Early stages of healthcare privatization in the uk

Early Stages of Healthcare Privatization in the UK August 2013 BLOG POST

Overview The National Health Services (NHS) is the largest government-owned provider of healthcare services in the UK. The UK government is working towards privatizing some of the services of NHS, especially in England. This move, which is in its preliminary stage, is being taken by the government to incorporate more accountability for healthcare providers by increasing competition among hospitals and making them more independent.

The Health and Social Care Bill, which the government won in 2012, is believed to end free and comprehensive healthcare and hand over some services of the NHS to the private sector by abolishing Primary Care Trusts and establishing Clinical Commissioning groups. Hospitals will be able to use fully 49% of their beds and theatre time to generate private income. The Commissioning groups would allow doctors and other healthcare professionals to take control of their budgets and buy services from other providers.1 England is shifting control of its GBP107 billion annual health budget from a centralized bureaucracy to doctors at the local level. Under the plan, GBP67 billion to GBP84 billion a year would be provided to general practitioners, who would use the money to buy services from hospitals and other health care providers. The plan would also shrink the bureaucratic apparatus, in keeping with the government’s goal to affect GBP20 billion in “efficiency savings” in the health budget by 2014.2 NHS-owned Hinchingbrooke Hospital was reported to be running at a loss of GBP5 million a year on revenues of GBP90 million, with accumulated debts of GBP40 million – in November 2011 by the Business Insider. It was hoped that a private company enhances the hospital’s efficiency and hence revives its profit-making ability. The announcement of NHS Hinchingbrooke Hospital in Cambridgeshire being handed over to a private health company Circle was a major step towards privatizing the British health system.

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World Socialist Web Site: Health and Social Care Bill prepares health care privatization in UK The Red State Report: England To Privatize Their Health Care (values converted using; £1 = $1.5)

Early Stages of Healthcare Privatization in the UK

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Opportunities for Private Providers The Government’s health reforms have already awarded GBP7 billion in contracts to private firms such as Virgin Care, private equity-owned Care UK, Serco and Circle. Some examples of these contracts are represented below:3 4 5 6 7 8

Challenges with Privatization of the NHS9 10 While privatization of the NHS hospitals looks to grow in the future, this transition from government to private care is bound to face challenges ranging from hospital employee resentment regarding job commitment to patients wary of treatment at private hands. Critics fear the move will lead to closed hospitals, lengthy waiting lists, rationed medicines and a steep decline in the quality of care for patients.

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Mirror News: How private firms already run frontline NHS services by stealth World Socialist Web Site: Billion-pound NHS contract offered to private health care providers 5 The Financial Times 6 The Northern Echo: Anger as NHS loses prisons contract 7 Health Service Journal: Circle wins Nottingham contract 8 HefmA: Circle wins Hinchingbrooke contract 9 Mirror News: David Cameron accused of destroying NHS with privatisation plans 10 The Independent 4

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Outlook According to the NHS – private-sector contractors performed 4.3% of the elective hospital procedures it provided in fiscal 2012.

However, the biggest chunk of NHS care yet is to be bought from a private provider, in a contract worth up to GBP1.1 billion. The Cambridgeshire and Peterborough clinical commissioning group (CCG), one of the more than 200 GP-led bodies, is interested to buy services for their local patients via a contract that will include end-of-life care for the elderly. It is worth between GBP140 million and GBP160 million per year for five years, with a two-year extension option, and will replace six separate contracts the CCG already has with NHS providers. Private providers – Virgin Care, Serco and Circle – have all reportedly shown interest in the contracts.11 Virgin Care has supposedly extended the opening hours in its facilities on evenings and weekends and is offering walk-in appointments, which can be hard to get from the NHS.10 Again, after Circle took charge of the NHS-owned Hinchingbrooke Hospital – patient satisfaction has risen to 85%, placing Hinchingbrooke in the top six of the East of England’s 46 hospitals. Efforts like these from the private providers would help gain trust and confidence from the healthcare industry in the UK.12

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The Independent: The biggest yet: A GBP1.1 billion health contract offered to private providers The Telegraph

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