Private firms making billions out of NHS contacts

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Richard Branson’s Virgin Care won a record £1bn of the UK’s National Health Service (NHS) contracts last year, as £3.1bn of health services were privatised. The Guardian reports that this was despite a government pledge to reduce the proportion of care provided by private companies.

Overall, private firms scooped 267 – almost 70% – of the 386 clinical contracts that were put out to tender in England during 2016-17, according to a new report. They included the seven highest value contracts, worth £2.43bn between them, and 13 of the 20 most lucrative tenders.

The report says the £3.1bn in contracts, a big rise on the previous year’s £2.4bn, prompted concern that profit-driven companies are increasingly involved in delivering care, in a development that undermines repeated assurances by the health secretary, Jeremy Hunt, that they play only a marginal role. “These figures clearly show that privatisation has a strong momentum within the NHS,” said Paul Evans, the director of the NHS Support Federation, a campaign group which monitors the privatisation of NHS services and which produced the report. “The doors to private sector involvement in the NHS remain open despite promises to move away from market-based approaches by NHS leaders and politicians. Privateers continue to win huge new NHS contracts.”

The private sector’s £3.1bn of wins last year represented more than two-fifths (43%) of the £7.2bn of contracts tendered by the NHS for services including babies’ health and out of hours GP care. That dwarfed the £2.55bn (35%) of tenders won by NHS trusts and £1.53bn (21%) by not-for-profit organisations, including charities.

The report says the expanding role of for-profit firms comes despite a pledge by the NHS England CEO, Simon Stevens – backed by Hunt – to abolish the purchaser/provider split in the health service introduced by Margaret Thatcher’s government in 1990, which helped facilitate competition in healthcare and the outsourcing of services, and promote greater integration of health and social care services. “Private health providers now have a strong foothold,” said Evans. “Billions of pounds-worth of opportunities to bid for NHS business are still being advertised, despite numerous failures and widespread criticism.”

Critics say that the sector’s continued success stands in sharp contrast to a long history of winning contracts, often by undercutting rival bids from NHS trusts, only to then hand back those that do not yield a profit or have them taken away because they have provided inadequate care.

“Dysfunctional” NHS procurement rules mean that private firms could land another £10bn of contracts in the next three years, said Evans. The NHS Support Federation, which is funded by individuals, charitable trusts and trade unions including the TUC, tracks publicly available information about NHS tenders.

The report says Virgin Care and Care UK defended their role in delivering NHS-funded healthcare. A Virgin Care spokesperson said: “We have a strong track record of delivering high quality, free NHS services over the last 11 years. More than 93% of people rating the services we run would recommend them, while the CQC have said in their recent report we can evidence the improvements we have made to community services.”

A spokesperson for Care UK said: “We have a very strong track record in partnering with the NHS to deliver high-quality and patient-focused care. This includes three services rated outstanding by the CQC and consistently high patient feedback scores.”

A Department of Health spokesperson said: “Spend on private healthcare by the NHS accounts for just eight pence of every pound and this government is fully committed to a world-class NHS owned and funded by the British taxpayer and free at the point of use, now and in the future.”

The Guardian report

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