The Lowdown survey of 23 ICBs has revealed interesting new information on the extent of local dependence upon private sector clinical services, and the extent to which ICBs and trusts view the private contracts to be a liability rather than an asset.

Thirteen ICBs from the sample of 23 refer to the use of private providers; five of these are clearly positive about them, and regard the independent sector as an asset.

Bedfordshire, Luton & Milton Keynes notes “Elective Recovery Fund income is expected to grow in 2024/25 with the expansion of Independent Sector Providers.” (p103) The private providers have even developed their own waiting lists: “There were 2,589 patients waiting at local independent sector providers (Blakelands Hospital, Manor Hospital, Saxon Clinic and SpaMedica Bedford).” (p106)

However deficits at both Bedford and Luton mental health services are attributed to “increased demand for private sector beds.” (p115)

Leicester, Leicestershire & Rutland ICB also seems to regard independent sector and insourcing providers as an asset in efforts to hit waiting list targets.

West Yorkshire ICB reports “Through WYAAT [West Yorkshire Association of Acute Trusts], there is an established mechanism for collaborative use of the available independent sector capacity to maximise best use of this capacity for our population.” (p31)

Lancashire & South Cumbria also insists “maximisation of all available capacity including the independent sector is a critical element to our plans.”(p13)

Lincolnshire ICB is even more enthusiastic, stressing that “Mutual aid [in eliminating 65 week waits by March 2024 and 52-week waits by March 2025] will continue to be delivered predominantly from independent sector providers for challenged specialties, particularly for Gastroenterology and Dermatology.” (p 177) It notes that activity with independent sector providers increased by 120% last year, while United Lincolnshire Hospitals increased by 116% and neighbouring trusts just 105%. (p294)

One ICB, Hertfordshire & West Essex appears neutral, revealing a substantial use of private providers, forecasting the full 23/24 spend at £51m (12% of the Trust’s Elective Recovery Fund activity) but making no comment. (p169)

However the ICB also reveals, without explanation,  that East & North Herts Trust is seeking to outsource imaging to the private sector.”(p122)

Other ICBs are more obviously concerned by the costs and other aspects to working with the private sector. Mid and South Essex ICB includes as one of “three key areas of significant pressure;

  • acute services where there had been growth within the independent sector and the exercise of choice and was expected to continue into next year” (p11)

Norfolk & Waveney also lists the use of “Acute independent sector” along with “Prescribing and Mental Health Packages” among the “Key adverse drivers” impeding efforts to balance the books.

South East London not only includes the private sector as a cost pressure increasing the deficit but puts a figure on it: “Maintaining independent sector capacity to support elective recovery targets and mental health bed pressures – £21.8m.” (p98)

South West London also notes the increased spend on the independent sector: “Acute services forecast overspend is largely due to increasing in activity delivered by Independent service providers”. But the ICB looks on the bright side “this counts towards ICB’s elective recovery target so additional allocation will be received based on actual activity delivered.” (p197)

In Nottingham & Nottinghamshire both the acute trust and the community and mental health trust have faced cost pressures as a result of the independent sector. Nottingham University Hospitals lists “£3.8m independent sector activity above planned levels” (p189) as one of the factors in its deficit (although the planned level is not discussed), while Nottinghamshire Healthcare FT notes drivers of its increased deficit including “Private Sector Beds – ( £7.8m) of sub-contracted bed costs within mental health due to additional spot purchase acute and PICU beds and additional patient observations.” (p191)

Cheshire & Merseyside notes the positive impact on health equalities of reducing dependence on private provision: “Levelling-up performance on cancer and cardiovascular disease to address health inequalities has reduced use of independent sector activity compared to 2019/20 down by 11% for CT, 47% for MRI and 70% for ultrasound.” (p109)

Greater Manchester ICB, with far and away the biggest financial problems of the 23 ICBs surveyed so far, reports the scale of spending on private providers of acute hospital care: £175m in 2023/24 (p32). While this is just under 5% of the £3,580m spent with NHS providers, it is money that flows out of the NHS and cannot be used to expand and renew NHS capacity.

The private share is much larger in mental health spending, with £227m spent on independent, Voluntary, and Community services. This is a massive 44% of the sum spent on NHS providers and more than a quarter of the ICB’s mental health budget. (p33)

It is clear Greater Manchester health chiefs now view this level of spending as a problem to be tackled. In identifying steps to financial recovery in 2024/25 the ICB includes as its first two points:

  • The continuation and further embedding of grip and control.
  • A systematic reduction in our dependency on the independent sector. (p42)

However achieving this will require investment to expand NHS capacity, especially in mental health, for which Greater Manchester is in the top quartile for need, but in the bottom quartile for level of spending. The ICB admits

“• Demand will remain high with high acuity, exceeding the bed capacity in the GM footprint across both NHS and Independent Sector providers. (p89)

However the ICB remains hooked on private sector solutions to reduce Out of Area Placements of mental health patients:

“• The ICB has, since November 2023, implemented a grip and control process for OAPs which has seen a sustained reduction in the number of placements. – some of this is attributable to the purchase of an additional 15 independent sector beds.” (p90)

It will clearly be some time before the ICB, like many others, can achieve the ambition of reduced dependence on private providers.





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