Romanian healthcare companies reel, as hopes of private insurance recede
publication date: Sep 22, 2009
Any Romanian private healthcare company with state business is looking vulnerable. Meanwhile, a move to private healthcare insurance looks likely but not until 2010.
Healthcare providers tell us that the Romanian state has simply ceased paying bills. This will have a huge impact on any company with a substantial state business. And that means practically everyone, apart from subscriptions business Medicover. Sources say the worse affected are groups like Gral Medical and Romar which have built their businesses around government spending, but many other operators get a substantial portion of their revenue, circa 40%, from the state. Less affected will include Euroclinic at around 8%, CMU Unirea and Sanador.
Catalin Popa at Euroclinic said: "I anticipate a situation rather like the one faced by pharmacies a few years ago. Payments took so long that they were not able to fulfil any scrips which were part paid by the state."
Hardly surprising then that the list of companies officially for sale continues to lengthen. As well as CMU Unirea and Medlife, Romar has been for sale for some time and Bedminster Capital is now indicating it may sell its stake in distributor and healthcare services provider Hyperdia.
Meanwhile, plans to move to a new model in which private insurance becomes complementary and the public sector pays for a much more limited basic package have been delayed. Nobody wants to do anything before the November presidential elections.
However operators do remain confident that sooner or later the Romanian government will move to a model which gives a much greater role to private healthcare insurers.
"It is a big thing that, in a time of crisis, the package of measures in health system has come so close to being adopted. Introduction of co-payments and the defining of the minimum package of health services are not popular decisions. In no country in Western Europe, their adoption was easy. The more difficult it is to do it in a time of crisis," said Michael Mark, president of Medlife.
But our sources say that there is now an air of desperation among many private operators. “We have pinned our hopes on the introduction of private healthcare insurance, but,really, we are all waiting for some big international operator, such as Asklepios, to come into the market and scoop us all up,” said one.
Healthcare providers tell us that the Romanian state has simply ceased paying bills. This will have a huge impact on any company with a substantial state business. And that means practically everyone, apart from subscriptions business Medicover. Sources say the worse affected are groups like Gral Medical and Romar which have built their businesses around government spending, but many other operators get a substantial portion of their revenue, circa 40%, from the state. Less affected will include Euroclinic at around 8%, CMU Unirea and Sanador.
Catalin Popa at Euroclinic said: "I anticipate a situation rather like the one faced by pharmacies a few years ago. Payments took so long that they were not able to fulfil any scrips which were part paid by the state."
Hardly surprising then that the list of companies officially for sale continues to lengthen. As well as CMU Unirea and Medlife, Romar has been for sale for some time and Bedminster Capital is now indicating it may sell its stake in distributor and healthcare services provider Hyperdia.
Meanwhile, plans to move to a new model in which private insurance becomes complementary and the public sector pays for a much more limited basic package have been delayed. Nobody wants to do anything before the November presidential elections.
However operators do remain confident that sooner or later the Romanian government will move to a model which gives a much greater role to private healthcare insurers.
"It is a big thing that, in a time of crisis, the package of measures in health system has come so close to being adopted. Introduction of co-payments and the defining of the minimum package of health services are not popular decisions. In no country in Western Europe, their adoption was easy. The more difficult it is to do it in a time of crisis," said Michael Mark, president of Medlife.
But our sources say that there is now an air of desperation among many private operators. “We have pinned our hopes on the introduction of private healthcare insurance, but,really, we are all waiting for some big international operator, such as Asklepios, to come into the market and scoop us all up,” said one.