Prime Minister meets with management and employees of Dr. Simo Milošević Institute

Spajić: The Institute is saved with an €88 million investment, Government to acquire children's ward for school construction

Prime Minister Milojko Spajić has announced that the Dr. Simo Milošević Institute has been saved, marking a turning point for this rehabilitation center, which had long been caught between insolvency and privatization. 

During a meeting today in Igalo with the Institute’s management and employees, Prime Minister Spajić highlighted the significance of the Shareholders' Assembly’s decision to adopt the Restructuring Plan, which includes an €88 million investment in the Institute by the end of 2028. 

The adoption of this plan marks a new phase in the development of the Institute as a reputable rehabilitation center, which will serve as a source of pride for its employees, patients, the municipality, and the entire country, stated Prime Minister Spajić. 

He recalled the challenging situation the 44th Government inherited regarding the Institute—burdened with significant debt, an unsustainable business model, and deteriorating facilities. 

Faced with a complex situation regarding state aid, we focused on the well-being of our citizens and managed to resolve the Institute’s chronic liquidity issues. We increased the reimbursement rates for patients covered by the Health Insurance Fund, thereby securing additional budget funds—€9 million annually instead of €4.5 million. This ensured long-term liquidity and positive financial operations for the Institute, said the Prime Minister. 

Instead of insolvency or privatization, the Restructuring Plan guarantees the settlement of all liabilities and investments into the second phase of development, restoring the Institute as a leading center for rehabilitation and health tourism, not only in Montenegro but beyond. 

Prime Minister Spajić expressed gratitude to the employees for their dedication, which helped sustain the Institute during its most challenging years. He also thanked creditors who recognized the Institute’s national importance and refrained from initiating bankruptcy proceedings. 

We have not forgotten the needs of Herceg Novi’s citizens. The Government will promptly acquire the Children’s ward of the Institute to build a new school, finally resolving a decades-long issue for Herceg Novi and Igalo, he concluded. 

The Government, together with minority shareholders, will invest €88 million into the Institute by 2028, with €62 million allocated for infrastructure improvements. 

Minister of Health Vojislav Šimun described the event as a historic day for the Institute. 

It is particularly gratifying to have found a comprehensive plan to rescue the Institute. The commitment of the 44th Government has been remarkable, and the leadership of the Prime Minister has been crucial. Thanks to his proactivity and persistence, we have reached this long-awaited milestone, stated Minister Šimun. 

He noted that the Institute provides essential services to approximately 5,000 patients annually through the Health Insurance Fund, including 500 children. He emphasized the Government’s commitment to ensuring the continuation of these critical healthcare services while simultaneously fostering the growth of health tourism. 

We owe a special debt of gratitude to the Institute's employees, who never lost faith that we would resolve a problem that had been neglected for years, the Minister added. 

The Institute’s management, union representatives, and minority shareholders agree this is a historic day for the Institute.

I hope this day will be remembered as historic for the Institute and a catalyst for its future growth. The unanimous approval of the Plan proves that the Institute has a promising future and will be a source of pride for current and future generations, said Institute Director Zoran Kovačević, adding that the plan also expands certain benefits for patients covered by the Health Insurance Fund. 

President of the Institute’s Union Biljana Ribar emphasized that employees had long awaited the adoption of this plan. 

We anticipated this decision with both hope and uncertainty. Employees have endured difficult working conditions for years, but I believe this marks the beginning of a new era where we can all be satisfied, Ribar stated. 

One of the Institute’s key shareholders, Žarko Rakčević, expressed confidence that the Institute could meet Montenegro’s healthcare needs while also serving as a center for health tourism. 

We must continue the Institute’s healthcare mission and elevate it to new heights while simultaneously ensuring its financial sustainability. These two aspects must go hand in hand, making the Institute a model for Montenegro and Europe. We must reclaim the Western European market. We had negative experiences with previous governments, but we have now built trust, and we sincerely appreciate the proactive approach of this administration, Rakčević concluded.