Hospitals deny private takeover despite debt woe

Liz Kendal MP
Liz Kendal MP
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HOSPITAL trusts in Yorkshire have moved quickly to insist that no hospitals in the region will see their management taken over by private companies, despite crippling debts.

It follows the takeover by Circle Healthcare of management at Hinchingbrooke Hospital in Cambridgeshire in a decade-long, £1bn deal.

Although private firms have previously operated units within the National Health Service – such as hip replacement centres – Hinchingbrooke is the first entire hospital to be run privately.

But NHS Yorkshire and the Humber categorically denied that any hospital under its control would follow the same route.

This is despite of private management becoming an increasingly attractive option in light of financial problems.

The Yorkshire Post reported in October that the Mid Yorkshire NHS Trust, which serves 550,000 people in Wakefield, Pontefract and Dewsbury, is targeting efficiencies of £30m by next march but still requires an extra £14m in financial support to break even.

North Yorkshire’s Primary Care Trust (PCT) has been beset by debt problems for a decade.

Hinchingbrooke, which serves 161,000 people in Huntingdonshire and the surrounding area, is £39m in debt despite an annual turnover of £90m.

Health Minister Earl Howe welcomed the deal, which officially starts in February next year, saying that it creates a “win-win situation” for both patients and taxpayers and has saved the hospital from closure.

“This is a transfer of risk on to the private sector – that is why it is a good deal,” he told the House of Lords.

“But it is also a good deal in another sense, because the patients will still have a hospital in Hinchingbrooke.

“This is a hospital that in common parlance could be described as a financial and clinical basket case. There were no NHS bidders willing to take this on.” But Labour and unions have criticised the move, saying it represented the government’s “true vision” for the NHS.

Shadow Health Secretary Liz Kendall questioned why Circle – a private sector firm with “close links” to the government and no prior experience of running Accident and Emergency or maternity departments -– had been chosen.

“Patients and the public will be deeply worried that they have seen this Government’s true vision for the future of our NHS, with the wholesale transfer of the management of entire hospitals to the private sector,” she said.

Unison described the takeover as an “accident waiting to happen” and compared Circle to failed nursing home operator Southern Cross.

Christina McAnea, Unison’s head of health, said: “The company is currently in a vulnerable state and the takeover could lead to a second Southern Cross, putting patients at serious risk.

“The company is losing contracts and millions of pounds in turnover.

“Circle made losses of over £27m last year and recently floated on the stock market – they look less and less like the social enterprise that they claim to be.

“This must not become a precedent for the NHS, or millions more staff and patients will be put at risk.”