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Friday, 15 June 1984
Page: 3132

Senator COATES —My question is addressed to the Minister representing the Minister for Health. Is the Minister aware of the claims made by Sister Teresa Plane of the Mount Carmel Private Hospital in Seven Hills, Sydney, that funding provided since hospital categorisation was introduced is so inadequate that it will force her to close the hospital? Is he aware that Sister Teresa claims the hospital's losses have reached $48,000 a month? Is this the same hospital supported on the Australian Broadcasting Corporation program, Pressure Point, last night by the Federal Secretary of the Australian Association of Surgeons, Mr Michael Aroney? What has the Government done about these claims?

Senator GRIMES —I am aware that a great deal of publicity has been given to the Mount Carmel Private Hospital as a result of the attempts of Sister Teresa Plane to pressure the Government to recategorise this hospital under the health insurance program. I know that there has been a considerable amount of misleading information given about this case. Just before I came into the chamber this afternoon, I was asked, for instance, what the Government would do about the unfortunate situation of this nun who, apparently, is running this hospital. I had better clarify what it is all about.

First, despite the inferences that have so frequently been made, Sister Teresa is not a nun; she is a nursing sister. From here on I think I had better refer to her as Ms Plane. She kept the name Ms Plane from her marriage to her second husband, Mr Jack Plane, who is a director of the hospital. Her first husband, Mr Roy Williams, is an administrator at the hospital. Her third husband, Dr Carl Spencer, also works at the hospital.

Another misnomer is the name of the hospital, Mount Carmel. Although this name gives the impression that it is a religious hospital, it is in fact not a religious hospital. It is run by a private company for profit. Last year it made a profit of $90,441, which included a gift of $10,000 from Mr Jack Plane. Ms Plane is Chairman of the Board of Directors of Mount Carmel Hospital Pty Ltd. The other directors are Mr Jack Plane, private company director, of Elizabeth Bay, Mr John Martin of Warrawee, and Mr Arnold Barton, a chartered accountant, of 65 York Street, Sydney. A company declaration dated 6 December 1983 and lodged with the Corporate Affairs Commission in New South Wales shows that the Andamooka Pastoral Co. Pty Ltd holds about three-quarters of the issued capital of Mount Carmel Hospital. That company's registered address is 65 York Street, Sydney. Its directors as at December 1983 were Mr Jack Plane, Mr Arnold Barton, and Mr Hercules Billjoen Hefer, of Johannesburg, South Africa. Its major shareholder is Springbok Holdings Ltd, care of Douglas, Isle of Man.

Andamooka Pastoral Co. also figures prominently in Mount Carmel's profit and loss accounts which show that, after salaries, wages and allowances, interest payments to Andamooka are the hospitals biggest expense. For the year ended 30 June 1983 the hospital paid interest of $190,000 to Andamooka Pastoral Co. compared with $130,000 in the previous year. This followed borrowings of $1.25m to upgrade facilities at the hospital.

According to Corporate Affairs, the other quarter of the issued capital is owned by Ms Plane. In other words she owns a quarter of the hospital which is estimated by the New South Wales Department of Health to be worth about $3.5m. Because she owns a quarter of the hospital she also received a quarter of the dividend of $80,441 declared last year-more than $20,000 on top of her salary of $27,500.

Her claim that the hospital is losing $48,000 a month is hard to reconcile with the information she supplied to the Federal Department of Health. Mount Carmel is an 80-bed hospital, with 60 beds for surgical patients and 20 for palliative care, or care for the dying. Statistics show that occupancy rates at the hospital have been declining for several years because other hospitals have been opened up in the area and because there has been a general reduction in the post -operative stay of surgical patients. In the seven months to 31 January the hospital had an occupancy rate of 52 per cent. In February and March this year, the first two months of hospital categorisation, the rate was 48 per cent and averaged 37 1/2 patients a day. Half of those were palliative care and the other half were surgical. It is true that occupancy was lower in April but that is normal in a month split by extended public holidays when people opting for elective surgery do not wish to be confined to bed. There are 39 patients in the hospital today.

Ms Plane's campaign to have the hospital put in category 1 is based on claims about the cost of the palliative care provided, not because of any expensive surgery provided. Yet, the figures she has provided to us show that, in the six months to 30 June 1983, the costs for running surgical beds were a third higher than for palliative care. She stated that the average cost of running a surgical bed was $163 compared with $120 for palliative care. Benefits paid at the time were $136 a day for non-surgical patients and $148 a day for surgical patients. As a category 2 hospital, Mount Carmel now receives $130 a day for each patient.

I would remind honourable senators that categorisation is based on providing benefits related to costs, not to what the hospitals wish they could charge. The previous Government's decision to end cost sharing in 1981 initiated massive increases in public hospital charges. Without any need for comparison to relevant increases in costs, private hospitals were able to ride on the coat- tails of public hospitals as bed charges soared from $50 a day in August 1981 to $120 a day shortly before the introduction of Medicare. That meant that the best private surgical hospitals in Australia, equipped with the most expensive and highly sophisticated equipment, were being reimbursed at the same rate as hospitals--

Senator Chaney —Mr President, I rise on a point of order. I just draw your attention to the length of this answer and the relatively small number of questions we have been able to ask.

Senator GRIMES —I will not be a minute. It follows a campaign--

The PRESIDENT —Order! I have pointed out consistently that I cannot direct Ministers to answer questions in the way in which the Chair might like them answered. But I would ask Ministers to be as brief as possible.

Senator GRIMES —I finish up by asking why in fact Ms Plane has mounted such a media campaign using patients as tools in an attempt to have her hospital recategorised. If the hospital were put in category 1, its value would go up and she would make a greater profit when she sells it. The second reason can be gleaned from reports in the Press that she wishes to open a 20-bed hospice at Penrith which she wants the Federal and New South Wales governments to fund. This Government and the New South Wales Government believe they have been more than generous in funding Mount Carmel Hospital. We do not believe, on any facts or figures, that recategorisation is justifiable. We are concerned about and deplore the attempts in the media falsely to depict the situation at Mount Carmel through the use of means which can create only great anxiety for the hospital patients. I hope those few words will put a bit of perspective into the situation.