ARCHIVE: first published on Spinwatch.org May 2015.
UPDATE: A lot has changed since 2015, such as the introduction of Sustainability and Transformation Plans, the scrapping of the Staffordshire cancer contract (mentioned in this article) and more, but this below is useful background.
‘The whole point of our NHS reforms,’ David Cameron said, is ‘to put the power in the hands of local doctors, so that they make decisions based on what is good for their local area.’
That is tosh.
Yes, most of the NHS budget was handed to GPs, who are now – phase 2 – handing it over to private corporations.
It is private firms who will determine how and where the NHS budget will be spent (through a process known in NHS speak as commissioning).
Everything from deciding which hospitals stay open, which services are still available on the NHS, and who provides these services, the NHS or the private sector.
As the Observer reveals this morning (2 May 2015), the list of approved suppliers bidding for this work – the planning and buying of care – has just quietly been released.
The list is dominated by management consultancies, outsourcing giant, Capita, and Optum, an arm of the US health insurer, UnitedHealth, the previous employer of NHS CEO, Simon Stevens.
Last year, Spinwatch uncovered how UnitedHealth’s lobbyist, Chris Exeter, chaired a discreet forum, the Commissioning Support Industry Group, giving these firms regular privileged access to senior NHS officials overseeing the creation of this new market in ‘commissioning services’.
Capita was another member of the group, as were KPMG, PwC, EY (formerly Ernst & Young) and McKinsey.
There are eight (was nine) consortia set up to ‘supply’ local health purchasing decisions. Optum, Capita, KPMG and PwC are now approved suppliers to two thirds of them. McKinsey and EY are suppliers to half of them.
These companies (and others) will supply GP commissioners with key services that have until now been done by the NHS for the NHS: planning services; managing relationships and contracts with healthcare providers, like hospitals; and crucially deciding what the NHS will look like in the future – what NHS England calls ‘transformation and service redesign’.
GP groups will be forced to re-procure a lot of these services by April 2016. It is thought that, consequently, between £3-5billion of services will be bought through these consortia.
The privatisation of commissioning hands the private sector more power, more influence and potentially a lot more of the NHS budget.
It also presents potentially huge conflicts of interest, with private companies like UnitedHealth (Optum) bidding to take charge of local health budgets at the same time as it is increasingly looking to provide the healthcare those budgets pay for.
UnitedHealth, for example, is bidding for the biggest privatisation in NHS history, Staffordshire’s £1.2bn contract to run cancer and end-of-life care. Are rules in place to prevent any conflicts of interest?
The approved list of suppliers also includes a number of commercial lobbying firms working for private healthcare clients seeking to make money out of the NHS.
Take commercial lobbying agency Hanover, which is part of a consortia led by UnitedHealth. Hanover’s head of health is lobbyist Andrew Harrison, a former aide to Labour’s privatising health secretary, Alan Milburn and an ex-colleague of the man currently holding the NHS purse-strings, Simon Stevens.
Hanover has been UnitedHealth’s lobbying agency for years. Another recent client is HCA, the huge private hospital operator that had to pay $1.7bn in US fraud settlements in 2003. HCA has a few ‘joint ventures’ with the NHS, but wants more. Hanover also bends ministerial ears on behalf of the US pharmaceutical lobby group, the American Pharmaceutical Group. Another long-standing client is Alliance Medical, which paid ‘cash-for-access’ Tory MP Malcolm Rifkind to sit on its board and recently won an £80 million contract to run cancer scans across England (despite a rival NHS group claiming their bid was £7 million cheaper).
Hanover, which as an approved supplier is now in line to provide “communications services” to local health bosses, already serves a number of NHS bodies. It provides the NHS Cancer Screening Programmes with ‘reputation management’, and advises on ‘managing relationships with key stakeholders’, for example.
Hanover aren’t the only commercial lobbyists on the list faced with potential conflicts of interests.
Engine is in another of the private sector consortia, MBED. Engine is actually a group of communications companies, which includes lobbying agency MHP. The firm has long been a favorite of healthcare companies. Until recently, their star turn was Bill Morgan, who was Andrew Lansley’s right-hand man.
MHP’s roster of clients contains all the big names in pharmaceuticals, and some drug-funded health charities. Since 1999, Engine has also worked for Bupa, including providing the private health company with ‘business consultancy’ and support for its e-Health programmes (using computers to both collect health data and provide healthcare and monitoring).
Global business consultants FTI Consulting are a part of half of the consortia that GP local health bosses will now be encouraged to use.
FTI claims to have years of experience creating campaigns to ‘protect clients’ political and policy interests’. Who they lobby for in the UK isn’t known, but in the US clients include the lobby group for the private health insurance industry, America’s Health Insurance Plans; the Biotechnology Industry Organisation; and the health insurer AXA. In Brussels, FTI stands up for private health insurer, Prudential; lots of pharmaceutical companies, plus the European Association for Biotech industries.
Then there’s EY, formerly Ernst & Young, another global consultancy firm that is poised to help direct how and where the NHS spends its money. EY are – you guessed it – lobbyists for private health companies. EY has just registered Prudential as a client on the UK’s new register of lobbyists (see entry for Jan-March 2015). The Pru is also a US lobbying client, as are Zurich and AIG; Pfizer; and every NHS-leader’s favorite US healthcare firm, Kaiser Permanente.
PwC, which is a supplier to most of the consortia, has registered itself on the UK’s register of lobbyists, meaning it lobbies ministers on behalf of (as yet un-named) clients. PwC is looking to increase its position in what it sees as the UK’s growing, commercial market in healthcare. ‘The health industry in the UK offers strong opportunities for growth in the wider economy and for PwC,’ said chair of PwC’s advisory board, former health secretary, Alan Milburn.
McKinsey, a supplier to five of the groups on offer to GPs, earns most of its revenue from advising corporations: health insurers, private hospital groups, pharmaceutical companies, tech interests and investors. Emails show that it was sharing its thinking on the implications of the Coalition’s NHS reforms ‘with clients’. Who they are, and what McKinsey does for them, though, is confidential. McKinsey also appears to act as a bridge between the public and private sectors.
More documents show the consultants connecting London’s health officials with one of Germany’s largest private hospital chains to discuss ‘potential opportunities’ to take over public hospitals in the capital. McKinsey also advised them how to minimise public resistance to the privatisation of hospitals: start ‘from a mindset [of] one at a time’.
Then there’s KPMG, a supplier of services to six of the nine approved groups. Official spending data shows how much work has already been sent KPMG’s way by the NHS-led consortia. From September 2013 to March 2014, it picked up £3.5m from them. One group on the list, the Arden & Greater East Midlands Commissioning Support Unit (GEM) paid KPMG over a quarter of a million pounds a month in the first six months of 2014 for services, including work on a £500k ‘enhanced analytics’ project, and supporting ‘specialised commissioning’.
KPMG has itself subcontracted some of this work to UnitedHealth (via another unnamed company), according to a Freedom of Information release. There is no contract between GEM and UnitedHealth, showing just how opaque this new system is with its corporate supply chains, but NHS-front.
At the same time, KPMG is engaged with the private healthcare sector. Addressing a conference of healthcare companies and investors in New York in 2010, Mark Britnell, head of KPMG’s UK health division, spoke of the private sector opportunities presented by the UK’s health reforms: "The NHS will be shown no mercy and the best time to take advantage of this will be in the next couple of years," he advised the attending companies.
Britnell was speaking a year into his job at KPMG, which he joined from the Department of Health where he was director general in charge of commissioning. Britnell was the architect of what we see today: the privatisation of commissioning.
Back in 2010, the BBC reported the Coalition’s reforms of the NHS as 'handing funding powers to GPs'.
And now they are being told to hand it to the private sector. These corporations will determine what the NHS will be like for future generations.
The foxes have control.