01.04.15
Hinchingbrooke handed back to the NHS
Hinchingbrooke Health Care NHS Trust was handed back to public hands today, marking an unhappy end to the Department of Health’s biggest experiment in healthcare privatisation.
In January Circle Health announced its intentions to pull out of its contract to manage the first privately run NHS hospital, blaming falling funding and the surge in A&E attendances making it “no longer sustainable under current terms”.
Shortly following the announcement Hinchingbrooke was also subject to a scathing inspection report from the CQC. The trust was placed in special measures after the report rated it ‘inadequate’ for safety, care and being well-led. Circle disputed the accuracy of the CQC report, saying it contained 300 errors.
The company took over the trust in 2012 and was supposed to run it for a further seven years, however it invoked a clause in the contract that allowed to terminate its franchise in the event that support payments it had to make to run the hospital exceeded £5m.
In walking away Circle will be leaving behind a deficit of between £7.7m and £12m, which will be added on to the Department of Health’s books.
Nick Boyle, business development manager at Circle, told City A.M. that as soon as Circle took over the hospital it was no longer on a “level playing field” with the rest of the NHS – a fact "ignored" by politicians.
He said that on top of extremely high efficiency gains targets, which exceeded those of any other nearby hospitals, Circle faced more spending cuts than anyone else during its tenure: “In the last year, Circle's budget was cut by over 10%, but the other two hospitals in the local area faced reductions of just three or 4%.
“So on the one hand we were being hit by increasing demand, with more people attending A&E over the Christmas period, and on the other hand we were asked to do it for 10% less money, and that was just not possible.”
In further identifying where things went wrong Boyle believes Circle’s “co-operative model”, which gives doctors and nurses more autonomy over the running of the hospital, was something unusual and incompatible with the NHS.
“The NHS has been increasingly burdened with bureaucracy, and that filters down to every part of the system,” he said. “It's a great shame that politics plays such a great role in the NHS generally. we think if the NHS is going to survive then it has to embrace innovation. It has to find new ways of doing things, and needs to have a structure that allows organisations like Circle and others with novel ways of doing things to come in and learn from us. It needs to allow us to help and support the NHS.”
The NHS Trust Development Authority has now taken over responsibility for Hinchingbrooke and has appointed a new board to manage it. The chair has been named as Alan Burns, a retired NHS Health Authority and Strategic Health Authority chief executive with over 30 years of experience.
Before making its departure from the hospital Circle gave share options to Hinchingbrooke Health Care Trust’s charitable fund, as a “gesture of support” to the staff.
The company is giving 310,000 share options to the trust’s charitable funds committee at a set price of 2p at the end of the year.
If the shares were trading at their current share price of 42p at the end of 2015 and the committee decided to translate the options into shares and sell them immediately, it would make a profit of £124,000.
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