The private sector could secure a fifth of the annual £8.5bn market for NHS community services by 2016, analysts have predicted.
The Laing and Buisson report on primary care and out-of-hospital services argues that NHS staff interests are not powerfully entrenched in the community as they are in hospitals and primary care, and political barriers to independent sector involvement are likely to be lower.
“It would not be unreasonable, therefore, to envisage an independent sector penetration, over and above the social enterprise spin-offs, of perhaps 20 per cent or more of this £8.5bn market over the next five years,” it says.
“This would give independent sector providers approaching a £2bn per year share, or more, of the NHS community health services market.”
While private sector penetration in this area has been “slower than the independent sector had hoped”, the analysts note that there had been “major contract wins by for-profit groups in 2011”. These have included Assura Medical’s £450m five-year contract to provide community health services in Surrey.
They argue that among the players “well placed to establish a significant presence” are domiciliary care companies like Mears Group and Care UK, which can potentially exploit the crossover between home based social care and community nursing.
“There is a clear parallel between where community health services stand today and where social care services stood 20 years ago,” the report argues. “In the two decades since, domiciliary social care services have effectively been privatised in the UK as independent sector providers have entered the market offering less generous pay and terms of employment.”
Overall, the planned shift of NHS resources from acute hospitals to off-site healthcare provides “massive opportunities in marketplaces together worth billions of pounds”, the report concludes.
But author William Laing added: “Nearly all of the potential migration of services out of hospital will depend on politicians being willing to support the decommissioning of at least a portion of the acute NHS hospital capacity currently used to care for mainly older people admitted as emergencies to medical wards, most of whom do not actually need to be in hospital.”