Dr Marinos Soteriou: It’s a shame to demonise profit; we are not living in a communist regime

A huge effort has been underway in recent years to attract foreign investments to Cyprus; and yet there never cease to be reactions coming from specific directions against acquisitions or the equity participation of companies and investment funds from abroad in large Cypriot companies in various sectors of business activity.

A good example of this is the recent decision by opposition party AKEL to table the investments being made by Hellenic Health Group (HHG) in Cyprus’ healthcare sector for discussion at the House, taking aim at a potential monopoly in the island’s private healthcare sector.

HHG, an internationally recognised and Greece’s largest healthcare provider, recently acquired the Apollonio and Aretaeio private hospitals in Nicosia, while the Commission for the Protection of Competition (CPC) has green-lit its acquisition of 50% of the equity capital of American Medical Center (AMC).

Indeed, the House Health Committee’s MPs voiced some questionable concerns.

“We are not living in the ‘60s”

With this in mind, InBusinessNews contacted AMC's founder and Chairman, Dr Marinos Soteriou, who was also surprised by the reactions, stating: “We are not living in the communist regime of the ‘60s, but in a free economy.”

He went on, “It is a shame to demonise profit and business activity, because in reality, there is no other hospital except those under (state health services organisation) OKYPY, whose losses are reimbursed by the taxpayer. Those who come and invest are doing so in order to make a certain profit; without profit you can’t do anything”.

As he said, it is natural for hospitals within and outside the general health system (GHS) to want to return a profit, to ensure they run smoothly and can continuously upgrade the healthcare they offer.

"We see what is happening, for example, to the salaries of public doctors who are supposed to be the ultimate picture of altruism. They are constantly on strike demanding more rights, while if you look at the evolution of their salaries in recent years, they may have even increased in some cases," Dr Soteriou pointed out.

"The existence of a strong private sector should be welcomed and we should encourage it, rather than discourage it," he said, stressing that the CPC has carried out extensive research on the matter, requested a lot of information and concluded that based on the laws and regulations that exist at this moment, there is nothing objectionable with the HHG deal.

He further highlighted how having a dominant market position – even though this is not the case here – is not prohibited. “It is how you take advantage of that position that could possibly create some problems,” he explained.

“The GHS is not affected in any way”

Regarding HHG’s participation in American Medical Centre, Dr Soteriou categorically denied claims that this will negatively impact that GHS.

“I really don’t understand the reasons behind this furore, especially in this case where we are clearly referring to the acquisition of a share in a hospital outside the GHS,” he said. “I honestly cannot comprehend why Mr (AKEL MP Giorgos) Loukaides is complicating matters and complaining that this will affect the Health Insurance Organisation’s (HIO) monopoly regime? What does the HIO have to do with a share acquisition in a private hospital that is not in the GHS? Nothing. The GHS is not affected in any way by this deal. We are talking about two completely different markets,” said Dr Soteriou.

As for the AKEL MP's claim that it is forbidden to be both inside and outside the NHS, and therefore it is forbidden to be the owner of hospitals inside and outside the NHS, Dr Soteriou said this is not what the state laws and regulations say.

“The most astounding and wild thing is that Mr Loukaides is complaining and favouring a monopoly for the HIO, but not a monopoly or oligopoly for anyone else,” said Dr Soteriou.

"OKYPY has 1,500 beds, which makes it - as I said in Parliament - the elephant in the room, because there is an oligopoly and a subsidised monopoly, but because that is where the state is, they ignore it. Even if this is paradoxical,” said Dr Soteriou.

“For example, a patient at specific HIO hospitals pays €500 a day for a single room. When you go to have a robotic knee, you will pay €20,000, because the HIO came and issued a circular that is illegal, since the Attorney General has clearly stated his position on the matter, that is, a hospital cannot be both inside and outside the GHS and therefore, the HIO cannot come and say that I am taking this service out of the GHS and not this service. This can’t happen, but they overlook it,” he said, adding that similar cases have been observed in diagnostic centres.

“For example, you want to have a CT scan; with the GHS, you have to wait for two months, while if you have private insurance, you can get an appointment for the next day. All these very serious issues did not bother Mr Loukaides yet he was bothered by whether a share was acquired in a hospital outside the GHS,” said Dr Soteriou.

Why has the HIO changed its stance?

The doctor wondered what the parliamentary discussion aimed to achieve, given that when the matter was discussed at the House two years ago, the HIO was hugely in favour, stressing that Cyprus’ healthcare sector will be upgraded, investments will be attracted, and so on.

"What has changed since then, and especially since an investment fund is invested in a hospital outside the GHS? How is the HIO affected by something like this?", he wondered, while pointing out that "everyone should ask themselves why we exist and people come and pay to receive care, while there is an alternative solution in the public sector and indeed free of charge".

Besides, he added, “what other European country does not have a private healthcare sector?None. And so I repeat, what is all this furore and discussion about? To harm the private sector? This whole discussion does not make sense”.

Furthermore, he said, everyone should be concerned about the GHS, particularly after Eurostat announced that fatality in Cyprus after the system was implemented and following the coronavirus is 23% above the EU average; that is, one in four deaths approximately could have been avoided. “At the same time, we know that the GHS is being abused and incredibly, nobody seems bothered, and we know this is the source of evil, and not whether a hospital or part of its share capital was sold,” said Dr Soteriou.

And so the HIO should carefully assess the GHS itself, because people are not happy and are having to resort to the private sector, he said.

"The existence of a private sector, a healthy private sector, also offers a measure of comparison to upgrade the rest of the hospitals. Therefore, the existence of a quality private sector should be welcomed and we should encourage it, instead of discouraging it," Dr Soteriou clearly emphasised.

American Medical Center’s plans for the future

Asked what the next steps are for the American Medical Center following the CPC’s approval of the 50% acquisition by HHG, whether further investments should be expected, the doctor said that “there will definitely be investments in the hospital, depending on its needs”.

The plans to develop and expand the hospital have existed for years, he added, and have been submitted to the authorities for approval – which is still pending.

“When we receive the approvals we will proceed with our plans,” said Dr Soteriou.

Regarding AMC’s facilities in Nicosia, Dr Soteriou said that several multi-purpose buildings will be erected, which will be connected to the rest of the buildings with flyovers and underground corridors for unhindered patient access. The new facilities will be equipped with state-of-the-art technologies and the most modern medical and therapeutic services will be provided.

And as the doctor pointed out, AMC Limassol is currently under construction, aiming to become a reference point in the local healthcare system. This new model private hospital will operate on the basis of the most modern international standards and will become one of the largest and most advanced private hospitals in the wider region, Dr Soteriou concluded.