Hobart Clinic Secures Funding to Stay Open for Six Months

A Temporary Reprieve for Hobart Clinic

Southern Tasmania's last remaining private mental health hospital, the Hobart Clinic, has received a reprieve as the state government announced $2 million in transitional funding to keep its doors open for at least six months. This decision comes after the clinic was set to close on Friday, with only four patients remaining.

The 27-bed facility has been serving the community for four decades. The funding will allow the clinic to continue operating while it reassesses its business model and determines whether it can remain viable without government support. After the six-month period, the clinic must demonstrate that it can operate independently, as no further funding will be available.

The announcement followed an emergency meeting held in the office of Health Minister Bridget Archer. Representatives from the clinic’s board, the three members of the non-profit company, and proponents of a rescue bid led by former clinical director Hannah Lake were present. The rescue effort was highlighted by the ABC, showcasing the urgency of the situation.

Public System Struggles to Cope

Dr. Lake, who previously served as the clinic’s clinical director, emphasized the challenges faced by private psychiatric services in southern Tasmania. She noted that before the closure of St Helen’s Private Hospital two years ago, there were 66 inpatient beds in the private system compared to 99 in the public system.

"It's very clear that the public system cannot absorb that number of patients and cannot cater to that amount of need," Dr. Lake stated. Her group, supported by psychiatrists, nurses, and other professionals, is working to preserve private psychiatric services in the region.

Minister Bridget Archer confirmed that the one-off grant, administered by the Department of State Growth, comes with conditions to ensure service quality. She stressed that the health and safety of patients and staff remain a top priority.

"I have communicated this to The Hobart Clinic chair today and look forward to their prompt agreement, which will enable a deed to be finalised as soon as possible," Ms. Archer said. The government also plans to work with other private providers to meet the mental health needs of Tasmanians in the future.

A New Governance Structure

Graeme Lynch, the chair of the clinic, wrote to the minister on Friday in support of the rescue bid. Although the letter has not been publicly released, it is understood to include an agreement for a new board of directors to oversee the clinic’s governance. This new board may include Dr. Rob Walters, a local GP who previously worked for the clinic.

Minister Archer made it clear that the transitional funding is conditional on the proposed governance arrangements. This move aims to ensure stability and accountability within the clinic.

Political Reactions

Labor health spokesperson Sarah Lovell welcomed the news, calling it "a huge win for the workforce, the clinicians and patients of the facility who didn't give up and pushed the minister to finally take action." However, she criticized the government for making the process difficult.

On Tuesday, Robbie Moore, state secretary of the health services union HACSU, delivered a 3,500-signature petition to Ms. Archer’s office, urging her to provide stop-gap funding to keep the clinic open.

Exploring Long-Term Options

Dr. Lake, who worked at the clinic from 2017 and became clinical director in 2021, resigned in late 2023, leading to a mass walkout of psychiatrists. Her group attributed the clinic’s predicament to governance and management issues. They have requested up to $2 million in immediate bridge funding to cover six months of operations and $400,000 for a feasibility study to create a sustainable business model.

Long-term options being explored include selling the clinic’s seven acres of land at Rokeby and relocating the facility to redeveloped premises at the site of the former St Helens Private Hospital in Macquarie Street.

Financial Overview

The Hobart Clinic is a private non-profit company limited by guarantee, with three members acting as shareholders: Rural Alive and Well, Mental Health Lived Experience Tasmania, and Home Base. These three entities were represented at the emergency meeting.

Recent financial reports for the 2023-24 financial year show that the clinic achieved a small profit of $473,280 and had net assets of nearly $6 million. This suggests that, despite challenges, the clinic has a solid financial foundation to build upon.