It has been in the interests of the communities we serve and ensures the sustainability of our ministry. To be a leader in the Australian health care sector in the modern environment, health care providers are becoming increasingly specialised and must have scalability.
The desire to develop scalability in order to be sustainable has been one of the guiding forces for our strategic decisions. Underpinning this is the desire, as a Catholic provider of health care, to respond to the needs of our communities, patients, clients and caregivers.
In 2015/16 we experienced one of our biggest years of growth yet.
Growth and response to community need
In November 2015 St John of God Health Care opened the new St John of God Midland Public and Private Hospitals in a public private partnership with the State Government of Western Australia.
The hospital commissioning and orientation of about 1,300 caregivers were among the most significant achievements of 2015/16, with the $340 million 307-bed public hospital and co-located $70 million 60-bed private hospital being opened on time and on budget.
For St John of God Health Care, the hospitals represent significant investment of more than $100 million of our funds, and signal our commitment to growing our involvement in public health care.
The Western Australian State Government has shown foresight and prudence in looking to the private sector to help deliver public health care more efficiently to the taxpayer and we value the trust placed in us as the selected operator of the hospital.
I would like to thank the staff at the Department of Health WA, the North Metropolitan Health Service and those from Swan District Hospital with whom we have worked so closely to deliver this wonderful hospital, and I look forward to our continued partnerships.
St John of God Health Care also entered into a public private partnership with the New South Wales government in 2015 to manage Hawkesbury District Health Service, a 131-bed hospital with associated health care services located in outer Sydney previously managed for 18 years by Catholic Healthcare Limited (CHL). I thank CHL for working with us to ensure a smooth and seamless transition of services.
To remain sustainable, we must respond to the changing environment in which we operate. In 2016, after significant discernment, we announced our intention to sell our pathology operations to Australian Clinical Laboratories (Clinical Labs).
Clinical Labs has the scalability to offer our pathology caregivers the best prospects for a long-term future and, importantly, the sale ensures Clinical Labs is of a size to be a credible third competitor in pathology service provision in Australia, which is vitally in the best interests of the community.
St John of God Health Care has a long-term contract with Clinical Labs to provide pathology services to our hospitals and, innovatively, we have taken a minority equity stake in the organisation as part of the sale. I will join the Clinical Labs board after sale completion.
Our revenue in 2015/16 was up by 20.8%, well above the 9.5% average growth of the prior four years, primarily due to the commissioning of St John of God Midland Public and Private Hospitals and the acquisition and integration of Hawkesbury District Health Service.
Despite total revenue increasing by 20.8%, our EBITDA dropped by 2.8%. This reflects the significant commissioning costs for our new Midland hospitals ($12.3 million) and operating losses at St John of God Midland Public Hospital during its first seven months of operation ($5.3 million) while we experienced the inevitable teething issues of opening and operating a new hospital.
Excluding our investment in our new Midland hospitals, EBITDA increased by 10.3% during 2015/16 to $133.3 million.
We also increased our investment in social justice initiatives by $2 million, in Mission and pastoral services by $1.4 million consistent with our role as a ministry of the Catholic Church, and in research by $1 million as we focus on increasing our clinical expertise.
Activity was strong in 2015/16. Total patient separations were 12.3% higher year on year than 2014/15 with overnight patients up 16.5% and day patients up 9.6%. Again, St John of God Midland Public and Private Hospitals and Hawkesbury District Health Service accounted for most of the growth. Excluding these new divisions, overnight patients were up 3.2% (higher than long term average) and day patients up 3.6% (lower than long term average). We delivered more than 12,000 babies in 2015/16.
In 2015/16 we grew our caregiver head count by more than 25% mainly due to St John of God Midland Public and Private Hospitals opening and Hawkesbury District Health Service becoming part of the group.
The addition of large numbers of extra caregivers required detailed workforce planning and training. In addition, cultural alignment activities were undertaken to induct staff from Hawkesbury District Health Service and Swan District Hospital, as well as new caregivers at the Midland hospitals, and to provide hospitable, inclusive and welcoming environments that would allow our people to focus on patients and clients.
Occupational health and safety and improving safety at work were a major focus in 2015/16.
Our lost time injury frequency rate was 7.75 at the end of 2015/16 compared to 7.97 at the end of 2014/15. While we recognise we are not yet best practice, we are delighted that 11 of our hospitals improved their performance during the year.
Pleasingly, several hospitals had zero lost time injuries in 2015/16, and our overall positive downward trend from April to June 2016 bodes well for improvement in 2016/17.
Changes to Group Management Committee
In 2015/16 I was delighted to welcome Cynthia Dowell to our Group Management Committee as the Group Director Nursing.
I also look forward to welcoming Marcelle Mogg, who will commence in the position of Group Director Mission Integration in the first half of 2016/17 and I thank Cathy Scott who has acted in the role of Group Director Mission for the past 16 months.
Ensuring St John of God Midland Public Hospital is operating effectively and optimally is a major focus for 2016/17.
We will also work closely with New South Wales Health with a view to becoming a long-term operator of Hawkesbury District Health Service and expanding and growing the hospital’s services.
We are aiming to complete the sale of our pathology division in the first half of 2016/17 and will work closely with Clinical Labs to transition these services smoothly and to ensure patients continue to receive access to high quality diagnostic services.
St John of God Health Care is also investing substantially in technology, which is of growing importance in the delivery of modern health care.
As part of our digital strategy, we are preparing for the introduction of a group-wide Clinical Information System and will launch a new St John of God Health Care website that has greater focus on the consumer and improved patient/customer experience.
We have a goal of zero harm for our caregivers and will focus on improving our occupational health and safety performance to benchmark levels.
Patient safety and quality are our highest priority and we are working on a number of initiatives towards eliminating preventable harm. These include governance, technology, education and training, and enhanced performance monitoring.
As a Catholic organisation, having the right internal culture is fundamental. We will commence the implementation of the recommendations from the Mission Management Model review to ensure we remain faithful to our Mission to provide person-centred, compassionate care.
It is with great pride that I look back over the past year, and I would like to thank my Group Management Committee and all the caregivers, doctors, allied health practitioners, volunteers, donors and consumer representatives who make up our community and continue to provide outstanding care to our patients and clients.