This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.theguardian.com/society/2015/jan/09/circle-exit-private-contract-hinchingbrooke-nhs

The article has changed 5 times. There is an RSS feed of changes available.

Version 0 Version 1
Circle in talks to exit private contract to run Hinchingbrooke hospital Circle in talks to exit private contract to run Hinchingbrooke hospital
(35 minutes later)
The healthcare company Circle is in talks to pull out of its contract to manage Britain’s first privately run NHS hospital, Hinchingbrooke in Cambridgeshire, as it blamed funding cuts and a surge in demand for accident and emergency services. A politically charged hand grenade has been thrown into the general election debate on the NHS after the healthcare company Circle said it plans to pull out of its contract to manage Britain’s first privately run hospital, Hinchingbrooke in Cambridgeshire.
Circle Holdings said funding for Hinchingbrooke Health Care NHS Trust was cut by about 10% for the current financial year and the company had spent £4.84m to support the trust. Circle is allowed to withdraw from the contract if it spends more than £5m. Circle Holdings issued a statement to the London Stock Exchange blaming funding cuts, a surge in demand for accident and emergency services and a failure to deliver “joined up” reform between health and social services. It said the company has entered into discussions with the NHS Trust Development Authority “with the view to ensuring an orderly withdrawal from the current contract.”
The company said conditions had got worse in recent weeks and that its franchise to operate the trust was not sustainable. The company said that funding for Hinchingbrooke Health Care NHS Trust had been cut by about 10% for the current financial year and that the company had spent £4.84m to support the trust. Circle is allowed to withdraw from the contract if it spends more than £5m.
Circle referred to Hinchingbrooke’s status as one of the first hospitals to be assessed under the Care Quality Commission’s (CCQ) new regime; a critical preliminary report was published in the autumn. It said a further report was imminent, but its conclusions would be unbalanced and it would contest many of them. Conditions had worsened in recent weeks and that its franchise to operate the trust was not sustainable, it added.
Steve Melton, Circle’s chief executive, said in a statement: “Like most hospitals, over the past year Hinchingbrooke saw unprecedented A&E attendances and not enough care places for healthy patients awaiting discharge. The announcement comes ahead of a report by the Care Quality Commission’s new regime which is expected to be highly critical of the hospital. The Circle statement said the reports’ conclusions, which follow a preliminary report last year, would be unbalanced and that it would contest many of them. In preliminary findings released in September, the CQC reported patients at the hospital were being neglected, hygiene was inadequate and Hinchingbrooke was facing staffing problems.
Steve Melton, Circle’s chief executive, said in a statement: “Like most hospitals, over the past year, Hinchingbrooke saw unprecedented A&E attendances and not enough care places for healthy patients awaiting discharge.
“At the same time, our funding has been cut. We also believe that inconsistent and conflicting regulatory regimes compound the challenge for acute hospitals in this environment. This combination of factors means we have now reluctantly concluded that, in its existing form, Circle’s involvement in Hinchingbrooke is unsustainable.”“At the same time, our funding has been cut. We also believe that inconsistent and conflicting regulatory regimes compound the challenge for acute hospitals in this environment. This combination of factors means we have now reluctantly concluded that, in its existing form, Circle’s involvement in Hinchingbrooke is unsustainable.”
The developments will come as a severe blow to the health secretary, Jeremy Hunt, as he fights Labour claims that the Tories are so determined to increase privatisation of the NHS that they risk undermining its principles. In 2012, Hinchingbrooke became the first NHS trust to be run by a private company after ministers described it as a “financial and clinical basket case”.
Hunt has said Circle won the contract under a process that began under the last government. Circle was disclosed as the preferred bidder in November 2010, six months after the general election.
But the statement by Circle Holdings goes to the heart of many of the issues highlighted by Labour as it seeks to place the NHS at the heart of the election debate. Andy Burnham, the shadow health secretary, says the government is intent on increasing the role of private-sector providers who have little feel for the values of the NHS.
Labour also says that the winter crisis in the NHS, during which a series of hospitals has declared major incidents amid intense pressure on A&E services, has been caused in part by the failure to combine health and social services. Labour says hospitals are facing huge pressures in part because of the cuts in social service care for elderly people. Labour has called for the NHS and social services to be combined.
Circle’s statement said: “We believe that solving the problems facing Hinchingbrooke can only be achieved through joined-up reform in Cambridgeshire across hospitals, GPs and community services. We fully support the vision of NHS England chief executive Simon Stevens’ Five Year Forward View, but these proposed reforms are too far into the future. If reform in the region develops fast and a new role for us does become clear, we are happy to play our full part.”