Fiasco as contractor hangs up on NHS phone service

An NHS Direct spokeswoman said the contracts were “financially unsustainable”.

The company announced that it was preparing for a “planned withdrawal” from the contracts after projecting a £26 million deficit for the coming financial year.

NHS Direct provides the non-emergency phone line in nine regions of England.

NHS Direct originally won 11 of the 46 contracts to provide the 111 service.

Earlier this month the company announced that it would be unable to provide the service in North Essex and Cornwall.

But now it is also planning to stop providing the service in Somerset, Buckinghamshire, east London and the City, south-east London, Sutton and Merton, West Midlands, Lancashire and Cumbria, Greater Manchester, Merseyside and Cheshire.

A company spokeswoman said: “The trust is seeking to agree a managed transfer of NHS Direct’s 111 services, and the frontline and other staff who currently provide them, to alternative providers.

“NHS Direct is seeking to withdraw from the NHS 111 contracts it entered into as these have proved to be financially unsustainable.”

Chief executive Nick Chapman added: “We will continue to provide a safe and reliable NHS 111 service to our patients until alternative arrangements can be made by commissioners. Whatever the outcome of the discussions on the future, patients will remain the central focus of our efforts, together with protecting our staff who work on NHS 111 to ensure that the service will continue to benefit from their skills and experience.”

The company “encountered significant problems” when it launched the three contracts in the north west of England and the West Midlands in March, the spokeswoman said.

She said the calls took “twice as long as expected” and as a result, NHS Direct did not have “sufficient capacity” to handle all the calls that it received.

The NHS 111 line, which replaced NHS Direct as the number to call for urgent but non-emergency care, has been riddled with controversy since its inception on April 1.

The line suffered many teething problems, with patients complaining of calls going unanswered, poor advice given and calls being diverted to the wrong part of the country.

Just a month after its launch medics warned that the “problematic” roll-out of the system left many patients not knowing where to turn.

Health officials launched an investigation into the advice line after a number of potentially serious incidents, including three deaths, were linked to the service.

Earlier this month, the Health Select Committee criticised ministers for the “premature” roll-out of the service.

They said the service was implemented “without attempting to interpret the evidence from pilots, which themselves were limited in scale and scope”.

“NHS 111 was launched prematurely without any real understanding of the impact it would have on other parts of the NHS, including emergency and urgent care,” they said.

NHS England said it would support local health providers to ensure alternatives would be put in place.

A spokeswoman said people who call the line in the affected areas will “continue to receive a prompt and safe service”.

NHS England’s deputy chief executive Dame Barbara Hakin said: “Over 90% of NHS 111 calls are now answered in under a minute and patients are rating the service highly. Our immediate focus is to ensure that this level of service and improvement is delivered consistently.

“We are working closely with the Trust Development Authority and the board of NHS Direct to ensure that NHS Direct continues to provide a safe, high quality service to patients while alternative, long-term, providers are secured.

“We have been in discussions with NHS Direct for some time over this issue and they have assured us they are committed to continue to provide services. We are also having constructive discussions with a number of potential new providers who could take on these contracts, specifically with the local ambulance trusts who have experience and a strong track record in provision of similar services.

“I want to reassure callers to 111 that, regardless of today’s announcement, a full 111 service will be available throughout the transition. The public should not feel any detrimental effects of changes in the providers of the service.

“This decision has been taken by all parties to make sure that 111 delivers a sustainable high level of service to all callers in the years ahead.

“NHS Direct’s current contracts will come to an end in a planned and managed way throughout 2013/14.”

A spokesman for Prime Minister David Cameron conceded there had been problems with the initial implementation of 111, but insisted performance and patient satisfaction was now high.

“He is confident that we will continue to push up standards and deliver a high level of service for patients across the country,” the spokesman said.

At present, 593 NHS Direct employees work on NHS 111. It also employs 415 agency staff to work on the service.

Overall it employs 1,300 staff and contracts 763 agency staff.

The spokeswoman said NHS Direct’s other services will be “unaffected”.

In the organisation’s annual report and accounts for 2012/13 it describes the company’s difficulties with the service.

NHS Direct worked on the pilot of the 111 line, which was based on a cost of £13 for each call - to cover staff salaries and other costs.

But it says when the first 111 contract was awarded in the North East of England, local health commissioners said they would pay for no more than £7.80 per call.

“This was extremely challenging for the Trust as it was far below the cost of the pilot 111 services that the Trust had experience of, and was substantially below the level of cost that the Trust had modeled as its future 111 service proposals,” the report states.

NHS Direct said that it submitted a bid to provide the service, but at a higher cost per call, and lost out on the contract.

Other health providers around the country said they would pay maximum costs of £7 to £9.

The NHS Direct board remodeled costs and came to the view that it could bid for contracts on the basis of costs of £7 to £8 per call.

It was subsequently awarded 11 contracts, covering 34% of the country. Private company Harmoni is providing the service in 12 regions and the rest of the contracts were awarded to local ambulance trusts and social enterprises.

The NHS Direct annual report states: “It is now clear that the trust is not able to to provide the 111 service within this lower cost range, and that the 111 contracts that the trust has entered into are financially unsustainable.”

Shadow health secretary Andy Burnham said ministers ignored warnings about the 111 service and their failure to do anything meant pressure was put on accident and emergency departments.

He said there were now major questions marks over the service’s future.

Mr Burnham told BBC Radio 4’s The World At One: “The Government needs to drop their complacency and urgently get a plan in place to ensure that 111 is a safe service but also that it is a service because with NHS Direct withdrawing there are major question marks now about its future.

“The fact is that it was ministers who ignored warnings about NHS 111. They were being told that it didn’t have the right staff in place to provide a safe, reliable service and we’ve seen all of the problems since its launch and they’ve continued basically to do nothing and it can’t carry on because it’s not just about the out-of-hours advice line.

“The failure of the service is putting extra pressure on ambulance trusts but also on accident and emergency departments.

“The collapse of the 111 service was a big factor in the extra pressure on A&E that we’ve seen in the early part of this year, it’s the Government who need to get back into the office, get a plan in place to sort out 111 to ensure it’s providing safe care up and down the country.”