Will Hinchingbrooke Hospital and IES Breckland detoxify profit?

By Peter Hoskin
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What a happy coincidence that on the day the Prime Minister delivers a speech about innovation in the health service, there’s a stunning example of just what that innovation can achieve. And that example is Hinchingbrooke Hospital in Cambridgeshire, the first NHS hospital to be run by a private company. If you haven’t heard the Today Programme’s interview with the chief executive of that private company, Ali Parsa, then I’d hasten you in its direction now. But the basic story is this: the hospital was flat-lining, stuck with £40 million of debt and a poor track record, before Circle took on the contract to administer it in February this year. Now, only six months later, there appear to have been dramatic gains in several directions. Waiting times and costs are down; quality of care and patient satisfaction are up. Hinchingbrooke is now ranked as the fifth best hospital trust (or the very best trust with an A&E) among the 46 in its corner of the country, the Midlands and East of England.

And guess what. Circle are making a profit out of Hinchingbrooke, or at least they will once they’ve paid off the hospital’s debts and curtailed its projected losses in the years to come. I’m sure people will begrudge them this, even if their success so far continues — but let them. It’s still a totemic demonstration of the fact that, with due diligence, profit and the private sector needn’t translate to malpractice and miserliness. It will be a joy for ministers to see this in practice after years of dread rhetoric from Labour about the ‘privatisation of the NHS’. Little wonder why Chris Skidmore MP has taken to the Telegraph to write that this is “a coup for the supporters of innovation”.

But it’s not so much the type of body that’s running Hinchingbrooke as the way it’s running Hinchingbrooke. It’s striking, in that Today Programme interview, how much emphasis Ali Parsa places on involving the healthcare professionals themselves, the doctors and the nurses, in the management of the hospital. ‘You let them take charge,’ he says. And Circle appear to be doing just that: they have turned Hinchingbrooke into a John Lewis-style partnership, where staff own part of the company, and they have put 17 clinicians on the hospital’s board. This is the same sort of thinking that lay behind the Conservative’s plans for cooperatives, and it cuts across healthcare borders — public, private, charity, profit-making, whatever. The important thing is best practice. In that respect, as Parsa says, ‘we need to take private, public, the ideology out of healthcare, and let the National Health Service provide free-at-the-point-of-delivery care to everyone.’

And the lessons extend beyond the NHS too. We may not have profit-making Academies yet (mainly because Nick Clegg is immovably set against them), but a group of parents, aided by their local MP Matthew Hancock, is going to approximate one in Suffolk later this year. Their plan is that the Breckland School will exist as a trust, but the management of it will be outsourced, for a fee, to an outside provider — in this case, Sweden’s International English Schools — much as how school lunches might be outsourced to an outside caterer. If this is also a success, then it could be another totem against the idea that moneymaking and public services oughtn’t mix. Now, two in a year? That would be something.