You recover your health, they recover their costs

A new report suggests that pay beds could help to secure the future of the NHS. Paul Gosling reports

There will be more pay beds, and more NHS patients will pay for add-on facilities, such as evening appointments and better meals, predicts Healthcare 2000, the independent report on the future of the National Health Service published last week.

As the market reforms take an ever-tighter hold over the NHS, more patients and trusts accept the principle of a wider range of charges within the the service. Chris Ham, director of Birmingham University's health services management centre and a member of the Healthcare 2000 panel, says: "As we are moving towards more of a mixed economy in the NHS, it is inevitable that hospitals will want to offer pay beds, and I don't see any problem with that. It is a useful way of topping up budgets."

In 1993/94, the last year for which figures have been published, 158 NHS trust hospitals earned pounds 185m from pay beds, giving them a market share of 14.4 per cent of private health care. That represented a growth of almost 13 per cent over the previous year, a trend that looks set to continue.

Pay beds are offered through various arrangements: some hospitals directly manage them, others contract with external companies to run private wings. For example, Margate Hospital in Kent has 13 pay beds, which are managed by the private company Healthex. The company's profits are transferred to the hospital after keeping a proportion as a management fee.

A pounds 3m development is planned for Margate, to be run by Healthex, funded through the Private Finance Initiative. The new wing will offer an additional 18 to 20 beds and, unusually, provide a private out-patients and daycare facility. The Department of Health must give approval before the contracts can be finalised, but has informally welcomed the proposal.

Bill Nuttall is the private patients manager at Margate, employed by Healthex, having previously run pay beds at Leeds General Hospital. He argues: "We are helping to secure the future of the NHS." Mr Nuttall believes that as the number of pay beds grows, so private hospitals will close down, as is already happening in London. He predicts private healthcare suppliers will move away from running independent hospitals, instead developing partnerships to run private wings at NHS trusts.

Nuffield Hospitals, one of the country's leading private healthcare suppliers, says political uncertainty is holding it back from doing this, though it is leasing land from Hull trust hospital. Nuffield will run an entirely independent hospital, but expects to rent out some facilities while the NHS hospital is being refurbished.

Bupa has entered into two agreements, with Hastings and Bradford hospitals, to lease land from trust hospitals, with rental being a proportion of income. The hospitals will have their own operating theatres, and radiology and physiotherapy units. It is expected that the closeness of the private hospitals will assist the NHS trusts in retaining consultants who want to do some private work.

Ian Robertson, manager of St Mary's NHS trust, which has provided pay beds for 60 years, and last year generated a pounds 1.25m profit for the trust, argues that the retention of consultants is a key benefit from pay beds. "It keeps our medical staff, and enhances the reputation of St Mary's. We have got the consultants' loyalty," he says.

Mr Robertson believes that the market reforms are confusing traditional definitions. "The question of what is a private patient will be harder to define. GP fundholders' business is going to our private wing because of our package of prices. It may be that it will be in the NHS interest in some cases to close beds."

The independent sector argues that a hidden form of cross-subsidy is taking place, under which trusts protect private beds from the real commercial costs. Norwich Union has sponsored the National Economic Research Associates (Nera) to establish whether this is true, and a report will be published within the next month.

Nera's economics consultant, Keith Davies, says: "First, we have looked at the purely accounting side of things, to see whether [private beds] make a surplus, to see whether all the resources used are costed. Then we have looked at the wider issues of the cost of training, of consultants who don't look after NHS clients, and see whether they still make a surplus."

If the results support the complaints from the independent sector, the Government will be under enormous pressure to introduce stricter accounting regimes, which, independent providers say, would destroy the concept of pay beds.

If, though, the report shows that pay beds genuinely create additional income for the trusts, producing a subsidy for NHS patients, it could have important effects beyond the next election. Even an incoming Labour government might then accept the use of pay beds.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Suggested Topics
Arts and Entertainment
Lou Reed distorted the truth about his upbringing, and since his death in 2013, biographers and memoirists have added to the myths
musicThe truth about Lou Reed's upbringing beyond the biographers' and memoirists' myths
News
people
News
Ed Miliband received a warm welcome in Chester
election 2015
Life and Style
Apple CEO Tim Cook announces the Apple Watch during an Apple special even
fashionIs the iWatch for you? Well, it depends if you want for the fitness tech, or the style
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

    Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

    £50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

    Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

    £13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

    Ashdown Group: Training Programme Manager - City, London

    £40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

    Day In a Page

    NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

    Who's monitoring the outsourced NHS services?

    A report finds that private firms are not being properly assessed for their quality of care
    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
    How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

    How do Greeks feel about Syriza?

    Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
    From Iraq to Libya and Syria: The wars that come back to haunt us

    The wars that come back to haunt us

    David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
    Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

    Too busy to surf? Head to The Pool

    A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
    Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

    UK's Major Tum to blast off on a spice odyssey

    Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
    John Harrison's 'longitude' clock sets new record - 300 years on

    ‘Longitude’ clock sets new record - 300 years on

    Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
    Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

    Let the propaganda wars begin - again

    'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
    Why Japan's incredible long-distance runners will never win the London Marathon

    Japan's incredible long-distance runners

    Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
    Why does Tom Drury remain the greatest writer you've never heard of?

    Tom Drury: The quiet American

    His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
    You should judge a person by how they peel a potato

    You should judge a person by how they peel a potato

    Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
    Beige is back: The drab car colours of the 1970s are proving popular again

    Beige to the future

    Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
    Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

    Bill Granger cooks with fresh cheeses

    More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
    Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

    Shay Given: 'This FA Cup run has been wonderful'

    The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
    Timeless drama of Championship race in league of its own - Michael Calvin

    Michael Calvin's Last Word

    Timeless drama of Championship race in league of its own