Provita has 180 employees and 200 employees, and the new hospital will have 300 employees in the future. The business of the Provita group reached 51 million lei in 2020, increasing by over 40%, and for 2021 the entrepreneur targets 65-70 million lei.
Provita’s second private hospital is expected to be operational by mid-2022, as the group now invests about 12m euros in the capital for a multidisciplinary unit with 65 beds of continuous specialization, 7 operating rooms and an angiography and radiology room. Dr. Ovidiu Palea, founder of Provita, explained in the show Invest in Romania !, made by ZF in partnership with CEC Bank.
„We expect the new hospital to be operational at this time of year. (…) In two years we want to get closer to 50-60% of the capacity, and I think the maximum capacity will be reached later. We have to be realistic, with the first hospital we reached the maximum capacity after four years „.
The Provita Group currently comprises two medical clinics, two imaging clinics, an analysis laboratory, a hospital and a wellness and recovery center – all located in Bucharest – for which it has about 180 full-time employees, respectively over 200 employees. .
„We are developing new lines of business, such as interventional radiology, and the medical team will grow a lot. This year at this time we expect a 5% increase in staff, but at full capacity the new hospital will have 300 employees alone. From the point of view of the medical teams, I think that they will triple in the next 2 years because it is a completely different circuit and another possibility of development in the new location ”.
The year 2020 was also an atypical one for a player in private medicine, in the context in which the activity resumed more difficult after the lockdown period in the spring, in order to later accelerate.
„Getting into a pandemic was like hitting a wall at full speed. (…) The start of the engines was more difficult in May last year, but then everything started very fast and accelerated, and the two months of lockdown were recovered quickly and we ended the year with a totally unexpected and unpredictable increase with a year before ”.
Thus, the Provita group registered a turnover of about 51 million lei in 2020, increasing by over 40% compared to the previous year. For 2021, the entrepreneur estimates business of 65-70 million lei.
„From a financial point of view, it was an absolutely spectacular year, with great challenges, because even a rapid growth is difficult to manage from the perspective of staff and costs. The need has suddenly increased, and in August last year we hired over 30 people in a single month, so the need for staff was very high. „
Another challenge Provita faced last year came from the wellness and recovery center project opened in Bucharest right during the pandemic.
„Exactly one year ago we were thinking about finishing it and what to do. People were locked in the house, scared, and we had to make instinctive decisions. We decided to finish and open the project. (…) The beginning was disastrous, the second wave came strong, the world was closed in the house and we had a difficult period in autumn-winter. Now we have a boomerang effect, the world is full of people at home, physically and mentally ankylosed, and the recovery center is going spectacularly ”.
Romanian private medicine is cruel
Doctor Ovidiu Palea explained that Romanian private medicine is very harsh, as it is based on the patient’s goodness, unlike the advanced countries where it is covered by medical insurance.
„The medical act is settled by the insurer, the patient pays the insurance, the hospital is paid by the insurer. Things are simple there. Romanian private medicine is cruel because it is based on how much the patient can pay and it is very difficult to use your pocket because we all have money for holidays, cars and others, but when we talk about health it becomes a problem because we pay taxes to the state and we want to be assured ”.
He claims that from a business perspective, the problem comes when you set prices, in the context in which you have to offer services at the same quality as Western Europe, but at a right price.
„The problem is that the private sector has to provide medical services as in Austria, but paid for out of the patient’s pocket. It is difficult to make a fair price in the face of changing technology, it forces you to keep investing, and if you are not efficient in the circuits, in what happens with the initial investment and the patient, it is very difficult to maintain a balance and a fair cash flow ”.
However, the development of private medicine in Romania can reduce the so-called medical tourism, offering in some cases a medical act performed with technologies comparable to those in the countries to which Romanians fly for interventions.
„Our dream is for medical tourism to become history because what is happening now is not a fair mechanism. Medical tourism is inevitable, but it must become an exception. Why? It is very difficult to have the continuity of the medical act if you still need chemotherapy, radiotherapy. It is useless to operate there if you have a complication that happens in the country „.
The guest said that 300-400 people enter the Provita facilities in the Capital every day, and the hospital has reached about 200 operations per month.
„I can say that most of our patients are from the country, not from Bucharest. I don’t think we operate in half of Bucharest. I think that the world has turned more in pandemic to the internal because they have seen that it is possible in our country and that integrated services are offered, because the medical act must be integrated. The continuity of the medical act is a big problem in medical tourism „.
Regarding the opening of a Provita center or hospital in another city in the country, the entrepreneur pointed to the shortage of specialized personnel in the medical sector, from doctors to nurses.
„The big challenge you have as an entrepreneur in this sector comes from two directions: one is financing, to say that here times have changed and there are other levers now, but the major problem is the human factor. (…) We are in a fantastic crisis of any kind of qualified staff, from A to Z, and then it becomes a challenge to maintain the quality of services. There is a need for new clinics in the country. „
The solution for the personnel deficit could come in the short term from the Romanian specialists who have gone abroad, and the private medicine and the salaries in this segment could be the point of attraction.
„I believe that the private sector is the real solution for those who come from abroad. Why? Because when you come up with other mindsets and ideas, it’s hard to go back and work for the state. The private sector is highly developed in Romania compared to all of Eastern Europe and offers solutions for all specialists, whether you are a radiotherapist, cardiac surgeon or neurosurgeon, because the private sector has the technology you need to practice at the same standard as abroad ”.
He pointed out that a Romanian doctor who returns to the country and works privately can obtain similar income „without compromise”.
„It simply came to our notice then. People can make a decent income, much more than what you do at the moment, all in white, without any compromises. And I think that’s what we need to present not only to doctors, but also to nurses. I recently had an interview with a nurse who worked in Italy and does not earn anything more than what is earned in Romania if you know what you are doing and you have value ”.
Ovidiu Palea worked for almost a decade in the United States as an anesthesiologist and intensive care physician, and in 2007 he was in a business with another associate, but he later split.
„The business split and that’s how Provita came about in 2011. We came back from the US in 2007-2008 and in ten years we developed the whole idea of Provita and how to approach patients and colleagues.”
Trained as an anesthesiologist, Ovidiu Palea caught a moment when the US medical technology market exploded and the entrepreneur saw the future of medicine.
„The beginning was in a different direction, after which in 2012 we took over a multidisciplinary outpatient clinic. I have developed a lot in pain therapy, which is a relatively new interventional specialty. The hospital became a reality in 2016, and in 2017 we opened it operationally „.
One of the great challenges of the first hospital was the financing part, even in the context in which the entrepreneur had obtained a grant from European funds.
„We were seen as a startup, and at the time I applied for the European project I was only 4 years old. It was difficult, almost impossible, to finance ourselves. (…) Given that we already had 60% co-financing, we expected it to be easier for us to find solutions, and in the 14th hour we signed a bank loan to be able to make the current hospital. I made it turnkey in eight months, from spades to equipment and furnishings „.
Provita went especially in the niche area, of medicine aimed at some pathologies, in order to differentiate itself in the market.