Business Irish

Monday 25 September 2017

Affidea Ireland boss finds the treatment to get private operation back to health

Tom Finn, a medical veteran of the real ER, is relishing leading rapid expansion of the healthcare scan giant in the fast-moving private sector, writes John Mulligan

Tom Finn, CEO of Affidea Ireland, says the HSE ‘needs leadership’ if it is to change to better serve the needs of the people
Tom Finn, CEO of Affidea Ireland, says the HSE ‘needs leadership’ if it is to change to better serve the needs of the people

When he worked at the HSE, Tom Finn was quickly given a new moniker by unions and others: The Minister for Outsourcing.

In 2007, as the assistant national director of the HSE's hospitals office, Finn arranged for tens of thousands of smear tests to be despatched to a private clinic in the United States to be analysed in order to clear a huge backlog at home. The decision became the subject of months of public debate and opposition.

Having worked for years in America, Finn had returned to Ireland in 2002, subsequently working in various posts with the health service here.

"I realised very quickly that things don't happen at a very fast pace," he says. "I found it quite frustrating.

"It was very easy to be offside if you tried to make a fundamental difference in bettering the service for patients," he says .

"I sent 60,000 smears to America to be tested. I was ridiculed by the former minister, by all sorts of people. The people who mattered to me - the patients and the GPs - didn't complain. I said as long as that's the reality, then I know I'm doing the right thing."

That system is still in place.

As chief executive of the Irish arm of healthcare provider Affidea, Finn now finds himself in a position that would be envied by any public servant who actually likes to get things done.

Affidea has 10 clinics in Ireland, with equipment such as magnetic resonance imaging (MRI) and computed tomography (CT) scanners, and now includes the HSE among its clients.

Affidea - which has almost 160 clinics across 15 European countries - is now controlled by the billionaire Italian-Swiss Bertarelli family. It was previously known as Euromedic (the company's name was changed over the past 18 months to Affidea).

The firm has 10 centres in Ireland, as well as two units attached to hospitals, in Sligo and Belfast. Its outpatients are a mix of HSE patients and GP referrals, and of those with health insurance and those on medical cards.

Its diagnostic equipment is more advanced than anything you'll find in a hospital. Affidea is, for example, the single biggest customer for MRI scanners in the world, and upgrades its technology frequently.

"Over the past couple of years we've spent probably €15m on new centres, remodelling centres and replacing equipment (in Ireland)," says Finn after giving a tour of Affidea's facility in north Dublin, where maximising the use of equipment and return on investment is key. "We have quite an aggressive expansion plan for the remainder of this year and into next year."

In the north Dublin clinic, the spacious waiting area has that calm, hushed air of any medical facility. The TV does little to distract from the underlying thought process: patients are there hoping there's nothing seriously wrong with them.

The MRI control room wouldn't look out of place in a sci-fi film, but it's still one of those places you hope you'll never end up in.

Still though, Affidea is trying to make the whole process as quick and as pleasant as it can be.

The company has just opened a new €3.6m centre in Tallaght, south Dublin, while a €2.7m clinic in Waterford also opened recently.

"For the rest of this year and into 2018, we're looking at new centres in Limerick and Galway, and probably one in Scotland, which will be run out of our Belfast office," says Finn (54), who grew up on a farm in his native St Mullins, in Co Carlow and fell into nursing after a brief stint selling sheep at a market after leaving school.

Affidea evolved from the Euromedic chain of clinics that had expanded rapidly across Europe. In Ireland, the company undertook a number of acquisitions during the boom that left the Irish business debt-laden.

Finn says that there was a subsequent "race to the bottom" by private clinics on MRI pricing, partly led by Euromedic.

"The cost of an MRI went from €650 to €100 at one point," he says. "It was completely unsustainable." Prices in Dublin now are about €245, he adds (Affidea Ireland performed 160,000 scans last year, including MRIs).

In 2015, the company generated a gross profit of €8m, but a pre-tax loss of €3m. Its accumulated loss at the time was €42.4m.

"When I took over, the company was in quite a difficult place at the time," says Finn, who admits that there had been some thoughts on whether it might have been wiser to shut the operation down. He took over as chief executive of Affidea Ireland in 2015.

"Yeah, when you look back through the numbers, why wouldn't you think that? It seemed like a logical thing," he says. But a strategy devised by the group's executive committee saw a growth opportunity.

"We're making money now," says Finn, adding that turnover this year will hit about €22m (compared to just over €19m in 2016) and that the Irish arm, which employs about 300 people, will be substantially Ebitda (earnings before interest, tax, depreciation and amortisation) positive.

"The key this year was to be ahead of our operational plan. It's taken a while to get to that point."

Finn adds that Affidea's plan is to become a €1bn company by 2025.

Its growth plans in Ireland will see it spend about €25m over the next two to three years, he says. That will include opening clinics in Galway and Limerick.

But smaller clinics, with less of the big-ticket equipment found in big city locations, are also being targeted for some other towns.

It's all a world away from the glacial mechanics of the HSE.

Finn had left Ireland for Los Angeles in 1991. He worked as a nurse and night manager in the emergency room in the Inglewood neighbourhood of the city, getting the kind of grounding only otherwise available in a war zone.

The hospital was "chaos", he says. "All the research for the TV show ER was done with us."

"It was a really interesting place," he says. "You go into work and we had two armed guards with German shepherds inside the door. You feel like you're constantly living in a movie."

But Finn had more than working in an emergency room on his mind. He completed further studies and within a decade had moved into executive roles within the private healthcare arena in the States.

Home beckoned, though. He returned in 2002, and in between a couple of sabbaticals, worked in a number of roles in the Irish health service. He was assistant national director of the HSE's acute hospitals commercial unit, as well as a director of the child and family agency, Tusla.

But he ultimately found the health service a frustrating place to work.

"I came back from America after being in a service where everything was done the day a decision was made, to a system where it took a lot of time to do things," he says.

Despite the entrenched practices at the HSE, be firmly believes it can change.

"It obviously can, but it needs leadership, and the desire to change," he says. "We've had several versions of the health service since 2002. There were structures created that can never work, no matter how you do it.

"You have to have the courage to make the right decision," he adds.

A fundamental difference between Affidea is how it optimises use of its equipment. Its MRI scanners, for instance, are operated from 7am to 8pm every day and on many days operate to midnight.

Finn accepts that MRI scanners in hospitals often cater for more acute cases, with patients who may be hooked up to other equipment, for example, that makes the whole MRI scanning process longer.

"If you ask why we're doing four MRIs in an hour when a hospital might just do one, it's essentially because of the acuity of the hospital," he says. "We take care of the 80pc of people who don't need to be in hospital who consume about 20pc of the resources, and hospitals do the opposite, which is appropriate."

Typically, hospital machines will work one shift a day, he points out.

"I always had this debate when I was in the hospital. If someone says in a hospital that the MRI scanner is at capacity, well it's working eight hours a day - it's not at capacity. It's a very different cultural environment."

Half the patients who come through Affidea's doors are paying for this service themselves. Half are insured.

"We're contributing significantly on a daily basis to the overall access to healthcare," according to Finn.

"We're in the business of making profit. But there's no way that any public hospital can do what we do at the cost we can do it at. Why not then avail of that for patients?

"The entire diagnostic waiting list could be cleared for a very small amount of money."

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