Published: 15/07/2004, Volume II4, No. 5914 Page 4 5

The proposed London chain of independent treatment centres has crumbled after the Department of Health gave the go-ahead to a proposal by one of the participating trusts to carry out the extra work themselves.

HSJ has learned that Barnet and Chase Farm Hospitals trust was told this week that its plans to create extra capacity to treat 3,000 elective surgery patients per year have been approved.

Royal Free Hampstead trust and Barking Havering and Redbridge Hospitals trust have also drawn up plans to increase capacity. The move comes three months after the preferred bidder for the ITC chain withdrew.

Private provider Anglo-Canadian withdrew its bid in April (news, pages 3-4, 15 April) amid fears that it could not offer the Department of Health value for money. It had been bidding for a contract to provide orthopaedics and general and specialised ear, nose and throat surgery over five years, treating around 30,000 patients per year.

Barnet and Chase Farm Hospitals trust received approval this week for its alternative business case, which will see the trust creating the extra capacity needed to treat 3,000 elective surgery patients per year.

It is understood the proposed centre will provide operations at tariff price.

According to a trust spokesperson, the trust's own 'Surgi Centre' plan 'is a big part of the trust's strategy to turn around its finances and services'. It has the support of the local health economy including the trust's two main commissioners, Barnet and Enfield primary care trusts.

According to a source close to Barnet and Chase Farm, the new proposal is likely to be cheaper than an independent provider, as the DoH was expected to pay any private provider a percentage above tariff.

The Barnet and Chase Farm Hospitals trust scheme is reliant on capital funding from the DoH, and now that it has been given the go-ahead the trust proposes to open the centre in April 2005 on the Chase Farm site, in line with the original London chain timetable.

Royal Free Hampstead trust's Royal National Throat, Nose and Ear Hospital pulled out of the chain in May and HSJ understands that the trust, along with North Central London strategic health authority and Camden PCT, has since drawn up a business case to provide extra capacity in-house.

Camden PCT director of commissioning and modernisation Stephen Conroy said the new capacity on the RNTNE site could be open by the end of 2005.

'The priority is to provide extra capacity to achieve waiting-list targets. This capacity should treat an additional 6,000 patients per year.'

North Central London SHA associate head of performance Sean Morgan said that although the proposals to refurbish parts of the RNTNE were not 'ideal for the long-term future, some investment in some parts [of the site] will serve for a few years'.

The SHA board was due to meet this week to decide on capital funding for the project.

The third trust originally involved in the London chain, Barking Havering and Redbridge Hospitals trust, has also put forward three plans to increase capacity.

The proposals drawn up by the trust, North East London SHA and Havering, Redbridge and Barking and Dagenham PCTs include either re-tendering for a private sector provider; meeting capacity in-house with£15m in capital funding from the DoH; or increasing capacity under a local improvement finance trust scheme.

A source close to Barking, Havering and Redbridge trust revealed that the trust and the local health economy favoured the second option, which would see the it carry out 10,000 extra operations a year in a new NHS building.

Several of the trusts involved in the original London chain have expressed frustration at being left in 'limbo' as the DoH makes a decision on the scheme's future.

One PCT source in the original chain said that there had been 'a large degree of hiatus when Anglo-Canadian pulled out'.

A DoH spokeswoman said it would be making an announcement on the chain's future soon.

A contract for the South East ITC chain is expected to be signed by Mercury Health before the end of the month. Discussions with Interhealth Jarvis on the chain covering Kidderminster and Cheshire and Merseyside are ongoing.

The national orthopaedic spine chain provided by Capio was launched earlier this year, as was an ophthalmic chain run by Netcare.