NHS England’s moratorium on commissioning new specialised mental health services helped deliver new demand and a return to real terms growth for independent providers, according to new research. Market analysts LaingBuisson’s report, shared exclusively with HSJ, also says moving away from block contracts could help open up the mental health sector to more independent providers.

The analysis says independent providers of mental health beds are “enjoying robust demand” with growth back up to an average of 4 per cent a year in the last three years, although profitability has been affected by austerity measures since 2008.

NHS demand for private sector beds, which LaingBuisson estimates accounts for 87 per cent of independent mental health care providers’ revenue, is subject to “ebb and flow” as NHS commissioners turn to private sector beds to meet capacity shortfalls.

The report says: “The demand ‘tide’ has been flowing in favour of independent mental health hospitals in the last few years essentially because of constraints on NHS in-house capacity as a result of an NHS England moratorium on commissioning of new capacity (for centrally commissioned specialised services).” …read more

HSJ: 17 February 2016

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