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Can private providers be trusted to run NHS hospitals after Hinchingbrooke?

BMJ 2015; 350 doi: (Published 20 January 2015) Cite this as: BMJ 2015;350:h289
  1. Stephen Collier, chair, NHS Partners Network, part of the NHS Confederation, London SW1H ODB, UK ,
  2. Gabriel Scally, visiting professor of public health, University of the West of England, Bristol BS16 1QY, UK
  1. Correspondence to: S Collier stephen.collier1{at}, G Scally gabriel.scally{at}

The private company Circle is withdrawing from managing the NHS’s Hinchingbrooke Hospital. Stephen Collier says that all NHS providers are feeling the strain and that independent providers have an important part to play, but Gabriel Scally wonders whether a profit motive is compatible with the NHS’s values

Yes— Stephen Collier

The recent news that the independent sector provider Circle was withdrawing from the contract to run its franchise for Hinchingbrooke Hospital was disappointing to everyone who has followed its efforts to turn around a struggling district general hospital.

Having inherited a £10m (€13m; $15m) deficit in February 2012, Circle managed to reduce this to just £1.3m by April 2014. Year on year efficiency savings of 6% were made over two years, and Circle spent millions of pounds at Hinchingbrooke to improve performance and raise patient satisfaction.

Local patients and the public will therefore be disappointed that Circle does not think the contract is viable under the current terms and conditions and that it intends to hand the contract over to another organisation.

The news inevitably attracted much attention, and it is now vital that Cambridgeshire and Peterborough Clinical Commissioning Group, the Trust Development Authority, and Circle work together to ensure a smooth transition to protect and maintain patient care. The issues this throws up are far beyond the management control of any single organisation.

All providers are under strain

But what are the lessons that need to be learnt from Circle’s withdrawal? The first is that the NHS provider sector is under huge strain. Last November the National Audit Office highlighted that 22% of NHS trusts and 28% of foundation trusts were in deficit at the end of 2013-14.1

Trusts and foundation trusts had to be given an additional £1.8bn of revenue funding between 2006-7 and 2013-14 to help maintain provider stability. The amount required has grown …

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