Are We Safe in a Public-Private Health Service?

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Laurence Vick - Enable Law

The following article was originally published in issue 8 of Medico-Legal Magazine, and is reproduced here in full with kind permission:

Laurence Vick Legal Director at Enable Law

Outsourcing medical treatment to private providers is common practice in many areas of the NHS, with private companies increasingly operating alongside NHS trusts. The result, in some places, is an NHS that is neither fully public nor fully private, leading to concerns over gaps in safety where the two sectors overlap.

In this article Enable Law Legal Director Laurence Vick comments on the safety concerns over outsourcing by the NHS to often inadequately vetted private sector hospitals and shortcomings in the supervision and monitoring of those contracts when in progress.

The Paterson scandal inevitably looms large over the private healthcare sector and serves as a reminder of the sometimes uneasy relationship between the NHS and private providers. Paterson had been employed by the Heart of England NHS Foundation Trust (HEFT) and had practising privileges at Spire’s Solihull Parkway and Little Aston hospitals. Spire, BMI and other private companies carry out a significant amount of work for the NHS. The NHS is now contracting out a fifth of its total healthcare budget, equivalent to more than £20 billion a year.

Spire’s NHS referrals nationally are reported to account for almost a third of its £926m annual revenues. Although nearly a quarter of their activity at the Solihull and Little Aston hospitals is funded by the NHS, none of Paterson’s surgery appears to have been outsourced by the NHS.

Nearly half of the patients treated by BMI in their hospitals are NHS referrals. In her 29 January 2017 report for the Bureau of Investigative Journalism on the concerns over consultant orthopaedic surgeon Mohammed Suhaib Sait’s treatment of patients at the private Fawkham Manor BMI hospital, Melanie Newman noted the current lack of a national system for monitoring the care provided to NHS patients treated in the private sector. Regional NHS Clinical Commissioning Groups (CCGs) are responsible for handing out and overseeing contracts, but senior NHS sources quoted in the TBIJ article said that these bodies are overstretched, unable to carry out adequate checks and rarely carry out audits: ‘NHS commissioners are funding these treatments but don’t know which patients have had what done…they get a bill for a list of services and they pay it’

We may not be sliding into full-scale privatisation of our healthcare as many fear. After Circle’s unhappy experience running the Hinchingbrooke NHS hospital there must be a doubt over the private sector’s appetite for taking over and accepting the operating risk and indemnity cost of running a full-service hospital, or a maternity unit or A & E department. Circle pulled out less than a third of the way through their 10 year contract after Hinchingbrooke had been placed into special measures following a CQC report revealing a catalogue of serious failings. An increase in outsourcing of specific elective treatment and services by the NHS to private providers seems inevitable though.
My experience of these cases going back over 10 years echoes these findings and has revealed failures in outsourcing on a number of levels: the private companies and the staff they employ are not always assessed as fully as they should be; contracts do not appear to receive an appropriate level of supervision and monitoring by commissioning NHS organisations, and there is a concern that local NHS management may not be in a position to intervene swiftly if problems occur. I have also found a gap when seeking to establish who has overall responsibility at the highest level for the safety of outsourced care.

As patients we need to know that any outsourced treatment we undergo is carried out to the same if not better standard than if performed in the NHS. The vast majority of treatment carried out in the private sector goes ahead without mishap but how can we be sure and how can this be put to the test? The sector will point to the high quality of private health care but, given the lower transparency requirements, how do we know that the treatment provided – whether to outsourced NHS or wholly private patients – is safe?

Whereas NHS hospitals treat all-comers, adults and children, with the full range of medical conditions, illnesses and diseases, private hospitals carrying out outsourced work for the NHS can effectively ‘cherry pick’ the most profitable, usually low-risk, forms of treatment that can be delivered at a predictable cost. This should present no difficulty for surgeons and their teams but problems do occur. There should be few if any complications, so the 50% complication rate – attributed to not one but to a ‘constellation’ of failures – only four days in to the outsourcing contract for cataract procedures carried out by Vanguard Health in 2014 for the Musgrove NHS Trust in Taunton was alarming.

A lack of transparency and a culture of secrecy often seems to prevail when the private sector is involved in NHS contracting. A fundamental problem is that private operators are not subject to the Freedom of Information Act. As taxpayers and users of our NHS shouldn’t we have the right to investigate the terms and details of contracts made with private operators and how they are to be monitored and supervised? Private hospitals can also be reticent when it comes to publishing information which would allow their outcomes to be analysed and compared with NHS hospitals.

As appeared to be the case with the Musgrove- Vanguard cataract contract, the impression is that the private sector can be reluctant to participate in open joint investigations with the NHS when problems have occurred. This should surely be an automatic requirement so that information can be shared, standards and outcomes in the NHS and private sector compared and lessons learned. We won’t see the culture we have moved towards in the NHS if private providers, with obligations to shareholders as well as patients, are able to hide behind ‘commercial confidentiality.’ If private providers are to do business with the NHS, it seems only reasonable that they should be required to face the probe of FOI requests and adhere to the standards of openness and transparency we are increasingly seeing in the NHS. Otherwise we risk losing the key advances that have been made in the law relating to consent before treatment and the duty of candour after treatment has been carried out. The concern where NHS care has been outsourced is that the private provider may thwart the commissioning NHS body in complying fully with the duty imposed on them. I don’t see how we are going to get an accurate explanation of the risks inherent in a procedure or the reasons why treatment has failed if a private provider is reluctant to disclose its outcomes. The ‘insurance factor’ may also play a part. Will a private provider’s insurers be happy for their insured hospital or clinic to explain the full reasons why an operation may have failed? Paterson’s NHS and private operations pre-dated the introduction of the duty of candour but it would be interesting to know what patients could expect from the duty of candour if they had taken place today.

The ISTC programme and Netcare

My own involvement in handling failed outsourcing cases goes back to the Netcare ISTC (Independent Sector Treatment Centre) contracts of 2006. An ISTC contract to provide orthopaedic and cataract operations was negotiated by Hampshire and Isle of Wight Strategic Health Authority with the South African healthcare provider Netcare, which flew in surgeons and nursing staff from South Africa to carry out operations at the Haslar Hospital, Portsmouth.

One of our clients, a patient of Plymouth’s Derriford NHS Hospital, underwent a hip replacement at the Haslar under this ISTC initiative. The hip surgery failed and during the procedure she suffered a severe burn on the leg from the diathermy wand used to cauterise blood vessels. She was left in the invidious position of having to wait while her local NHS hospital argued with Netcare over responsibility for her care. Derriford argued that clinical as well as legal responsibility for her care had effectively been transferred to Netcare. This impasse was resolved by Derriford accepting responsibility for the treatment of the burn injury. They also arranged for the hip surgery to be re-done by a leading orthopaedic surgeon at a local private hospital. On the morning of the revision procedure, however, our client faced the private clinic’s receptionist demanding to know who would be paying for the operation. This was resolved with the NHS Trust picking up the bill; the revision surgery went ahead at no cost to our client, but not without a great deal of distress. We never discovered if the NHS recovered these costs or the damages paid to our client from Netcare but the suspicion was that they did not.

The report commissioned by the Strategic Health Authority into these failures in 2006 identified a range of shortcomings: inadequate vetting of the medical and surgical staff employed by Netcare; inadequate liaison, and often tension, between Netcare and local NHS personnel when addressing surgical complications and inadequate monitoring of the contract when in progress. We submitted evidence of the Netcare failures and the safety concerns to the Commons Health Select Committee as part of their investigation into ISTCs in 2006. Their review revealed concerns over regulation and monitoring of quality of care demonstrated by ISTCs and included the recommendation that all organisations providing services to patients, public or private, must be regulated with the CQC.

The Musgrove/Vanguard contract

Taunton and Somerset NHS Foundation Trust set up an outsourcing arrangement in May 2014 by which Vanguard Healthcare Limited was to carry out cataract operations in their mobile units at Musgrove Park hospital. The contract was reported to be worth £320,000, covering over 400 operations at a rate of 20 a day – at least six more than NHS consultants at Musgrove would routinely carry out each day. After only 4 days the contract had to be terminated by Musgrove after an alarming 31 of the 62 patients treated suffered complications. The already over-burdened (but highly regarded) NHS ophthalmic staff had raised concerns over the large number of patients they were having to treat after they had come to emergency eye services with post-operative complications. One of our clients, elderly like most of those affected, also suffering from dementia, was left blind in one eye.
The failure of the Musgrove/Vanguard contract is a classic example of all that can go wrong when the NHS outsources treatment to private contractors. I have chosen this contract not to single out Musgrove but because it illustrates the problems that can arise when the NHS outsources to the private sector.

To their credit, the Musgrove NHS Trust promptly announced that that they would commission a full internal report investigating the failings that had occurred and ‘Any financial responsibility would rest with us. If any patients wish to pursue compensation, we would work with them.’ The impression was that Musgrove wanted to get a report out as swiftly as possible. After a significant delay publication only took place after the report was leaked to the BBC.

The report established that there had been no single clear cause for the ‘constellation’ of failures that had occurred over the very short life of the contract. The report also exposed a complex chain of sub-contracting whereby three companies provided various elements of the outsourced service: Vanguard as main contractor, The Practice PLC supplying the surgeons, and Kestrel Ltd the equipment.

Complication rates in cataract procedures are generally less than 5%, so a 50% rate after only four days raised questions over the monitoring of the contract and when the first alarm bells began to ring. It emerged that the ophthalmic NHS staff at Musgrove had raised concerns from the outset. We gained the impression of an argument behind the scenes over responsibility for these failures and a reluctance on the part of Vanguard, or possibly the sub-contractors, to participate in or agree to the publication of the NHS investigation. There was even a suggestion that the report would expose the Trust to an action for defamation. Kestrel later claimed never to have had access to the report at all.
Vanguard acknowledged in media statements that there were lessons to be learned “by all parties”.

Further details only emerged when the Trust responded to our FOI request. We asked the Trust if their report had been officially published and why there had apparently been a threat of legal action if the report was circulated to the press. The Trust said they had been advised that the report could only be shared with ‘patients, a core group of staff directly involved in the matter and key stakeholders’. They said this decision had been made to protect the hospital against a number of potential legal claims: ‘In sharing a report with these groups we informed them that the report is strictly confidential and not to be disclosed to anyone else.’ They added that the report had been shared with Vanguard for them to comment on matters of ‘factual inaccuracy or concern’. We asked the Trust to disclose documentation evidencing the vetting of Vanguard and The Practice, including data and outcomes from previous outsourcing contracts between the Trust and those companies. We were told that this information was ‘commercially sensitive’ and therefore would not be disclosed. In response to the enquiry as to the type of implant and the supplier used by Vanguard and/or The Practice under the contract we were told that this question should be directed to Vanguard as the ‘contracted organisation’.

The RNIB expressed concern in press reports on the Musgrove-Vanguard contract over the wider issue of whether NHS ophthalmic safety guidelines, to which they contributed with the Royal College of Ophthalmologists in 2011, were being adhered to when cataract treatment is outsourced. This remains a concern as ophthalmic procedures are increasingly subject to rationing by the NHS and outsourcing to the private sector.

The Health Select Committee

Our clients were far from happy with the responses we had received on their behalf and I submitted their concerns to the Health Select Committee chaired by Dr Sarah Wollaston MP in March 2016.
Dr Wollaston raised our concerns over patient safety and indemnity at the highest level. She wrote to and received detailed replies from Jeremy Hunt Secretary of State at the Department of Health, Simon Stevens Chief Executive of NHS England and David Behan Chief Executive of the Care Quality Commission.

The correspondence was published on the Commons Health website on 13 August 2016: ‘Responsibility for subcontracted services & detection of system-wide safety/quality issues’ (

The responses received by the Health Committee reveal a confusing picture with potentially dangerous gaps in the vetting of providers and monitoring of contracts when in progress. The position as to the overall high-level responsibility for outsourcing by the NHS remained far from clear. Despite the assurances she received Dr Wollaston remained concerned as to the lack of defined responsibility for vetting of contractors and monitoring and identifying systemic issues which may arise when the NHS outsources or sub-contracts services: she referred to this as the need to ‘join the dots.’ Jeremy Hunt and NHS England Chief Executive Simon Stevens suggested that responsibility for identifying any ‘systemic problems’ under outsourcing and subcontracting arrangements lay with the CQC. In his response to Dr Wollaston, CQC Chief Executive David Behan, however, was emphatic that this did not fall within the responsibility of his organisation.

The correspondence also suggests there is uncertainty over indemnity and the suspicion remains that the NHS continues to pick up the bill for failures of outsourced contracts.


The case of breast surgeon Ian Paterson, now serving 20 years in prison on counts of causing grievous bodily harm and wounding with intent after performing unnecessary radical mastectomies and ‘cleavage-sparing’ mastectomies – which increased the risk of cancer returning – has highlighted multiple failures of governance and patient care at all levels in the NHS and private sector. The Independent Review announced in December and expected to announce its findings by the summer of 2019, is to consider a range of issues including the responsibility for the quality of care and the appraisal and validation of staff working in the private sector, information sharing between the private sector and the NHS, the role of insurers of private providers and the extent of the medical indemnity cover doctors working in the independent sector are expected to hold.

Paterson had been allowed to continue his dangerous practices in the NHS and in the private sector where he worked at BUPA hospitals from 1993 and at the two Spire hospitals from 2007 onwards. Spire maintained in the court proceedings that they had allowed Paterson to operate on their private patients but relied on the NHS to vet his competence and warn them of concerns over his treatment. Prior to the eventual settlement of the court action Spire were reported to be suing the NHS Trust which employed Paterson for not warning them of his dangerous practices: surely a damaging position for a private health care provider to adopt?

Whereas NHS Resolution, formerly the NHSLA, which covers the liabilities of NHS hospitals, has paid out £17 million to compensate Paterson’s NHS victims, his private patients faced many obstacles in their battle for justice. The contract for undertaking an entirely private operation in the private sector with no element of outsourcing is between the patient and the surgeon, with a separate contract between the patient and the hospital for the use of the hospital’s facilities and services. Until the recent settlement, his private patients were unable to recover compensation from Paterson personally and his professional indemnity insurers refused to meet claims on his behalf. Spire refused to accept responsibility for compensating his private patients, relying on the more limited role of the private hospital in line with this traditional formulation of the private hospital/surgeon/patient relationship.

The liability position of private hospitals would have faced a severe testing at the trial listed for hearing later in 2017 but Spire, many believe, bowed to the inevitable and agreed to pay £27.2m into a fund to compensate 750 of Paterson’s private patients, equivalent to £49,600 per patient. A further £10m is to be provided by Paterson’s insurers and his former NHS Trust. Neither the NHS nor Spire have actually admitted liability.

After it emerged that Paterson had been allowed to continue operating as a surgeon for such a lengthy period, President of the Royal College of Surgeons Derek Alderson commented in a BBC Panorama interview on 16 October 2017 that private hospitals are not reporting enough data on patient outcomes: ‘We don’t know exactly what’s going on in the private sector… It cannot be as robust or as safe as the NHS at the moment for the simple reason that you do not have complete reporting of all patients who are treated… It’s not good enough. Things have to change’ The RCS recommended that private hospitals must be required to participate in clinical audits as a condition of registration by the CQC and should be forced to report similar patient safety data including ‘never events,’ unexpected deaths and serious injuries as required of NHS hospitals.

Even now there is concern that numbers of both NHS and private patients operated on by Paterson have not been contacted and followed up by HEFT or Spire, suggesting an apparent lack of liaison between the NHS and private sector. Former Paterson patient Deborah Douglas who helps run the Breast Friends support group told the Guardian in December: “For me the big thing now is how many other people were affected. We want those facts – we want those figures.”


The NHS does not have a good track record when it comes to their treatment of whistleblowers but it is likely they are made to feel even less welcome in the private sector. Little seems to be known of how whistleblowers who raise concerns over outsourced contracts would be treated. It is hard to imagine there won’t have been employees at Spire as well as the NHS who attempted to raise concerns over Paterson’s practices but may have been suppressed. The Daily Mail reported in June 2017 that up to ten doctors who worked with Paterson are being investigated by the GMC and the Nursing and Midwifery Council said it was investigating ‘a small number of nurses’ linked to Paterson. These may be the former colleagues who turned a blind eye to his activities.

Facilities in the private sector

In their 2016 report ‘Privatisation an independent sector provision of NHS healthcare’ the BMA found that some private hospitals still lack intensive care facilities. Private hospitals were often ill-equipped to deal with surgical complications; an estimated 6,000 patients each year required NHS care after failed treatment at private hospitals and clinics, with around half of that number classed as emergency cases requiring admission to NHS A&E departments.

The CHPI thinktank reported in 2011 that five of the 17 private hospitals providing in-patient care in central London had no ‘critical care’ beds. More recently in their 20 October 2017 report ‘No Safety Without Liability: Reforming Private Hospitals in England after the Ian Paterson Scandal’ the CHPI found that little had changed since their earlier reports. There were a number of systemic patient safety risks specific to the private hospital sector; some junior doctors in private hospitals were left in charge of up to 96 beds and working weekly shifts of 168 hours; surgeons were often absent after carrying out surgery and not on site to deal with any complications. The absence of intensive care facilities in many private hospitals remains a concern.

Establishing the facilities at private hospitals where outsourced treatment is to be performed is not easy but clearly this should be part of the NHS’s vetting process. Quite apart from the safety issues and the question of whether the NHS should be outsourcing to hospitals lacking what would seem to be essential facilities, surely in the interests of transparency patients should be warned about these shortcomings so they can make an informed choice and give a valid consent?

FOI in the private sector

Information Commissioner, Elizabeth Denham, who oversees FOI and data protection in the UK confirmed in an interview in July 2016 that she is seeking to improve the transparency of public services delivered by private companies. “Private contractors above a certain threshold for a contract or doing some specific types of work could be included under the FOI Act. The government could do more to include private bodies that are basically doing work on behalf of the public.” This would be a welcome reform.


As our public-private health service becomes increasingly fragmented it is difficult not to harbour anxieties over the safety issues of outsourcing arrangements. The concern is that if private hospitals continue to escape legal liability for the actions of doctors working in their premises and who are using their equipment and working alongside their staff, then they have come to regard themselves as untouchable and lack the incentive to monitor the activities going on in their hospitals. As private companies often employ NHS doctors, surely they should not be able to argue – as appears to have been Spire’s reported intention – that it is the responsibility of the NHS and not the private hospital to vet those doctors. The private sector should be accountable for the treatment carried out in their hospitals and the NHS should not be out of pocket as a result of their failures.
Regardless of the political considerations and fears over what is seen as the increasing privatisation of the NHS, it is imperative that patient safety remains paramount. Outsourcing to the private sector may be inevitable as the NHS confronts its many challenges, but the standard of care must be equal to, if not better than, that which patients can expect to receive in the NHS. Outsourcing can only be sustainable if contracts are monitored, and private providers to the NHS properly vetted and held to account for their errors. If the private sector wishes to work with the NHS it should face the same level of scrutiny and meet the same standards of transparency and disclosure as the NHS and should accept the probe of Freedom of Information requests.

For a list of references and suggested further reading, please visit ( nhs-outsourcing-suggested-reading/)

Footnote 1
CHPI thinktank report ‘The Contracting NHS: can the NHS handle the outsourcing of clinical services?’ March 2015