Private health sector expands rapidly as people remain dissatisfied with the national system

Over the past decade, the private health sector has been expanding its business and last year was probably the best in this expansion cycle. A series of merger and acquisitions made the sector a vital one on the Athens Stock Exchange, reflecting its real prospects for expansion, as Greeks are skeptical of the level of services offered by the National Health System. There are about 200 private clinics in Greece with a capacity of over 15,000 beds. The medical staff employed in these clinics reaches 24,000, or 40 percent of Greece’s total. Since 1997, turnover for private clinics has more than doubled, exceeding -1.3 billion last year. Turnover is expected to rise from 12 to 14 percent this year. This stands in stark contrast with the 1980s when the ruling Socialist government government, desiring to expand the newly set-up National Health System, passed a law in 1983 forbidding the issuing of new licenses for private clinics or the expansion of existing ones. As a result, the number of private clinics declined from 391 in 1983 to 224 in 1993. The conservative government that came to power in 1990 again allowed licensing for private clinics or independent diagnostic units within clinics in 1991, allowing the private sector to invest, once again, in new technologies and to corner the disease diagnosis market. New technologies and investment, along with medical advances, have reduced the average hospitalization from 9.9 days in 1990 to 8.4 in 2000, while private clinics’ average capacity utilization rose from 66 percent in 1995 to 78 percent in 2000. An average family spent about 7.15 percent of its income on private healthcare in 2005, slightly up from 1999 (6.82 percent). A survey by market research firm ICAP shows that families living in Athens are somewhat less likely to use private health facilities than people living in the rest of the country (6.92 percent to 8.28 percent). This despite the fact that, according to Ministry of Health data for 2004, Athens accounted for more than half the capacity of private clinics in Greece (8,318 beds out of a total of 15,068). Most private clinics are general clinics, that is, offering most or all medical specialties. However, 19 percent are psychiatric hospitals. Expanding market The private health sector will continue to expand in the near future. For this year alone, general clinics’ turnover will rise 12-14 percent, private maternity clinics’ turnover 7-8 percent and private diagnostic units’ turnover about 5 percent. Hot prospects for the future include genetic and artificial insemination centers, children’s hospitals and rehabilitation centers. Cosmetic surgery clinics are also expected to expand fast. Since 1997, general clinics; turnover has expanded at an annual rate of 15.2 percent, reaching -826.4 million in 2005 from -265.6 million in 1997. During the same period, maternity clinics’ turnover rose from -88.6 million to -203.3 million, with an average annual growth of 10.9 percent. In 2005, two new maternity clinics, Genesis SA and Genesis Athens, were founded. Diagnostic centers’ turnover was -291.3 million in 2005, up from -153.8 million in 1997. Almost 70 percent of those who use them are insured in public sector pension funds.