Hospital will pay ISK 900 million debt ‘at some point’

The total debt of the National Hospital of Iceland, a state-run institution, has risen to ISK 900 million (USD $15.1 million), mostly due to the procurement of medicines and necessary medical equipment.

Most of the purchases were made through the Federation of Icelandic Trade (FÍS) and its associated companies, to which the National Hospital owes a total of ISK 700 million. Andrés Magnússon, the managing director of FÍS seemed unconcerned by the debt’s magnitude but he is demanding the government pay up.

“This is the fourth, if not the fifth time in five years that I’ve sent a notification about this situation [to the government], but not received any direct response. The hospital will probably get the funds to pay its debts at some point, it’s just a question of when and how much,” he said.

Because it is behind on the debt, Magnússon estimates that the National Hospital is paying between ISK 600,000 and 700,000 a day in penalty fees.

“What we are pointing out, and we find peculiar, is that this state institution has to get down on its knees and beg its business partners to find a way to lower the penalty fees on its arrears,” Magnússon said.

Gudlaugur Thór Thórdarson, the Icelandic Health Minister, acknowledged the serious nature of the problem. “It is obvious that it would be more sensible for the National Hospital to take loans from the state than from suppliers. But it is also obvious that short-term solutions are not sufficient to solve a situation like this,” Thórdarson told Morgunbladid.

The minister concluded that the entire way of running the hospital was a current problem and that the country’s health service was one of the most important issues for the new government to handle.