Virgin to sue the NHS

Following MD’s revelation that Virgin Care was cutting up rough after losing the £82 million Surrey children’s services tender (Eye last), the Health Service Journal has discovered Richard Branson’s business empire is suing NHS England, Surrey County Council and the county’s six clinical commissioning groups after commissioners awarded the three-year contract to Surrey Healthy Children and Families Services Limited Liability Partnership.
A Virgin Care spokesman told the HSJ the company had concerns about “serious flaws in the procurement process which has led to an outcome that we strongly feel is not in the best interests of the children and families we support, or our valued colleagues.” A Virgin Care whistle-blower was less convinced the company deserved to retain the contract it had held for 5 years. ‘A lot was promised by Virgin when they won the contract, but very little materialised. We all got nice phones and new computers, but the recruitment needed into developmental paediatrics didn’t happen. There was lots of branding and leadership courses, but I don’t think the care of children with special educational needs, or the support for their families, improved. For example, a key receptionist was not replaced and it’s now very hard to navigate the system if you are not literate.’

This was backed up by Guildford and Waverley CCG’s Wellbeing and Health Scrutiny board, which said the complexity of commissioning and contracting arrangements has led to children and young people experiencing “service variation with differing access for families…a well as gaps in service provision and variation in waiting times.” A joint CQC and Ofsted report in October 2016 into the effectiveness of the Surrey area in implementing disability and special educational needs reforms resulted in a ‘Written Statement of Action’ because of significant areas of weakness in the local area’s practice. ‘Overwhelmingly, the parents and carers of children and young people who have special educational needs and/or disabilities, and who spoke with or contacted inspectors, lack confidence in the local area’s leaders and services. This is the result of parents’ continuing difficulties in obtaining the timely and accurate assessment of, and planning for, their children’s needs.’

None of this means that there weren’t faults in the commissioning deal that removed services from Virgin Care, and the company mounted a successful legal challenge in 2016 in Hull, forcing NHS commissioners to undertake a full procurement process for several GP services. In June 2016, the NHS took Virgin to court after Swale CCG and Dartford, Gravesham and Swanley CCG awarded a £127m community services contract to the private firm. The move was challenged by incumbent NHS provider Kent Community Health Foundation Trust. It argued the assessment was flawed and that transferring the work to Virgin Care would cause legal, IT and human resources problems affecting patient care. The High Court suspended the award of the contract. The Surrey spat could be payback.

MD predicted all this waste and mayhem when the Health and Social Care Act was introduced. Vast amounts of time and money are wasted on preparing bids and tenders, supported by costly legal and management consultancy advice, that often don’t succeed and even when they do, the process for rebidding in 2 or 3 years starts all over again. NHS Commissioning is generally poor, with repeated glaring errors that the private sector ruthlessly expose. The legal sour grapes exhibited by Virgin are an entirely predictable consequence of aggressive tendering, and if not successful may at least minimise Virgin’s losses. In Surrey, the company are demanding close to £1 million to ‘de-Virginize’ care records and extract the relevant information to pass onto the new providers on April 1. Staff who have suggested that the last reports and care records should be printed out and handed over as hard copy have been told nothing must be printed out. Staff have also been ordered not to speak to the press and to be vigilant about anyone trying to film on the premises.

Surrey children’s services and the NHS are unlikely to be free form Virgin Care’s lawyers for a long while yet. Meanwhile, the company has published its accounts to March 2016, with a loss of £10.5 million. The accumulated losses are now £84.1 million, while the share capital of the company is only £53.8 million. The company has a bank overdraft of £368,000 and has yet to balance its books in 7 years. If it was an NHS trust, it would be in special measures. So what game is Branson playing?

Virgin Territory

According to Chief Inspector of Hospitals Prof Mike Richards, the NHS stands on a ‘burning platform’ with 11% of trusts rated inadequate by the CQC and 70% requiring improvement. Understaffing and overcrowding put patients and staff at risk every day. Meanwhile, private providers lead by Virgin Care are busy ‘conquering the community care space’ says HealthInvestor magazine. ‘A market worth around £10 billion has suddenly become a private affair…’ Virgin has already hoovered up over 400 health, social care and local authority services’ contracts, worth over £1 billion. It’s ‘quite the portfolio’ according to HealthInvestor, and other companies are lining up to conquer what’s left. ‘The chance to drink in a £9 billion pool in tantalising…’

There’s a clear underfunding and privatizing trend in NHS and Local Authority services. Between April 2013 and April 2016, 45% of the community health services that were put up for tender went to non-NHS providers. Private operators now run GP and out of hours services, walk-in centres and minor injury units, district nursing, diabetes, musculoskeletal, audiology, dermatology, physiotherapy, podiatry, rheumatology, mental health and other chronic disease services, urgent care, phlebotomy, anti-coagulation, sexual health, wheelchair services, prison healthcare, community hospitals, neuro-rehabilitation, frail and elderly care, health visiting, services for children with complex mental, physical and sensory learning difficulties, social care for adults and children and end of life care.
The whole range of community healthcare has now been privatized while Theresa May and Jeremy Hunt – and Tony Blair and Alan Milburn before them – have the gall to repeat the lie that the NHS is not for sale. The NHS has outsourced its very essence – much of the complex, difficulty care that requires close collaboration and team working has been contracted out. Virgin argues that such care was fragmented when the NHS offered it and that they have a much better chance of joining it up under one organization. The more they hoover up, the more they can join up.

Andrew Lansley’s Health and Social Care Act has allowed companies like Virgin to aggressively tender for any service they want, and to legally challenge the award of any contract that doesn’t allow them to make a pitch. Their pitch is deceptively simple. ‘Our aim is to make a real difference to people’s lives by offering NHS and social care services that are better than what went before, a great experience for everyone and better value for the public and the NHS. ’When the NHS pitches for services it tends to be far more downbeat, citing the reality of trying to keep an underfunded, understaffed service afloat in the face of rising public demand and expectation. It’s easy to see how the Clinical Commissioning Groups and Local Authorities who award the contracts fall for the optimistic swagger of Virgin. The company generally employs the NHS staff who were providing the services previously, and gives them smart phones, colour printers and other gadgets you have to fight for in the NHS. It claims that 93% of customers recommend it services to friends and family. If it can provide better services than the NHS for the same cost or less, then why not?

NHS commissioners are often naïve (remember PFI?), and get turned over in contracts, which companies aggressively stick to. ‘If it’s not in the contract, we’re not doing it’ rarely equates with universal healthcare. Yet despite some tough negotiating, Virgin Care has yet to make a profit in 7 years doing business.
In the year ending 31 March 2015, turnover was reported as £40.38 million leading to a gross profit of £5.2 million, but with administrative expenses of over £20 million, the company made a loss of £9.1 million. When will shareholders start demanding it balances the books and cuts back on smart phones? Virgin recently lost its Community Services Contract for children in Surrey. As a whistleblower told the Eye : ‘Virgin Care are now concentrating on recouping as much money as possible, asking for asset templates  to be completed, threatening removal of laptops and mobile phones with little thought for safe transfer of care. They have been restricting information sharing with the new provider and talking about intellectual property rights. Many staff are feeling anxious about being able to carry on with “business as usual” on 1st April.’ Meanwhile, the government is launching 10 year Multispecialty Community Provider contracts to take the pressure off hospitals. ‘It’s another lucrative opportunity for the private sector’ says HealthInvestor

Who wants to be Leader?

Health secretary Jeremy Hunt believes, rightly for once, that the NHS can only survive if more clinical staff become leaders. Yet most clinical staff don’t want to be lead by Jeremy Hunt or implement dangerous £22 billion austerity cuts, departmental closures and the private outsourcing policy of the government. Leading an organization where patients and staff are routinely harmed by the effects of unnecessary underfunding is a thankless task. The BBC’s week long exposure of the NHS crisis introduced us to the concept of ‘corridor nurse’ in scenes reminiscent of the nineties. Back in July, a Surrey woman died after being denied entrance to 3 hospitals and NHS England was warned of worse to come. Now many ambulance trusts aren’t able to fulfil their emergency response times, and staff are in tears in short-staffed departments that can’t cope with the demand. The service has always been glued together by goodwill but under Hunt, the goodwill has gone and staff are walking.

Under Hunt’s command, the number of junior doctors progressing directly into specialty training has fallen from 71.6% in 2011 to 50.4% in 2016, its lowest ever level (Eye last). This is sad, but unsurprising not just because of their work pressures, but because they feel undervalued and ignored by the Department of Health and NHS England. Many of the junior doctors MD has spoken to also believe that it is unsafe to blow the whistle about their working conditions and patient harm. As one put it: ‘It felt a lot safer when the BMA was behind us and 55,000 of us were united in exposing the dangerous understaffing in the NHS. But since the BMA capitulated over the new contract, it’s as if you’re on your own if you dare to speak up. And you have no legal protection.’

Junior doctors often take a career break after finishing their F2 training year, but the omens are not good for most of them returning to the NHS full time. ‘As a paediatric trainee, my workload was simply overwhelming. There were – and still are – rota gaps in every shift that we have to cover. Sometimes I’d be looking after 40 sick kids. I would worry about harming them when I was on duty, and then take it home with me and spending all my ‘down time’ worrying that I’d done something wrong because I was always multi-tasking very complex problems when, say, getting a dose of a drug wrong or missing the subtle signs of sepsis could prove fatal. Just driving past the hospital on my days off would make me feel very anxious. And before a shift I would sit in the car park and cry, and just wish I didn’t have to be there. I used to love my job, when the workload and stress were manageable, but they aren’t any more and I can’t return to the job until they are.’ Another junior doctor highlighted Hunt’s leadership; ‘You can’t blame Hunt for everything. The NHS has been underfunded for most of its 69 years, and that’s all of our fault. But I simply refuse to work in a system where I believe the leaders are both unwise and unkind. If Hunt had listened to junior doctors, instead of fighting them, we could have worked together to try to sort out some of the problems. To be blunt, I think the leaders of the NHS are either in denial about the true state of the NHS, or are deliberately running it into the ground so they can sell it off. Most of my friends aren’t going into full-time specialty training until the NHS becomes a safe and humane system to work in. And that needs a change of leaders as much as a change of funding.’

Some good news for Hunt is that people appear to have stopped living longer, at least for now. Researchers from the London School of Hygiene and Tropical Medicine have analysed the sharp rise in deaths in 2015 (30,000 more in England and Wales than in 2014) and linked to the ‘massive disinvestment’ in health and social care. If this is true, 2016 looks like being a bumper year for deaths. In the meantime, the corporate hoovering up of NHS services by the private sector continues apace. One senior NHS manager, who doesn’t wish to be identified, gave an alarming account of the process:

‘We lost our contract for community services – something we had run successfully for many years – to Virgin. I still don’t understand why, but I guess they made promises to the CCG that we realistically couldn’t deliver. We then had a meeting with representatives from Virgin to discuss handing over the contract. It was like an episode of the apprentice. These bright-eyed twenty-somethings were full of enthusiasm but clearly had no idea how to run the service. They wanted us to advise them, and to hand over all our knowledge and expertise. I thought ‘this isn’t how corporate take-overs work.’ If Sainsbury’s take over a Tesco branch you don’t expect the Tesco staff to hand over all their business intelligence to a competitor. But you do it in the NHS, because you don’t want to see patients harmed. I’ll be amazed if they make a success of it, but it’s the CCG who gave them the contract. It’s doctors doing the government’s dirty work.’ Clinical leader anyone?