Samitivej hospital defers Bt1-bn plan

Samitivej Hospital has delayed its three-year Bt1-billion investment plan (2009-2011) because of the economic crisis.

"We decide to freeze all major investment plans and wait for an economic recovery," managing director and CEO Raymond Chong said.

He said the company, in the third quarter of last year, had planned to allocate roughly Bt1 billion to improve its medical services at its three hospitals - Samitivej Sukhumvit, Samitivej Srinakarin and Samitivej Sriracha. But the plan was deferred after the US economic meltdown spread to other countries, including Thailand.

The Bt1-billion investment budget was formerly set to improve the dental and eye departments at Samitivej Sukhumvit and expanding those divisions. There were also plans to provide more medical technology to Samitivej Srinakarin as that hospital had been the top performer with a 20-per-cent increase in revenue in 2008 compared with the other two hospitals of the Samitivej group.

The budget also included a provision to build the second building at Samitivej Sri Racha. At present, occupancy rate of that hospital is 80 per cent, said Chong.

The main reason for delaying the investment plan, he said, was that the hospital this year has decided to maintain last year's medical treatment fees.

In addition, it has started a 30-per-cent discount campaign for patient rooms to celebrate its 30th anniversary this year. The discount will run from now until the end of June this year.

"Although medical inflation is expected to increase by 4 per cent this year, we decided to absorb the increasing costs and extend our policy not to adjust medical treatment fee for another year. We want to draw more patients to Samitivej. We have to also maintain our medical treatment standard at the same time. So we have to save more cash and focus on only medical services instead of business expansion," he said.

Samitivej has also cut its Bt500-million budget for the connected-hospital programme, which was aimed at improving the IT system at Samitivej Sukhumvit. It will now spend only 30 per cent of the total budget this year, he added.

Chong said the company would revise its investment plan and the connected hospitals programme in this year's third quarter.

However, the hospital would spend only 2-3 per cent of its total revenue on improving staff capability, information-technology system and replacing some medical instruments, said he.

Samitivej expected revenue growth of 15-16 per cent last year compared to 2007, and is targeting revenue growth of 8-10 per cent for this year.