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| The first transfer of a hospital to a private company is now agreed: Hinchingbrooke Hospital is to be taken over by a firm called Circle Health.
Circle Health presents itself as if it were a worker's cooperative and is described in the press as the "John Lewis of health care" because 49.9% of it is owned by a partnership of employees: so that sounds good, I suppose.
Circle Health is a subsidiary of Circle Holdings, and that company owns the rest of it. Circle Holdings is run by one Ali Parsadoust who is a former vice president of Goldman Sachs. In 2010 Circle Health's accounts showed losses of £27.4 million. It is incorporated in Jersey, which is a well known tax haven
Circle Holdings is not the ultimate owner of Circle Health, however, because it is itself owned through a complicated structure with bases in tax havens such as Jersey and the British Virgin Islands. 28.9% of it is owned by a hedge fund company called Lansdowne UK,(domiciled in the Cayman Islands) founded by Tory party donor Paul Ruddock. A further 16.6% is owned by Odey Asset Management and its founder, Crispin Odey, is also a Tory party donor. A company called Balderton Capital III owns 16.9% and the rest is owned by BlueCrest Venture Finance Master Fund (14.9%) and Blackrock (12.9%) Circle holdings was part floated on the stock exchange Alternative Investments Market in June 2011, and it reported the flotaton raised £45.3 million. It is reported that makes the total value of the company £95.4 million: the contract to run Hinchingbrooke is to provide Circle Health with £1 billion over 10 years.
Circle Health was founded in 2004 by a surgeon called Massoud Fouladi, now its clinical Director, and Ali Parsadoust (known as Ali Parsa). They say that they have a vision of "empowering" patients and clinicians, and that is the reason for the "partnership" structure. Also included in their aims is fast growth so as to "empower" as many health care professionals as possible in order to help the largest number of patients: all very laudable. I find it rather disturbing that the account of their "vision" includes this statement: " This model seeks to ensure that the interests of the financial institutions, founders and employees will always be aligned.". It is not that I don't believe them: but it is very much in tune with some things Vninect said in the "Future of the Architecture Student" thread: it is likely they will be aligned if they all agree that making money is their primary interest: and that is not what I want from a "health care professional".
Circle Health has been running a day hospital in Nottingham which is said to have spectacularly good results: and it also has a new, state of the art hospital in Bath, which is also said to perform extremely well. This is taken as proof that the model is good and that the company is competent: well perhaps. "Productivity" at Nottingham is the measure of that but it is compared with NHS provision which has to deliver the full range of service: which Circle does not. A brand new hospital which also does not provide the full range of service is also not directly comparable with NHS hospitals and I would rather expect high patient satisfaction (which it reports) if the service is limited, and the buildings and equipment are new: however I notice it is staffed by NHS personnel seconded for the purpose: I wonder what the results would be like if they had to train their own staff? Who knows. What I do find disturbing is that this company was granted "preferred bidder" status and it has only been in existence since 2004: is that a track record which suggests that it should be granted the full responsibility for a general hospital for 10 years. The company structure looks depressingly like that of Southern Cross: and we know how well that turned out
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