• Financial year 2021 again gripped by COVID-19 pandemic
• Targets met – consolidated profit and revenues increase
• Letter of Intent for enhancing separate accounting agreement signed
• CEO Höftberger: Reform of healthcare planning and financing in German hospital market indispensible

For RHÖN-KLINIKUM AG, financial year 2021 was also marked by the COVID-19 pandemic and a big test of its strength and resilience. Despite these challenges as well as the decline in reimbursements from the legislator in connection with COVID-19 legislation, the Company witnessed a positive business performance compared with the previous year.

In financial year 2021, revenues grew by 3.1 per cent to reach 1.4 billion. EBITDA gained 26.1 per cent to reach 101.2 million, well above the previous year’s level. The trend in revenues and EBITDA was thus in line with the forecast. Consolidated profit increased by roughly 27.7 million euros to reach 30.2 million euros. At the five hospital sites RHÖN-KLINIKUM Campus Bad Neustadt, Klinikum Frankfurt (Oder), the Giessen and Marburg University Hospitals (UKGM) and Zentralklinik Bad Berka, as well as at our medical care centres (MVZs), we treated a total of 845,642 patients, a gain of 4.6 per cent compared with the previous year. As at 31 December 2021, the Company employed 18,227 persons.

We continue to see some of the most pressing tasks of the Company in the following areas of action: strengthening nursing and medical care, ensuring that hospitals concentrate on their core activities, further optimising processes as well as pooling know-how e.g. at the (in some cases newly established) service companies providing in-house services. Moreover, we are continuing our efforts to press ahead with digitalisation to further reduce the workload on staff, standardise structures and clinical processes and thus ultimately further improve the quality of healthcare for the patients treated.

Letter of Intent for enhancing separate accounting agreement signed

At the beginning of this year, RHÖN-KLINIKUM AG reached an agreement in principle with the Hesse State Government, Universitätsklinikum Gießen und Marburg (UKGM) and Asklepios Kliniken GmbH & Co. KGaA on a Letter of Intent regarding the future financing of investments for the university hospitals.

For the period of 2022 to 2031 the Federal State of Hesse expressed the prospect of funding investment costs in the total amount of nearly half a billion euros. For the ten-year period of the agreement UKGM in return is expected, among other things, to guarantee that it will refrain from redundancies and from outsourcing business units. Provided the parties succeed in agreeing the final terms, a binding contractual agreement is expected to be concluded in the second quarter of 2022.

Dr. Christian Höftberger, Chairman of the Board of Management of RHÖN-KLINIKUM AG, stated: “We were always open to a pragmatic solution if it effectively helps UKGM. That’s why we are prepared to make concessions. UKGM is entitled to reasonable investment funding in line with the dual financing principle enshrined in German hospital financing legislation, under which hospitals’ operating costs are borne by the health insurance funds and their investment costs by the federal states. Especially now in times of political and economic uncertainty amid a quickly changing healthcare system, the most important task of all stakeholders is to support UKGM in fulfilling its duties in research, teaching and healthcare provision.”

Reforms in healthcare system indispensible

As the operator of several systemically relevant hospitals, RHÖN-KLINIKUM AG also considers it essential to call on federal politicians to undertake an all-encompassing reform of healthcare planning and funding. The rules currently in force are characterised among other things by obstacles and barriers between the outpatient and inpatient sectors which are now outdated and obsolete. These barriers must be overcome – also with the help of digital offerings. Moreover, they fail to adequately reflect the cost structures of the intermediate- and maximum-care providers and in particular university medicine in the system of diagnosis-related groups (DRGs). The reform announced by the traffic light coalition partners must be clarified promptly with the involvement of representatives of service providers and then implemented without any further delays.

In light of the imponderables due to the pandemic but also the challenging financial situation, RHÖNKLINIKUM AG is urgently calling for hospitals to be provided with tangible relief from bureaucratic red tape and better financial support through investment grants from the federal states.

“In Germany we have an outstanding hospital system. To make sure it stays that way, the federal states must better fulfil their statutory responsibility to assume investment costs – in the interests of healthcare workers and patients alike” Höftberger said.

RHÖN-KLINIKUM AG providing humanitarian aid for Ukraine

“We are watching the military conflict in Ukraine with great concern and dismay, and continue to hope for a quick end to the war”, Höftberger said. To help the distressed people of Ukraine, RHÖN-KLINIKUM AG immediately pledged its assistance in caring for war refugees and injured people from the conflict areas. The first Ukrainian patients are already being treated at our hospitals. Moreover, the Company is making available accommodations in vacant properties of the Group to those fleeing the conflict and is helping doctors, hospitals and the general population in Ukraine with medicines, medical supplies and donations in kind.

Outlook for 2022

For the current financial year, we expect revenues of 1.4 billion euros within a range of plus or minus 5 per cent. For earnings before interest, tax and depreciation/amortisation (EBITDA), we expect a level of between 92 million euros and 102 million euros.

The outlook is subject to considerable uncertainties in connection with the further course of the COVID-19 pandemic and any regulatory measures impacting our remuneration structure in 2022.