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US Multinationals cash in on NHS,m it will be destroyed

girl interrupted | 06.10.2004 11:43 | Sheffield

Big american multinationals to make money by americanising and privatising the NHS, this is dynamite, particulalry for the chronically and the terminaly ill who will be most affected at first

"Freestanding surgical centres run by international private operators ... are a first step. Private diagnostics and primary out-of-hours services are next". And he took some swipes at doctors, saying there was an "increased challenge to the medical profession's power" in an NHS which needs "constructive discomfort".

excellent article in the Guardian about the creeping americanisation of the NHS(which will as Gatts is implemented. But as the left continues its obssession with war and asylum seekers, nothing is done about it.

includes some letters following it.

US firm gets results for NHS - but soft sell masks an expensive truth

Big corporation lobbying hard to take over UK health projects - at a price

Read the documents on UnitedHealth

David Leigh, Rob Evans and Ed Harriman
Thursday September 30, 2004
The Guardian

In the rolling plains of Minnesota, Lois Quam enthusiastically displays to her visitors a large wall-mounted portrait of Nye Bevan. That socialist firebrand who founded the British national health service in 1948 might seem about as unlikely a guru for the corporate soul of the US midwest as, say, Fidel Castro.

But this is the soft sell with which this giant corporation is hoping to Americanise the NHS.

Ms Quam is the friendly face of UnitedHealth Group, which makes $1.8bn (about £990m) a year profit. She is of Norwegian extraction, and did research at Oxford: "I loved living in Britain," she said. "I had a GP, and a Labour council with progressive values."

Ms Quam said her state of Minnesota stands for social progressivism and medical innovation, partly because of its history of Scandinavian settlement. She and her husband are both Democrat activists.

"I have always loved the NHS," she said. "I believe in universal coverage."

But her company makes its money in the very different US system - from health insurance premiums paid by big employers for their workers; and by collecting Medicare cash from the US government, which subsidises healthcare for the over-65s.

US healthcare is widely criticised for being expensive and unfair to the poor. But in the course of that business, United has developed some sophisticated schemes to save money, both by keeping doctors in check, and by keeping its most costly customers out of hospital.

Now it wants to market its ideas to Britain, with an equally sophisticated lobbying operation. It first boasted in May that it had poached not only the editor of the British Medical Journal, Dr Richard Smith, an old friend of Ms Quam's, but also Simon Stevens, Tony Blair's (and before him Alan Milburn's) own adviser.

Mr Stevens, 37, is an Americanophile who has helped to write much of the current NHS plan for modernisation, computerisation and "choice", which his new employers hope to exploit. He has an American wife and began his career as a hospital manager with a spell in New York on a Harkness fellowship.

It was in a US health conference in New York last October, alongside the health secretary, John Reid, that Mr Stevens told his audience: "The era of English exceptionalism in healthcare is over". He pointed out the similarity between UK trusts now set up to "buy" health from doctors and hospitals, and US "managed care" organisations such as UnitedHealth. "Indeed," he said, "pilot programmes are now testing the partnering of US managed care plans with primary care trusts."

He promoted "choice": "Freestanding surgical centres run by international private operators ... are a first step. Private diagnostics and primary out-of-hours services are next". And he took some swipes at doctors, saying there was an "increased challenge to the medical profession's power" in an NHS which needs "constructive discomfort".

Thanks to Whitehall unease, Mr Stevens is not now this month installing himself as the new president of United's British subsidiary, Ovations (UK) Ltd in London.

Lobbying power

But Ms Quam, who heads United's Ovations subsidiary, still has plenty of lobbying power. Shortly before Mr Stevens' New York speech, she was in health minister John Hutton's London office for an "informal" discussion (without minutes) on ways to track the performance of GPs and "managing patient choice".

She brought along a representative of another US firm to make a pitch - Vitas, based in Florida, which specialises in hospices and "end-of-life care", another expensive aspect of the NHS. They also met Barbara Hakin, a Milburn adviser.

As Mr Stevens' hiring was clinched, another of United's political stable was brought on - Bill Clinton's former health secretary, Donna Shalala. She already knew some British ministers, thus demonstrating the seamless way politicians and political advisers can metamorphose into commercial lobbyists.

United "have asked me to serve as a liaison" she wrote to Mr Reid. "I will of course also be happy to discuss any elements from my experience ... under President Clinton which may be of assistance to you in your duties".

Ms Shalala failed to get in to see Mr Reid, but she did see Mr Hutton, on July 1 this year. The agenda - again no minutes were taken - was:

· Knowing his keen interest in US political developments, she will be happy to provide an update on events in Florida and elsewhere

· Congratulate him on the progress of the NHS and hear his thoughts on opportunities and challenges ahead

· Share thoughts on healthcare modernisation in the US and the UK.

"Dear John," said her thank you letter afterwards: "Best wishes on your upcoming wedding. You and your bride have a standing invitation to visit."

Ms Quam herself meanwhile talked to a junior health minister, Stephen Ladyman, at a behind-the-scenes ministerial seminar with "private providers" on adult social care. Mr Ladyman is planning a green paper on the subject this year "to shift the balance from welfare to wellbeing - promoting independence and choice", according to documents released to the Guardian under the open government code.

United has already acquired two contracts from the NHS, to tackle the "bed-blockers" who cost NHS hospitals the most.

The first scheme is called Evercare, for which Mr Milburn, then health secretary, handed out pilot contracts in autumn 2002. The principle is simple. Using a computer and specialist nurses, it identifies a small group of sick elderly people who it believes soak up immense resources. The specialist nurses visit them, liaise with family and doctors and, by spotting infections or early problems, save a fortune. The firm claims that Evercare in the US has "reduced hospitalisations by 50%".

United gets a flat fee from the US government for each Medicare patient whose healthcare it insures. So the fewer times each patient goes into hospital, the more money the company makes.

Evercare has been undergoing trials at nine British local health authorities (now called primary care trusts). United's own assessments claim that it discovered a hitherto unknown "high-risk population" which, although only 3% of the over-65s, was responsible for 35% of unplanned hospital admissions in that age-group.

The plan for what United terms the "new NHS" provides for Evercare-type projects across the country, although it has not yet been independently assessed whether they work.

This month, United was handed another contract, worth £6m, from the Department of Health, to perform similar pilot exercises on cancer patients, identifying them, and trying to keep them out of hospital.

It is only a starting point. United has presented the British government with its own "white paper", outlining a whole shopping-list of projects. It says the contents cannot be disclosed because they are "commercially sensitive". The Department of Health also refuses to disclose them.

Chronically ill

United is not the only US corporation in the market. The Department of Health is also funding trials of "managed care" for the chronically ill with the US firm Kaiser Permanente.

Taken to its logical conclusion, US firms such as United could end up eating into the role of health authorities themselves, getting funds from the taxpayer and then deciding which treatments, which doctors, which NHS hospitals and which commercial providers offer them the "best value for money". Jennifer Dixon, director of the King's Fund, a health thinktank, said: "They could bid to hold a budget to commission for an entire population - although that at the moment is a step too far for government policy".

The problem, however, is that in the US, it is only by playing to United's commercial interests that schemes like Evercare can be made to work. And companies like United are not altruists. Bill Maguire, head of the group, collected a $94m package last year, including stock options.

The firm is one of several embroiled in class actions in the US, brought by private-enterprise doctors who complain they can not get paid for expensive treatments they prescribe, and by patients denied approval for such treatments. US employers protest at the way insurance premiums are jacked up by the healthcare industry - an estimated 22% last year. And the US government complains that companies such as United are profiteering from Medicare, because they attract too many healthy customers, leaving the sick ones to Medicare.

The firm deals with this by spirited lobbying. It makes donations to Republican causes and Mr Maguire has been commended by George Bush for putting his hand in his pocket to get him re-elected.

This summer, the company and a former subsidiary paid $20.6m to settle without liability an action brought against one of their subsidiaries for allegedly submitting false expense figures for Medicare recipients in order to get bigger reimbursements and incentive payments than it was entitled to.

All this makes some people cynical about the claims that such "health maintenance organisations" (HMOs) are a miracle road to efficiency.

In Minneapolis, Kip Williams, of the Minnesota Physician Patient Alliance, has a thick file on United. "It's a great big canard that managed care saved anybody money," he said. "HMOS are hated. They are despised. They are the butt of cartoons and late-night comedy shows."

He tots up the extra overheads. First, marketing costs. "Every fall, employers let employees decide on their choice of health plans. The nation is blitzed with ads".

Second are heavy underwriting assessment costs for employee insurance - huge questionnaires about whether would-be beneficiaries have Aids or cancer, for example. Then there are the inevitable costs of "managed care" - profiling doctors, analysing hospital track records. Lobbying costs are another extra. Finally, there are huge executive salaries and the profit that has to be generated for shareholders.

"So before they even start, they have to climb a hill to make a buck out of Medicare," Mr Williams said.

But these are the kinds of cash-driven institutions which ministers now have on the agenda as models for the "new" NHS.

Some GPs say they could easily do the work themselves, given enough cash. Phil McCarthy is a GP in Bristol, where three Evercare schemes are being piloted. He objects to "the privatisation drive in the NHS", saying US firms will get an unstoppable foot in the door with local NHS trusts. "They are like minnows in a pool with an enormous shark," he said.

· Read the documents on UnitedHealth at

letters including a defence by NHS boss

Models for the NHS

Monday October 4, 2004
The Guardian

Patients want the NHS re-established as a world leader in all aspects of healthcare. This means we have to learn best practice from the very best (US firm gets results for NHS, September 30).

American systems such as Evercare or Kaiser Permanente (which we are piloting in a handful of primary care trusts) are helping us develop plans for first-class healthcare for people living with long-term or chronic conditions.

But this isn't about replacing the NHS with an American approach; or encouraging a creeping Americanisation; or allowing US healthcare firms a free rein to take over the running of the NHS.

I want the NHS to develop its own model for chronic disease management and, in doing so, we intend to learn from wherever we can, be it from overseas, private or voluntary sector expertise.

Nurturing NHS innovation will be equally important. Ironically, many countries are keen to learn from us and see the NHS as an emerging leader in managing long-term conditions. We are among the most advanced, large-scale economies to implement a systematic approach to chronic disease management.

Next month we will publish a framework for how the NHS locally can provide the best care possible for patients with chronic conditions. It is being developed through a careful analysis of what works for NHS patients in an NHS system. It will build on what we learn from America, and other sources. I make no apology for that.
Nigel Crisp
Chief executive, NHS

The cabinet secretary's restrictions of former Blair adviser Simon Stephens recalls the last period when US health ideas held so much sway in government (Ex-Blair Aide barred from helping US health firm, September 30). Mrs Thatcher and her spur-of-the-moment promise of NHS reform in 1988 led to the NHS internal market. Tory enthusiasm for the internal market quickly soured, nevertheless other NHS marketising reforms remained - one of the reasons why NHS hospitals are dirty and so many ancillary staff poorly paid and uncherished.
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A virtual shuttle service has been running between companies like Kaiser and people of influence in health in and around Whitehall. The interest in outsourcing NHS activity to such companies accords with Labour's motif of consumer choice.

Surveys in the US show that the choice provided by US-managed care companies is largely bogus, while company practices are loathed by patients and doctors alike. Given that the US healthcare system is so unappealing, why do we continually give credence to US ideas and companies? Are we so lacking in self confidence or are there more cynical reasons at play? The renewed interest in Britain by US corporations is simply explained. The chancellor's largesse towards the NHS, combined with Alan Milburn's private sector Concordat and John Reid's new choice agenda, opens lucrative opportunities.
Dr Geof Rayner
Co-author, Banking on Sickness: Commercial Medicine in Britain and the USA

In the US, it has been uncommon for skilled nurses to work in the community and support identifiably vulnerable patients out of hospital. However, in the UK, district nurses were developed many years ago. It is little wonder that current and recent health ministers have fallen for the PR of US health corporations in favour of various kinds of privatising of the NHS if possible projects are not openly discussed. The US healthcare industry has a well-documented history of great PR coupled with very high costs, poor coverage and widespread

he NHS chief executive, Nigel Crisp (Letters, October 4), offers the disingenuous argument that, in order to test the efficiency of a US model of healthcare for people with long-term or chronic conditions, it is necessary to allow a US corporate healthcare group to operate within the NHS.

He must surely be aware that corporate penetration of the NHS (and of education and the UK services sector generally) is the prime objective of the General Agreement on Trade in Services (Gats) which, undebated and surrounded in secrecy, is about to be foisted upon us. Such irreversible, free-trade commitments will change the whole social and economic structure of the UK. They are clearly a major component of Blair's modernisation plans and their imposition a key factor underlying his decision to serve throughout a third term.
Prof Roy Butterfield

I entirely agree with the points made in Dr Geof Rayner's letter. I now have had the experience of three heart attacks and two rounds of coronary bypass surgery, all performed under Aneurin Bevan's model of the NHS. As a result of this excellent not-for-profit care I am able to look forward to my 75th birthday.

Those people who are members of the caring professions together with those who facilitate their work have earned massive public gratitude and don't need any lessons from those who are responsible for an appallingly neglectful health service. What seriously concerns me is the fact that the government is intent on commercialising public services and all of its "new" intentions are adaptive for this purpose.
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If the current commercial finance initiatives are anything to go by, firms of proven incompetence will be allowed to degrade the NHS and still receive new and very costly contracts.

The primary duty of maximising company profits is the foremost duty of care of company managers and must inevitably be a contaminating influence. They thus form a serious drain on the NHS economy. That also explains the repeated degradation of services within the NHS where the commercial finance initiative has been applied.
Dr B Glaizner

Nigel Crisp is, of course, quite right in saying that we should be prepared to learn from best practice in the health systems of other countries. But if an idea is worth exploring, do we not have the expertise, clinical and managerial, in the NHS to set up our own pilot studies?

Concerns about allowing a foothold to overseas commercial interests are well-founded. I remember raising this with a previous secretary of state for health and being told: "If we don't offer them long-term contracts they won't come."
Peter Fisher
President, NHS Consultants' Association

girl interrupted

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