By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Doctors Hospital’s chairman has blasted the “many bureaucratic obstacles” it has faced in obtaining approvals for its medical tourism initiatives, implying that this played a key role in driving a 190 per cent year-over increase in its net losses.
Joseph Krukowski, writing in the BISX-listed healthcare provider’s annual report, said its Blake Road-based Bahamas Medical Centre was “continuing to grow its business, although slower than we would wish”.
The western New Providence facility was created as the centrepiece of Doctors Hospital’s medical tourism initiative, which is designed to attract international patients to come to the Bahamas for specialist treatment and generate economic spin-off benefits.
Mr Krukowski said the investment had already produced bright spots, with Hyperbaric Therapy performing “better than projections”, and patient volumes increasing at the Urgent Care Centre.
He added that The Medical Fitness Centre was “a fast-growing department with much potential ahead”.
Yet the Doctors Hospital chairman concluded: “The medical tourism programme has had many bureaucratic obstacles, as we await approvals for a number of different programmes that will have a very positive effect on our financial position.”
This is born out by Doctors Hospital’s financial performance for the year to end-January 2015, where the net loss suffered by the Bahamas Medical Centre - combined with reduced profits at Doctors Hospital’s main Collins Avenue facility - saw the company’s net loss more than double over prior year comparatives.
The ‘red ink’ increased by 190 per cent to $759,573 or $0.08 per share, compared to $261,391 or $0.03 per share the year before.
Doctors Hospital’s Collins Avenue facility saw its profits almost cut in half, falling 48.2 per cent year-over-year to $698,428 compared to $1.349 million for the year to end-January 2014.
This was more than offset by the $1.458 million loss suffered by the Bahamas Medical Centre, even though this represented a 9.5 per cent reduction on fiscal 2014’s $1.61 million loss.
Mr Krukowski wrote in the annual report: “As companies and individuals continue to struggle against this sluggish economy, Doctors Hospital Health System has seen a reduction in the number of insured patients, but an increase in the number of self-pay patients.
“While this shift in patient portfolio brings with it an increased risk of higher receivables, it does tell us that despite their lack of insurance coverage, Bahamians are still finding a way to seek healthcare with their first choice provider.”
At Doctors Hospital’s main Collins Avenue facility, total revenues for the year ended on January 31, 2015, fell by $208,967 as adult patient days fell by 6.7 per cent year-over-year.
The BISX-listed healthcare provider added that the Intensive and Intermediary Care Units accounted for 96 per cent of the drop in adult patient days.
Total admissions were 4,061 in 2015 compared to 3,870 in 2014, representing a 4.9 per cent increase over the prior year.
“This increase in admissions represented shorter stay admissions and one-day surgery cases, and therefore did not translate to increased revenue. The average daily census decreased to 29.2 patients per days from 31.3 in the previous year,” Doctors Hospital said.
“While total net patient revenue only fell $208,967, in-patient revenue (net) decreased $2.02 million, and emergency services increased $1.492 million, of which 50 per cent is directly attributable to physician services and is offset as an expense to outside services medical.”
Doctors Hospital’s total expenses increased by $627,759 or 1.4 per cent, and rose as a percentage of total revenues from 97.1 per cent to 98.5 per cent.
Medical services costs grew by $765,097 or 11.4 per cent year-over-year, due to increased emergency room volumes and increased professional services prices.
And Doctors Hospital was also hit by a 30 per cent, or $265,912, increase in Business Licence fees due to recent Budget-imposed rate increases.
As for the Bahamas Medical Centre, the BISX-listed healthcare provider added: “Total net revenue for the year was $1.393 million compared with $1.168 million last fiscal, an increase of $224,825 or 19.25 per cent.
“The hyperbaric department (oxygen therapy) came on line this year and is primarily responsible for the increased revenue, along with increased business in outpatient physical therapy.
“While there was some improvement in revenue generation, budgeted increases in medical tourism surgeries were again not realised due to approval difficulties.”
Total expenses were held relatively flat year-over-year, increasing by 2.5 per cent to $3.085 million from $3.009 million.
Doctors Hospital also enjoyed some success in controlling its bad debt expenses.
It told shareholders in its annual report: “Bad debt expense, as a percentage of patient service revenues, decreased to 2.9 per cent for the year ended January 31, 2015, compared to 3.9 per cent the previous year. This represented a decrease of $456,642, or 25.1 per cent.
“The number of days revenue in accounts receivable at year-end (AR Days) for fiscal 2015 stand at 44 compared with fiscal 2014 at 32.5 days, and net receivables as a percentage of net patient revenue rose to 12.13 per cent from 8.84 per cent.
“The increase is due to a higher census during the last two months of the year and slower than usual payments from the insurance companies due to Value-Added Tax (VAT) complications.”
Doctors Hospital is planning $4 million worth of capital spending in its current fiscal year to end-January 2016, up from $2.5 million last year.
Comments
Economist 8 years, 9 months ago
Well some one has to help justify NHI. What better way than to mess up Doctor's Hospital.
Maybe they are trying to mess up Doctor's so that it can be purchased by the new NHI.
banker 8 years, 9 months ago
Wow, another BISX wonder (sarcasm on). Just today I looked at shared for Drs. Hospital on BISX. In spite of declaring a loss the price hasn't moved, and there are a dozen unfilled sell orders, all for people wanting to ditch their shares at an average of $1.45 per share (ranging from a real dreamer at $1.55 to $1.35. Those 12 unfilled sell orders constitute 51,686 shares for an asking value of $75,729.70. They can't find buyers for those shares, and the ask price is still $1.45 per share? You gotta be nuts to invest in anything in BISX.
On a more orderly, efficient market, BISX shares would fall in price until they find a buyer. It shows you that BISX is fool's game, and not a serious exchange of any kind. And as for investment, the securities are junk-grade with no fiduciary oversight by the (hah!) regulators.
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