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Ramsay Healthcare

050307-N-8796S-070Banda Aceh Indonesia (Mar 07 2005)-- A patients X-ray hangs over the bed as Dr Elizabeth Mclarney, an orthopedic surgeon from the non-governmental organization "Project HOPE", performs surgery on an Indonesian patient alongside Indonesian medical professionals at the Tentera Nasional Indonesia Military Hospital in Banda Aceh, Indonesia. The surgery was successful in removing metal plates and screws from the patients leg as well as a piece of wire from the patients jaw, following reconstructive surgery eight years ago. The hospital ship USNS Mercy (T-AH 19) and its crew of medical and support personnel, civilian mariners, Uniformed Public Health Service and the NGO, ìProject HOPEî have been operating off the coast of Sumatra, Indonesia providing assistance to international relief organizations and host nation medical teams ashore in tsunami affected areas. US Navy Photo By Photographer's Mate Second Class Timothy Smith

Ramsay Healthcare operates 220 hospitals and day surgery facilities in Australia, Indonesia, France and the UK, with over 8000 beds and nearly 25,000 staff. In the UK Ramsay Health has a network of 30 hospitals and 3 neurological units, delivering both private treatment and care under contract to the NHS. Ramsay Health Care UK employs over 3500 staff.

Ramsay Health Care UK is a subsidiary of Ramsay Healthcare (Australia). It was established 1964 in Australia by Paul J Ramsay.

 

Strategy

Through a process of acquisition in its home market Ramsay Health has become Australia’s largest private hospital operator. Acquisitions have included other private hospital groups, with the largest being of Affinity Healthcare in 2005, which increased Ramsay’s hospitals from 35 to 69. Ramsay also has a history in Australia of moving into the public hospital sector. In 1994/1995 Ramsay Health Care won bids to privatise two government-owned repatriation hospitals (also known as veterans hospitals) – Hollywood Hospital in Perth and Greenslopes Hospital in Brisbane. This strategy has continued and in 2012 two private/public hospitals were in development.

Ramsay Healthcare’s first foray outside Australia was to Indonesia where it now runs three private hospitals; these were acquired with the acquisition of Affinity Health in 2005. Then in 2007 the company acquired Capio, at the time the fourth largest operator of private hospitals in the UK. The company’s focus for expansion switched to France in 2010, with the March 2010 acquisition of 57% of the French hospital company Group Proclif SAS, now known as Ramsay Santé. Ramsay’s expansion in France has continued, with the May 2011 acquisition of the Clinique Convert hospital, which Ramsay notes is a first step in expanding the Ramsay Santé business, with plans for further expansion. The company currently operates nine hospitals in France.

In the UK Ramsay’s growth had been driven by increasing volumes of NHS patients - as of 2016 they accounted for 77.3% -an increase from 75.5% in 2015 - however in 2017/2018 there was a significant downturn in NHS patients, according to the company.  Self-pay customers are also integral and Ramsay puts focus onto its “premium care” advertising to private patients.

Recent years have been tough for Ramsay in the UK: in June 2018 Ramsay wrote down the value of six sites in the UK by £70m. The company welcomed the Government's June 2018 promise of more money for the NHS, but it does "not anticipate immediate benefits for us and expect operating conditions in the UK to remain challenging in the medium term.”

Political ties

Ramsay Healthcare is part of the Private Hospitals Alliance (formerly H5) which lobbies Westminster on issues regarding healthcare and the role of private companies in delivering NHS services.

Financials

In the UK Ramsay’s business is conducted through Ramsay Health Care UK Operations Ltd. The most recent accounts available from Companies House are for the financial year ending 30 June 2017.

Total revenue for the year stood at £440.7 million with pre-tax profits of £14.6 million. The company paid £2.4 million in taxes that year.

Total post-tax profit stood at £12.1 million, over £2.1 million from 2016.

Full accounts are published by the Australian parent company, Ramsay Health Care. Accounts are available for the financial year ending June 2018.

Contracts

According to the HSJ, of all the private providers delivering publicly-funded work, Ramsay is the most dependent on NHS outsourcing and the choose-and-book system.

Ramsay Healthcare performs surgery at nearly all of its hospitals and clinics for the NHS.

In 2010 Ramsay Health was a bidder in the tender process for running Hinchingbrooke hospital; Ramsay eventually withdrew from the process in August 2010.

Dorset Spinal Surgery Service

In August 2017, Ramsay was awarded a seven year contract for spinal surgery in Dorset, worth £30,800,000.

Concerns

In October 2017, Ramsay was fined £550,000 at Southwark Crown Court following a prosecution by the HSE. The HSE was alerted by a whistleblower in 2014 to deficiencies in the company's occupational health team and it subsequently found a string of problems, including failing to risk assess hazardous substances, including carcinogenic chemotherapy drugs, and failing to provide workers with adequate health surveillance.

In 2007, Ramsay Health agreed a 10-year deal with Bromley Hospitals Trust (now South London Hospitals Trust) for the Princess Royal University Hospital in Orpington to build a £4.2 million, 25-bed unit, which the trust would then rent to Ramsay Health UK for £500,000 a year. But in June 2009, just two years into the contract, Ramsay closed the unit saying it was no longer commercially viable. This has left the already deeply in debt South London Hospitals Trust having to pay back eight years rent that was paid upfront by Ramsay Health, and with no money to pay the running costs of the unit without impacting on its budget or to offset the £4.2 million the unit cost to build.

In March 2011 Jill Watts CEO of Ramsay Health UK was called to give evidence before the Public Accounts Committee. Although Watts was at ­first evasive on the issue of failure, eventually she admitted that should a business be failing then the company would close it. When questioned on what would then happen to the patients she noted that that would depend “on what the marketplace is”.

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