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Private Healthcare Firm in £320m NHS Contract Dispute

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In a move that many observers will see as a victory against the increasing ‘stealth’ privatisation of the NHS, healthcare provider Circle is set to lose its contract to the Nottingham NHS Treatment Centre, despite taking legal action to get the decision changed.

Circle broke new ground in 2012 by becoming the first private and for profit healthcare business to be placed in charge of running an NHS hospital. Despite this contract, at Cambridgeshire’s Hinchingbrooke hospital, returning to NHS control in 2015 due to rising financial pressures, Circle had successfully run the Nottingham NHS Treatment Centre since 2008. Despite receiving high CQC ratings for patient satisfaction and having hit NHS targets for patient treatment, the firm – who claim to operate as a ‘John Lewis style social enterprise’ – lost the contract in April this year.

Circle has been criticised for taking robust legal action in contesting the award of the new contract, valued at £320m over five years, to the Nottingham University Hospitals NHS Trust (NUH). Shadow Health Secretary Jonathan Ashworth commented:

It’s hugely welcome this service is returning to our public NHS and out of the hands of Circle. Patients well remember Circle’s chaotic handling of the Hitchingbrooke hospital contract and their failures over dermatology at Queen’s Medical Centre…it’s shocking Circle fought this move tooth and nail in the courts, exposing everything that’s wrong with the expensive, wasteful process of competitive tendering and privatisation.”

Following the legal action, a spokesperson for Circle said:

Circle believes the CCG ran a flawed procurement which does not adequately safeguard the sustainability of the services currently provided. We believe we put in the most credible bid, which would have continued the first-rate patient care and brought new investment and innovation, along with additional savings, to the local healthcare system…Circle is disappointed in the local Nottingham decision given the benefits that have been delivered over the last 11 years and the sustainable and innovative bid that we submitted. We believe passionately that the award of contracts needs to ensure long-term sustainability.”

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