28 May 2013

Private health group's shares, profit fall

9:52 am on 28 May 2013

Acurity Health Group says it will continue to operate in a constrained environment with private health insurance continuing to contract.

The company, which was formerly Wakefield Health, reported a 2% fall in profit to $5.9 million in the year to the end of March.

Revenue fell 1% to $79 million, while operating earnings fell 12% to $14.2 million as a result of increased costs for contracting surgeons for ACC and district health board work, and also a substantial increase in insurance premiums.

Acurity Health chairman Alan Isaac says the reduction in underlying earnings reflects continued subdued revenues and patchy demand.

He believes that as the population ages, there will be increased demand for private healthcare. Similarly, he says, the Government will not be able to maintain the level of investment it's currently making in the public system.

He says his company is developing stronger relationships with DHBs and hopes to work more closely with them in the future.

Mr Isaac says the Government should consider providing tax relief to people taking out private healthcare insurance.