The Tribune

By AVA TURNQUEST

Tribune Chief Reporter

aturnquest@tribunemedia.net

HEALTH Minister Dr Duane Sands is eyeing a multi-million dollar transformation for public health that would see the government embark on a public-private partnership to lease-to-own new health facilities over a 20-year period.

Officials say it is just one of many proposals submitted to the government as it seeks to upgrade and optimise local healthcare services. However, The Tribune understands a proposal from Medistar Corp, a leading medical real estate development firm, has become the front-runner.

Previously, Dr Sands had said he was in discussions with leading US health provider Johns Hopkins from which a number of senior executives had toured several facilities in Nassau.

In February, Dr Sands told The Tribune Johns Hopkins had expressed interest in exploring the merits of a strategic “Nation Health Services Agreement” with the Bahamas to create a Caribbean Centre of Excellence.

Yesterday, Dr Sands said talks with John Hopkins were focused on collaboration related to safety and quality.

“The Johns Hopkins proposal has nothing to do with building a building, or financing a facility,” he said.

“It’s about quality health care, it’s about standards, it’s about safety. They are related but they are as night is to day.”

News of significant upgrades in health services had previously been limited to three areas at the Princess Margaret Hospital: a new emergency room, maternal child health facility and a radiology tower.

“A proposal has been made to consider more than the above,” said Dr Sands. “That doesn’t mean that we are minded to nor are we committed to any particular idea.

“Bear in mind we would have made a commitment to the Bahamian people in our 2017 (FNM) manifesto.”

The expansive Medistar proposal, seen by The Tribune, outlines terms that see the firm front all pre-development costs of the project. They would be responsible for all financing and equity required for all facilities. The facilities, which range from a new maternal child health facility to the replacement of the Rand Hospital in Grand Bahama, would be financed, developed and owned by Medistar but operated and maintained by the Ministry of Health, or under a management and operations company selected by the ministry.

Currently private rooms at the Princess Margaret Hospital are managed by a consortium of local physicians knows as The Physicians Alliance Ltd. Dr Sands said the Physicians Alliance is not involved in the project under discussion.

Dr Sands stressed no commitments have been made to any party, adding another US-based company SYMX Healthcare Corporation has also submitted a proposal.

“We have been actively looking at public-private partnerships for major capital works to the tune of $200m to 300m, and a smaller project for the Rand (Memorial Hospital). We’ve been working on it for a year and I think we’re getting closer to having something that we can actually present,” he said.

“We’ve had proposals presented, we have made no commitments. We are going to now review the proposals and, armed with a financial proposal, look at the feasibility of moving forward.”

Public Hospitals Authority Chairman Julian Rolle confirmed yesterday his body was reviewing a proposal from Medistar but also looked at a number of “unsolicited proposals” concerning healthcare upgrades. Mr Rolle maintained deliberations were in the “very early stages”.

Medistar’s proposal - if adopted - would leave the government with a massive rental bill. Currently the vast majority of funds provided to the PHA are swallowed up on salaries leaving little for actual equipment and medicines.

The Tribune asked Dr Sands how he thought the government was going to find the money to pay the new rent it will face. Dr Sands said Bahamians spend more than $400 million a year seeking medical treatment in Florida. A new state-of-the-art facility here, he believes, will bring those patients back to The Bahamas.

Medistar CEO Monzer Hourani sent Dr Sands a technical proposal for development in the Bahamas on May 24, and a financial proposal was due on May 31. Yesterday, Dr Sands declined to discuss or reveal financial costs associated with the Medistar proposal, telling The Tribune it would soon be on its way to Cabinet.

The technical proposal from Medistar - intended “for study and discussion only” - follows several consultative meetings between Medistar, architectural and engineering firm Page and Bahamian government officials, including Dr Sands.

It details a maternal child health facility envisaged for PMH will require 600,000 square feet of new construction plus helipad, and boasts 372 potential new inpatient beds. The outpatient component, an integrated medical plaza, would be connected to the inpatient facility via a climate-controlled atrium and could include: a primary care clinic; multi-specialty clinic; women’s centre clinic; cancer clinic; eye clinic; diagnostic imaging; outpatient rehabilitation; outpatient surgery; specimen collection; retail pharmacy; and food service, according to the proposal. The preliminary overall size of the medical plaza is estimated at 130,000 gross square feet.

The proposal also anticipated the development of the following “additional ministry mandates”: a medical school; EMS facility; national blood bank, reference lab and coroner’s facility; a new home for the AIDS Secretariat inclusive of clinical and research space and parking garage; PHA offices at PMH’s campus; the Rand Hospital replacement, and integrated medical plaza at the Rand; and a research and specialty medicine centre and school.

According to the proposal, the ministry would execute with Medistar a bankable long-term lease of 20 years or more, with appropriate project finance guarantees. It furthered the ministry would have the right to acquire the facilities by purchasing from Medistar at “fair market value at any time after the third year of operations”.

“The duration of the optimum lease term (most beneficial to the economics of the transaction) will be mutually decided between Medistar and the government. At the end of the lease term all real estate, including all buildings and hospital facilities, will revert back to the government free and clear of all liens.”

In the preliminary proposal, Mr Hourani also expresses his interest - along with Medistar - in developing a “major mixed-use, medically-aligned district” in Nassau.

“This is envisioned as a robust and vibrant destination development, initially suggested to be located between Nassau Harbour and Princess Margaret Hospital, and may include market rate apartments, student housing, hotel, retail, restaurants, entertainment, medical offices and ample parking lot to support the district,” he says in the proposal.

Speaking to its industry record, Mr Hourani pointed to Medistar’s 45-year track record of developing healthcare facilities. He highlighted the Bay Area Regional Medical Centre in Texas as Medistar’s hallmark innovation. The hospital was designed and built to withstand hurricane winds of 225pmh, and withstood Hurricane Harvey in 2017.