The Sisters of Mercy have decided to close St Michael's Private Hospital in Dun Laoghaire and put some or all of the premises up for sale. This will not affect the operation of the public hospital on the same site.
The congregation said in a statement that the financial position of the private hospital was not sustainable, and it was at "a distinct competitive disadvantage in relation to other similar facilities." The Blackrock Clinic and St Vincent's Private Hospital are both in south Dublin.
A spokesman for the order said its first commitment was to public medicine, and it could not afford to run the private hospital at a loss.
The closure costs will run to about £4 million, a substantial part of which will go towards redundancy payments and pension provision for staff. "We are committed to just and appropriate provision for all in terms of redundancy and pension arrangements," the order said in a statement.
The hospital has 80 beds, currently with 50 per cent occupancy. There are between 90 and 100 staff, ranging from medical to administrative and service workers.
The building is part of a complex which includes the public voluntary hospital and the convent. There are no specific plans at the moment for how it will be disposed of but, according to the statement, "the use or sale of the premises for private medicine has been excluded."
The congregation will now appoint a project manager who will examine all the options for the premises. The closure will be gradual, to ensure the minimum disruption to patients, but the sale will take place this year, according to the spokesman.
"As Mercy Sisters we are committed to our ministry responsibilities in public medicine," the statement concluded. It is understood one of the options will be the taking over of the building by the public health sector.
The Labour Party health spokeswoman, Ms Liz McManus TD, called on the Minister for Health, Mr Cowen, to ensure that the private hospital is kept as a south Dublin health facility.
But a spokeswoman for the Eastern Health Board, in whose area Dun Laoghaire is, said it was not possible to say whether the board needed such facilities or would be in a position to buy them.