The agreement to put virtually the entire English private health sector under contract to the government to treat coronavirus patients will have come as a relief to its owners as well as the National Health Service.
The move will provide welcome additional beds for patients on the road to recovery from Covid-19, or those who have not required intensive treatment.
It will increase the NHS’s current ventilator capacity by almost 20 per cent and enable urgent operations and other care to be provided that the NHS will be too overwhelmed to deliver. The sector’s 5,000 nurses who currently do not work for the NHS will also be put into the frontline of the coronavirus effort.
However, as the NHS struggles to secure enough critical care beds to treat the expected deluge of patients, the deal is unlikely to deliver a substantial immediate boost to intensive care facilities.
UK private hospitals have 8,482 beds, according to LaingBuisson, which supplies healthcare data to the government. Only 138 of these are for intensive care but several hundred more are equipped for critical care, according to the Independent Healthcare Providers Network.
However, nearly all the private hospitals rely on NHS consultants to treat patients, raising questions about how much genuinely extra medical support the sector can deliver. It is generally not equipped to treat more complex cases.
The government said on Saturday that the deal with the private sector would deliver about 700 extra doctors.
“There are very few private consultants that could come out of the woodwork and work for the NHS as most already work for them,” said Ted Townsend, author of one of LaingBuisson’s reports on the sector.
Howard Freeman, clinical director at the Independent Healthcare Providers Network, which represents private hospitals, said some of the work it would undertake for the NHS would be high-dependency intensive and critical care. However, support would also be made available for coronavirus patients who require oxygen or clean facilities as their condition improves.
Some private hospitals would need “repurposing” but this could be done quickly alongside retraining staff, Dr Freeman added. “The key point is that the NHS has secured significant extra capacity to throw at the fight against coronavirus and we can expect all of this to be deployed in the weeks and months ahead,” he said.
The medical capacity available in the sector reflects the UK’s unusual model of private healthcare.
Healthcare in Britain is funded through general taxation but patients can choose to beat long waiting lists to see NHS consultants who also work in private hospitals. About 40 per cent of these pay through private medical insurance, provided by employers, and a further 30 per cent are paid for by the NHS through the so-called “choose and book” system, which allows people to choose to be treated in a private hospital at the state’s expense.
Although the 10 largest private hospitals chains in the UK — including BMI Healthcare/Circle Healthcare, Spire Healthcare, HCA and Nuffield Health — have been expanding into new, higher-margin areas such as oncology, for the most part they still focus on routine elective surgery such as hip and knee operations or cataract treatment. The going rate for a knee replacement is up to £15,200.
But although the private sector has not been providing acute care, NHS capacity has fallen over the past three decades. The NHS lost 44 per cent of its general and acute beds between 1987/8 and 2018/19, according to data analysed by the King’s Fund, a think-tank.
Vivek Kotecha, researcher at the Centre for Health and the Public Interest, a think-tank, said that the expansion of the private hospital market over 20 years had provided “an excuse for the government not to invest enough in healthcare capacity”.
The coronavirus will have hit private hospitals’ earnings, with non-emergency medical operations being cancelled because of vulnerable patients staying away and medical staff being unavailable.
Travel restrictions were also hurting the London hospitals’ other large source of income — revenues from overseas patients, particularly from the Gulf states, who pay for care that is not available in their own countries.
Mr Kotecha said the deal with NHS England was effectively a “bailout” for the UK’s private hospital sector and their landlords, which include listed real estate investment trusts. “To have their costs covered, at full capacity, for the near future is welcome relief,” he added. However, it was not clear whether insurers will have to refund premiums as a result of the reduced services.
On Saturday, the listed Spire Healthcare, which runs 35 hospitals, said the deal with NHS England would provide “sufficient liquidity and financial stability during the Covid-19 outbreak”. It added that it would receive “cost recovery for its services, including operating costs, overheads, use of assets, rent and interest less a deduction for any private elective care provided”.
Ramsay Healthcare, which has 827 beds in the UK, and relies on income from the NHS for about 80 per cent of its revenue, also welcomed the deal. Last week the Australian-owned company suspended its full-year guidance because of uncertainty over the impact of coronavirus.
The Independent Healthcare Providers Network said patients undergoing urgent cancer or long-term neurological treatment would experience no disruption. HCA added that it had asked doctors to look at their patients and continue operating on those who are scheduled for time-critical operations.