MedLife

Environmental & Social Review Summary

This Environmental and Social Review Summary is prepared and distributed in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board of Director’s decision. Board dates are estimates only.
Any documentation which is attached to this Environmental and Social Review Summary has been prepared by the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content.

Project number	25069
Country	Romania
Sector	Health Care
Department	Health and Education
Company name	MedLife SA
Environmental category	B
Status	Active

Date ESRS disclosed	August 7, 2006

Previous Events	Invested: November 13, 2006 Signed: October 16, 2006 Approved: October 13, 2006

View Summary of Proposed Investment (SPI), click here

Overview

Category & Applicable Standards

Key Issues & Mitigation

Community Engagements

Client's Documentation

Overview of IFC's scope of review

IFC’s review of this project involved analyzing project documentation provided by MedLife as well as a site visit to MedLife’s medical facilities in Bucharest, including the hospital which is currently under construction. Meetings were held with company management in Bucharest including the General Manager, Medical Director, Human Resource Director, and MedLife’s project architect.

Project description

MedLife is a successful private healthcare provider owned by a family of physicians and bankers and headquartered in Bucharest. The company currently offers a wide range of medical care services through its 11 medical clinics in Bucharest and Ploiesti. MedLife also operates 3 medical laboratories in Bucharest as well as one of the largest private medical facilities in Romania, Hyperclinica. MedLife is currently building a 100 bed hospital adjacent to Hyperclinica, with the new hospital to be opened by November 2006.

The IFC financing will allow MedLife to expand their high quality medical services to other areas of Romania and include new 40 to 50 bed hospital/clinic combinations (as in Bucharest) opening in Constanta, Timisoara, Brasov, Iasi, and Cluj over the next 2 to 3 years. All the sites for these developments have been purchased and these will all be greenfield developments (except the clinic in Timisoara which will be in a renovated building). The buildings, medical facilities, equipment, medical care and support have been established to meet both Romanian and international standards.

Key environmental and social issues and mitigation

The client has presented plans to address any impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements of Romania as well as the IFC environmental and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the managers of the project is summarized in the paragraphs that follow:

The existing and proposed new medical facilities of MedLife pose only a very limited impact on the environment and the neighboring communities. Medical facilities in Romania located in urban areas are permitted by the Government as follows:

- Planning Permission from the Municipality which includes approval on details such a use of natural gas and electricity, fire protection, police, traffic flow and impact, and sanitary conditions (e.g. water supply, wastewater discharge, and handling and disposal of garbage and red bag wastes);

- Planning Permission and finalization of the project design allows the Municipality to issue the final authorization to build (together with the necessary environment permits);

- during construction inspections are carried out regularly by the Government authorities, the main contractor, and the owners representative;

- once the building is completed satisfactorily, the Municipality issues the Final Authorization (the building can now open to the public); and

- as these are medical facilities, the Government of Romania then provides the necessary authorization for the medical staff and the medical facilities themselves.

The Municipal permits follow specific requirements laid down by the Government of Romania. The existing facilities in Bucharest have all successfully been through this thorough permitting process and the new facilities in Brasov, Constanta, Timisoara, Cluj, and Iasi will also be permitted in the same manner.

MedLife is already operating a number of clinics (including the large Hyperclinica), medical laboratories, and is building a 100 bed hospital. As a result MedLife already has in place a strong management team and has developed and is implementing policies and procedures to ensure the medical services they provide comply with Romanian and international standards. MedLife’s General Manager provides strong leadership and commitment to high quality throughout the organization. MedLife already has in place the necessary management plans and programs as well as the organization and teams of well qualified professionals to ensure a quality product which complies with international, Romanian and IFC standards.

MedLife intends to hire a new engineer to supervise each construction project and this engineer will assist in the facilities operation once the construction is complete. The engineer will report to the General Manager (GM) during construction and the facilities GM, once operations begin. MedLife will use the same architect (Redin Abduraman of OMBA) and the same construction company for all their construction activities. As observed during the site visit, the standard of OHS on the construction site is good. Based on the requirements of the local permitting process, it is anticipated that this project with MedLife will comply with both Romanian and IFC environment, health and safety, and social requirements.

MedLife places a very high priority on hiring, training and retaining of high quality staff. The company’s operations are fully consistent with the new Romanian Labor Code and the Government inspects their operations regularly. MedLife has a detailed Human Resource policy that is provided to all employees when they begin employment. Salaries and benefits are excellent by the standards in Bucharest. The Board of MedLife approves staffing levels and job descriptions are prepared for new positions and advertised both externally and internally, a process that is both open and transparent. New employees attend 2 weeks of induction and job training. Employees have a collective agreement and individual employment contracts which are registered with the Government’s Department of Labor.

The company has established a grievance mechanism which is a requirement of the new Labor Code. MedLife has a labor committee made up of members from each department, voted/selected by the employees from that department. Each year the labor committee negotiates a new collective agreement with management. The company places a very high priority on internal and external training to maintain and improve their standards. MedLife prides itself on being an excellent place to work.

MedLife does have detailed occupational health and safety procedures in place. An independent company certified by the Government (Labor Department) has been retained by MedLife to identify work place risks, provide necessary staff training, and to monitor performance. Accidents are reported and necessary actions taken to address any problems. Buildings have all the required smoke and fire detection equipment with either fire extinguishers or, in the larger facilities, hose and reel fire fighting systems. MedLife has agreed to add sprinklers to their new Bucharest Hospital (under construction) as well as to all new clinics and hospitals. This is consistent with the requirements in IFC’s Life and Fire Safety Guidelines.

Raw water to the clinics and new hospital in Bucahrest is provided by the Municipality with MedLife then providing necessary additional water treatment prior to distribution to the medical facilities. Wastewater is discharged to the Bucharest city industrial wastewater sewer for treatment prior to discharge to the environment. MedLife has a very detailed procedure for handling wastes. Red bag waste is collected by MedLife staff and stored onsite. Licensed contractors collect this red bag waste every day for transport to a Government licensed incinerator for disposal. In addition laboratory and radiological wastes are also collected regularly by Government licensed contractors for proper treatment and disposal. Garbage is also collected every day by a licensed contractor and taken to a licensed landfill for disposal. The Government and City officials regularly inspect these systems to ensure they comply with Ministry of Environment requirements. Natural gas is used in the boilers. MedLife wishes to be as resource efficient as possible and has embarked on energy and water efficiency programs. MedLife plans to use a similar approach to water, wastewater, waste management and disposal, and resource efficiency at their new facilities elsewhere in Romania.

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