A family doctor helpline brought in €520,000 in profit to the private medical concern Confido last year, the year the group was purchased by big businessman Margus Linnamäe.
The Health Insurance Fund (Haigekassa), a state agency responsible for the 1220 line's day-to-day operations, refers to it as a simple and effective way to getting quick medical advice, for instance when a doctor's appointment cannot be made immediately, or when there is not a family doctor's surgery in the vicinity.
The line's ownership raises questions about potential conflicts of interest, given that its advice can include what over-the-counter medications to purchase; one of Linnamäe's major business concerns is the pharmaceutical wholesaler which operates the Apotheka chain.
A hotline delivering pediatrician advice has also been purchased by Linnamäe.
Health Insurance Fund responsible for 1220 line, Confido won tender
As to the question of appropriateness of medicinal product advice being dispensed via a phone line by by a company belonging to Margus Linnamäe's group of firms, a Health Insurance Fund representative mentioned in the organization's June newsletter that the hotline does not recommend medicines from a specific pharmaceutical manufacturer, but only the active ingredients of the required medicine, whoever manufactures it.
The Health Insurance Fund spokesperson, Sander Rajamäe, told ERR that: "As with a dispensing pharmacist, the advice line can also provide information on which drugs are appropriate for the relief or treatment of symptoms which a person experiences, or as a preventative measure for those symptoms which occur more frequently in the summer"
"For example, recommending the active ingredient paracetamol would not constitute a conflict of interest, since there is not just one provider of this, but several. The same principle also applies when giving recommendations on stocking up on plasters, bandages or antiseptic for the summer house medicine cabinet," Rajamäe added.
Rajamäe said that the contract with the tender winner stipulates that the advisory line is engaged in in informing the public, in cooperation with the health insurance fund and other relevant authorities.
Extensive business interests
Margus Linnamäe is the majority owner of MM Grupp OÜ, a holding company operating in Estonia, Latvia, Lithuania and Finland and which owns among other entities, Magnum Medical OÜ, which sells pharmacy goods and medical equipment, and operates the Apotheka drugstore chain.
The group is also the ultimate owner of Semetron, which deals in medical equipment, including field hospitals to Ukraine.
The Postimees Grupp, operator of the daily newspaper of the same name and its regional variants, newswire BNS, radio station Raadio Kuku and TV channel Kanal 2 are among the media concerns owned by the MM Grupp.
The group also operates the Valge Klaar Apple retail chain and the Apollo entertainment group; the latter is related to the franchisee for KFC in Estonia, as well as to the Apollo bookstores.
Confido, also a Linnamäe company, has operated the helpline since before the Covid pandemic, starting in 2019.
Confido paid €1.8 million in 2022 for operating 1220 line
Sander Rajamäe of the Health Insurance Fund said that in 2022 the 1220 line service provider was paid €1.8 million for staffing and servicing the line, including €473,000 additional fee in boosting Covid testing referrals.
For the first half of 2022, the line operator has been paid €622,000 for provision of service, Rajamäe added.
The Confido Healthcare Group reported a 19 percent rise in turnover in the past financial year, to €28.8 million; if extraordinary revenue earned as a result of the pandemic in 2021 and 2022 is excluded, however, core business turnover rose more then two-fold during that time, the company says.
Nonetheless, Confido itself did not turn a profit in the past financial year, posting a net loss of nearly €6.28 million, citing wage-price inflation as one of the main factors.
The company invested over two million euros in fixed assets in the last financial year.
The Family Doctor Advice Line (Perearsti Nõuandeliin) has been in operation for 18 years and is now owned by the Confido group, as noted, while the 1220 phone number itself belongs to the health insurance fund – a tender process is used to outsource the actual operation of the line.
1220 made net profit of €520,000 last year
The current contract lasts until the end of next year, though according to Rajamäe, how much is spent on the service per year depends on the number of calls received – naturally the pandemic led to a large surge in calls.
The advice line turnover last year was €1.9 million and, unlike its parent company, it turned a profit, of €520,000. In the preceding financial year, it reported a net profit of €580,000.
Again, this related to the peak of the pandemic.
The Health Insurance Fund says it will be announcing a new tender for the 1220 line at the end of this year.
The 1220 line itself is free to use. The Health Insurance Fund says it should be the first port of call when unwell, while operators triage cases between those who can seek home remedies, those who should make an appointment to see a doctor, and those who should present at an emergency room.
The hotline can also extend prescriptions at weekends, in urgent cases, ERR reports.
1599 pediatrician helpline also owned by Confido, service not free to call
A Linnamäe concern also owns the 1599 pediatrician hotline, which costs up to a euro per minute when obtaining advice from a doctor; the line was purchased from Tallinn Children's Hospital (Tallinna Lastehaige) in July last year.
Last year, Confido also expanded its outreach in offering work ability assessment services as a contract partner of the unemployment fund Töötukassa), commenced with outpatient medical care as well as inpatient care, opened several new clinics and purchased the Tamme Erakliinik (private clinic).
In addition, on behalf of the Health Fund, Confido began to provide primary medical care to Ukrainian war refugees, among other aid to Ukraine.
KT Holding OÜ sold the majority share, i.e. 70 percent of Confido, to businessman Margus Linnamäe last year.
This required Competition Authority (Konkurentsiamet) approval, which came in February this year.
Since the minority shareholders of Confido then transferred their shares also, Linnamäe became 100 percent shareholder of Confido Healthcare Group, in turn the became the sole owner of subsidiary Arstikeskus Confido.
Linnamäe sole owner of Confido Healthcare Group
In May this year, Linnamäe's LMRA 20 OÜ became the sole owner of the Confido group – the former guarantees financially the latter, for this year at least.
The holding company of Confido Healthcare Group will make a contribution to the voluntary equity reserve in September of this year at the latest, in order to offset part of the loan claims against the group, since Confido's unconsolidated adjusted equity did not comply with the requirements of the Commercial Code, it is reported.
Confido Healthcare Group brings together a number of clinics: Confido Medical Center, which offers a wide range of treatment services, surgery and rehabilitation, Ortopedia Arstid and Tamme Eraklinik, which focuses on specialist medical services, Nordic Imaging, which offers radiological services, Kordamed, which specializes in detoxification, Medco Partners, which focuses on specialist medical care and aesthetic services, and voluntary health insurance packages are sold by Confido Kindlustusagent and Tervisekindlustusagent, in addition tot he 1220 and 1599 hotlines.
In addition, the Confido Healthcare Group also incorporates the private companies Confido Innovations and Confido Esteetika, as well as the Confido foundation, none of which are currently active.
Confido was prominent during the Covid pandemic, in providing tests and vaccinations.
Editor: Karin Koppel, Andrew Whyte