Private hospitals pivot to elderly patients as surgery put on hold

The main revenue driver for private hospitals, elective surgeries, has been banned again prompting operators to open door to elderly.

The Victorian government said: “Wherever possible, surgeries that have already been booked will proceed.” Picture: Getty Images

Private hospitals are co-operating with Victorian health authorities, taking on vulnerable aged-care residents as patients while the coronavirus rips through nursing homes across Melbourne and forces the Andrews government to resurrect a ban on most elective surgery.

Victorian Premier Daniel Andrews banned elective surgery at Melbourne hospitals as the city continues to record hundreds of COVID-19 infections each day, despite being thrust into a hard lockdown three weeks ago.

Elective surgery in regional areas will continue as normal.

Mr Andrews said the ban was necessary to free up nurses to help protect the most vulnerable members of the community, aged-care residents, most of whom are in federally subsidised nursing homes.

Despite the ban on elective surgery — the main revenue driver of public hospitals — placing further earnings pressure on private health operators, they have not hesitated in opening their doors to the elderly.

The private health sector is receiving funding under the government’s viability guarantee but that covers only the cost of treating patients, leaving no cash to reinvest in equipment, training or servicing debt.

“The Victorian (viability) agreement had a step in, step out arrangement so it was always going to be envisaged that if a second wave was going to happen, hospitals would step back in,” Australian Private Hospitals Association chief executive Michael Roff said.

“They’d have their costs covered and now we are seeing facilities and staff are being used in the pandemic response, which was exactly how it was designed.”

The government banned most elective surgery in April but was able to quickly get on top of the first round of COVID-19 infections and lifted the restrictions later that month. Mr Roff said the initial ban was aimed at preserving personal protective equipment, while this time it was “about preserving the workforce”.

Victoria’s COVID-19 surge has put health stocks on edge, with Goldman Sachs analysts singling out Australia’s biggest private hospital, Ramsay, as the most exposed, given 20 per cent of its revenue comes from the state.

Ramsay runs 16 hospitals across Victoria and its Australian operations chief executive, Danny Sims, said the government had requested it to re-enter the viability agreement to ensure it had the capacity to help treat the most vulnerable members of the community.

“As part of the pandemic agreement between private hospital operators and the Victorian government, Ramsay has been called on to accommodate some of the vulnerable aged-care residents in our hospitals. We have taken a cohort of these residents at two of our sites currently,” Mr Sims said.

“We have had some amazing staff who put up their hands to assist by working shifts in the aged-care facilities. A group of nurses including one NUM (nurse unit manager) drove more than an hour to cover a night shift at an aged-care facility. At the same time, our other employees have also stepped up by preparing our facilities and continuing to provide support as required.”

Mr Sims said Ramsay’s Victorian hospitals remained safe despite the state continuing to record hundreds of COVID-19 infections each day.

“Due to our robust infection prevention and control measures in place, as well as the extensive training our teams have undertaken, it remains safe for other patients to be admitted to our facilities even where we have suspected or confirmed COVID cases. All our sites have implemented pandemic response plans to ensure we are prepared for these scenarios.”

Healthscope, Australia’s second biggest private hospital operator, also has freed up its facilities to care for the elderly. A spokesman said it was caring for 45 aged-care residents at four of its hospitals, including the recently converted La Trobe Private, which had been mothballed for several years.

“Since the pandemic first landed in Australia, Healthscope has made its people and facilities available to fight this unprecedented health crisis. We are doing what we can to help care for those most at need in our community in these difficult times,” the spokesman said. “Healthscope is working closely with the DHHS and commonwealth health authorities to support their efforts to manage the current COVID-19 outbreaks in many Victorian aged-care centres.”

The Victorian government said: “Wherever possible, surgeries that have already been booked will proceed — but for the time being, only new category 1 and the most urgent category 2 surgeries will be booked.

“IVF treatments such as egg retrievals will be able to continue given the time-critical nature of these procedures and minimal impact on hospital capacity.”