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Private company to withdraw from running NHS hospital

The first private firm to manage an NHS hospital has announced its intention to withdraw from the contract.

Circle, an employee co-owned partnership, took over the running of Hinchingbrooke Hospital in 2012. The hospital was said to be facing closure at the time.

In a statement today Circle chief executive Steve Melton said: “After considerable thought and with great regret we have concluded that Circle’s involvement in Hinchingbrooke does not have a sustainable future in its existing form, and have entered into discussions with the Trust Development Authority with a view to withdrawing from the current contract.”

Melton said Circle had invested in the quality of care, in staff and facilities and delivered £23m in savings but claimed that – since the contract was put out to procurement in 2009 – “the playing field has changed”.

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He explained: “First, like most hospitals, over the past year we have seen unprecedented A&E attendances – at times up to 30% higher, year-on-year – and not enough care places for healthy patients who await discharge.

“Second, at the same time, our funding has been cut by approximately 10.1% this year.

“With these pressures on the system, to maintain the standards our patients deserve requires significant further investment, on top of the £4.84m and considerable resources Circle have invested in the hospital to date.”

Melton suggested that solving the problems facing Hinchingbrooke could only be achieved through joined-up reform in Cambridgeshire across hospitals, GPs and community services.

Circle’s chief executive said the Care Quality Commission was likely to publish its report on Hinchingbrooke Hospital soon.

“We fully expect it to be unbalanced and to disagree with many of its conclusions,” he said. “We recognise the importance of a regulator focussed on quality, but we are not the only hospital to find their process problematic. We believe that inconsistent and conflicting regulatory regimes compound the challenges for acute hospitals in the current environment.”

Melton said the combination of these factors meant the firm had now “reluctantly concluded that in its existing form, Circle’s involvement in Hinchingbrooke is unsustainable”.

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