Mount Gambier Private Hospital enters voluntary administration with its future in doubt

The Limestone Coast’s only private hospital has gone into voluntary administration, putting its long-term future in doubt amid a funding crisis.

Mount Gambier Private Hospital has entered into voluntary administration because its current operational model is no longer financially sustainable.

Acting chair Catherine Lunnay made the announcement on Saturday morning, saying it would not impact current patient care or staff at the 20-bed facility which is co-located with the SA Health-run Mount Gambier and Districts Health Service (MGDHS).

“Over the past five years, changes in the operating model of MGDHS, our largest creditor, have resulted in operational pressures which have had a direct impact on our economic performance and long-term feasibility that we can no longer sustain,” Ms Lunnay said.

Hospital co-administrator Austin Taylor confirmed there were long-term problems with its operational model.

He said hospital operators have been asking the state government for funding for a number of years and was left with a “shortfall” of $250,000.

The hospital was fronted with an bill they could not pay. of approximately $800,000, after MGDHS increased the rent.

“There’s a need for further high-level negotiation around the ongoing future arrangements between the private hospital and public hospital system with SA Health,” he said.

“It (the hospital’s future) won’t be resolved without further high-level discussions.”

Ms Lunnay said in a statement the hospital will enter a five-week administration.

“We enter the five-week voluntary administration process, managed by Meertens Chartered Accountants, very hopeful that the situation can be remedied and look forward to working with the LCLHN to identify a new, co-operative working model that is in the best interest of both parties but most importantly, the community of Mount Gambier, who have long been very supportive of our hospital.

“The Mount Gambier Private Hospital will continue to operate as normal during the voluntary administration period.”

Mount Gambier Private Hospital has been placed in voluntary administration. Picture: Jessica Ball

Federal MP Tony Pasin said Saturday’s news was “incredibly disappointing” and a long-term solution was needed.

“I’ve spoken today with the administrator who assures me that in the short term, no patients will be impacted, which I’m sure will be a relief to those currently using the service,” Mr Pasin said.

“It is untenable for there not to be a private hospital in Mount Gambier, South Australia’s second-largest city.

“This matter needs to be resolved urgently by the South Australian state government, and I‘m confident they will take the actions necessary to resolve any uncertainty around the future of the Mount Gambier Private Hospital.”

Barker MP Tony Pasin.

Labor MLC Clare Scriven.

Labor MLC and Port MacDonnell resident Clare Scriven said it was a concern negotiations between the hospital and the state government had deteriorated to the point of potential closure.

With the private providing the equivalent of 5000 day stays per year, she said it would be difficult for the already strained public hospital to pick up the difference.

“It’s incumbent upon the current government to ensure that it is not the end of the private hospital,” Ms Scriven said.

“It provides an important service to the region and without it, there’ll be unacceptably high increased demands on the public hospital.

“We should not be losing hospital services – if anything, we need to be increasing them – so it’s a real concern that the government has not managed to work out a better solution for the private hospital.”

SA Health declined to comment.