VHI: We can't afford to cover hospital

VHI say they cannot afford to provide cover for the Cork Medical Centre, or any other new private hospital development.

CMC, which opened in October in Mahon, closed last night with the loss of 75 jobs. It was to employ up to 525 people when fully operational.

The new Minister for Health, Dr James Reilly, was due to meet with hospital management today in a bid to resolve the situation.

However, in a document seen by the Evening Echo the Vhi made it clear there were major cost implications in providing cover — claiming it would cost €37.5m annually to cover the 75-bed hospital.

The insurer argued they were underwriting losses of €150m over the past three years and had lost 200,000 customers over the last 24 months.

“Against this backdrop Vhi Healthcare simply cannot afford to provide cover to any additional facilities for which there is no clear need or which do not provide medically innovative services,” read the statement which had been sent to Cork TDs who had sought a meeting with the Vhi.

The cost implications had been disputed by the CMC who say there would be no extra cost as they had taken measures to avoid any extra charges.

It is also understood that Vhi took into consideration the impact the Mahon facility would have on the other private hospitals in Cork, including the Bons Secours and Shanakiel Hospital.

James Sheehan, chairman of the CMC said the increased competition would help improve the service being offered to patients in the region.

Meanwhile, despite the stance of the Vhi in not providing cover for any new facilities, Cork developer Owen O’Callaghan is to proceed with plans for a private hospital on Lancaster Quay in the city centre.

A spokesperson for O’Callaghan properties said: the company was concentrating at present on achieving planning and getting the statutory approvals for the €80m project. “The health insurance landscape will be undergoing radical change over the next few years. We believe that health insurance will not be an issue with respect to our project. We intend to proceed and are confident that it will be brought to fruition.”

Story courtesy of the Evening Echo