Health and Social Care Bill passes through the Lords
The Health and Social Care Bill has been in the House of Lords where a hundred peers queued to speak and were given eight minutes each. The outcome was a comfortable defeat of attempts to delay or throw out the Bill in the biggest turnout in the Lords for over ten years. Attempts to defeat the second reading and to set up a special committee to study the impact of the reforms were both defeated.
The Health and Social Care Bill removes from ministers the responsibility to provide or commission health care services directly, passing the duties on to ‘frontline organisations, free from political micromanagement’. The Bill removes the cap associated with earnings from private patients, opening up huge opportunities for the private sector.
It is no surprise to find that more than 40 peers have an interest in private health-related companies. They include former Conservative Health Secretary Virginia Bottomley who is a Bupa director; Lord Darzi, appointed by Tony Blair as a Labour health minister, adviser to medical technology firm GE Healthcare; Lord Naseby, chair of Invesco Perpetual Recovery Trust, investors in pharmaceutical and biotechnology companies; Lord Hunt, partner in the commercial law firm Beachcroft which offers lobbying services to private health care companies; and Lord Higgins who holds over £50,000 worth of shares in Lansdowne UK Equity Fund, a major investor in the private hospital group Circle Holdings.
Clinical Commissioning Groups and private deals
In an argument that can only be in the interest of big business and not people, the government says that £20 billion savings in the next four years can be achieved by handing power to private firms and commissioning groups. David Nicholson, chief executive of the NHS in England since 2006, is now chief executive of the NHS Commissioning Board (based in Leeds with an office in London).
This Board is responsible for a budget of £80 billion, of which £60 billion is allocated to the new Clinical Commissioning Groups (CCGs) which are overseen by the Board and which will ‘buy’ health care within the NHS.
Accountable to the Secretary of State through an annual mandate, the NHS Commissioning Board is described as an independent, statutory body, free to determine its own organisational shape, structure and ways of working.
It has recently appointed Malcolm Grant, University College London (UCL) provost as its part-time chair. Grant intends to continue as provost alongside his NHS responsibilities. He owes his appointment to Health Secretary Andrew Lansley: the parliamentary health select committee which interviewed him concluded that it could ‘not endorse Professor Grant’s candidacy’, saying that he ‘did not demonstrate to the committee a robust understanding of the issues’. It also reported that he had received help from the Department of Health in preparing his application and ‘demonstrated an assumption that his appointment was already confirmed’ – which of course it was.
To add insult to injury, Grant revealed that he does not use the NHS – he is a private patient. As UCL provost he achieved notoriety for his extravagant pay (at one time £440,000 per annum) and for outsourcing the UCL cleaning contract to a company paying less than the London living wage.
31 CCGs, representing thousands of GPs in London, have signed a £7 million contract with private companies for intensive organisational support for commissioning services. These companies include all the usual management consultancies – KPMG, Price Waterhouse Coopers, Capita, McKinsey, Ernst and Young. Other beneficiaries are large legal firms like Capsticks Solicitors and accountants Binder Dijker Otte.
An NHS draft report, Developing commissioning support – towards service excellence, makes clear that CCGs need to procure commissioning support through open tenders from April 2013. The document deems such support to include health needs assessment, business intelligence, support for health care service re-design, communications and media handling, organising tenders for and purchasing health care and contract management of hospital providers, plus supporting ‘back office’ functions such as IT, finance and legal services. In other words, CCGs will be run by private companies with GPs rubber-stamping their decisions.
Private companies to run NHS hospitals
The first deal of this kind has just been finalised – Circle Health will take over Hinchingbrooke Hospital in Cambridgeshire in February 2012. Circle will be responsible for paying off Hinchingbrooke’s £40 million debt. The company’s sole relevant experience is running a boutique hospital in Bath, but it has ambitions to take over 20 ‘failing’ hospitals as part of the government’s new deal.
Circle chief executive is Ali Parsa, a former Goldman Sachs banker. The company is jointly owned by Circle Holdings and Circle Partnership. Circle Holdings, the dominant partner, is in turn owned by Parsa and half a dozen venture capital and hedge funds. Circle makes much of the fact that Circle Partnership is owned by its 2,500 staff, including doctors, nurses, porters, cleaners, as a ‘John Lewis style mutual’. However, it is registered in a Virgin Islands tax haven, and there is little likelihood that the shares will yield any dividends, especially as the company made a pre-tax loss last year of £44.3 million. How the company will pay off Hinchingbrooke’s debt defies analysis: this is a loss-leader where the contract will be re-negotiated in the future to ensure there are adequate and risk-free returns for the company. The government will not allow the deal to fail: it will be secured like every future NHS privatisation at the expense of patient care.
Hannah Caller
Fight Racism! Fight Imperialism 224 December 2011/January 2012
