At this time of crisis, profiting from scarce NHS resources is unconscionable

David Rowland | January 15, 2021 | Blog

In London and other parts of the South East, the NHS has tragically reached that point which disaster planners had prepared for but hoped would never happen, namely a hospital service so overwhelmed by patients infected by a lethal respiratory disease that it can no longer provide care to all those in need.

With urgent cancer surgery now being cancelled in parts of the capital, this awful moment must be addressed by taking every possible measure to suppress rising infection rates whilst commandeering all available healthcare resources to limit loss of life.

It should not be a moment when scarce NHS consultants are boosting their income by doing non-urgent private work whilst making a profit for healthcare companies.

Yet this is what currently happening, according to reports in the Health Service Journal at the weekend.

Unknown to most people, the private hospital sector in the UK does not train or employ its own doctors.

Its business model can only function if it uses NHS surgeons and anaesthetists to carry out the operations – such as hip and knee surgery – which are its main source of income and profit.
Take away the permission granted to NHS consultants to do private work in their ‘spare’ time and the industry collapses overnight.

And yet, rather than seek to repay this enormous subsidy at a time of national crisis, the private hospital sector has instead decided to continue using NHS consultants to treat non-urgent – but nonetheless profitable – patients on a private basis, pulling them away from the pandemic response.

This fact led a number of NHS medical directors to write a letter attempting to ‘shame’ the private hospital sector into dedicating their resources to treating those urgent cases who are being denied care due to the pandemic and to refuse to support those consultants who are undertaking non-urgent private work rather than focusing on those most in need.

But there is little point in appealing to the better nature of a sector whose prominent members have sued the NHS, been fined for price fixing and healthcare fraud and who have refused to make changes to patient safety regimes despite numerous high profile scandals.

For these are healthcare businesses with a singular focus on the bottom line, who must maximise shareholder value at all costs and repay the large debts they have taken on.

To date these businesses have done very well out of the NHS during the pandemic and they intend to keep on doing so.

Ignore the glossy brochure put out by the industry which aims to show how the private sector came to the rescue of the NHS during wave 1 of the pandemic, when the NHS bought out the entire capacity of the private hospital sector at an estimated cost of £1 billion – despite receiving very little in return.

Because without this £1 billion bail-out many of the private hospital companies would have faced financial ruin due to lockdown restrictions and the inability of their highly lucrative overseas patients to travel to the UK.

In the case of the listed private hospital company Spire for example, its share price collapsed at the height of the pandemic and it was close to breaching the covenant with its lenders until the NHS stepped in with a bailout – but since that moment its share price has tripled in value.

Instead of seeking to accommodate and protect the interests of the private hospital sector and the consultants who work out of them, more decisive action is needed from the government if it is to stop profiteering and make best use of all the available healthcare resources to deal with the current crisis.

In the first place, it should suspend that part of the consultant contract which permits consultants to do private work in their spare time.

No matter how controversial this may be amongst the Royal Colleges and the BMA, all consultants should be under the direction of their main employer for the duration of the crisis and access to their care and treatment should be determined on the basis of need and not ability to pay.

Second, rather than renting facilities from the private hospital sector and buying services from them over the next 4 years at a cost of £10 billion ─ as is the current plan ─ it should instead purchase those beds and equipment it needs at current market price and incorporate them into the NHS estate.

Given that many of these companies are only likely to be viable with the income they receive from the NHS, it makes no business sense for the NHS to prop them up and to then buy operations from them at an inflated rate, particularly when these operations can only be provided using staff gifted to them by the NHS.

And to put that £10 billion figure in context – if what the NHS needs from the private sector is facilities rather than staff, prior to the pandemic when market valuations were significantly higher it was possible to pick up 30 private hospitals for £1.5bn.

As many on the right have argued for years, the NHS should indeed start thinking and behaving more like a business and act in the way that many other large monopolies are doing at this current time ─ namely exploiting the difficulties of their competitors and suppliers, cutting off any special treatment and buying up their assets cheaply.

Whilst this may seem a radical idea it is not without precedent.

In 2001 Robert Naylor, former Chief Executive of University College Hospital London, PFI pioneer, and recent author of the last Conservative government’s NHS Estate strategy, became aware that the owners of the privately run London Heart Hospital were in financial difficulty and needed to sell the facility quickly and so swooped in picking up the facility at below market value, thus adding a major facility to the NHS’s estate.

To undertake such a policy would of course require a change in attitude from a government which is ideologically committed to growing private healthcare.

But it is the rational approach to adopt in the midst of this crisis.

If there is any hope of providing a comprehensive hospital service right now, every hospital bed and every consultant should be placed under the direct control of the NHS and care should only be available on the basis of need not ability to pay.

To seek to profit from the current crisis, in any way at all is truly unconscionable.

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About the author

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David Rowland

David Rowland is CHPI's Director. He joined the organisation in 2019 after over a decade of working in senior policy positions within the healthcare regulatory sector. For David's full bio see our People pageSee all posts by David Rowland