A man called Jim Easton was, for most of his career to date, an executive in the NHS. In 2009 he was appointed as the "NHS National Director of Improvement and Efficiency". This ridiculous title covers the fact that his role was to deliver the "efficiency savings" demanded by government. That means cuts (to the tune of £20 billion), but let that not detain us. It also means that he was heavily involved in the privatisation (which is called "commissioning" so we don't immediately realise that) represented by sub contracting services to the private sector.
In October 2012 Mr Easton resigned from his position to become the managing director of Care UK, a private company which is a major provider of long term care with substantial contracts to run NHS services and an expressed interest in obtaining "management franchise deals" for NHS hospitals.
In the past there were rules which restricted public servants from taking employment in related industries when they left their public service employers. The reasons for those rules were obvious and they served us well. But they clearly no longer exist, and conflict of interest is not seen to be a problem nowadays: the "revolving door" is presented as a helpful thing, and it is paranoid to worry about corruption, apparently. But that is an aside.
Care UK started life as Anglia Secure homes in 1982, and it became Care UK in 1994. At that time it was a public limited company. In 1997 it acquired a company called Care Solutions Limited which ran 59 homes for those with learning disabilities: and in 1998 it bought another company called The Care Partnership adding a further 7 care homes in the process.
In 2010 the company was the subject of a management buyout: and it is no longer listed on the stock exchange in consequence. Since then its major shareholder has been something called Bridgepoint Capital. Bridgepoint is a private equity investor and it does not seem to have much interest in health: at least judging from other things it has invested in, such as Pret a Manger ( a sandwich chain) and Leeds Airport.Their website says
QUOTE
Bridgepoint is a major international private equity group focused on investing in market-leading businesses, working with management teams to create and realise value within its portfolio companies.
Bridgepoint bought Care UK for £423 million in cash. In the process the company went from being a publicly listed company to a purely private enterprise, though, as noted this was presented as a management buyout: it is a bit difficult to see it as such given that Bridgepoint put up the money. Presumably that was lent to the management to allow them to buy it: but it is not clear. The justification was that this was long term finance and the public markets were not very keen on investing in this sector at the time.
At the time of the acquisition Care UK had turnover of £410 million a year and pre tax profits of £21 million. 90% of the business came from local authorities and the NHS. In addition to care homes it also operates GP out of hours services; some GP practices; some treatment centres; and some prison health care. Bridgepoint issued a bond to fund the acquisition and so Care UK owes them £250 million and pays interest at 9.75%. At the same time Care UK raised loans in the channel islands and it pays interest on them at 8%. £4 million a year is deductible for tax purposes because of this. £8 million a year goes to the owners in the form of dividends on their preference shares
When Bridgepoint bought Care UK it set up another company called Silver Sea Holdings: and guess what they do? Why, they own the care homes and lease them back to Care UK. Does that remind you of Southern Cross at all?
Incidentally, Care UK's chairman also donates money to the tory party and it is reported that before he became secretary of state for health Andrew Lansley got £21,000 from him.
In another part of the forest, a company called Harmoni won 12 contracts with the NHS to provide out of hours care for people who need urgent treatment but do not need to go to a hospital in an ambulance. This used to be done by GP's but there were problems with that and this is supposed to be cheaper and more efficient. Mr Easton was a prime mover in the development of this new approach and he said
QUOTE
The Secretary of State for Health and I are fully committed to the delivery of an integrated 24/7 urgent care service, accessed through NHS 111, and that ensures people receive the right care, from the right person, in the right place, at the right time.
Care UK, in conjunction with Capita. also bid for those contracts but seems to have pulled out quite early in the process, for some reason. It is reported in the press that they "lost out" to Harmoni but I have not been able to find details of what happened there
Harmoni was owned by ECI, which is another private equity company, and it seems to have been doing very well. It has increased sales by 39% since 2008, which is a measure of how fast privatisation is going, when you consider that this amounts to approx £100 million turnover all of which comes from the NHS. In November 2012 ECI was "delighted" to announce the sale of Harmoni..... to Care UK, for £48 million. According to reports at the time this was beneficial to all concerned. The combined companies would have turnover of £700 million and those who awarded the contracts to Harmoni (and not to Care UK) were said to be content with this. The chief executive of Care UK, a Mr Mike Parrish said:
QUOTE
What commissioners are seeing is they have got the provider they gave the business to but enhanced with a broader range of services and an even stronger balance sheet.
So that is all right.
It is a bit unfortunate that Harmoni is not delivering a decent service though.
http://www.guardian.co.uk/society/2012/dec...P=ILCNETTXT3487According to reports in the press today, senior doctors allege that the service is regularly unsafe, and putting patients at risk. It is also charged that they are fiddling their records to hide the fact that they are regularly missing targets and are unable to provide a service at all some of the time
QUOTE
Dr Fred Kavalier, the former clinical lead at Harmoni, said he resigned in January last year because he felt unable to be responsible for the service, which he believed had become unsafe after cost-saving cuts in clinicians' shifts and the length of time allowed for GPs to see patients, and a failure to recruit and pay GPs sufficiently.
The company denies all of this: or rather
QUOTE
Harmoni did not deny staff shifts had been unfilled, or that London clinics including the Whittington had been closed for several hours on recent occasions because clinicians had not been available to run them. But the private equity-owned company, which was sold for £48m to Care UK in November, categorically denies that the service has been unsafe or failed to meet contractual obligations on clinic opening and response times.
So it seems the lack of medical staff, at a clinic which is not even open when it should be, has no significant impact on that health service. Astonishing !
And of course those pesky patients must bear some of the responsibility, for it seems they are not willing to travel miles for an appointment in the middle of the night, when they are ill. Some people !
Never mind: none of the allegations are true, and even if they were Care UK (which, I repeat, did not even win the contracts) is on hand to sort it all out. What could possibly go wrong?
