The ACT government is gathering opinions on where to locate a new hospital. This is a worthy idea and will be one of the inputs to the decision process. However, it fails to ask who should own the hospital and how it should be governed.
Before deciding where to build a hospital, the first question is whether the hospital should be privately owned, ACT government-owned, Federal government-owned or owned by the community served by the hospital.
If the community owns the hospital the ongoing financial costs from the hospital will be substantially reduced, and the savings can be spent on upgrading and developing other health services in the local community.
The savings will be greater if the ownership is linked to health insurance and medicare payments and systems. We can expect the cost of operating and running the total health system in the community to drop by at least 25% for the same level of service. The reason the costs drop is community finance is half the cost of private financing.
If it is decided that the Community will finance the hospital, the location should be decided by the Community in consultation with the government rather than the other way around.
For more on Community Finance and how it reduces costs visit Build to Rent which describes how to halve the finance costs of home ownership.
