Private hospital group Life Healthcare is exploring an exit from its Polish business Scanmed, which has been hit hard by government-imposed tariff cuts, reports Business Day. The report sayas while the private hospital group Scanmed has never been a significant part of Life Healthcare’s business, management’s decision to divest highlights once more the unforeseen regulatory challenges that have confronted it and its JSE-listed rivals, Netcare and Mediclinic International, with many of their offshore ventures.
Life Healthcare acquired Scanmed in 2014, saying at the time there was strong projected growth for the privately insured market. But it has been hit by a series of regulatory moves including double-digit tariff cuts imposed in 2017 by the Polish government, which accounts for 80% of its Scanmed business.
“While Poland is an incredibly exciting economy, we have decided from a strategic point of view to explore an exit. We still think it is a very exciting asset, but one better suited to other hands,” Life Healthcare CEO Shrey Viranna is quoted in the report as saying. Life Healthcare said it intended to retain a footprint in Poland through its UK-based diagnostic services company Alliance Medical.Business Day report