Private hospital providers’ bid for repayment of acquisition loan interest and budgeted depreciation rejected on appeal

The Court of Appeal dismissed an appeal by private hospital group providers against the High Court's refusal to require a statutory health service to reimburse over €8 million in interest and depreciation charges under a heads of terms agreement stemming from the COVID-19 pandemic. The dispute centred on whether interest costs arising from loans taken out to acquire the hospital business constituted operational costs 'related to the ongoing operation and functioning' of hospital facilities, and whether depreciation should be based on budgeted or actual figures. The Court of Appeal affirmed the High Court's judgment that only interest linked directly to the operational costs of hospital facilities, and not to their acquisition, could be claimed, and that depreciation must be reimbursed by reference to actual, not budgeted, costs. The court also found no error in declining to grant further declarations sought by the appellants regarding expert determination and set-off procedures. The outcome results in the providers being liable to repay sums overpaid and confirmed that the health service is not required to cover acquisition-related debt costs in this context.