Published:25/04/2002, Volume II2, No. 5802, Page 8

Health Care International Hospital, Scotland's largest private hospital, could become a national resource outside the current board and trust structure if it is sold to the Scottish Executive.

HSJ understands that Scottish health minister Malcolm Chisholm is considering using the 540-bed hospital as a centre of excellence for cancer or cardiac care, to be used by patients across Scotland. The move would mean Scotland would lose more than 50 per cent of its private capacity, giving even more weight to ministers' statements that private care is on the 'margins'.

According to figures from the Independent Healthcare Association, there are 431 beds in Scotland's private hospitals, excluding HCI. Following a leak to BBC Scotland hours before the Budget, the Scottish Executive confirmed there were ongoing 'discussions'with HCI.

The executive would not go into detail for reasons of commercial sensitivity. But a source said that the process was likely to continue for some time. The source would not respond to reports that management of the Clydebank Hospital had approached the Executive, offering the hospital at a knock-down price. 'I am not getting into who kissed whom first, ' he said. 'But there has been a dialogue since the waiting-times unit was set up.'

Though there are a number of options on the table, Mr Chisholm is believed to favour the idea of using the hospital as a national resource.

HCI has been the subject of ongoing controversy since it opened in 1984 at a cost of£180m, much of it paid by the taxpayer. It went into receivership less than four months later and was taken over in 1985 by the Abu-Dhabi Investment Company.

More recently, it has become a focus for debate over the NHS's use of the private sector.

The Scottish Executive has been criticised, particularly in some sections of the press, for refusing to follow the English into a concordat with the private sector.

The Scottish Conservatives in particular have been loud in their disquiet about English trusts buying up capacity in the hospital, while 80,000 Scots languish on waiting lists. Though the NHS in Scotland has always used spare capacity in HCI, successive ministers, most recently Mr Chisholm, have made it clear that the private sector plays a marginal role.

In an interview last month with HSJ, Mr Chisholm said he did not want the NHS to lose staff to the private sector.

Taking over the hospital would answer that worry and also calm trade union concerns, but it is not clear what would happen to hospital staff, who reportedly earn more than their NHS counterparts.

IHA spokesman Peter Fermoy said: 'HCI never generated the sorts of incomes it anticipated from overseas patients, but it has proved it has the capacity to deliver care to NHS patients.'