Hospital project could hit $1 billion – financing questioned

THE HOSPITAL City project in Ancón  one of  the previous administration’s much lauded flag ship projects could end up costing more than $1 billion while putting the future of the Social Security (CSS)  maternity and professional risk programs are on the danger list for survival.

The financing, of the complex, once named after Ricardo Martinelli, while he was still president,  was outlined in a report by Fifth Anti-Corruption Prosecutor Janeth Rovetto in the investigation of former CSS  Director Guillermo Sáez-Llorens and other former Social Security officials  including  former Minister of Health Javier Diaz, for alleged irregularities in the contract.

The work was initially granted under a turnkey agreement, in which the contractor would arrange the financing, but a change was made after the contract was awarded. That change was to pay for 80 percent of the $517 million project from the maternity program and the remaining 20 percent from the professional risk program.

Current Social Security official Rolando Villalaz said the impact of the project on the agency will be greater due to cost overruns.

“Between equipment, staffing and the inclusion of a cancer treatment program, we could be talking about more than $1 billion,” he said.

So far the government has paid the contractor just under $200 million for the project, which is due to be finished in 2017.

The final cost will have a drastic impact on the finances of the two programs, which have combined reserves of $2.3 billion.

The agency is also struggling with potential deficits in other areas which must be addressed or it will run out of money reports La Prensa.