Medibank to open ‘no gap’ short-stay hospital

MedTech News: A new partnership with a specialist doctor-led Joint Venture (JV) entity will deliver a $64 million short-stay private hospital in Kew, Melbourne.

Forty-two (42) specialist doctors have formed a JV with Medibank to develop the new short-stay surgical facility, providing no gap treatments to eligible patients.

Centuria Healthcare will develop and retain ownership of the property, with the JV committing to a long-term 15-year lease.

Andrew Hemming, Centuria Healthcare Managing Director, said “We are delighted to partner with the joint venture doctors and Medibank to develop and own the real estate delivering this new short-stay surgical facility. This is a transformative project that can change the landscape of the healthcare sector and we are pleased to be the real estate partner of this forward-thinking project.

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“The project is central to Centuria Healthcare’s strategy to partner with top-tier operators backed by secure lease covenants. We are focused on providing modern healthcare real estate investments across Australia and currently have c.$1.0 billion worth of these assets under management.”

Spokesperson for the investing doctors, Professor Michael Grigg, said “This is a significant investment in Australian healthcare. We are committed to delivering short-stay models of care where clinically appropriate, across many surgery types, with reduced or no gaps for eligible patients. We are proud to partner with Medibank and Centuria in this new facility where doctors will have much greater input into the operation of the hospital.”

Medibank Group Executive Healthcare & Strategy Dr Andrew Wilson, commented “We have long said that affordability in the private health system needs to be addressed. Out-of-pocket costs are a big part of that. Our investment is aimed at supporting our doctor partners to deliver a short-stay model of care that is already widely available at scale in other health systems internationally.”

In November 2020, Australian Orthopaedic Association’s President, Dr Andrew Ellis, stated “The AOA remains deeply suspicious of for-profit private health insurers who wish to enter the ownership of private surgical facilities or hospitals. They do this for business development reasons but under the guise of enhancing care in “doctor led” models. Out of pocket expenses are the smallest element in this move, as the majority of fees are paid by the commonwealth through the MBS. The real reason is to disrupt established hospital groups, and encourage alternative methods of care by offering fee incentives to surgeons to participate in managed care in health insurer owned vertical business structures.”

The new Kew short-stay hospital is planned to offer four operating theatres and a procedure room, 30 beds, radiology and an infusion (chemo) clinic.

The facility proposes to provide services such as orthopaedics, Ear, Nose and Throat (ENT), vascular, plastics, general surgery, urology, gastroenterology, anaesthetics, oncology, and radiology.