public partner.

The ministry also plans to hold talks with experts and other organisations active in the health-care sector, as well as to provide all relevant information about the project to the public. This includes the publishing of the feasibility study adopted by the government last June, the ministry stated. Several health-care analysts have been critical that the study has not been made public, Sme wrote.

According to the schedule, the bidders should submit their final offers for the project by the end of this year, with the plan to sign the agreement in spring 2016. Construction should start in October 2016 and be finished in two years. The facility would begin operations in 2018 and would focus on the most serious patients from across Slovakia.

After the new hospital starts operating, the buildings of the Bratislava University Hospital in Kramáre and on Mickiewiczova streets are to be closed. The hospital on Antolská in Petržalka is expected to remain open and continue developing, Králik told SITA.

The fate of the hospital in Ružinov district is still not clear. One of the alternatives is that it would be turned into a facility for patients with long-term illnesses, SITA wrote.

 

First steps initiated

 

The ministry has already held some tenders related to construction of the hospital. In October 2013 it announced a competition to select the author of a feasibility study on construction of the new hospital. It was won by the consortium of Ernst & Young and Ružička Csekes companies, which were paid more than €720,000 without VAT. Based on this feasibility study, the hospital could be completed in late 2017.

In late September 2014, the Health Ministry started searching for an advisor to help with the public-private partnership project to build the hospital. The advisor is to secure broad financial, legal and technical consulting services over the next three years and advise on the public procurement process to select an investor and an operator for the medical facility. The ministry announced the tender on September 26, with the order valued at €2.25 million without VAT. The deadline for submitting bids was set to November 4, SITA wrote.

 

What happened to Rázsochy?

 

The idea to build Rázsochy, a state-of-the-art hospital in Bratislava, was born more than 30 years ago. But what started out as an ambitious project to serve patients from across Slovakia, and to house medical students, resulted in a huge but unfinished complex which was later left to rot and has been ravaged by scavengers seeking scrap metal and other materials.

Construction of Rázsochy began in 1987, two years before the fall of the communist regime in Slovakia. The complex was supposed to have been completed in 1993, but construction was halted in 1990. The second government of Mikuláš Dzurinda completely terminated the project in 2003. Today only the skeleton of the huge facility remains.

Topic: Health care


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