European subsidiary of US group wins Derbyshire GP contract
Owen Dyer
A US healthcare company is to take over two Derbyshire general practices after beating local GPs to the contract in a bidding process led by the local primary care trust.
UnitedHealth Europe, a subsidiary of the Minnesota based United Health Group, was awarded the contract by North Eastern Derbyshire Primary Care Trust, ahead of 17 other bidders. It will operate general practices in Normanton (a ward of Derby) and Cresswell, a former mining village, both of which are considered deprived areas with inadequate services. The practices’ previous contracts were terminated for reasons that the trust says it cannot disclose, on the basis of legal advice.
UnitedHealth Europe’s chief executive is Dr Richard Smith, former editor of the BMJ. He said the practices will be able to offer a range of treatment and diagnostic services not previously available and represent a "small beginning" for a company that hopes to play a bigger part in providing primary care through the NHS.
The company "can bring a treasure house of information tools and management techniques from its experience around the world," said Dr Smith. "This small beginning will enable us to think about what sort of things we can do to develop primary care in Britain."
But Scarcliffe Parish Council, which administers Cresswell, has voted unanimously to oppose the plan, arguing that a local GP’s bid had the support of its residents and that the bidding process lacked consultation.
"We voted to a man to oppose it," said the council’s vice chairman, Stephen Fritchley. "We’ve been kept completely in the dark. Nobody here has heard of this company, and a lot of people are fearful of privatisation. UnitedHealth’s first responsibility is to their shareholders, not to us. The natural incentive for them will be to hire doctors as cheap as they can get them."
The local bidder favoured by the council was Elizabeth Barrett, a GP from nearby Shirebrook, who submitted a plan to set up a practice in Langwith, which is currently served by a branch surgery of the Cresswell practice. The bidding process offered the option of tendering separately for Langwith, she said, and the parish council had offered her land at peppercorn rent to build facilities there.
"I’m not hostile to the private sector," she said, "and it could well be that our bid just wasn’t good enough. But this is a bit overwhelming, because of the size of the company, the fact that it’s something of a first in Britain, and because nobody here was consulted. The idea for our bid was generated by the patients themselves."
The tender for contract had specified that successful applicants must have experience of managing primary care in Britain, she said, a criterion that UnitedHealth did not meet.
But Martin McShane, acting chief executive of North Eastern Derbyshire Primary Care Trust, said: "UnitedHealth is a British-based company which includes people with a wealth of experience in primary care in this country. I was amazed by the quality of the bids for these contracts. About a third of them involved British GPs allied with corporations. These are entrepreneurial, visionary GPs looking for better ways to improve primary care in areas which have been underserved. And that is what this contract was all about."
The decision to award the contract to UnitedHealth was made by the primary care trust but was in line with Department of Health policies, said a department spokesman. "There is nothing new in independent providers being able to provide these services. PCTs [primary care trusts] have been able to commission services from alternative providers since the alternative provider medical services (APMS) contract was introduced in April 2004."
The Secretary of State for Health, Patricia Hewitt, has said that her goal in encouraging new providers to take on primary care in England is to break the "inverse care law," which holds that the greater an area’s deprivation and need, the poorer the medical services it will have.
But Julian Tudor Hart, a research fellow at Swansea University Clinical School, who first described the inverse care law in 1971, said Ms Hewitt misunderstood his theory. "Politicians love one liners, but they’ve missed the second line: that this is a market effect, and any return to the market will make it worse."
"Richard Smith seemed to understand this when he was editor of the BMJ and regularly criticised the privatised American model, but he seems to have changed his mind," said Dr Hart.
Dr Smith agreed that he had formerly doubted the ability of US healthcare companies to contribute to the NHS. "But now that I understand United much better, I see that it’s not so," he said, citing the company’s "Evercare" programme, which manages health plans for US patients covered by the federal Medicare and Medicaid health insurance programmes.
Hamish Meldrum, chairman of the BMA’s General Practitioners Committee, said his preliminary enquiries indicated that the bidding process had been "fair and above board," but he added that "these larger companies inevitably carry a bit more sway."
"We don’t oppose private companies per se, so long as the bidding process is fair, funding arrangements are the same as for other GPs, and they are held to the same standards. Time will tell—and we’ll be keeping a close eye on it," said Dr Meldrum.