HSJ’s round-up of Tuesday’s must read stories

Raised eyebrows over Bath contract

Last week Virgin Care was announced as preferred bidder for a seven year contract to deliver community services in Bath and north east Somerset.

The company beat a consortium led by Sirona Care and Health that included two NHS providers – Avon and Wiltshire Mental Health Partnership Trust and Royal United Hospitals Bath Foundation Trust.

The contract covers over 200 health and social care services currently delivered by more than 60 different organisations and worth £69m a year.

Bath and North East Somerset Clinical Commissioning Group and Bath and North East Somerset Council want to bring the disparate services together under a “prime provider” to join up services and stop patients from having to go from pillar to post for their care.

That’s a worthy aim. However, the commissioners’ claim that the contract will require “any financial surplus made by the new prime provider to be reinvested” into local services has raised some eyebrows.

HSJ asked Jane Shayler, the council’s director of adult care and health commissioning, whether this “surplus” referred to anything left over from the “margin” that Virgin Care – a profit making organisation – would usually be expected to make on such a contract.

“No [it means] any surplus… ‘margin’ to my mind is just another way of describing a surplus,” she replied.

Nevertheless HSJ readers appeared to remain unconvinced.

One commenter wrote: “Virgin are not doing this out of the kindness of their hearts, they have profits to make. If it isn’t called ‘margin’, then look more closely at some of the other numbers. The commissioners do sound touchingly naive!”

Another chipped in that the commissioners and Virgin Care “would both be well advised to be completely transparent about what ‘no margin’ means here and what the mechanisms are”.

That seems like sound advice – if the parties aren’t transparent, it might come back to bite them.

CSU redundancy bill revealed

The bill for redundancies following the closing down of two commissioning support units earlier this year reached more than £6m, HSJ revealed on Tuesday.

A total of 142 people were given severance deals from Yorkshire and Humber CSU and North West CSU, which were closed in March.

North West CSU, which served CCGs in Cheshire, Merseyside and Greater Manchester, and Yorkshire and Humber CSU had been unsuccessful in their bids gain accreditation to join NHS England’s lead provider framework. NHS England said the changes will save money on back office support and improve support services.

Figures from NHS England show £6.2m was spent on payouts, with the costs borne by clinical commissioning groups and NHS England. The national body was “unable to confirm” the amount of redundancy costs that fell on CCGs when asked by HSJ.

Nearly 1,450 staff transferred to other organisations following the break-up of the CSUs, while commissioners on both sides of the Pennines also used the shake-up to bring a significant number of staff in-house.