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Last Updated: Friday, 30 June 2006, 13:28 GMT 14:28 UK
Q&A: Private sector role in NHS
Image of a GP
PCTS commission local services such as GPs
The government has advertised for firms to effectively take on the role of commissioning services in the NHS.

Ministers deny that is the intention, but if true it marks a new phase in the role of the private sector in the health service.

How is the private sector involved in the NHS?

In recent years, the government has looked to increase use of the private sector in providing NHS services.

Nearly one in 10 non-emergency operations are carried out by the private sector and the figure is increasing.

They are either carried out by private hospitals or clinics officially termed independent sector treatment centres, which carry out relatively minor procedures such as cataract operations and hip replacements.

Billions of pounds of contracts have also been signed with the private sector to build new hospitals, known as PFI schemes, or replace community facilities such as GP surgeries and health centres through the LIFT programme.

The firms recoup their costs by charging the NHS a repayment fee over a set period - sometimes up to 30 years.

One deal has been signed in east London involving the firm Care UK, which has traditionally run hospitals and care homes. More are in the pipeline.

Why has the government done this?

The simple answer is that ministers see the private sector as an easy way of increasing resources quickly.

The NHS is in the middle of its biggest hospital building programme in its history.

Everyone would agree many of the older hospitals need replacing or redeveloping and without private money the government could not afford to pay for so many schemes in quick succession.

For hospitals, it has enabled bosses to reduce the waiting times to under six months, while ministers say they want firms to run GP services to help plug gaps in under-doctored areas.

Has it proved controversial?

In a word, yes. Doctors, trade unions and left-wing academics have all rallied against the plans.

PFI hospitals have been attacked for representing poor value for money, with some doctors claiming their hospitals only need a little redevelopment rather than a full-scale rebuild.

Independent sector treatment centres have also been attacked. Doctors say they can hinder training as they hive off many of the minor operations which are important for younger doctors to experience before going on to more complex procedures.

There have also been reports of NHS operating theatres lying idle as independent sector treatment centres are given guaranteed levels of activity.

Meanwhile, GPs have been quick to oppose private sector involvement in the family doctor market, pointing out firms could cherry-pick the easiest patients with the least complex needs to make the maximum profits.

What does the latest move mean?

If the government has invited firms to run primary care trust services, it means potentially three quarters of the NHS budget - about 65m - could be handed over to the private sector.

PCTs commission local services such as hospital care and community services such as GPs.

The trusts also have responsibility for deciding strategy at a local level, including which drugs to fund.

It would complete the triangle of private sector involvement in primary care (GPs), secondary care (hospitals) and purchasing of services (PCTs).

Critics say this creates a potential "conflict of interest" as private firms could be in charge of commissioning the services which they provide.

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