By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
Doctors Hospital’s determined that a long-planned $40 million expansion of its main Collins Avenue facility was not feasible because the market was “unable to bear the cost”, due to the “dwindling” number of persons covered by private health insurance.
Charles Sealy, its chief executive, explained: “In terms of that expansion project, we determined that it was non-feasible in terms of the market right now. The market would not be able to bear the cost of such a project.
“In the market right now, the number of persons with private insurance is dwindling. There are more self-pay customers now, and we are not satisfied that we would have the capacity to take care of that expansion. Also, medical tourism is not taking off as we had envisaged.”
Tribune Business revealed on Monday how Doctors Hospital has written-off $573,000 in architectural drawing fees after deciding not to proceed with the “major renovation” investment at its main Collins Avenue facility.
Mr Sealy said yesterday that the project would have been valued in the range of $40 million.
“When you look at the market, there’s a lot of uncertainty and a lack of sustained growth to go ahead with such an expenditure. We’re just not prepared to make such a sizeable investment unless we can see a reasonable return,” said Mr Sealy.
The BISX-listed healthcare provider’s 2016 annual report revealed that the project had been on the so-called drawing board for at least six years.
“Architectural drawing fees in the amount of $573,000 that were completed in 2010, and held in ‘work in progress’ pending the major renovation, were written-off,” Doctors Hospital wrote under the heading ‘loss on disposal of fixed asset’.
“It was decided to permanently put this project on hold as the investment to expand is not feasible at this time.”
Tribune Business’s files showed this referred to plans that potentially involved adding a further two stories to Doctors Hospital’s main Collins Avenue facility.
Barry Rassin, the company’s then-president, told this newspaper in a January 2011 interview that the expansion/renovation would not proceed until the Bahamian and world economy was “back on track”.
He explained that the BISX-listed healthcare provider’s strategy for its proposed expansion was to complete the architectural and engineering plans, get the financing in place, obtain all government approvals, and have the construction contract out to bid, then wait for the economy to recover.
Comments
ohdrap4 7 years, 10 months ago
it is too bad this story was drowned by the referendum headlines.
the cost of health insurance is ridiculous as a percentage of the monthly income of an average person.
i dropped mine years ago, even with a subsidy of my employer. the monthly amount is like a car payment or almost as much as rent on my income.
the amount i pay yearly for tests and medication as a private patients is about two months worth of premium in health insurance out of the year.
the health insurers are to balme though because they refuse to change their cost structure.
One of the blood tests I have done twice a year costs seventy-five dollars for me as a private patient. but the same lab bills two hundred and twenty dollars to a health insurance patient with a thirty dollar co-pay. they likely get the remaining 45 from the insurance company, this is a ripoff of the client.
TalRussell 7 years, 10 months ago
Comade please do c.c. your post to the red senator Dr. Duane, as he seems to be completely illiterate in all matters relating to the true costs of not having BahamaCARE.
Government should have already commenced the steps to nationalize Doctors Hospital under BahamaCARE
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