Ali Parsa, Chief Executive of Circle is amazingly charismatic. He’s also an impressive public relations operator. His admirers claim Hinchinbrooke test case for privatisation.

Circle’s claim to be a mutual or a co-operative are disputed. Its claims to be a social enterprise are harder to contest because there appears to be no agreed definition of what that means.  But Roy Lilley certainly doesn’t believe it. Nor does he accept the claims of huge improvements at Hinchingbrooke.

Hinchingbrooke Hospital, now managed by Circle,  reports  big improvements, reflected by high patient approval ratings, and claims its accident and emergency department has become the “top performing full service trust among all hospitals in the Midlands and East of England region”. This is a huge change in an NHS Trust, which has  been reported as a basket case for the last ten years.  If this experiment in private management fails nobody will be surprised. But if it succeeds it will be such a powerful “Proof of Concept” that it will challenge the existing model of the NHS very profoundly.

Circle produced a 16 point improvement plan – all admirable, and you wonder why some of those things had not been tackled before.  But it’s fundamental plan – like most hospitals – is to increase its business. One point  is to increase the number of patients treated each year by 5,000 They seem to have managed to attract some orthopaedic surgery from Addenbrookes, but in an environment where most commissioners are looking to reduce hospital activity there are not going to be many opportunities of this kind.

What counts as success is of course not straightforward.  For the people of Huntingdon, probably the question is just about whether they will  still have a hospital at the end of the 10 year period of the Circle contract, as closure has looked a probable outcome for a long time.  But Ali Parsa  has already managed to get the Today Programme to report his claims of success in some detail.

Mark Simmonds MP for Boston and Skegness visited the trust on 6 July and was able to attend a meeting about the positive changes that have been implemented in our Emergency Department this week. He had this to say: “In this hospital you can change the way the NHS works, in my view for the better, you are at the frontier of the way healthcare is going to be provided in the future. ”  The press release neglected to point out that Simmonds was on Circle’s payroll.

For the Conservative Party this is a test case for private sector contracting (Circle don’t own Hinchingbrooke, nor do they employ the staff). And of course it wasn’t this government that set the deal up.  It was Andy Burnham.    Sean Worth of the Better Public Services Project claims the wonderful results at Hinchingbrooke  have happened because “Under a new employee-ownership deal, hospital staff became part-owners of the managing company, Circle, so all had a personal stake in making the project a success”…..”As Hinchingbrooke shows, the right kind of reform can turn around shoddy government monopolies and transform them into huge success stories. Yes, there are problems with outsourcing – but the answer is not to rein it in, but to be more radical still”.  He reminds me of the people who thought that nationalisation failed because we didn’t do enough of it.

Charismatic leaders can make a success of most things.  Some GPs made a huge success of fundholding.  But that doesn’t prove it was the best way to organise the service.

Success in running a hospital is difficult to measure.  The bit that is easy is to count the money. The latest news is that a finance report to the board has revealed that it now only expects to deliver £6.5m of the savings originally targeted for this year. An additional £3.4m of new savings schemes have been identified  to fill the gap. All recruitment will be scrutinised by the senior management group. They may need another loan to keep the place going.

If Circle fail to keep Hinchingbrooke afloat will Mr Worth and his mates be learning any lessons?

It’s official. The first privatised NHS hospital is failing.

Tribal ran Good Hope Hospital in Birmingham in 2003 to 2005 – it wasn’t a big success

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8 Comments

  1. Richard Grimes says:

    The problem is that the questioning of Parsa and Circle so far has been on soft, unmeasurable things. Walking around a hospital that has had a death sentence on it for half a decade, and poking a microphone in someone’s face and asking them “do you feel happy now that the uncertainty is over?” will only get an affirmative reply. It is not an endorsement.

    My questions to Ali Parsa would be:

    1) What joint working do you have with GPs and community services? A good relationship between primary care and acute care is a key indicator of a trust being run well, so this will indicate whether they are running a business or a hospital. From a business point of view, commissioners will try to reduce hospital care and move the care into the community, so it makes sense for the acute trust to get more involved in community care, if only to make up for the hospital-based care they have lost.

    2) What joint working do you have with other hospital trusts? Any innovation that is developed in the trust is valuable: if the innovation is successful other trusts will want to emulate it. Is the trust selling their IP? What about other joint working with other trusts, for example on procurement (in particular, drugs)? One trust can save money on procurement, but at consortia of trusts will have much bigger buying power and a much bigger opportunity to save money.

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