The health secretary announced that three small contracts for scans and renal dialysis, worth £40m a year, would go ahead. But six more surgical treatment centre contracts have been scrapped, taking to 15 the total abandoned since the procurement was launched in 2004. Only one out of nine original contracts for diagnostic services now survives.

Procurement will continue on seven more treatment centre deals, most of which have already shrunk considerably in size. But while the intention is to take final decisions by March, a health department spokesman said there was “no guarantee” they would go ahead.

Even if they did, the total value of the contracts looks unlikely to top £2.5bn on industry estimates, against the £6bn that the private sector was originally promised. Without them the total will be nearer £2bn.

Announcing his decisions, Mr Johnson insisted that the reduction in the size of the procurement “does not represent a change in policy”.

But Chris Ham, former head of the strategy unit at the health department, said: “That is not a credible statement. The contribution of the private sector will be much smaller than planned, and the potential for innovation reduced.

This is the strongest signal yet that the prime minister is distancing his government from the policies of his predecessor.”

Mr Johnson insisted the independent sector had “an important and increasing role in the NHS” despite the cutbacks, which included firing Care UK, an independent provider, from an already operational diagnostic contract in the West Midlands on the grounds that only 5 per cent of its capacity was being used.

A “significant increase in productivity” in the local NHS had removed the need for the contract, Mr Johnson said, as he also cited improved NHS performance for the scrapping of six more treatment centre deals.

Mr Johnson said his approach to the independent sector “is pragmatic, not ideological”. Where it offered good value for money “we will bring them in”.

However, both Nuffield and Spire Hospitals, two of the biggest private groups, say the majority of primary care trusts are “hiding” the right to choose by not putting the independent providers on the front screen of the “choose and book” system that family doctors use to help patients decide where to go.

Because the private hospitals are hidden on the back screen, they say, only well-informed patients get through.

That was producing “a postcode lottery” in access to care, said Richard Jones, chairman of the NHS Partners Network, which represents the private providers.

David Mobbs, chief executive of Nuffield Hospitals, said ministers should make clear that such “attempts to thwart choice unfairly and to distort markets will not be tolerated”.

In an attempt to appease the private sector, Mr Johnson promised a campaign to raise the awareness of patients’ right to choose, and a new advisory forum of private providers.

In public, the private operators reacted with restraint at the cutbacks. In private, they were furious.

Neil Bentley, the CBI’s public services director, said the decisions were “a Christmas present for opponents of reform” and that “patients are the losers”.

Karen Jennings, head of health at the trade union Unison, welcomed the government’s “change of emphasis” on private sector involvement, as the Conservatives accused ministers of “incompetence” after spending tens of millions of pounds on the failed bids.

From:
http://www.ft.com/cms/s/0/ca759530-93ab-11dc-acd0-0000779fd2ac.html

The thwarting of private services should come as surprise to readers of Health Direct. On
July 26, 2007 we posted: Alan Johnson blocks new wave of private health clinics when the health secretary, Alan Johnson, yesterday vetoed plans for a third wave of independent sector treatment centres to compete with NHS hospitals.

In a break with Tony Bliar’s drive to expose the health service to the challenge of market forces, Mr Johnson said local NHS commissioners should adopt a more pragmatic approach to treating patients on the waiting list for tests and operations in England.

He will allow them to buy extra capacity from the private sector if they need it to meet targets on waiting times, and can show it provides value for the taxpayer. But he told the Commons health committee: “There will be no need for another national independent-sector procurement … There will not be a third wave.”

Mr Johnson was presented with plans for a third wave when he became health secretary last month, but he refused to endorse them.

As for the right to choose on October 31, 2007 Health Direct posted: Only 44pc recall hospital choice watchdog finds

Further evidence that the Labour’s “choice” policy is struggling as a means of driving reform in the National Health Service has come from the latest survey of how far it is being offered to patients.

A mere 44 per cent of patients could recall being offered a choice of hospital for their first outpatient appointment in May – down from 48 per cent in March – with provisional results for July showing a further decline to 43 per cent.