St John of God eyes troubled Peel campus

ST JOHN of God Health Care is making its move on the Peel region, signalling its desire to take over the troubled Peel Health Campus if the state government puts the hospital to tender.

Chief executive Michael Stanford told WA Business News he had written to the state treasurer indicating St John of God’s “strong desire” to bid for the Peel Health Campus contract if it came up for tender.

The hospital is the subject of a forthcoming independent review, expected to examine alleged misconduct by private operator Health Solutions.

Health Solutions’ major shareholder, Jon Fogarty, has publicly dismissed the parliamentary process that led to the inquiry as flawed.

“We always thought we were in a good position if the government chose to tender,” Dr Stanford said.

“What Health Solutions have tried to do is to stop other parties having a crack at it and we can’t imagine how that could be helpful to the state, or to the community, not to have an open tender process.

“It would seem to us, at least, very surprising were the state to choose, without a tender process, to re-contract a group that clearly has had a lot of adverse publicity.”

Separately, St John of God is seeking council approval for a proposed 120-bed private hospital in Mandurah.

The hospital would be built over two stages, with mid-2016 targeted for completion.

Dr Stanford said St John of God had been developing expansion plans into Mandurah for more than five years and had bought a five-acre block of land in 2010 for the proposed hospital.

The proposal has been advertised for public comment and will go before the local council next week.

Health Solutions WA announced plans of its own for a stand-alone private hospital as part of a $75 million expansion plan for Peel Health Campus earlier this year but Dr Stanford was sceptical it would go ahead.

“They haven’t got many years of their contract to run and, even if you got the design right, it takes about three years to build a hospital of the size that they or we would be talking about,” he said.

“They would not do that for a contract that finishes in (2017) because it would be a complete waste of money.

“The only way that Health Solutions will build a private hospital is if they have a significant expansion of their current contract, and that’s what they’ve asked the state government to give them.

“It would seem to us unlikely that the state, without a tender process to prove value for money, would re-tender to Health Solutions.

“Even if they did, we’re trucking on with our plans and Health Solutions would have to find the funds to build a private hospital and would have to seek to out-compete us.”

Health Mnister Kim Hames told reporters last week Health Solutions’ expansion plans were “definitely on hold” and signalled that the government was likely to seek expressions of interest from other potential private operators for the running of Peel Health Campus.

“We will be, once (the review) is over, open for other interested parties to put forward what they would do,” Dr Hames said.

St John of God was awarded a $5 billion, 2 3-year deal earlier this year to operate a new public hospital in Midland, set for completion in mid-2015.