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FAQs: Staffordshire Cancer Privatisation

What's really going on with the Stafford cancer privatisation? Documents were leaked to Kate Godfrey - here she answers your questions.

Kate Godfrey
16 March 2015
kate godfrey2.jpg

Kate Godfrey. Image: Stafford College

 Introduction

 The Memorandum of Information (MOI) for the £700m privatisation of cancer care in Staffordshire has been published by openDemocracy.

Working in partnership with campaign group Cancer – Not For Profit, OpenDemocracy also intend to publish documents relating to the separate £500m privatisation of Stafford’s End of Life care.

Together, the documents have a combined value of £1.2b, making the joint privatisation the biggest in NHS history. The deals are the first time that it has been thought appropriate to put either cancer or end of life care on the open market.

The published tender covers cancer services for a population of 800,000 people, and has considerable implications for the future of the NHS.

 Rather than working to deliver services to cancer patients, Staffordshire CCGs (Clinical Commissioning Groups) have decided to outsource care management from commissioning downwards. The resulting arrangement will be non-transparent, result in the further fragmentation of care, and ‘too big to fail.’

The Memorandum is a document that every NHS patient ought to read. Thanks to my years of health campaigning in Staffordshire, it was sent to me. And even I have been taken aback at quite how far project managers have taken the freedoms granted to them in the Health and Social Care Act.

In order to help patients who may find the MOI of interest, Cancer Not For Profit have put together this rough guide, containing some of the frequently asked questions sent to our campaign group.

Information and analysis has been collated from independent health experts, charities, campaign groups and clinicians, and where appropriate, is credited. It is an open source document, and sections and quotes are available for use under open commons licensing.

It should however be understood that access to project documentation and analysis remains limited. We can offer no guarantees on completeness of information. The Staffordshire Cancer and End of Life Privatisation is a closed project. Commissioners have gone to some lengths to protect information, including the MOI published by Open Democracy. In keeping with the nature of the project, any analysis or interpretation will be equally partial, and can only represent the opinion of the section author. 

As with any open source document, we look forward to refining and improving this document as the project is opened up to a greater level of public attention, and to critical scrutiny.

In Quotes

‘no more than a blank cheque for whichever private firm is most ruthlessly willing to cut costs to shore up their own profits’

John Lister, Health Emergency

 ‘Now we have groups of GPs, with no training in epidemiology, oncology or commissioning, making plans to spend millions on an untried system with private companies, who have no experience in cancer care, eagerly waiting to make profits from these sick patients.’

Wendy Savage, Keep Our NHS Public (Letter to the Guardian)

 ‘Andrew George MP: ‘I just wanted to be clear in my own mind as to why you appear to have snatched at a pioneer project. It seems to be on the back of anecdotal information and stories. Is that right?

Jan Sensier (Healthwatch Staffordshire): No, I do not think that would be true to say at all.’

 ‘Patients here want to be heard. We want those in power to realise that this is our NHS, and we want the right to see what is being done and why. We have suffered enough from uncertainty about our health economy and removal of vital services. We do not need or want this further threat to our care. ‘

Gail Gregory, Cancer Not For Profit

 ‘we were being kept in the dark... the patient champions were always ‘too busy’ to be engaged with, and the few details we did seem to have about the project seemed to be commercial insanity. What reputable organisation hives off a major aspect of its worth to a private company with no break clause? Or without establishing who will take responsibility if it all goes wrong?’

 Valerie Vaz MP: ‘Just tell me, is the University hospital happy with this process?’

Andrew Donald (Chief Executive Stafford and Surrounds CCG): No, the chief executive is not.

 

Valerie Vaz MP:‘ (it is) a hell of a risk to take with taxpayers’ money, is it not? It is £1.2b.’

Professor Chris Ham (King’s Fund) ‘Indeed it is a risk to take with taxpayers money.’

What does the contract involve?

  Staffordshire Commissioners intend to appoint a ‘Prime Provider,’ a single company who will take responsibility for arranging the delivery of cancer and end of life care in Staffordshire, essentially stepping into the place normally occupied by local commissioners, or CCGs. Two linked contracts are on offer, affecting services across acute care, emergency care, primary and social care; the voluntary sector and community care.

The contract will be delivered in two stages: an initial ‘double running’ period in which existing providers will continue to organize care while the appointed company gathers information and develops a set of ‘service outcomes,’ (Part 1) and a second stage lasting from years three to ten, in which the appointed company will take ‘full responsibility for the delivery of cancer care services’ (Part 2).

Uniquely, most of the elements of contract design – including contractual commitments, benchmarks, standards and performance management will effectively be carried out after contract award, and during Part 1.

‘6.1.9 During Part 1 of the Contract the expectation is that the Commissioners and the Prime Provider will agree what steps need to be taken in terms of existing contracts with existing providers. This will be driven by the Prime Provider‟s model of service delivery for Part 2 of the Contract. Steps may include the Commissioners decommissioning services with existing providers and putting into effect a series of individual sub-contracts between the Prime Provider and selected providers of services.’

 The appointed company will have discretion to continue or to exit existing contracts – for example with local hospices, community voluntary groups and even hospitals – as they wish.

 ‘6.1.10 The Prime Provider will not be required to accept the novation or assignment of existing provider contracts en masse.’

How was the document obtained?

 The published document is one of a number passed to Labour PPC Kate Godfrey. It has been scrutinised and verified by independent health experts, who have helped to identify areas of concern for patients, and to produce an annotated version of the document which will be released separately by openDemocracy.

Why publish?

This is a document that every NHS patient ought to read. It is also a document that the project team behind the £1.2b contract worked very hard to hide. Campaigners first requested a copy last summer. Local clinical and community groups requested copies, expressing an interest in bidding as part of an NHS consortium. If given information they would have been required to sign non-disclosure agreements. Campaigners were told that unless they could provide evidence of extensive financial reserves, they would not be deemed qualified to bid, and were therefore excluded from project planning. The documents released by openDemocracy will affect care for than 800,000 patients, but were produced for the eyes of big business only.

Communications over this point are on the record, and were handled by the Strategic Projects Team (see below).

What contractual clauses should I look for?

Key aspects of the contract include:

Designed to privatise – clauses included which have no legal purpose but to assist private companies against their NHS-led rivals

High risk – winning bidder given ‘discretion’ to design services they would like to deliver, cut spend per patient and propose the payment structures most beneficial to themselves

Unaccountable: No obligation for private companies to deliver the open, transparent care that patients should be able to expect, or to place patient interests first

Front line services sold off – core NHS responsibilities such as radiotherapy, surgery and chemotherapy could be delivered by the private sector, with no mechanism for patients to seek redress following failures of care

Freedom to ‘disinvest’ – the winning bidder given freedom to alter or exit any existing contract – for example, funding for much loved local hospice care – without patients given any chance to challenge

Expensive - £1,600 for every man, woman and child living in the CCG areas will be vested in the contract. To put this in context, NHS funding across the UK is £1,700 per person. While administering the contract, the prime provider will expect to derive a minimum of £100m in fees.

Designed for cuts – bidding companies are told that although their own fees must come out of the ‘identified cost envelope’ – immediately diverting funds from care – but also that they are expected to make additional savings, and to divert a proportion of these savings back to the CCG

Tax efficient – ‘The Commissioners will adopt a flexible approach to the structure of the Contract to facilitate a VAT efficient model.’ 

No public consultation – 18 GPs sit on the four CCG boards backing the project, with no meaningful consultation of the 127 GP practices that they represent, or the wider patient population

Failure to explain why a high risk privatisation has been introduced in Staffordshire, where the standard of existing cancer care is above national averages, and only one of the four CCGs involves lists cancer services as an area where significant improvements could be made

Impossible to exit. ‘Too big to fail, too big to succeed’ – most work on contract design will be completed after selection of the prime provider, and during the two year ‘double running’ period. Serious work on benchmarking, performance review, sanction and exit clauses will only begin after the CCGs have very publicly committed to a provider. It is hard to imagine that the CCGs would be willing to break the contract thereafter – except in the position of real provider failure, or the provider themselves decided to step away. On the example set at Hitchingbrooke, this could result in the provider demanding reimbursement of millions of pounds from the taxpayer. Thanks to TTIP (see below), the contract would likely then have to be awarded again into the private sector, with further millions accrued in retendering and consultancy costs. There is no example of the prime provider model being successfully used on this scale for a reason – it sets up providers who have the discretion to act as they want, an NHS ‘blank cheque,’ and too expensive to hold to account

Ill-defined outcomes. The CCGs justify privatisation of cancer and end of life care by referring repeatedly to the potential for clinical improvement. Not only is this over-stated but the aspiration set to deliver ‘top three’ care in Europe is simply unrealistic (see below).

Contract risks

      The ‘outcomes’ set out in the MOI can’t be guaranteed. Commissioners justify the risks of outsourcing with the potential for clinical improvement (see below). Outcomes are left deliberately imprecise, with only the ultimate goal to provide ‘top three in England’ care specified. One-third of cancers are associated with lifestyle factors, while Staffordshire remains one of the most deprived healthcare economies in the UK. As a contract aspiration, the commitment to ‘top three’ care is unenforceable.

The contract will be expensive. A minimum 8% profit is required before private health providers will bid on public contracts. Over £100m of cancer funding currently spent on care will be diverted into paying the costs of the private provider. This money will come directly from the current ‘identified cost envelope’ – money now being spent on care.

Designed for private companies, not NHS led bidders – in addition to suggesting that the contract could be structured to support the VAT position of a private company, the MOI text shows an awareness of competition requirements and of NHS law requiring that the ‘economically advantageous’ (i.e. cheap) bidder be appointed. This requirement encourages underbidding, while the competition clauses cited encourage private companies to legal challenge of contract award. Any attempt to award the contract to an NHS provider is likely to be subject to legal challenge – and this risk is itself something that may be considered during the procurement process.

Existing services could be cut. The MOI establishes the prospect of the prime provider deciding for themselves which services should continue and which should suffer ‘disinvestment.’ No explanation of the decisions will be required, with no requirement to consider complicating factors such as local demographics, inequalities and even accessibility to public transport prior to contract award.

Serious concerns over accountability. A private provider is not required to provide information on a par with an NHS provider, nor to run a public tender to appoint its sub-contractors. Those sub-contractors could be running frontline care within a contract that will last for a minimum ten year term. The resulting risks are considerable.

Contract ‘too big to fail, too large to succeed.’ The contract will be allotted for a 10 year term – a major gamble given the recent track record with private sector providers (UnitedHealth exiting primary care contracts, Circle and Serco pulling out of agreements before the expiry of the contractual term). There is no mechanism to hold the prime provider to account once the contract has been awarded, with the value of the contract precluding early termination. It is operationally impossible for the NHS to disengage or to ‘buy out’ of a £1b contract. The MOI contains no suggestion that failure by the prime provider to deliver as promised would result in penalty payments, withholding of finance, or any sanction at all.

The contract could have serious implications for existing providers, including hospitals, hospices and community care. The winning bidder will be given discretion to exit or change existing contracts as they prefer, or to reduce spending with an existing provider. There is no obligation to share information, hold negotiations in public, or consider providers needs. In contrast, existing providers are expected to work within a new system, potentially at reduced margins and without being able to accurately forecast future revenues.

Why do you say that this contract is bigger than anything that has gone before?

The NHS Support Federation have created a useful guide to the contracts offered up in the eighteen months following the passage of the 2012 Health and Social Care Act, which created the legislative underpinning for the privatisation of NHS services.

The NHS Support Federation noted an increase in the use of the prime provider model, and that prime provider contracts were typically over £100m in value. The two examples cited were the Elder Care contract in Cambridgeshire and Peterborough, which after significant pressure was ultimately awarded to an NHS led consortium and integrated musculoskeletal pathways, including one in Bedfordshire.

The Bedfordshire contract is an interesting comparison for Staffordshire. As openDemocracy revealed, Bedford Hospital NHS Trust refused to become winning bidder Circle’s sub-contractor without a minimum income guarantee. Elective surgery referrals thereafter dropped by 30%.

The MOU is explicit. There will be no guarantees for existing providers in Staffordshire. The prime provider will have discretion to renegotiate or to exit existing subcontractor relationships as they please.

A detailed review of the prime provider contracts listed since the passage of the social care bill shows the Staffordshire Contract to be greater by an order of magnitude. In the area of end of life care, for example, only two contracts were listed. The Staffordshire contract valued at up to £500m, and a much smaller contract advertised by the Greater Manchester Commissioning Support Unit, with a value of £4m.

Tender documents were posted on the European Tender Portal OJEU on 16th June 2014.

Is this the first time cancer services have been sold off?

In short, yes. The 2014 edition of the established NHS For Sale report – a report set up to track privatisation deals by the year had this to say.

‘In our analysis, diagnostics, contracts for services in the areas of mental health, GP services, pharmacy, patient transport and community care were the services most frequently advertised as available for competitive tender. These are also areas where private sector involvement has been long established. However, there is now a far wider range of treatment and care available for alternative providers to bid for or manage for the NHS. A notable new area that has been opened up to competition is the treatment and care of cancer patients. In June 2014 a contract notice advertised for bidders to run a cancer care service in the area of Stafford and Stoke and this was followed by a contract notice seeking bidders to run an end of life service in the same area. Together the contracts are worth just over £1 billion.’

Setting aside the question of whether private companies ought to be used deliver frontline care at all, no-one can argue that the Staffordshire contract is anything but untested. 

The prime provider model

If successfully implemented, the contract – which hands over responsibility for spending more than a billion pounds of NHS revenues, will the first example of local NHS ‘commissioning’ responsibility being handed wholesale to a private company, known as the ‘prime provider.’

The prime provider model has been widely criticized, and is regarded as a high risk approach which can result in deterioration and increased fragmentation of care – the problems that the published document says the commissioners hope to solve.

The King’s Fund has produced a useful guide to commissioning models, from which the extract below is taken.

‘In a prime contractor model, the CCG contracts with a single organisation (or consortium) which then sub-contracts individual providers to deliver care. The CCG retains overall accountability for the commissioned services, while the prime contractor holds each of the sub-contractors to account individually.

The prime contractor takes responsibility for designing a delivery model and patient pathway that will most effectively meet the terms of the contract. It uses the terms of the sub-contracts to stimulate and incentivise the necessary behaviours and performance it wishes to see across other providers.’

They list the advantages and disadvantages of the prime provider model.

Advantages 

Simple for commissioners to manage 

Enabled pathway management 

Shifts clinical accountability onto integrator and providers 

Disadvantages 

High financial and relational risk for prime contractor 

Concern over management of co-morbidities and other boundaries 

Providers may not have sufficient skills in contracting, supply chain management and commissioning’ 

The risks were also more simply explained by the NHS Support Federation, as: 

“the negative effect on local NHS organisations if they are not included in the Prime Provider’s network of contractors; 

The lack of integration as a result of separating out a clinical area; 

and, the lack of scrutiny and control the CCG has over the Prime Provider once the contract has been awarded.”

 

Further work from the King’s Fund also found that the prime provider approach could bring ‘significant risks.’ These risks are multiplied in the Staffordshire contract, which is on a greater scale than any previous use of the prime provider model. If cancer patients are not separated out, then services may be. Under a prime provider contract, the provider can decide simply to provide care themselves, up to and including frontline radiology and surgery.

What happens to people with ‘co-morbidities’ – for example requiring care both for cancer and for a heart condition? The intention of the Prime Provider model is to create two parallel systems. How will they work together? And what happens to patients who need services within the cancer care pathway: for example, patients with immune conditions requiring radiotherapy. Who will look after their interests?

 Criticisms of the prime provider model

The reasons for selection of the prime provider model rather than, for example, exploring joint decision making and improved integration within the NHS, are  summarised in the 2014 report, ‘Lost in Translation: A review of Cancer Commissioning,’ with a foreword by Mike Hobday, then Director of Policy and Research at Macmillan. Macmillan are sponsors of the Staffordshire outsourcing agreement, and have provided financial support.

Macmillan became involved in exploring new models of cancer care delivery in the wake of the 2012 Health and Social Care Act, pointing to the need to accountable co-ordinated commissioning, including co-commissioning. Unfortunately, in the prime provider model, this has led commissioners down a pathway which is more likely to further fragment than to consolidate services – making Macmillan’s continuing involvement a matter for question.

Particularly, the Prime Provider (ie. privatising) model is seen as inappropriate where the aim is to consolidate services. With legal and organisational responsibility vested in the Prime Provider, the selected company have the right to award services where they will, and can either take on elements of the work themselves, or renegotiate contracts with sub-contractors that they favour.

These points apply strongly in Staffordshire, where the appointed bidder has discretion to either deliver services up to and potentially including radiology and surgery, and making direct efficiency savings, or to simply squeeze existing contracts in order to be paid. With private companies brought into the heart of NHS care, patients will have little right to information on how the contract was working or not working. This was seen very recently at Hitchingbrooke, where professional communications staff were able to put a positive spin on performance right up to a damning CQC report.

After Circle announced their intention to exit Hitchingbrooke, patients learned that during the period the most positive coverage was received, staffing in key positions had in fact fallen by 30%. Staff at least could vote with their feet. Patients couldn’t.

Why are commissioners planning privatisation? What are they hoping to achieve?

The project is justified by repeat references to the clinical improvements that could be obtained, but without any detail on the models used, or explication of how – before the shape of the contract is fully determined – valid assumptions can be made.

The Memorandum nowhere discusses the numbers of patients, or makes any assessment of the scale of services required. However NHS England, working with the Right Care initiative, has published “comprehensive data packs” to assist CCGs in “commissioning for value”. which show differences between the four CCGs. The only CCG for which cancer comes out top of a list of programme areas offering greatest opportunity for improved performance on both quality and spending is Cannock Chase.

In Stoke on Trent cancer comes second on the list for quality related improvements, but is not among the top programme areas for potential cash savings.In North Staffordshire, cancer comes fourth on the list of potential cash savings, but is not among the biggest potential areas for quality improvement.

Stafford & Surrounds has lower mortality rates than the average of the top five CCGs in England on all of the main specialist services (Cancer, neurological, circulation, respiratory, gastro intestinal and trauma): it scrapes in at third on the list for potential cash savings.

Non-clinical reasons for privatisation

Given than the potential for clinical improvement is limited, why has an outsourcing agreement on this scale been introduced in Staffordshire?

At least partially, to set a precedent. The one comparable contract for care for the elderly in Cambridgeshire attracted very serious opposition, and was ultimately awarded to an NHS-led consortium, comprising Addenbrooke’s Hospital and a local mental health trust. Although care did eventually stay public, concerns were registered by staff, who faced great uncertainty, thousands of local patients, and at costs of bidding which the NHS-led consortium had no choice but to pay. These included millions of pounds in charges for lawyers, accountants and advisors.

Cambridgeshire was one in a long run of projects seen as failures for outsourcing sponsors ‘Strategic Projects,’ (see below) including Hitchingbrooke Hospital, brought back into public hands after reports of serious failures of care and indebtedness under private provider Circle.

A deficit of up to £12m is forecast for 2015. Circle, who are indemnified for losses beyond £5m by the terms of the contract, have applied to the Trust Development Authority for £9.6m to maintain solvency.

When Circle announced their intention to pull out of Hitchingbrooke - following a damning report by the CQC – David Owen wrote in the Guardian,

‘This has been a heavy defeat for an ideological solution that can work well in manufacturing or retailing, but runs into problems in healthcare, where there is already reluctance among taxpayers to fund the sort of very high returns on capital that they are already paying through the PFI in the NHS.’

The ideology may be discredited, but the Staffordshire cancer and end of life outsourcing is going ahead, and according to sources from within the project – moving at a faster rate.

Given that the potential for clinical improvement is limited – removing even the underlying justification for change – it is therefore valid to ask again. Why introduce this project in Staffordshire?

Why introduce cancer privatisation in Staffordshire?

Staffordshire is one of the most deprived, and unarguably the most fragmented health economy in England, something that should in itself preclude the introduction of further high risk reconfiguration here. Over the last two years Stafford Hospital – one of the key facilities delivering the care being privatized – has been downgraded, thousands of patients moved to other hospitals, which will now also be affected, and the NHS Trust delivering care disbanded. A recent report by KPMG found regional healthcare delivery to be ‘in permanent crisis,’ heavily indebted, and ironically, suffering under ‘NHS commissioners pursuing market tenders for services that do not always appear to have the full support of all commissioners or to be linked to a clear long term strategy for the whole LHE (Local Health Economy)

Members of the Cancer Not For Profit campaign team met Macmillan managers in 2014 and asked them, on the record, why they planned to introduce a high risk project in Staffordshire. Macmillan commented that it was because NHS care in Staffordshire is so fragmented. ‘If we can make it work here, we can make it work anywhere.’

It probably is the case that if privatisation works in Staffordshire, similar models of care could be rolled out across country (and interesting that Macmillan are thinking in those terms): however, it is small justification for introducing another high risk change for patients who have already had to cope with more than any other patient population.

While giving evidence to the Parliamentary Health Committee on 14 October 2014, the President of the Royal College of Radiologists Dr Giles Maskell said,

‘The concerns that we have are, first, is this the right place to be doing it? This is an area of the country which is really struggling in the aftermath of the Mid Staffordshire debacle and the imminent dissolution of the Mid Staffordshire Foundation Trust. Is it the right way to go about it? Is it something, with its 10 year span, which we run a risk of being locked into and which if it turns out not to be working well, will then be impossible to dismantle once it is under way? Is it potentially going to get in the way of any other projects locally… In this, in essence, the best way to go about integrating cancer care in this area?’

The KPMG report

In 2014 Staffordshire was chosen as one of the eleven most deprived healthcare economies in the UK, and made the subject of a study by KPMG which aimed to calculate the size of potential county-wide debts. Controversially, the government refused to release the study, despite multiple FOI requests and parliamentary challenges.

The KPMG report was leaked in March 2014 by Labour MP Paul Farrelly, who published the summary and conclusions. Amongst other findings, KPMG identified that Staffordshire healthcare would face debts of £217m by 2019 without comprehensive restructuring. Even if all of their recommendations were implemented they concluded, £70m of debt would remain.

The report was clearly and comprehensively very critical of local NHS management, pointing to a ‘generally oppressive’ culture, quality and leadership issues, and poor commissioning performance.

The KPMG report also appeared to call into question the process of cancer outsourcing itself. From page nine of the summary and conclusions:

‘The lack of a single strategic plan across the LHE (Local Health Economy) has reinforced the ‘silo working culture’ we have witnessed. This is still in evidence with NHS commissioners pursuing market tenders for services that do not always appear to have the full support of all commissioners or to be linked to a clear long term strategy for the whole LHE. Whilst we support the view that commissioners should be allowed to commission we think that tenders should pass some simple tests:

·         The potential change of service has been flagged in the commissioner five year plan

·         That strategic decisions have the support of all six commissioners in the spirit of ‘do it once where possible’

·         The beneficial impact across the LHE has been considered

·         The extent to which the public, GPs and effected providers have been involved

·         That unintended consequences for the LHE have been considered.’

These benchmarks have not been met in Staffordshire.

Stafford Hospital

And then there is Stafford Hospital. No matter where one stands on the tragic history of Stafford Hospital, or on the hard work that had, by 2014, made the hospital one of best ranked in the West Midlands, the 2014 downgrade has introduced unparalled change and fragmentation to the local health economy.

Hospital downgrade was achieved through dissolution of the Mid Staffs NHS Trust, with patients and services transferred into the UHNM (University Hospitals of North Midlands) and Royal Wolverhampton NHS trusts. The two remaining NHS bidders for cancer and end of life services are UHNM and Royal Wolverhampton, also the current providers of services. At the same time as local NHS trusts are absorbing tens of thousands of new patients, they are being asked to invest millions of pounds in co-ordinating a complex bid to continue to be able to manage delivery of services to those patients.

The financial impact of the project on local hospitals could alone be profound. As shown by the KPMG report, Stoke is particularly financially vulnerable. If, as seems inevitable, the prime provider opts to take over delivery of care, or to cut spending, it will be the hospitals not awarded the cancer and end of life who will pay the cost.

How will the winning bidder be paid? How much? 

The MOI is explicit that costs must be recouped from existing funds. Point 7.2.1 ‘Through service re-engineering the appointed prime provider will be expected to deliver the outcomes of this project within the identified cost envelope.’

This need to make savings may itself be a motivating factor in contract award, as cancer diagnosis and cost of treatment both climb yearly. It does however raise the spectacle of a ‘postcode lottery’ where cancer treatment in Staffordshire is reduced or underfunded in order to pay for the introduction of a private company.

We know from comparable contracts that private providers see 8% as a minimum in order to regard a project as viable. Virgin admitted this to the Financial Times in 2012. To justify engagement in such a monolithic project as Staffordshire, costs are expected to be a little higher. This also accords with the findings from the only comparable agreement – the £800m contract for integrated care for the elderly, which was eventually awarded back into the NHS. Private bidders exited the Cambridgeshire project when asked to confirm that they would return margins over 8% to CCGs.

A figure of around 10% is therefore a useful guide to the funding that could be diverted to pay for the inclusion of a private provider. At £120m this money be sufficient to pay for a whole year of cancer and end of life delivery in Staffordshire. The money paid to the winning bidder will be diverted directly from frontline and community care.

What are the implications for our hopsitals and hospices? 

The people and organizations now delivering care are known as ‘current’ or ‘existing providers.’ If the contract goes ahead, existing providers will lose any right to challenge decisions made by the prime provider, and can be left behind, their funding cut or removed altogether.

Co-morbidity and boundary definition

The prime provider model draws boundaries around groups of patients, separating them out. This is a problem in any prime provider contract, but it is a much bigger problem in the Staffordshire agreement. While previous prime provider contracts have been offered for elder care or for non-critical care, the Staffordshire privatisation is the first example of front-line care being separated out in this way.

In other words, cancer patients in Staffordshire will be the first group defined only by a shared condition to be separated out of NHS care because of that condition.

And of course, it is nonsense. This is simply not how health, or how clinical care work. Many patients will have not one condition, but several, creating complex webs of needs that only a comprehensive, and public, health service can meet. Others will have conditions requiring care that has been transferred into the cancer contract, but is not cancer. Patients with immune conditions for example, may require radiotherapy. How would this work when control of radiology has been transferred to an organization contracted only to care for cancer patients?

It is difficult to ring-fence cancer care. Emergency surgical services will deal with cancer and non-cancer patients; radiology services may deliver hundreds of scans before identifying a patient with cancer. Creating contractual boundaries to separate out patients by condition is not helpful.

Complex care

 Where cost is a consideration, patients with complex or expensive to treat conditions may find that they are left behind.

Who is behind the outsourcing of complex care?

The project team is a consortium of four Staffordshire based clinical commissioning groups or ‘CCGs’ based at North Staffs, Stoke-on-Trent, Cannock Chase and Stafford and Surrounds, NHS England – represented by the ‘Strategic Projects’ team and Macmillan Cancer Support.

 CCGs

The project is led by Stafford and Surrounds CCG, with headquarters in Stafford. The ‘Accountable Officer’ for outsourcing agreement is Andy Donald, Chief Executive of Stafford and Surrounds.  

Strategic Projects

The logo printed most prominently on the contract is from ‘Strategic Projects,’ the department of NHS England set up to to oversee the privatisation of Hitchingbrooke Hospital, and since responsible for transferring NHS projects with a potential value of nearly £10b into the private sector.

 The Staffordshire outsourcing agreement is one of fourteen flagship ‘national pioneer’ agreements championed by Strategic Projects. 

The Managing Director of the Strategic Projects Team is Andrew MacPherson. On his LinkedIn page, MacPherson talks about having personally delivered more than £6b in NHS transactions designed to ‘deliver change and reform through the mergers, divestment and rationalisation of challenged health services.’

While no one person has played a greater role in the marketisation and privatisation of NHS services, the outsourcing of cancer care in Staffordshire represents something of a departure for MacPherson. Cancer care in Staffordshire is not ‘challenged,’ but according to the commissioners’ own figures, is is currently delivered to good standard and is ranked as better than average against national comparators. Only one of the four CCGs backing the contract lists cancer care as an area where significant improvements can be made.

While setting up the project in Staffordshire MacPherson gave an interview to ‘Healthcare Market News,’ in which he said, ‘Will there be more contracts modelled on Hitchingbrooke? We would hope so.’

Macmillan

Cancer and end of life outsourcing has been granted in partnership with Macmillan Cancer Support. Macmillan’s involvement is often used in defence of outsourcing, with CNFP research showing that more than 40% of patients have left engagement events believing that Macmillan nurses will deliver outsourced services in Staffordshire.

While it is possible that the appointed Prime Provider will commission services from Macmillan, their primary role has been as sponsors of the procurement. This includes donating approximately £20m to meet project set-up costs, and to fund the initial two year ‘double-running period’ in which cancer services will be run in tandem between the Prime Provider and existing providers.

Macmillan’s practical involvement with the Cancer and End of Life Outsourcing has also drawn criticism, with the charity appearing to go beyond their independent status in order to secure the future of the project.

 On 25th February 2015 the Macmillan Information Support Service Bus visited Stafford Market Square, offering ‘clinical, financial, emotional and practical support information’ and even private appointments for people living or concerned about cancer. By coincidence, a BBC crew were filming in the Market Square, and caught Macmillan staff distributing project information produced by the CCG teams to patients. When asked, staff expressed their own concerns, but were unable to comment on how the decision to distribute materials relating to the Cancer and End of Life projects.

The matter was reported to Macmillan on the 25th February, and to the Charity Commission thereafter. No formal response was received from Macmillan.

The support provided by Macmillan was assessed by the Parliamentary Health Committee, who asked project officers to clarify Macmillan’s role.

Barbara Keeley MP: ‘I have to say, as a person who did run a coffee morning for Macmillan a few weeks ago, that I think this is a risky thing for Macmillan’s reputation… This is seen as privatisation. As a charity, it seems to me that Macmillan is taking a lot of risk in making what sounds like a very substantial investment into a model which an awful lot of people who might have been your supporters don’t agree with.

Who is against privatisation?

Clinicans

 

The project has failed to support clinical support, with the exception of specialists working within the project team.

In the year that the project has been public facing, we are not aware of a single independent clinician who has offered support. Many have broken ranks to give written testimony to their concerns – testimony that Cancer Not For Profit will be publishing in forthcoming weeks.

In July 2014 Giles Maskell, the President of the Royal College of Radiologists wrote a letter to the Guardian in which he said:

‘Our fellows, the doctors who diagnose and treat cancer, have registered major concerns with us about the planned model for commissioning cancer services in Staffordshire...

These changes could destabilise vital cancer diagnosis and treatment services, and are already leading to planning blight with regard to service improvements. This could lead – in the short-term – to worse services for patients. This is a brave initiative but one that must be considered a gamble in a health economy still feeling the effects of the Mid-Staffordshire disaster. Long-term planning has proved an elusive goal in UK public services. The leaders of this initiative are in no position to predict, let alone control, what might happen over the period of the 10-year contract – politically or financially. It seems unlikely that the architects of these changes will be able to see through their vision or to be held accountable for its consequences. What we may see is contracts that cannot be dismantled without severe penalties. Greater clarity is required with respect to the role of the "prime provider" who will not in fact be providing services but managing services provided by others.’

It is clear that those on the ground who will be relied on to make this happen have yet to be meaningfully engaged, and we have made their concerns known to Macmillan Cancer Support and NHS England who are leading this initiative. Clinicians share the ambition for an integrated approach to cancer care and must be more closely involved if this gamble is not to fail.
Giles Maskell
President, Royal College of Radiologists’  

Consultation

From project launch, the cancer and end of life program has drawn criticism for a failure to carry out public consultation. One month after the project was listed on tender sites, Chief Executive of Stafford and Surrounds Andrew Donald told Cancer Not for Profit campaigners that the CCGs had taken specific legal advice and had been told that no statutory duty to consult applied.

It is worth going into this point in some detail, as it is unheard of for a public contract on this scale, and involving significant change to services used by hundreds of thousands of people, to take place without a proper public consultation in which a policy is proposed, options offered, and public views invited. The duty to consult before major service change is in fact explicit. The legal advice obtained by the CCG depends on the definition of service change – and whether appointing a prime provider to take responsibility for delivery of services counts. Most people, and most legal authorities, would say so.

Consultation is important. The language in the MOI is dismissive of current care – and in a way that is not supported by clinical evidence, and some of the language used in the MOI around the standard of care simply doesn’t make sense.

‘3.9 From community feedback gained during a range of engagement events across the Region, including clinical and public input, it is known that there are pockets of excellent care. For cancer, this means that people are not always being diagnosed early and often find it difficult to know where to go for information and support. Care can often feel disjointed due to a lack of co-ordination and communication between different health professionals, and with other support services. This means that patients very often report a negative experience. This is unacceptable and needs to change.’

 With no evidential basis provided, this is a rather large, not to mention contradictory, statement. From project managers, we understand that it may be based on research in the form of interviews conducted with cancer patients prior to tender advertisement: however, no information on this research study has been made available. While acknowledging that some interviews appear to have been conducted, campaign groups have pressed on one specific point -  whether patients were made aware that responses could be used as part of input data for service reconfiguration. It appears that this was not the case, and that consultation was correspondingly inadequate.

 When MPs pressed for detail on the level of consultation they were shocked at the information given. When Barbara Keeley MP asked for detail:

 Jan Sensier, Healthwatch Staffordshire: ‘One issue is how many patients is the right number of patients to get involved in the actual detail of the programme, the design, the champions and what we have described. I understand there are about 50 patients involved, which is a small proportion but actually quite large compared with the involvement of patients in other health services.’

 Barbara Keeley: ‘That is 50 out of how many overall?’

 Jan Sensier: ‘I do not know the exact population covering the four CCG areas, but I would imagine it must be about 500,000 or 600,000 and it would probably be more than that. It is a very small proportion.’

 In fact, the population of the CCG areas is 771,500, with fewer than one in 15,000 people interviewed by the CCG. With the odds of being struck by lightning at 1 in 3,000 – patients in Staffordshire are statistically five times more likely to be struck by lightning in their lifetime than to have been part of redesigning cancer services, despite cancer services being used by one in two people in their lifetime.

 Why can't consultation be carried out later?

 

If formal consultation is not carried out prior to contract award, there will be no opportunity to consult on specific service changes later. Private companies are not subject to the same duties to consult, or accountability when selecting sub-contractors. As the MOI specifically allows the winning bidder to renegotiate or exit existing contracts, the prime provider is empowered to cancel a contract with a valued local care provider, and to replace that provider directly, or with another private company under terms that would not been made public. There would be no legal requirement to consult on this change, despite the direct impact on patient care.

This point was specifically tested as part of the contract for elderly care offered in Cambridgeshire and Peterborough. Here, as in Staffordshire, commissioners initially tried to award an £800m contract without a full and proper consultation. Ultimately, commissioners bowed to pressure, and opened up to consultation – with the resulting weight of public opinion helping to ensure that the contract was eventually awarded to an NHS-led bidder.

Following public pressure, there is evidence that the position of the CCGs and the project managers has changed. In recent months, campaigners have noticed ‘engagement events’ – which are not designed to substitute for formal consultation – being repositioned as evidence of compliance with the statutory duty to consult.

Engagement events

Having taken advice that a formal consultation was not required, project managers instead decided to run ‘engagement events,’ offering pre-prepared materials to partners or interested parties.

A list of organizations and individuals that the project team claimed to have met with and to have interviewed was provided to campaign groups in October 2014. A follow up study found that named individuals from almost all of the organizations listed had no recollection of having been interviewed, and were unable to answer simple questions about the project. Results from this follow-up study are being prepared for publication.

Clinical consultation

The lack of consultation extends to clinicians. Independent health expert John Lister comments:

‘The four CCG Boards boast a grand total of just 18 GPs (3 of these non-executive members in North Staffordshire), but have engaged in this controversial project without any proper consultation with the remaining 453 GPs in 127 practices which they claim to represent, let alone the 771,500 people covered by the CCGs, which have yet to be offered any proper consultation.’

President of the Royal College of Radiologists Dr Giles Maskell clarified this point as an expert witness before the Health Committee.

‘I understand that clinicians in the community were involved at an early stage but I can say that the hospital-based clinicians were not involved. In fact, some of our colleagues have told us that the first they saw was when the advert went out. That really was the first they knew about the programme.’

Asked for his personal opinion by Valerie Vaz MP, Dr Maskell clarified:

‘It is an unfortunate way to kick off something which is supposed to integrate primary and secondary care. If you are not asking the secondary care clinicians for their input and advice from an early stage, it gives the impression that there is something to hide, or that there is some threat or whatever. Whether there is or not, it creates a perception of poor communication and perhaps something that they would rather not hear.’ 

Cancer Not for Profit

Cancer Not For Profit is the community campaign which brings together NHS staff, health campaigners, patients and unions. Set up specifically to contest the £1.2 sell-off of cancer and end of life services in Staffordshire, Cancer Not For Profit represents the 800,000 patients living in the CCG areas affected, and three million patients in the wider health economy. Patients living with cancer, or with previous experience of cancer, make up a large proportion of our membership base. In the weeks following contract announcement CNFP alone gathered more than 12,000 petition signatures from local people.

National Scrutiny

A project as high-profile as Cancer and End of Life privatisation will attract scrutiny on a national scale, including parliamentary scrutiny. Throughout 2014 the cross-party Parliamentary Health Committee heard evidence on the fourteen ‘Integrated Care Pioneer’ projects, of which Staffordshire Cancer and End of Life is one.

In the exchanges before committee, non-expert commissioning partners, such as Staffordshire Healthwatch were broadly supportive, but clinical and expert witnesses were not. Valerie Vaz MP referred to the Staffordshire contract as ‘a hell of a risk to take with taxpayers’ money, is it not? It is £1.2b.’ Professor Chris Ham of the King’s Fund responded, ‘Indeed it is a risk to take with taxpayers money.’

Who are the short-listed bidders?

Setting aside the two NHS Trusts who remain in the bidding – but who appear to be deliberately excluded by contract clauses - bidders include:

·                     CSC Computer Sciences – paid nearly £12b from the UK taxpayer to design an NHS record keeping system without delivering a single working system

·                     United Health – the former employer of NHS England boss Simon Stephens, and through a US subsidiary now known as Optum (the name under which United Health is listed as a preferred NHS provider and under which cancer services would be delivered), currently facing allegations of implication in the US ‘hospice packing scandal.’ Optum are defending these allegations.

·                     Virgin Care – the private health care brand warned by the Care Quality Commission over their operation of other NHS services, including the Urgent Care Centre at Croydon Hospital. In 2014 CQC Inspectors found that the centre was in breach of four basic standards of care, and had used untrained receptionists to decide the level of treatment required by patients

·                     Interserve Investments – the best known of the health PFI investors, and chaired by former Conservative policy chief Lord Blackwell. Interserve have refused to comment on the role played by Lord Blackwell in Interserve’s bid, despite questions from Labour’s Jon Ashworth designed to establish if any discussion of the bid between Lord Blackwell and Conservative Ministers had taken place.

Why is it unlikely that this contract will be awarded to an NHS bidder?

The NHS-led bidders remaining on the shortlist are local NHS Trusts: University Hospital of North Midlands and Royal Wolverhampton– already charged with delivering services to cancer and end of life patients, and already struggling to absorb thousands of patients displaced by downgrade of Stafford Hospital. Sadly, this contract seems to have been designed expressly to exclude them. The outsourcing agreement offered is an organising contract, a managing contract, a record-keeping and IT contract, a money-saving contract – but it is not a contract designed to be won by an NHS trust. There are clauses here which also seem to have been specifically written with a private company in mind – for example, the provision for a ‘VAT efficient’ structure.

The least-worse outcome – that the contract be awarded to UHNM, is also the least likely. Trust Managers are put in an impossible position. In the interests of their patients, they can’t afford to walk away from delivery of these services, to simply surrender cancer and end of life care to the private sector. Equally, they can’t afford the millions of pounds spent on contract design and legal costs. Contracts of this type are lose-lose for NHS bidders.

What is TTIP?

TTIP (Transatlantic Trade and Investment Partnership) is a free-trade agreement being negotiated by the US and European Union. It is designed to bring down barriers to trade for big companies, including restrictions which protect Europe’s health, education and public services. In short, TTIP puts any part of the NHS on sale, on sale to American multinationals, and it provides a mechanism, known as ISDS or Investor-State Dispute Settlements which ensures that not only must NHS services be offered to wider markets, but that companies can sue if any attempt is then made to bring former NHS services back into public ownership.

  What implications does TTIP have for Staffordshire cancer patients?

In Staffordshire this could mean that even if the ten year contract were regarded as a disaster, or any attempt made to bring it to an early close, the companies who would have bid on the next contract term would have a case to require compensation. On a combined cancer and end of life contract with a value of over £1b, the award would be many millions of pounds.

ISDS agreements have already being used to support more than 500 legal cases worldwide, including the Dutch firm Achmea BV vs. Government of Slovakia. In that case a government who had tried to limit private sector involvement in national healthcare provision was found to have acted illegally.

In more than half of the cases brought, international tribunals either found in favour of the company bringing the legal case, or forced a financial settlement.

In Staffordshire, TTIP will tie the hands of future commissioners. Once the cancer and end of life outsourcing agreement is signed, it doesn’t matter how poor the standards of service negotiated under the Memorandum of Information might prove to be, or the relative value for money, or whether an overwhelming patient preference is expressed for local cancer care to be put back under the umbrella of the NHS. As long as ISDS is thought the appropriate mechanism for dispute resolution, the only viable option for a future government will be to keep these services on the market, and to sign another private deal.

Without real change in the negotiated terms, TTIP means that once the Staffordshire contract is signed, it is unlikely that NHS control of local cancer care could be restored. Long after the CCGs and Project Managers have gone, the contract will persist, an unregulated outlier in an NHS that campaigners are other determined to keep public.

What happens next?

The document published on the 16th May 2015 is the first of several from within the £1.2b privatisation contract that are being prepared for publication. It is the first opportunity for the 800,000 patients affected to see any information from within the contract, and to join with the campaign groups and clinicians who are working to keep cancer and end of life care within the NHS.

Unless commissioners can be persuaded to think again, the next stage of the £1.2b privatisation of cancer and end of life care in Staffordshire will be awarded in June. At best, an NHS organization or consortium may be able to keep these services. Equally, they may not. And whatever happens next, millions upon millions of pounds will have been spent on separating cancer and end of life care out from the NHS, and on setting a precedent by which – one day soon – cancer care in other parts of the country could be outsourced. And then care for patients with heart conditions. And then any service for which NHS commissioners have decided that they no longer want to be responsible.

At Cancer Not For Profit, we’re working to stop that precedent being set, and to persuade commissioners that they can improve care within the NHS. Privatisation isn’t the only answer. For many, it isn’t an answer at all.

For more information on Cancer Not For Profit and the Staffordshire campaign see here and follow @NHSsaleshurt on Twitter.

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