A hospital in Sydney’s Northern Beaches will become completely publicly owned, after an audit uncovered “systemic issues” leading to the death of a two-year-old boy in 2024.
The NSW Government will assume full control of the Northern Beaches Hospital, ending its existing public–private partnership.
Health Minister Ryan Park said: “This agreement does not mark the end – but the beginning – of the transition of a major hospital into the public health system.”
Hospital
The Northern Beaches Hospital, built in 2018, operates under a shared-ownership model established by the former NSW Coalition Government.
Health company Healthscope was contracted to manage the hospital until 2038. However, in 2023, it made two requests to end the contract early and transfer full ownership to the state, citing “insufficient funding”.
Healthscope is currently in receivership, meaning creditors have taken control of its assets and will sell them to repay debts.
The hospital’s operations came under scrutiny late last year after two-year-old Joe Massa died while waiting for emergency care.
An independent audit, which handed down its findings earlier this year, found “safety and quality issues” in the hospital’s hybrid public-private model had hindered its ability to provide adequate health services.
The audit cited “tension between commercial imperatives and clinical outcomes” and said the hospital had failed to take “sufficient actions to address some identified clinical safety risks.”
The deal
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The hospital will be transferred to full public ownership by the middle of next year.
Under the agreement, the NSW Government will pay $190 million to Healthscope’s creditors, assume responsibility for all 500 hospital beds, and oversee a workforce transition for current employees.
The Government said negotiations will continue to finalise the remaining “legal and commercial arrangements” that are yet to be transferred.
Health Minister Ryan Park described the transfer as “complex”.
The move has been welcomed by the state’s peak doctors’ union, which has campaigned against the public–private model.
Australian Salaried Medical Officers Federation President Dr Nicholas Spooner said he hopes full public control will mean the hospital “prioritises patient care [and] values its workforce.”
Opposition
The Opposition, which established the original deal in 2014, said it will support the Government in executing a “smooth and safe transition” of the hospital to full public control.
It acknowledged the concerns raised by doctors, peak health advocacy groups, and Massa’s parents about the previous model.
However, it warned the Government to ensure access to private care is not “diminished” under the new arrangement.
