Outsourcing giant Serco underestimated how long it would take to restructure community health services in Suffolk, its health managing director has told HSJ.

Valerie Michie also admitted she would be “insane” not to consider that recent scandals which have engulfed the company and sparked a high-profile criminal investigation would have “implication in the health market”.

In a wide-ranging exclusive interview, she outlined Serco’s healthcare strategy, stating it was focusing on two areas: community healthcare and non-patient facing services in acute settings.  

The former accountant denied the firm’s £140m bid to run Suffolk Community Healthcare for three years - which is widely viewed as being low - had been unrealistic. However, when asked if the company would make a profit, she said: “I don’t know.”

She also admitted the company had been “overly ambitious on the timing of what we could do”, in the county.

Ms Michie added: “I absolutely still believe there are sustainable changes that will improve the quality and co-ordination of community care that can be made not just in Suffolk but also across the whole sector.”

The three-year contract tendered by NHS Suffolk was “too short to deliver transformational change”, she said but she insisted the company was still “very glad to have the contract”.

East Suffolk Clinical Commissioning Group last month raised concerns about “staff capacity, skill mix, workload, succession planning and morale, training, communication, mobile working, care co-ordination centre processes, incidents and near miss incidents”.

Serco could be fined if the problems continue but Ms Michie said she was confident it would avoid this and was “on track” to deliver plans agreed with commissioners.

Staff were spending 40 per cent more time with patients because they were adopting new technologies, she added.

Despite the company targeting community services, it has withdrawn its bid for Cambridgeshire and Peterborough CCG’s £800m older people’s contract in a move HSJ understands to have been driven by costly service specifications.

Serco has had a difficult year with senior figures including its chief executive Christopher Hyman departing after it was accused of overcharging the Ministry of Justice for the electronic tagging of prisoners and falsifying prison van documents. The Serious Fraud Office is investigating the issue.

In July the Commons public accounts committee attacked its “substandard” out-of-hours GP service in Cornwall amid concern about staff levels and manipulation of performance data.  

Ms Michie said she was “proud of what we do day-in-day-out”. While there had been problems “in a very small number of contracts…that does not mean that it’s acceptable”.

Regarding acute services, she said the company wanted to provide “support services in hospitals” which meant doing “everything that is not done by a doctor or a nurse”.

“Candidly, I think the NHS has a much better brand for the engagement of and delivery of clinical services in a hospital environment but we can partner with them really successfully to give them capacity and expertise to help them support that delivery,” she said.