- Australia’s largest private hospital operator, Ramsay Health Care (RHC), has signed a comprehensive agreement with the state of Queensland to make its facilities and services available during the COVID-19 pandemic
- The deal means Ramsay can keep its workforce fully employed to help deal with the pandemic and will receive net recoverable costs from the Queensland government
- The term of the agreement began at the end of March and will end 30 days after the State determines that activation of the Australian Health Sector Emergency Response Plan for Novel Coronavirus 2019 has ended
- Ramsay has already negotiated a similar deal with the state of Victoria, while discussions are ongoing with New South Wales and Western Australia
- Despite the announcement, the company’s share price is down two per cent with shares selling for $61.2 each.
Australia’s biggest private hospital operator, Ramsay Health Care (RHC), has signed a comprehensive agreement with the state of Queensland to make its facilities and services available during the COVID-19 pandemic.
It comes off the back of a previous deal signed with the state of Victoria last month, with Ramsay also in discussions to finalise agreements with New South Wales and Western Australia.
What’s the deal?
The deal means Ramsay can keep its workforce fully employed to help deal with the pandemic and will receive net recoverable costs from the Queensland government.
Reimbursements include direct operating costs, corporate overhead costs (to the extent related to the provision of the services), depreciation associated with pre-existing capital which is owned and amortisation of leases and pre-approved capital expenditure. It excludes debt servicing and interest costs.
The agreement began at the end of March and will end 30 days after the State determines that activation of the Australian Health Sector Emergency Response Plan for Novel Coronavirus 2019 has ended or another end date is agreed.
Both parties have agreed to negotiate that other as soon as practical.
Despite the announcement, the company’s share price is down two per cent with shares selling for $61.2 each.