The private medical services industry has been growing rapidly over the past 10-12 years. The industry grew along with the economy and the population’s purchasing power. Offering a much needed alternative to the public health system, private services have been welcomed by Romanian people.
By Aurel Constantin
The latest estimates show that private clinics providing specialised medical assistance reached well over EUR 2 billion in revenues in 2022. In 2021, the number stood at EUR 1.9 billion, up almost 25 percent from the previous year. Companies operating in the hospital segment had revenues of EUR 450 million (RON 1.9 billion). Investments in the sector are concentrated around big cities, where medical personnel is easier to find.
There are major players on the market that make investments in development every year, both organically and through acquisitions. The Regina Maria group of hospitals and clinics has an yearly expansion budget of EUR 20-25 million. MedLife, Medicover, and Gral Hospital are also buying smaller competitors every year.
One of the most important transactions that took place last year marked the entry of Turkey’s Memorial Healthcare to Romania through the acquisition of the Monza oncology hospital within the Enayati Medical City. The Italians from Monza owned 80 percent of the oncology unit, while Wargha Enayati, the founder of Enayati Medical City, owned 20 percent. The transaction perfectly illustrates the interest sparked by the local market among international companies.
New investments will also be made in test labs and collection centres, which are a winning bet given that most patients usually pay for their own medical tests because public funds tend to run out in the first days of each month. The lists of patients waiting for routine blood tests stretch for one or two months.
Impact on the larger system
The private health system, including private hospitals, had 23,065 doctors and 54,540 other health personnel in 2020, according to INS data. Private health providers make up an important component of Romania’s health system and they have a considerable impact on the country’s economy. The total estimated value of the private medical services market was EUR 2.9 billion in 2019 and EUR 3.1 billion in 2020. Investments in the private health segment doubled between 2010-2020, reaching 0.2 percent of GDP.
The largest share of the entire healthcare system expenditure comes from public sources (approx. 80 percent), while the private sector covers about 20 percent, through the direct payments people make in order to access medical services, but also through medical subscriptions or voluntary insurance. And subscriptions for private medical services will continue to be successful, even as employees are still paying the compulsory contribution to the public system. The big market players are often announcing new investment projects. Medicover, for example, is collaborating with German company Karl Storz, a world leader in the field of endoscopy, to equip the new hospital in Bucharest with one of the most advanced digital technologies for the operating room. The OR1 system will provide intelligent interconnectivity between surgical teams and medical devices inside and outside the operating room, improving patient-centred medical performance. The new Medicover hospital in Bucharest responds to a pressing need to treat increasingly complex conditions through minimally invasive surgical techniques. The new hospital will also have a high-tech imaging centre, an integrated outpatient clinic, and over 150 beds. The works on the hospital in Bucharest are ongoing, with completion expected in the second half of the current year. Medicover’s investment in the new hospital amounts to EUR 20 million and involves the transformation of an office building with a total area of 15,000 sqm. “We set out to equip the new hospital with the most advanced technology and to support the team in achieving excellence in the medical practice, to the benefit of patients. Today, technology allows not only access to rich data, but also a high degree of collaboration between doctors, helping them successfully address complex conditions,” said Dr Florinela Cirstina, the general director of Medicover Romania.