Hadassah Medical Center carries a NIS 1.3 billion debt, which increases by NIS 300 million a year, but it also owns valuable real estate and, in some cases, pays exorbitant salaries. This is the picture that emerges from petition for a stay of proceedings filed on Friday by the hospital, which is struggling with cash flow problems.
Most of Hadassah's revenue comes from the healthcare funds - 62% of its NIS 1.16 billion revenue in 2013. Maternity care accounted for 10% of revenue, or NIS 172 million. Medical tourism accounted for 4% of revenue, or NIS 78 million, and private healthcare generated NIS 254 million, of which NIS 40 million went to the hospital and NIS 214 million went to doctors.
Hadassah has 1,000 beds, 31 operating theaters, nine emergency units, and it treats one million patients a year. The hospital has 6,000 employees, including 1,180 doctors and 896 managers.
The stay of proceedings details examples of "employees whose salaries are substantially higher" than salaries at other hospitals. For example, X-ray technicians have a monthly salary cost of NIS 25,500 (some of them earned more than NIS 100,000 a month until a few months ago), the average salary cost of a cleaning supervisor is NIS 19,000, and the average salary cost of a senior secretary is NIS 18,000.
However, Hadassah's expenditures mess does not end there. The stay of proceedings describes a fiasco of excessive overtime payments to employees: "The company pays high costs for the 'general overtime' item, which is backed by nothing, and for which it does not receive anything in exchange." This cost is estimated at NIS 38.8 million a year.
The stay of proceedings lists Hadassah Medical Center's property in Jerusalem, such as rights in a clinic at 24 Strauss Street, worth NIS 11.2 million, and rights in a building on Guatemala Street, worth NIS 8.5 million. Income-producing property that generates very high rent includes buildings on Ha'Etzel Street, each of which generates NIS 930,000 a year in rent. The building on Guatemala Street generates NIS 861,000 in annual rent.
Hadassah has rights in other properties, including a residential and commercial building in Jaffa, other buildings in Jerusalem, Tel Aviv, and Beit Shemesh, and land in Hadera.
The stay of proceedings petition states that Hadassah spends NIS 25-35 million a year on medical malpractice claims. The reason is that the hospital's insurance only covers "catastrophes". An average of 75 medical malpractice claim are filed every year.
On Friday, Hadassah Medical Center, run by CEO Avigdor Kaplan, filed for a stay of proceedings with the Jerusalem District Court, in order to obtain court protection for implementing the hospital's recovery plan. The court was asked to appoint Dr. Lipa Meir as trustee and to give him all the authority needed, together with the hospital's board and CEO Kaplan, to draw up and implement a recovery plan and debt settlement. The petition was filed by Adv. Amir Bartov of the Lipa Meir & Co. Advocates law firm.
Published by Globes [online], Israel business news - www.globes-online.com - on February 9, 2014
© Copyright of Globes Publisher Itonut (1983) Ltd. 2014