Romanian Private Hospital Mkt Expected To Grow In 2010

In the 2007-2008 interval, most major local medical service operators were prepared to fill the market gaps. They would be helped by foreign investors drawn in by the segment potential and low competition.

However, last year's crisis context gave pause to most companies, causing them to rethink and even drop their private hospital construction plans.

The recent plans made by the local Ministry of Health, to introduce the co-payment system, prompted local medical service market players to once again consider entering the private hospitals market.

Early July, 2009, the Government approved the introduction of health vouchers, setting a maximum yearly cap of 600 lei (EUR1=RON4.0958). The health voucher represents co-payment of the taxpayer to the medical services provided, the medication and the medical equipment utilized. The voucher will be used for outgoing procedures, services provided by hospitals (excepting emergencies) and for paraclinic investigations.

According to a poll published last week by Polish research company PMR, private healthcare services providers plan to invest over EUR200 million in private hospitals in Romania over the following two or three years.

Thus, after giving up on a project in Bucharest last year, Romar Medical rethought its decision and intends to build a private hospital in Romania's capital.

"The Ministry of Health is preparing a series of draft laws regarding public-private partnerships, copayment and incentives for insurance premiums. These laws could come into force on January 1, 2011. In addition, the crisis brought, on the real estate and construction markets, many opportunities, namely buildings abandoned in various stages of construction, left unfinished," said Romar Medical general manager Erghin Hagicalil.

Another factor that could contribute to the growth of the private hospitals market in Romania is the development of medical tourism.

One example would be Medicana Hospital, one of the largest private hospital networks in Turkey, which plans to start end-September the construction of its first unit in Romania, in the capital city Bucharest, following an investment of $30 million.

The Turkish company plans to build a 10,000 square meter private hospital on a plot of land it owns in Bucharest. The project would create over 500 jobs, Medicana's board president Huseyin Bozkurt told MEDIAFAX on Wednesday.

"Our intention is to attract patients from the European Union member states," Bozkurt said.

In his turn, businessman Ionut Negoita recently announced that in Summer he will begin a project in Bucharest, which will include one hospital, one clinic as well as commercial spaces and several hundred dwellings. The overall investment is estimated at EUR35-40 million.

In Bucharest there are another six projects regarding the construction of hospitals.

The local branch of Dutch group Medicover intends to invest EUR40 million in an 88-bed hospital, Elim Pitesti is planning a EUR40-50 million hospital. Centrul Medical Unirea has set its budget to include a EUR12 million investment in a surgery hospital set for launch by fall.

Another project will be developed in Bucharest by the Gral Medical clinic network, which is currently analyzing the possibility of taking on an international partner for financing.

Also, Medsana, controlled by Athens Medical Center in association with German group Asklepios Kliniken, is analyzing the adequacy of a EUR25 million investment in a 200-bed hospital.

On a national level, last year there were five hospitals launched, following investments worth over EUR45 million.

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