Parsa Solution to A&E Bailouts

After Ali Parsa successfully duped the public over his claim to save £1.6m on procuring paper (which could only happen if Hinchingbrooke got all of its paper for free for 10 years) Jeremy Hunt is now trying the same thing with his announcement of an "extra" half a billion for struggling A&E departments.

The problem is that this is not an extra half a billion, indeed, it is unclear whether this money exists at all. HSJ reporter, David Williams attempted to get the Department of Health to explain where this money would come from (see 2.09 on the HSJ Live Blog):

A DH spokeswoman told me the cash is 'coming from DH underspends and efficiencies'. The department doesn't have a breakdown of exactly what these efficiencies are, or how much any given saving scheme is expected to generate, although she did say: 'We have quite a big drive to reduce administration spending'.

Note that this is from the department underspends, not NHS underspends:

The spokeswoman confirmed that the money would come from within the DH's departmental expenditure limit - so isn't new money going into the department from the Treasury. She also said it wasn't going to come out of the NHS commissioning budget, so taking the department at its word, this wouldn't be a reallocation of funds already being spent on NHS care to the most under pressure areas. The savings necessary to pay for the bailout haven't been made yet - they are being made in 2013-14. And if all that sounds a bit vague, remember they're planning to find the same amount again in 2014-15.

The spokeswoman confirmed to David Williams that this was not new money, the Treasury that has already pocketed billions from NHS underspends in the last few years is not going to give any of that money back. She also confirmed that the money would not come out of the commissioning budget - that is, the money that goes to CCGs and NHS England to commissioning services. So this is not a raid on CCG budgets like Osborne did a couple of months ago with his surprise announcement of funding for integration. Instead, this £250m a year for two years will come from the Department of Health's own allocation - the money it is given to run the department and few other public bodies:

So where's this money going to be made available from? According to DH's business plan for this year, its total budget is £110bn, but £94.2bn of that goes straight out again to NHS England, to be spent on commissioning NHS services. Most of the rest goes to other organisations such as Public Health England, Health Education England, and local councils. Just £3.9bn is identified as 'DH programme and admin expenditure'. Of this, 'admin funding' accounts for just £230.8m - meaning that even if the DH stopped administrating altogether, it couldn't save enough money to pay for the A&E bailout. 'Programme funding' comes to £3.5bn, of which £381m is capital. Programme funding pays for the chief medical officer's work, the external relations directorate, and the following acronyms: PHD; ERD; SCLGP; GOA; and SFNHS.

The list of initialisations at the end of this are a bit obscure, however, the DH Corporate Plan gives a clue to the work of these divisions and projects in the department. ERD is involved in improving care, delivering the Secretary of State's Care Priority and delivering the government's response on the Mid Staffs inquiry. GOA is associated with NHS estates and facilities. PHD is concerned with screening, long term conditions and the public health strategies to reduce smoking, alcohol consumption and obesity. SCLGP is associated with development of the "No Health Without Mental Health" strategy; improving the quality of life of people with dementia and improve health outcomes for children and young people. SFNHS is associated with cutting costs through strategic financial planning.

It is unclear whether it is possible for the DH to save 8% on the chief medical officer's work and the projects mentioned in the last paragraph, which leads to the sentence about admin funding:

Of this, 'admin funding' accounts for just £230.8m - meaning that even if the DH stopped administrating altogether, it couldn't save enough money to pay for the A&E bailout.

This is the Parsa solution. Whereas Parsa pledged to save £1.6m by getting all Hinchingbrooke's paper products for free, Jeremy Hunt will save £250m by not paying anyone in the Department of Health!

Out to the community

We hear constantly that moving care out of hospitals and "into the community" will save money, be best for patients and is generally is such a brilliant idea that it is clearly an indication of how rubbish the NHS is that it hasn't already been done. Politicians behave as if it is such a "nobrainer" that anyone questioning their brilliant idea must be doing so out of "vested interests".

The problem is that the people promoting this policy never back up their policy with evidence. We have no proof that moving care into the community is any cheaper than if the care is delivered in a hospital. If the treatment involves an expensive resource (a costly piece of equipment, or an expert clinician) it makes sense that the patients go to the centralised resource, rather than replicating this resource.

Indeed, there are some suggestions that hospitals are cheaper. In 2008 McKinsey (PDF) produced a report outlining the excessive costs in US healthcare.

[outpatient care] accounts for more than 40 percent of overall health care spending and 68 percent of spending above expected. This category expanded at 7.5 percent per annum from 2003 to 2006 - a faster pace of growth than observed in any other cost category - to add more than $166 billion in costs during this period. ... Same-day hospital care is the fastest growing of all outpatient cost categories at 9.3 percent per year.

The significant size and growth in spending on same-day hospital care is attributable to a number of factors. First, the United States delivers a higher percentage of care on an outpatient basis than on an inpatient basis, compared with most other countries. For example, nearly 90 percent of hernia surgeries in the United States are performed on an outpatient basis, verses about 40 percent in the United Kingdom.

What this says is that a large proportion of US health care is delivered "in the community" and it is carried out in a costly way. McKinsey acknowledge that the care would be delivered cheaper if it were delivered in a hospital. Indeed, they say that the care delivered in the community costs 68% more than if it had been delivered in a hospital, costing the US an extra $166bn over four years. In a rare admission, McKinsey gives the NHS as an example for the US to follow.

A few years ago I had some basal cell carcinomas on my back - a minor type of skin cancer which can cause ulcers that do not heal. The dermatologist told me that a common cause was sunburn before the age of ten; which brought back fond memories of hot 70s summers, holidays on the beach and my back peeling from sunburn. The treatment is photo-dynamic therapy (PDT) where a magic cream is put on the skin cancer. This cream makes the cancer cells more sensitive to infra-red light and is only half of the treatment; the other half is the patient spending time under an infra-red light while the cancer cells are (I guess the only appropriate word here is), cooked. The cream that attached to cancer cells also fluoresces under UV lamp, so it gives a good indication of the amount of cancerous skin cells there are. PDT is a very common treatment, NHS data show that in 2011-12 there were 387,000 separate episodes, at an average cost of £84 per episode.

I was referred to a hospital clinic to have PDT. On the day, there were 4 other people waiting for the treatment and luckily I was first in the queue. The nurse explained the procedure: the cream would be applied and then to allow the cancer cells to be sensitised I would return the next day and then have the infra-red treatment. Then the nurse took the tube of cream out of a cupboard. It was tiny. The nurse explained that the tube of cream cost £250 and would treat 5 people. She also explained that once opened, the cream had to be used immediately. This was the reason for the 4 other people outside: they would each have a fifth of the tube.

This is a treatment that could be carried out "in the community". The equipment was fairly basic: an infra-red lamp for the treatment, a UV lamp to "see" the cancer cells. The treatment was also straightforward and didn't need a consultant: it was delivered by a nurse. All of this meant that very little investment was needed, so it could be delivered in a GP surgery, or a converted storage room at Boots. The major problem is the cost of the tiny tube of cream. The hospital where I was treated covers a population of 300,000 so it was possible to get together 5 people who would be able to put aside the same two consecutive mornings. The NHS targets for treatment for cancer (treatment must be within 31 days of consultant deciding treatment is needed, and within 62 days of first being referred by a GP) complicate this further, because you have to have a large enough population to be able to find 5 people who have been referred for this treatment within a few days of each other.

If there are 387,000 treatments of PDT in England every year, then this means for a population of 300,000 there would be about 230 treatments, say, one PDT clinic treating 5 people once a week. A GP practice, on average, covers a population of around 7,000. Using the same figures, such a practice would expect 5 people a year to need PDT. Clearly one clinic a year would not meet the cancer targets, and if each patient were treated individually then that would mean each treatment would cost at least the cost of one tube of cream (£250). This is why PDT is not given "in the community": the cost would be too high.

Treatment "in the community" where the treatment is closer to the patient's home may well be better for the patient in some cases. But in today's NHS - like it or not - cost of care is the most important priority. Until care "in the community" delivers treatment at a lower cost than in a hospital, it will never happen. So remember this the next time a politician whines on about moving care out of hospitals.

Parsa's Paper Deceit

As part of the government’s reform of the NHS, the Secretary of State, Jeremy Hunt, announced that the NHS will go "paperless" by 2018 and save up to £4.4 billion. However, one NHS trust appears to have taken this decision months before. Hinchingbrooke NHS Trust claimed that it could save £1.6m through better paper procurement.

For a few days in August last year, Ali Parsa, then the chief executive of Circle Holdings, was everywhere in the media promoting his company and their recently acquired contract to run Hinchingbrooke NHS Trust. However, the situation was not as rosy as Parsa was making it out to be. Circle Holdings had recently contacted its shareholders asking for an additional £46m of capital or else it said "the Group would not be able to trade as a going concern which would be likely to result in the insolvency of all or part of the Group". Further, the finance report of the first quarter of Hinchingbrooke under the management of Circle showed that the trust was still in deficit and Circle's attempts to change the situation was behind plan by £652,000. (Since then, the financial situation at Hinchingbrooke has got worse. The finance report of last quarter of the financial year the trust said that it lost £3.5m over the year and Circle had to cover this debt with its own money. The financial situation of the trust has got so bad that in July 2013 the trust said it would need a working capital loan from the government to carry out necessary refurbishment.)

With Circle bankrupt and Hinchingbrooke showing signs of losing money, Circle desperately needed some good PR in August 2012 and Parsa launched a charm offensive that the media gladly lapped up. On the BBC Today programme on the first of August Parsa claimed that Circle "have looked at procurement and we can save £1.6m by just buying our paper better" (although the BBC's typically sloppy NHS journalism reports this quote on its website as if Hinchingbrooke had actually saved £1.6m, Parsa’s comment was aspiration, not actual). Considering the trust has a total annual income of £107m, a figure of almost two million pounds is a large amount to spend on paper, let alone to "save" on procurement. I have used a Freedom of Information request to obtain the actual figures of how much the trust spends on paper products. In 2011/12 the trust spent £148,000 on paper products and £115,000 of this was on office supplies like appointment letters.

Category of paper product	2008/09	2009/10	2010/11	2011/12	2012/13
Clinical Forms via managed print service	52,195.00	53,838.00	74,617.93	77,535.82	59,005.77
Office paper products	28,986.66	36,565.52	39,975.84	37,270.18	20,757.35
Clinical paper products	22,061.89	30,692.62	31,558.00	30,228.70	8,576.14
Patient paper products	2,520.00	3,049.22	3,544.98	3,234.01	1,915.05
Total	£105,763.55	£124,145.36	£149,696.75	£148,268.71	£90,254.31

Clearly the figures do not add up. For Hinchingbrooke to save £1.6m the trust would have to procure all of its paper products for free for ten years. That includes clinical paper in treatment rooms and toilet paper, as well as office paper. Even if Hinchingbrooke went paperless in the sense that Hunt is suggesting, and stopped using paper for appointments and GP letters, it would take the trust 14 years to "save" £1.6m, which is four years longer than Circle's contract to run the trust.

Parsa is no longer the chief executive of Circle Holdings, having resigned so that he can spend more time with his fantasy figures. Hunt, however, is still the Secretary of State, and has equally fantastic ideas about the savings possible by going paperless, and a £4.4 billion is even less believable than Parsa’s £1.6m.

Rotten Egg Hunt

I've already written about how I think Jeremy Hunt visiting hospitals is a gimmick, and I've politely suggested how he can do some actual good, rather use his time as a minister for self-promotion. Now the Guardian Professional (which, I have to stress, is not the society pages, it is a separate part of their website that appears to be used for puff pieces for PR companies) have an article which describes jeremy Hunt as a "good egg". In response I added this comment:

22 July 2013 10:42am
This hagiography is embarrassing: it made me cringe. Are you talking about the same Hunt as me?

"As a long-term NHS customer, he does seem to think like a patient." 

Well, that shows the problem immediately none of us are customers of the NHS. I am a long-term patient, I have had type 1 diabetes for 40 years and I have used the service regularly. I can tell you terrible stories of the NHS during the Thatcher/Major years. I can also tell you how immensely the NHS improved in the early years of this century. I can tell you as a real long term condition patient what the NHS is like. Lansley's reforms are tearing the NHS apart and hapless, clueless Hunt is unaware, and does not care.
Hunt's visits to hospitals are a gimmick. You are wrong: every minister has done them. They like their picture to be taken with smiling patients: Hunt is no different to any of the other Health secretaries.

If he really wanted to know what the NHS is like, he would attend all the patient meetings, like I do (do you? I have never seen any evidence that you do). Hunt should go to his local GP's Patient Participation Group - and if his GP does not have one, he should start it. He should go to his CCG Patient Reference Group, he should attend the FT governors meetings of the FTs in his area. These are all patient-run groups. It is in these meetings that he will know about the pressures in the NHS, about poor care that patients get. And more importantly, he will be able to find out what patients want.

You're obsessed with urgent care and returning it to GPs? Good. Now tell me how Hunt has improved this? Earlier this year a co-op of GPs in Hackney tried to tender to take over the OOH service that was being delivered badly by Harmoni. They were told that they could not be commissioned because there had not been a full competitive tender. Hunt was the secretary of state that brought in the Section 75 regulations on procurement, and he is the man who is stopping GPs from taking over OOH services.

I attend my local CCG commissioning meetings, for a year patients have been improving quality in our local services. Last week we were told that money is so tight that all commissioning has to be on cost alone, and that as patients we will soon be consulted on rationing treatments. Hunt did that. Twice during the meeting the Drs there stopped us and said that what we were suggesting would contravene Section 75 regulations: patients could not commission the services they wanted. Hunt did that.

"He gets down to the nitty gritty of prescribing the exact amount of medication for a diabetic patient." 

Huh? Was Hunt legally responsible? If that patient had been given the wrong dose, would he have been prosecuted? What a silly, obsequious statement to make.

You want to know about diabetes? I will tell you. Diabetes treatment is in a shambles, there are not enough Diabetic Specialist Nurses (you know, those people who give continuity of care?). At my GP there has been no GP with a specialist interest in diabetes since the previous one retired 5 years ago. The DSN told me at the beginning of the year that because of cuts in staff I would be seen once a year not twice as I have been throughout the last decade.

Then there is the issue that in this month's Balance magazine (Diabetes UK's magazine) I read that the needles I use are being withdrawn. I asked my pharmacist about this and she told me that it was because the needles are not popular and hence the drug company was not selling enough of them: the withdrawn is because of profit. Yet for clinical reasons I need these needles. Why isn't Hunt standing up to the drug company and saying to them "bugger your profits, we want patient choice, so you should provide the full range of needles or you'll not be allowed to sell any"?

The same thing happened to me a decade ago over my insulin. I had three month notice (via Balance, the weasly drug companies couldn't even be bothered to contact me) that the drug that was keeping me alive was being withdrawn. Why? Because the drug company wanted me to use their alternative which cost three times more (and which I had used, and it made me ill). Where was the NHS then? Why didn't the NHS protect my supply of insulin, and use its huge might to force the drug company to continue to supply the insulin I need? Hunt is not aware of this: he does not care, the debacle over my needles shows that he does not care. Incidentally, the drug company withdrew the insulin for humans, but (even though it is human insulin) it is available for treating diabetic dogs.

"I have anecdotal evidence from my contemporaries, that this happens."

Err, anecdote is not evidence.

Sorry, but this is a terrible article and the only excuse I can give the Guardian for printing it is that this is the Guardian Professional where contributors pay to publish puff pieces.

OK so I was ranting, but I think I was justified. Then four hours later there was a reply to my comment:

Gladiatrix > richardblogger 22 July 2013 3:11pm 

You don't actually know if Jeremy Hunt does attend the types of meetings which you have suggested. For all you know he may well do. 

I am sorry about the problems with the withdrawal of the needles which you use but see no evidence that you have actually raised this with your MP, with the select committee or with the SoS himself although you are blaming him for it. Given the nature of his role there is every chance that Jeremy Hunt hasn't been told about this, in which case you should bring it to his attention. 

The s.75 regulations were Andrew Lansley's idea not Jeremy Hunt's. 

Again, with regard to your preferred type of insulin if Jeremy Hunt doesn't know about this, because he wasn't responsible for the health system at the time it is unreasonable to blame him for it. The person who should have stopped it was either the then SoS or the CE of the NHS. Did you contact either of them?

I read this two hours later. I typed a reply, but by the time I posted it comments had closed and my reply was rejected.

The Guardian had closed comments after only eight hours. Why? Why were comments only enabled for such a short time? Anyway, here is my reply to Gladiatrix:

And you don't actually know if Hunt is doing anything useful when he visits hospitals. I contend he isn't. He does not have the training, and since he's not an employee then I doubt if he's actually covered by negligence insurance. He's a spare part, and worse, if Dave called Hunt on his mobile phone, Hunt would be back in London at a shot: no employee (nor volunteer) can do that. I could easily find out if he has ever attended a patient meeting as a patient, do you want to put money on his attendance?

As to the needles, it has just been sprung on me this month and I am told they will be withdrawn within three months. (Think about it FFS, this is what keeps me alive it is serious.) Contacting my MP (who is a junior minister) will be pointless. I know this because I've contacted him before, about the so-called "listening exercise". As a patient I was not invited to any of them in my area (I suspect that no patients were, I've asked around and no patients were aware of them). I wrote to my MP asking if he could help me get to one and he delayed and then replied after the exercise had finished to say that they had finished! Now you may think that is conspiracy - preventing an outspoken and informed patient from attending a so-called "listening" meeting - but I put it down to incompetence and contempt for the electorate: this government really doesn't care about the population. 

Why doesn't Hunt know about how patients have no choice about the medical devices they use? According to the article writer (and presumably also, you) he knows exactly what is best for patients. Well I think he doesn't care. OK, so here's another diabetic rant, something Hunt is doing nothing about. There are 4 or 5 manufacturers of insulin, all delivered through an insulin pen. However, the "cartridges" are all different: you cannot use a competing insulin in another company's pen. I take a large dose and only one pen will deliver that dose (ahem, that pen is likely to be withdrawn too, so another rant is due when that happens) so it means that I can only use one insulin. Where's the choice? If Hunt really knew patients' concerns he would be campaigning right now to get the drug manufacturers to standardise on insulin cartridges. There is no reason that they shouldn't standardise. Why isn't he? It's because he is a amateur, he's just a rent-a-suit minister, one day Culture Secretary, the next, Health Secretary, and the day after, back on the back-benches as a hapless nobody. He has no passion for the NHS and no ability as a patient activist.

"The s.75 regulations were Andrew Lansley's idea not Jeremy Hunt's."

Rubbish. The regulations (not the section) were published, and then changed, in April this year. Hunt became the Secretary of State in September 2012. They are Hunt's regulations. (Of course, if you want to be pedantic the actual regulations are signed by Lord Howe, but Hunt is the boss.) Are you seriously saying that Hunt is a puppet delivering what the Leader of the House tells him to? Hmm that would agree with what I'm saying about Hunt being an amateur, temporary, pointless minister.

Anyway, its lovely to see that you are blaming me for the failure of the system. The system can be improved by putting patients in control - and getting rid of the straitjacket of the procurement regulations would be a start - but all you want to do is blame patients. 

I have tousled with "Dick Vinegar" before, I find that he is opinionated without providing much evidence behind those opinions (hence my comment about "anecdotes" above).

I encounter his undying belief that technology will solve everything throughout the NHS. However, when I hear it from an NHS manager I can at least excuse them that they know nothing and are echoing what they have been told to say. This is not the case with "Dick Vinegar" who appears to have the ear of politicians. (I wonder if he has written any code? I tend to find that the people who believe that technology will solve everything - for example Tim Kelsey - have never written any code themselves.)

Dick Vinegar

This is the nom de plume of Richard Sarson who says he is a member of the "Parliamentary IT Committee". Richard Sarson was the Editor of the PITCOM website from 1995. PITCOM was disbanded at the end of the last Parliament and was replaced with the Parliamentary and ICT Forum (PICTFOR) in 2011. I cannot find any trace of Richard Sarson on the PICTFOR website.

Patient in Chief

One of the principal aims of the Health and Social Care Act 2012 was to remove the responsibility from the Secretary of State for the provision of NHS services. Lansley's "great idea" was that NHS England (the country's largest ever Quango) runs the NHS and once a year the Secretary of State hands them a list of instructions ("the mandate") for them to fulfil in the following year. However, few believe that is could be possible, certainly not in the short term. In the Fifth Report on Commissioning, Stephen Dorrell, the Chair of the Health select Committee said:

Voters will, however, rightly continue to regard the Secretary of State as accountable for the development of the NHS—there can and should be no doubt that ultimate responsibility rests with him. The Government must therefore put in place structures which enable the Secretary of State to respond to this political reality.

Inspite of the warnings that it is not possible for the Secretary of State to abrogate responsibility for the NHS, Jeremy Hunt and his lieutenants have tried hard to make it a reality. (For example, recently Anna Soubry, the Minister of State with nominal responsibility for cancer care, refused to answer questions from MPs telling them they have to ask NHS England and not her.)

Hunt has clearly decided to appoint himself the "patient-in-chief". However, in Hunt's rarified environment of Westminster politicians, hacks and wonks, his idea of a "patient-in-chief" is to spend all his time complaining about the NHS rather than taking actions to improve it. It's as if Hunt has become the personification of a Daily Mail article: the NHS is no longer his responsibility, it's someone else's problem.

It has always been a responsibility of Secretary of States to be seen in the NHS, mostly visiting hospitals for pictures alongside smiling patients. During the passage of the Health and Social Care Act the Labour Party needed to get publicity and to get the Press (who appeared to have had some kind of D-notice imposed on them about anything to do with healthcare) to report something about the party and their NHS policy. Labour came up with a idea where their health spokespeople would "shadow" people working in the NHS: GPs, consultants, nurses, porters. These gave valuable photo opportunities, and allowed Labour politicians to talk to the Press about their experiences. It was a bit of a gimmick, but one that was desperately needed considering the Press refused to report anything about NHS policy.

Hunt, a man who has never been known to have an original idea, has co-opted this policy. In April it was announced that the Secretary of State would

deliver care "in some capacity" and would be carrying out cleaning and portering duties while observing clinical care given to patients.

at Watford General Hospital's emergency department. This, we were told, was "part of a back to the floor experience". However, it was just PR. While Labour could be excused the PR gimmick because they were starved the access to the Press, Hunt does not need to do this.

Cleaning and portering duties on one occasion does not make Hunt realise what it is like to be a cleaner or porter. Hunt has a ministerial phone and it was understood that if the PM phoned him (even for legitimate reasons - like say a national crisis) then Hunt would immediately return to London. An NHS worker cannot do this, none are expendable, if they leave unexpectedly patient care is affected; Hunt knew that he was in addition to the staff needed so if he left unexpectedly the care would be just the same. Hunt was not earning an NHS wage, and after his shift did not have to go back to the bills and debts of a porter's wage. Even the aim to "observe clinical care" was phoney: it is inconceivable that the trust would not have put on a special effort during the day that the Secretary of State was visiting. It is also inconsistent. Hunt is modelling himself as the "patient-in-chief" so what does he do? He pretends to be an NHS worker!

Hunt should stop these "work experience" pantomimes. They serve no useful purpose: he neither experiences how it is to do the job, nor what it is like to be a patient. Moreover, they appear phoney and hence are counter-productive.

If he is serious about being the "patient-in-chief" then Hunt has to become a patient and see the NHS like we do. I am not suggesting that he becomes ill (I would never wish that upon anyone) but there are more effective ways to see how the NHS performs than by pretending he is a porter. When Andrew Adonis became transport minister in 2009 he prepare himself by travelling on every mainline railway, this way he could experience the rail system like a passenger and learn about where improvements should be made. Hunt should learn from this: he can be a patient without being ill.

What he needs to do is become a patient activist. To justify its uncalled-for reforms the government made a big announcement that the NHS would work by the principle of "no decision about me without me". The Lansley reforms added new structures to do this in addition to the existing patient participation opportunities. This is how Hunt can experience the NHS from the patient's perspective.

1. He should attend the Foundation Trust governors' meeting of his local trust. This is not a huge obligation from him, they have to be held four times a year and are usually half day meetings. At the governors' meeting he can hear about the concerns from patient representatives about the quality and patient experience at the trust. He will also see the effect of cuts in tariff and the increasing numbers of fines have on the smooth running of the trust.
2. He should attend local Healthwatch public meetings. These are not statutory and the policies of Healthwatch vary across the country, but Hunt should attempt to attend as many as he can for his local organisation. Healthwatch should know where the local problems are. If he attends his FT meetings then he can put Healthwatch concerns in perspective with the challenges that the FT has to overcome. This should allow Hunt to adjust his policies to improve the NHS in general. If his local Healthwatch are not reporting local issues then this is a failure and he should change his policies to enable them.
3. He should attend his local CCG's patient reference group. These vary across the country, but every CCG had to have some form of patient involvement in commissioning as part of authorisation. Hunt should attend his local group regularly - possibly once a month or every other month. This will allow him to see from the CCG's perspective the difficulty they have in providing services when faced with NHS cuts. He will also see how the relationships between GP commissioners and NHS providers are developing and see the effect of procurement law on the delivery of services.
4. He should attend his local GP's patient reference group. Again, this is not a huge obligation: an hour or so every other month. This will allow him to see the concerns of GPs and their patients. 
5. If he has some extra time (perhaps by cancelling some of his dancing lessons) he should attend his local Health and Wellbeing Board (every other month, 2 or 3 hours) so that he can determine for himself whether the board is effective.

The important point is that he does not do these things once. At a minimum he should do these things for at least a year. Since these meetings will be attended mostly by patients (or in some cases, run by patients) he would be able to see what actual patient concerns are (hint: in my experience as a "patient activist" no one has ever mentioned immigrant's use of the NHS, it is not a patient concern).

Hunt: stop the work experience and become a patient activist.

Creating More Mid Staffs

Robert Francis QC ascribes the poor care at Mid Staffs to:

The Trust prioritised its finances and its FT application over its quality of care, and failed to put patients at the centre of its work.

This is very clear: tight finances, so the trust was cutting staff (particularly nurses) and an obsession with achieving FT status above everything else, were the main drivers. The management of Mid Staffs was clearly poor and should have been replaced. In a recent debate in the Commons, Andy Burnham says:

In a national health service, there are areas where national direction is needed, and when things go wrong, there must be immediate powers of intervention, which, on my arrival in the Department in June 2009, I found I did not have. Foundation trust policy needs to be reviewed and adjusted to mitigate those dangers, including through a reconsideration of the power to de-authorise a failing foundation trust, which was recommended by the first Francis report, but repealed by the Health and Social Care Act 2012.

The original Act that created Foundation Trusts made them autonomous of Parliament which meant that they were no longer accountable to Parliament through the Secretary of State and so there was no power for Ministers to replace the management. On arriving at the Department of Health Andy Burnham found that he could not replace the management of Mid Staffs, the only people who could do that was Monitor. Indeed, it was Monitor who authorised a trust to be a Foundation Trust, it was not a case of the Minister deciding. It was Andy Burnham who changed the law to allow a Foundation Trust to be de-authorised, taken back under ministerial control so that the government can change the management.

The original Foundation Trust programme under New Labour was flawed. These three things were at fault: tight finances, Foundation Trust authorisation deadline and lack of ministerial control over Foundation Trusts.

At the 2010 election the Conservatives fully supported the Foundation Trust programme saying:

[We will] set NHS providers free to innovate by ensuring they become autonomous Foundation Trusts.

The Health and Social Care Act has several sections on "autonomy" which includes repealing the law that allowed Foundation Trusts to be de-authorised. Further, the White Paper on the NHS reorganisation said that all NHS Trusts must become Foundation Trusts within three years. The deadline was first put at April 2014, but then it was relaxed to April 2016. This deadline is as tight as the FT programme under New Labour.

Sixty percent of an NHS trust's income comes from Payments by Results (a fixed payment for activity)  and the current government has cut the PbR National Tariff by 1.5% in 2011/12, 1.5% in 2012/13 and from April this year, by another 1.3%. That means that NHS Trust incomes are going down. If an NHS Trust is efficient and makes a surplus on PbR payments, it cannot keep the surplus (this is a privilege that only FTs have) and instead the surplus is clawed back by the government as part of its deficit reduction programme. This means that NHS Trusts are under increasing financial pressure.

The three things that resulted in poor care at Mid Staffs are worse under the Coalition government, and they have been deliberately made worse. Indeed, the government could have retained the ministerial ability to de-authorise a failing Foundation Trust, but the government have deliberately repealed this law.

There is currently a Conservative HQ orchestrated attack on Andy Burnham. It is clear that it is orchestrated because the attacks are all the same, using the same language and the same points. Conservative HQ have used minor Tory MPs (so far Chris Skidmore, Charlotte Leslie and Steve Barclay) to make these attacks initially. They are testing the water to see how much mud sticks, and if it does, they will launch a much bigger attack using higher profile MPs. The sheer hypocrisy of these attacks is breath-taking. Rather than attacking Burnham (who tried to address the issues of Mid Staffs) the Tories should be learning from his actions to ensure that the situation will not happen again. Instead, the Tories are putting together the pieces to create many more Mid Staffs and are doing it fully warned of the consequences.

NHS Privatisation

There are two main aspects to the privatisation of the NHS. On the one hand there are the private, profit-making companies like Serco, Care UK and Virgin, who are contracted to deliver NHS services and make a profit that will be passed onto shareholders. This website is not about that aspect of privatisation. On the other hand there are NHS organisations behaving like private companies and carrying out treatments for fee-paying patients. This website is about this second aspect: private patients within the NHS.

The original 1946 NHS Act had provision for consultants to carry out their private practice in NHS hospitals. The Act was controversial and contained several compromises to persuade doctors to work for the new NHS. The numbers of private patients in NHS hospitals has waxed and waned with government policies and the economic situation. When the New Labour government brought in legislation to establish Foundation Trusts - autonomous NHS providers that are run like businesses – there was a lot of unrest on the Labour backbenches that the Act would be a massive expansion of the numbers of private patients. To assuage this backbench unrest, the government at that time created Section 44 of the 2006 NHS Act. This section said that:

the proportion of the total income of an NHS foundation trust … in any financial year derived from private charges is not greater than the proportion of the total income of the NHS trust derived from such charges in [2003]

The proportion of private patient income to the total patient income in 2003 is regarded as the private patient income cap and a Foundation Trust cannot exceed this proportion in any subsequent year. This cap is quite arbitrary. It includes the income from actual physical, in-the-flesh, patients, but it also includes income from other services like providing pathology or income from intellectual property. If an FT rents part of its site (for example, accommodation for nurses) then the money contributed to the private patient income even though no private patients were involved. This section of the Act, designed to restrict Foundation Trusts from offering a two tiered service, was clumsily applied. The 2009 NHS Act added a section specifically for private patients in mental health trusts. Section 33 said:

in the case of a mental health foundation trust designated under subsection (2A), that proportion or 1.5% if greater.

This section says that the minimum private patient income cap for a mental health provider was 1.5%. So even if the mental health provider had no private patient income in 2003, its private patient income cap is still 1.5%. For acute FTs the minimum cap was still 0%. The average percentage of private patient income for all FTs was 2% in 2011/12. Like all averages, this figure hides the wide range of income. Twenty eight FTs had no private income during this period, and 89 trusts (62%) had a private patient income less than £1m. A few trusts had very large incomes, as shown in the following table.

Foundation Trust	Private Patient Income (£000)
The Royal Marsden NHS Foundation Trust	51,144
Royal Brompton & Harefield NHS Foundation Trust	29,117
Great Ormond Street Hospital for Children NHS Foundation Trust	28,157
Guys and St Thomas NHS Foundation Trust	23,081
Royal Free London NHS Foundation Trust	19,224
Moorfields Eye Hospital NHS Foundation Trust	18,682
University College London Hospitals NHS Foundation Trust	18,006
Kings College Hospital NHS Foundation Trust	16,882
Chelsea and Westminster Hospital NHS Foundation Trust	11,264
The Christie NHS Foundation Trust	10,708

The Health and Social Care Act 2012 (HSCA) repealed sections 44 and 33. During the passage of the Act there were the same arguments about private care in NHS hospitals that there were during the passage of the 2006 Act. To try and reassure Lib Dem peers, the Coalition government came up with Section 164. Like the Section 44 before it, this section was also a fudge:

An NHS foundation trust does not fulfil its principal purpose unless, in each financial year, its total income from the provision of goods and services for the purposes of the health service in England is greater than its total income from the provision of goods and services for any other purposes.

This is usually quoted as the “49% rule” and is interpreted (wrongly) that 49% of the patients treated by a Foundation Trust can be private patients. This assumption ignores the fact that because it is far more expensive to treat a private patient the income from a private patient will be far more than from an equivalent NHS patient, so a Foundation Trust will need to treat fewer private patients to bring in the same income. However, this section is wider than Section 44 because the wording says that the majority of a Foundation Trust’s income must be from the NHS. This implies that the other income is from non-NHS sources rather than the more specific private patients.

Foundation Trusts are interpreting non-NHS income quite widely. The money that comes from car parking charges literally comes out of the pockets of patients (and not from the NHS) so is regarded as being part of the “49% rule”. If a trust delivers services (like speech therapy) to a local authority, the income does not come from the NHS and so is part of the “49% rule”. A Foundation Trusts does a lot of partnership working with social care and voluntary groups, and any income from this is treated as non-NHS income and hence part of the “49% rule”. In practice, it is extremely unlikely that 49% of the patients a Foundation Trust treats will be private patients.

The Health and Social Care Act has had a significant effect on Foundation Trusts. Analysis of the Forward Plans (the plan for the next three years) of the 144 Foundation Trusts that existed in June 2012, shows that 58 trusts (40%) intend to increase their private patient income. 

The new “business-like” aspect of Foundation Trusts mean that trusts are now creating private companies. Some are professional, serious businesses, like Kings Health Partners or Moorfields Dubai hospital. Others are comically amateur, like the private hair removal service at The Rotherham hospital. What is clear, however, is that such private enterprises distract from the core business of a Foundation Trust, that is, treating NHS patients. Section 164 of the HSCA supposedly addresses this:

An NHS foundation trust which proposes to increase by 5% or more the proportion of its total income in any financial year attributable to activities other than the provision of goods and services for the purposes of the health service in England may implement the proposal only if more than half of the members of the council of governors of the trust voting approve its implementation.

However, when you consider that the average proportion of private income is 2% for all Foundation Trusts, an increase of 5% is so large that it is unlikely to ever occur. This part of the Act will never be invoked.

The main private business that Foundation Trusts do is via private patient units (PPU). There are 43 foundation trusts with a PPU and these are usually just a few rooms (five or ten). The Forward Plans of Foundation Trusts show that 12 trusts intend to open a PPU. Every trust says that their PPU will provide income to the trust. However, closer reading of accounts and annual reports give a different picture. Although PPUs provide an income, the accounts do not give the expenditure of the unit and so we do not know the net profit or loss of providing a PPU. Trusts say that income from PPUs benefit NHS patients, but there is little evidence of this, and there is some evidence that private patients are detrimental to NHS patients. Indeed, most PPUs advertise the fact that private patients have full access (indeed, often better access) to NHS facilities. More telling is the occasional comment from trusts that the PPU was established to meet the demand from consultants. The HSCA is likely to increase this demand, consultants knowing that there are few impediments are demanding that their NHS trust allow them to conduct their private practice on trust premises.

Foundation Trusts also get income from charities. About a third (49) of trusts have charity income so small that they are listed as zero in their accounts. Nine tenths (129) of trusts have charity incomes less than £1m. However, there are a few trusts with significant charity incomes:

Foundation Trust	Charity Income (£000)
The Royal Marsden NHS Foundation Trust	31,790
Guys and St Thomas NHS Foundation Trust	12,667
Great Ormond Street Hospital for Children NHS Foundation Trust	9,334
University College London Hospitals NHS Foundation Trust	8,308
The Christie NHS Foundation Trust	6,697
University Hospitals Birmingham NHS Foundation Trust	3,334
Moorfields Eye Hospital NHS Foundation Trust	2,854
Blackpool Teaching Hospitals NHS Foundation Trust	2,357
Kings College Hospital NHS Foundation Trust	1,648
Gloucestershire Hospitals NHS Foundation Trust	1,569

It is apparent that there is a correlation between private patient income and charity income. In particular, trusts treating a lot of cancer patients (Royal Marsden, Guy’s) get a lot of income from cancer charities. The Royal Marsden has a huge income from private and charity sources and while it is clear that private patients benefit from the trust’s charity income (they have access to the Cyberknife facility bought with charity funds) it is unclear what benefits NHS patients have from the trust treating private patients.

One of the most business-like trust is The Christie, a specialist cancer FT in Manchester. The Christie has a joint venture company with HCA to treat private patients. The trust has used this company to hide its private patient income by listing the profit from the joint venture as its private patient income rather than the actual income from the private patients.

The Christie is one of two FTs that have been chosen to host a Proton Beam Therapy Unit (the other is University College London). These units are extremely expensive to establish, costing up to £150m. The government have rejected private funding of these units, so the capital costs will be met by taxpayers. A single unit can treat 750 patients and two units running at full capacity will only just meet the demand for all UK NHS patients (including 5% of patients for research). However, The Christie are currently building a private clinic specifically so that private patients can use the proton beam unit, even though there is no spare capacity for them. This raises the question of who will take precedence when the unit is running at full capacity: a private patient or an NHS patient.

It is clear that the passage of the Health and Social Care Act will increase the numbers of private patients treated by NHS hospitals: 58 trusts say they will increase their private patient income, and 12 say they will create a private patient unit. Annual reports and reports on trust websites show that these patients are more likely to benefit from NHS facilities than NHS patients will benefit from the income from these patients. Further, several FTs state that the reason for establishing a private patient unit is to benefit their consultants rather than NHS patients. NHS privatisation is controversial, and this report shows how the privatisation will occur from within.

About the Report

The report is a result of the analysis of the Annual Reports and Forward Plans of the 144 Foundation Trusts that existed in June 2012. The report lists the trusts' current private patient provision and plans to increase the numbers of private patients in the future. The web version of the report includes a selection of trust profiles, each one listing the private patient provision for that trust obtained from the Annual Report, Forward Plan and Board papers.

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