Medibank and doctors form new short-stay no-gap hospital joint venture
Medibank and more than 40 specialist doctors have formed a joint venture to develop a new short-stay surgical facility in Melbourne.
The joint venture will give patients more choice in how their care is delivered – with a short-stay model across many surgical modalities, including extending the no-gap treatment model for eligible Medibank customers.
The group of 42 doctors will be led by respected vascular surgeon Professor Michael Grigg, and the doctors will retain full clinical autonomy at all times.
The joint venture will work with real estate investment group Centuria Healthcare which will acquire the land and develop a new facility on a site in Kew, Melbourne. The joint venture will take a long-term, 15-year lease of the new hospital.
Professor Grigg said the investing doctors will own 51% of the joint venture, with Medibank owning a 49% non-controlling stake.
“This is a significant investment in Australian healthcare. The doctors who are co-investing are committed to delivering short-stay models of care where clinically appropriate, across many surgery types, with reduced or no gaps for eligible patients,” Professor Grigg said.
“We are proud to partner with Medibank and Centuria Healthcare in this new facility where doctors will have much greater input into the operation of the hospital.
“We hope to open the new facility in 2023, and we are committed to this innovative new model of care that will reduce out-of-pocket costs for eligible patients and reduce unnecessary time spent in hospital,” Professor Grigg said.
Medibank Group Executive Healthcare & Strategy Dr Andrew Wilson said the investment demonstrates Medibank’s commitment to putting patients at the centre of treatment, supporting healthcare providers to improve patient experience.
“We have long said that affordability in the private health system needs to be addressed. Out-of-pocket costs are a big part of that,” Dr Wilson said.
“Hospitals, doctors, health insurers and the government will need to collaborate more than ever in these changing times to ensure that the healthcare system continues to deliver the best possible experience for patients at an affordable cost.
“Our investment is aimed at supporting our doctor partners to deliver a short-stay model of care that is already widely available at scale in other health systems internationally and for which there is a strong body of evidence,” Dr Wilson said.
The facility is planned to offer four operating theatres and a procedure room, 30 beds, radiology, an infusion (chemo) clinic and 90 basement car parking spaces. The facility proposes to provide services in orthopaedics, ENT, vascular, plastics, urology, general surgery, gastroenterology, anaesthetics, oncology, and radiology. The development of the facility is subject to completion of the acquisition and obtaining all necessary planning and licensing approvals.
Centuria Healthcare Managing Director Andrew Hemming said Centuria is delighted to partner with the joint venture doctors and Medibank to develop and own this new short-stay surgical facility.
“This is a transformative project that can change the landscape of the healthcare sector and being the real estate partner of this forward-thinking project is exciting,” Mr Hemming said.
“The project is central to Centuria Healthcare’s strategy to partner with top-tier operators backed by long-term leases. We are focused on providing modern healthcare real estate investments across Australia and currently have c.$1 billion worth of these assets under management.”
The joint venture between the group of doctors and Medibank will invest approximately $22 million to establish the new facility, to support start-up operations and equipment. Medibank’s contribution will be approximately $10.7 million.
The joint venture is Medibank’s latest investment, following the recent investment in East Sydney Private Hospital and the proposed investment in primary care operator Myhealth Medical Group.
If the new private hospital receives necessary planning and licensing approvals
The new private hospital will be a modern short-stay facility located in Kew, Melbourne. The joint venture will enter into a 15-year lease of the facility. The facility’s Board, owners and management team comprises doctors and other health industry professionals. The facility proposes to provide services in orthopaedics, ENT, vascular, plastics, urology, general surgery, gastroenterology, anaesthetics, oncology, and radiology.
Medibank is a leading Australian private health insurer. We look after the health cover needs of more than 3.7 million customers through the Medibank and ahm brands. For more than a decade, Medibank has been collaborating with hospitals, doctors and governments on innovative ways of delivering care in the home and community. Medibank is Australia’s leading telehealth provider and delivers in-home care through its wholly owned subsidiaries HealthStrong and Home Support Services. Medibank is partnering with hospitals and doctors across Australia to deliver more patient-centred healthcare, reducing out-of-pocket costs for our customers.
About Centuria Healthcare
Centuria Healthcare is part of Centuria Capital Group (ASX: CNI), which has a more than $10 billion of assets under management across Australasia. Centuria Healthcare is a specialist funds manager of healthcare real estate assets across Australia with c.$1 billion of healthcare assets under management.