A major private provider of mental healthcare beds in the UK is planning a significant expansion into the sector’s community services market, its chief executive has said.

Priory Group chief executive Tom Riall told HSJ he had detected a shift in attitude in the NHS towards private providers, which could open the way for his firm’s ambitions to secure contracts for community services.

“For too long the debate has been about public versus private with public good and private bad,” he said.

“NHS providers are waking up to the fact that working together we can achieve an awful lot more.”

Mr Riall, who took the top job at the firm in April 2013, said it would bid in partnership with “incumbent” providers, an approach that would allow them to come up with new models of care.

While Priory is well known as a provider of acute inpatient mental health services for adults and children, Mr Riall said it recognised growth opportunities lay “lower down the acuity chain”.

“We have considerable commercial bidding expertise; that is what we do.”

Community nurse with patient

The Priory chief executive said ‘it makes sense to combine rather than to compete’ with NHS services

“We have access to capital investment and can make decisions quicker, but the NHS, as incumbent providers, have a lot of expertise and some very good people therefore we think it makes sense to combine rather than to compete.”

Priory predicts increasing numbers of contracts will be put out to tender as clinical commissioning groups became “more mature” and traditional block contract funding mechanisms come to an end.

“With the end of the block contract it really automatically implies that services have got to be retendered,” he added.

“We do see that as an opportunity for incumbent providers to be more innovative and for ourselves to develop those partnerships.”

“We definitely would like to see more outcomes based commissioning; more payment by results.

“We are still not really seeing an appetite for that sort of commissioning yet.”

The company, which has 7,000 beds across the UK, has already bid for community contracts.

While its attempt to secure a £15m a year community mental health contract in Bristol with Surrey and Borders Foundation Trust ended in failure, it is currently bidding for community contracts in Birmingham with Birmingham Children’s Hospital.

As well as its ambitions for community work, Mr Riall predicts the firm will expand the inpatient side of its business, having ploughed more than £100m into its facilities over the past three years.

He also wants Priory to be the “overflow provider of choice” for the NHS.

Growth in this areas would be “partly being driven by the fact in some instances the NHS inpatient estate is tired and in need of investment and the continued long term reduction in NHS beds”, he added.

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