Your essential update on health for the week

HSJ Catch Up

This weekly email gives HSJ subscribers a vital update on the biggest stories from the last week in health. If you have been out of the office or otherwise just too busy to keep up, HSJ Catch Up will ensure you are still in the know.

Bouncing back

Earlier in August, University Hospitals of Leicester Trust boss John Adler sent a message to staff criticising the trust’s poor accident and emergency performance and warning staff it could not continue (“Our performance is very poor and in some recent weeks it has actually been the worst in the country,” he wrote).

His latest email to the trust’s employees, revealed by HSJ has outlined how the trust is going to turn things around.

Mr Adler has set out plans for the “September surge”, to begin on the first day of the month.

The “surge” includes increasing the number of senior doctors working overnight in the A&E and ensuring “the rota is fully populated”. Managers will also monitor the emergency department more so that the “four hour window is maximised”.

New child mortality plan

The way child deaths are investigated in England is to be overhauled following a failure to consistently investigate them and share learning across services.

The Department of Health is taking over responsibility for local child death overview panels and a new database of child mortality is being set up.

The database is being established as part of NHS England’s wider child mortality programme to tackle the UK’s child death rate, which is among the highest in Europe.

Despite a legal requirement for all child deaths to be reviewed by local CDOPs, HSJ has learned there are concerns at the DH and NHS England that the panels are not sharing vital information and analysis locally or nationally. 

Why trusts are being hit with VAT costs

Have NHS commissioners learnt their lessons from the spectacular collapse of the UnitingCare contract in 2015?

In its review of the now notorious Cambridgeshire debacle, NHS England pointed out that VAT was an issue for UnitingCare (a company formed by two foundation trusts) because it was “outside the NHS VAT group”. As the trusts had formed a separate legal entity to bid for the contact, this new company would not be able to recover VAT on certain services. Neither the providers nor the clinical commissioning group anticipated this – which led to a large and unexpected VAT bill.

The review made clear that for “any future contract the current VAT rules should be applied consistently and factored into the bid”.

But it seems commissioners and providers in east Staffordshire also failed to anticipate a VAT storm brewing when awarding a £270m “prime provider” contract to Virgin Care in 2015.

The organisation bracing itself, however, is not East Staffordshire CCG or Virgin Care, but Burton Hospitals FT – which had to pay almost £300,000 in VAT in 2016-17 on the services it was commissioned to deliver by Virgin as part of the contract.

A little background: The aim of this contract was for Virgin to act as an “integrator” of community services rather than a direct provider of everything.

However, a key thing that seems to have been missed is that any trust commissioned by Virgin as part of the contract would have to pay VAT on any services they deliver for the company.


Essentially the trust is “selling” a service to Virgin, which, as a private provider, is not included in the NHS VAT group.

When a trust sells a service to any company outside of the group it is required to charge and pay VAT on some services.

It’s worth noting that VAT is not applicable on all services Virgin commission from Burton, just those that fall outside of the list specified by HM Revenue & Customs.

Competition: still an issue

The Competition and Markets Authority has been busy in the NHS this week, particularly in Birmingham.

After clearing a merger between Heart of England FT and University Hospitals Birmingham FT on Wednesday, the regulator announced on Thursday that it had passed a public/private deal involving the latter trust.

UHB has reached an agreement with American private company HCA Healthcare to build a £65m public/private hospital on trust land. The specialist facility will have 138 beds, 72 of them for NHS patients.

For the trust it will create much needed extra beds while avoiding a big upfront capital cost. UHB also expects to gain some revenue from the deal – although exactly how, and how much, are not yet clear.

For five other trusts, the news out of CMA was less welcome, after the regulator highlighted them for not supplying data on their private patient work (read the story to find out who).

The CMA issued directions against five trusts for missing the May deadline to supply the Private Healthcare Information Network with the information.

The requirement dates to a CMA direction in 2014 that ordered providers of private patient care, NHS or otherwise, to publish quality information, such as mortality and readmission rates.

The theory was that consumers of private healthcare had a right to the same level of information as consumers of publicly funded healthcare when making an informed choice.

At least some trusts seemed to have been dragging their feet because of information governance concerns. They were worried they would be breaching their obligations as custodians of patient data.

Most trusts told HSJ they had every intention of complying with the direction. But one, Royal Devon and Exeter FT, said it was working on “a proposal to the CMA which will enable us to supply the information required whilst protecting patient confidentiality and addressing our information governance concerns”.

The CMA has warned “further action”, which could include prosecutions, awaits trusts that do not start supplying the data.