Centre for Health and the Public Interest  

The relationship between the NHS and private hospitals has changed markedly over the last decade. The most recent figures show that the NHS (i.e the taxpayer) is now the second largest source of revenue for private hospitals, accounting for over a quarter of its income and amounting to a transfer from the state to for profit hospitals of over £1bn a year. [i]  An estimated 400,000 NHS patients were treated in private hospitals last year. [ii] 

Professor Colin Leys

The increased reliance of the private hospital industry on the NHS and the taxpayer has sheltered the industry from the worst effects of the economic downturn[iii]. This new relationship has come about as a result of various patient choice initiatives - which permitted NHS funded patients to choose treatment at private hospitals - as well as NHS commissioners using the spare capacity in private hospitals to meet waiting time targets. Some hospital chains such as Ramsay Health Care rely heavily on income from the NHS for their profits and financial viability.[iv] 

Private hospitals rely on the NHS in other ways. The consultants who perform operations in private hospitals are current or former NHS employees who have been trained at considerable cost to the taxpayer. And, according to Sir Bruce Keogh, the NHS medical director, the NHS also acts as a safety net for the private hospital sector when things go wrong [v] - on average over the last 10 years 6000 patients have been admitted to the NHS from private hospitals, although the costs to the NHS have never been calculated[vi].

Despite relying more and more on the taxpayer for its income the public, patients and regulators still know little about the quality and safety of care provided in private hospitals. In our recent report for the Centre for Health and the Public Interest we were able to establish through FOI requests that 802 patients had died unexpectedly and 921 patients were seriously injured in private hospitals between October 2010 and April 2014. [vii] However we – and presumably also regulators and commissioners - were unable to establish whether these data indicated that the mortality rates and the number of adverse patient safety incidents were a cause for concern because the Health and Social Care Information Centre does not collect or analyse this data.

What we do know about patient safety in private hospitals is that there are specific risks which are associated with providing healthcare in these settings. To start with most private hospitals are small compared to NHS hospitals and few of them have any intensive care beds to look after patients when things go wrong. In addition, private hospitals do not directly employ the consultants who operate within their facilities directly. This means the clinical governance arrangements for ensuring safe care can be difficult - a small 30-bed hospital can be used by over a hundred different consultants each year to carry out surgical procedures. Those who oversee clinical governance in private hospitals are not independent but are drawn from those consultants who work there.  When performing surgery these consultants usually do so alone, unsupported by junior specialists   - and the post-operative care of patients is normally left to a junior doctor - a Resident Medical Officer – who also lacks access to a team of specialists if in need of advice.

Despite the renewed focus on patient safety since Mid Staffs the Department of Health has not sought to address either the risk factors inherent in private hospital treatment or the lack of data on the quality and safety of patient care outside the NHS. One organisation which has stepped in is the Competition and Markets Authority (CMA).  Following its inquiry into the market in private health care it has used its powers under the Enterprise Act 2002 to direct private hospitals to form and fund an organisation to collect and publish performance data. [viii] It has also stipulated the types of information which must be made available to patients.  The direction is legally binding and private hospitals must comply by 1 September 2016.

Whilst this is a welcome advance it does raise two important questions. First, why should the CMA - a unique public body which is able to make laws of this kind without reference to Parliament – take the lead on such an issue when this is clearly a matter of public health policy? The legal intervention by the CMA has come about because their economic analysis of the private hospital sector identified a distortion in the market - they felt that patients didn't have enough information to exercise an informed choice between hospitals.  It was not because they were concerned about patient safety or private hospital performance. Consequently their recommendations reflect this bias and exempt private hospitals from publishing many of the patient safety indicators which NHS hospitals must now publish on the NHS Choices website. [ix]

Second, if data about the safety and performance of private hospitals is to be relied upon then why should it be collected and published by an organisation dominated by the private hospital sector and not the expert and independent Health and Social Care Information Centre?  This was a point made by Sir Robert Francis in his first report into Mid Staffs where he argued that information about hospital safety and performance is so vital for safe patient care that in order to avoid any possible distortions it should only be published by organisations which are "unimpeachably independent" from the hospitals themselves. [x]

Whilst the CMA - but not Parliament or the Department of Health - will oversee this new organisation the fact that the private hospitals have a financial interest in the content of the data which is published should rule them out from funding and running it. Since Mid Staffs those who run NHS hospitals can now be prosecuted for providing "false and misleading information" on hospital performance, but no such offence applies to the data supplied by private hospitals in relation to their private patients. [xi]. 

What goes on in private hospitals is poorly understood by Parliament, regulators and the public. The CMA should be congratulated for illuminating the workings of this highly complex market. But with the private hospital sector in England now an adjunct to the NHS it should be down to the Department of Health and Parliament to address these challenges and not the Competition Authority - the risks to patient safety are too serious and the information deficit too great.

Colin Leys is Emeritus Professor at Queen’s University, Canada, and an honorary professor at Goldsmiths, University of London. Since 2000 he has written extensively on health policy.

Views expressed in the Viewpoint blog are not necessarily those of the Health Services Management Centre or the University of Birmingham.


[i] Acute Medical Care  2013 Market Report, Laing and Buisson 2013Table 2.4.

[ii] Philip Blackburn, Private Acute Medical Care: UK Market Report, Laing and Buisson 2013, p. 123

[iii]Competition and Markets Authority Private healthcare market investigation Final Report’, para 2.35

[iv]Competition and Markets Authority Private healthcare market investigation Final Report’, para 3.30 https://assets.digital.cabinet-office.gov.uk/media/533af065e5274a5660000023/Private_healthcare_main_report.pdf

[v] Sir Bruce Keogh Review of the Regulation of Cosmetic Interventions: Final Report, Department of Health  April 2013 paragraph 3.2.1 www.gov.uk/government/uploads/system/uploads/attachment_data/file/192028/Review_of_the_Regulation_of_Cosmetic_Interventions.pdf

[vi] Colin Leys and Brian Toft “Patient Safety in Private Hospitals – the known and the unknown risks” Centre for Health and the Public Interest August 2014 http://chpi.org.uk/wp-content/uploads/2014/08/CHPI-PatientSafety-Aug2014.pdf

[vii] Colin Leys and Brian Toft “Patient Safety in Private Hospitals – the known and the unknown risks” Centre for Health and the Public Interest August 2014 http://chpi.org.uk/wp-content/uploads/2014/08/CHPI-PatientSafety-Aug2014.pdf 

[viii] Competition and Markets Authority Private Healthcare Market Investigations Order 2014 https://assets.digital.cabinet-office.gov.uk/media/542c1543e5274a1314000c56/Non-Divestment_Order_amended.pdf

[ix] See NHS Choices website – glossary of patient safety indicators http://www.nhs.uk/NHSEngland/thenhs/patient-safety/Pages/patient-safety-indicators.aspx

[x] Robert Francis QC, The Mid Staffordshire NHS Foundation Trust Inquiry: Independent Inquiry into care provided by Mid Staffordshire NHS Foundation Trust January 2005 – March 2009, Volume I para 59. http://webarchive.nationalarchives.gov.uk/20130107105354/http://www.dh.gov.uk/prod_consum_dh/groups/dh_digitalassets/@dh/@en/@ps/documents/digitalasset/dh_113447.pdf

[xi] Department of Health consultation on false and misleading information https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/305814/140422_FOMI_ConDoc.pdf