Private Business Intermediaries

NHS – Penny wise - pound foolish?

29/10/2012 | By Sharmila Chauhan
There has been much debate about the impact of privatising the NHS. Under new health reforms, private firms are able to bid and provide NHS services and of course make a profit. They have already been awarded millions of pounds-worth of NHS contracts. The recent Labour party conference highlighted some of the key concerns, especially in the community sector. October saw 398 contracts signed in eight NHS areas – including musculoskeletal services for back pain, psychological therapies, hearing services and children’s wheelchair services.

Since an increasing number of NHS services are ‘up for grabs’ it is likely that we will see a rise in the number of services provided by private companies. The government insists that privatisation will improve patient choice and put GPs in the driving seat to commission the services best for their locality. However is this a short term measure that will provide a quick fix – or a long term strategic option, created to improve patient care?

A Dispatches documentary – due to be screened tonight  - will reveal some interesting facts about one of the key players: Virgin Care. Virgin, perhaps better known for its role in planes, trains and music, already provides medical services, and in some parts of the country, entire medical centres. According to their website, Virgin Care “partners with groups of GPs to provide high quality NHS services through our locally led provider companies. Together with our GP partners, we’ve developed a wide range of community-based NHS services.” They already support 24 GP provider companies and operate over 80 services including "community-based intermediate NHS services, GP led walk-in and healthcare centres, urgent care centres, out of hours, community diagnostics and GP practices."

Despite the fact that each service is part owned by GPs – concerns are rising about the impact of using a corporate model for a public service. Ordinarily, an NHS service provider will reinvest any 'savings' back into the NHS. However, a private company is free to reinvest money wherever they wish and in essence will be almost 'leaking' money out of the NHS.

So in theory, whilst this ‘business’ model may have some advantages, in ‘buying cheaper services’, the NHS could find itself – loosing money in the long term.

Getting Rich on the NHS will be broadcast tonight at 8pm on Channel 4.