New report: private NHS providers increase fraud risk, damage patients

An independent health think-tank (which looks to be genuinely independent, unlike all those right-wing ‘independent’ groups that abuse charitable status for tax-breaks while plotting ways to impoverish us) has published a new report on the impact of increased use of profit-making providers in the NHS.

The CHPI (Centre for Health and the Public Interest) report warns

that the introduction of greater use of for profit providers of healthcare services as a result of the 2012 Health and Social Care Act is likely to substantially increase the amount of healthcare fraud in the NHS. This will result in less money for patient care when funds are already scarce in the NHS.

The authors of the report find

that the use of payment by results contracts with private providers in the new NHS market provides significant opportunities for fraudulent claims such as ‘upcoding’, whereby patients are categorised as having more severe conditions than they actually have in order to attract
higher rates of payment..

This type of fraud is prevalent in the US, where private companies already provide healthcare services. A number of the companies which have settled major fraud cases there are currently delivering healthcare services in the UK or are seeking to do so.

The report goes on to highlight the weaknesses of current government anti-fraud measures and points out that health-related fraud in the US amounts to an incredible £80bn per year.

As I unvcovered during my investigations into NHS mortality statistics, there is almost zero training or auditing of the NHS’ PBR (payment by results) data input – a factor which led to massive errors in the ranking of hospitals for their mortality rates. It also led to Mid Staffordshire NHS’ financial problems, as the Trust was vastly underpaid because of undercoding of ‘co-morbidities’ (conditions present as well as the main one requiring an episode of treatment.

‘Upcoding’, as the practice of documenting more severe illness than a patient actually has, is twice as high in profit-making hospitals, and it is certain that no profit-making centre is going to under-claim for the treatments it provides.

Even if all private providers were scrupulously honest, by definition a profit-making entity takes funds away from treatment of patients and puts it in a company bank account somewhere. That in itself would be enough to make more for-profit involvement in the NHS a very bad idea.

But that’s not the case. With fraud rates double the non-profit rate, every inch conceded to private health interests is twice as damaging to patients, and a disaster for the NHS.

The government, by carving open the NHS to allow the even easier entry of profit-making providers, is not only stealing, piece by piece, the UK’s greatest achievement and institution but also endangering the very patients whose interests it claims to have at heart.

If you want to read the report in full, you can do so here. Please spread the word, especially if you hear anyone talking about privatisation in the NHS being more efficient, ‘saving’ anything – or being anything other than a Very Bad Thing.


  1. Well I’m going to say it again – a publicly-owned, collaborative, vertically integrated NHS with appropriate numbers of trained and graded professional staff in local & specialist hospitals and the community is the best and most equitable health care system – AND the cheapest.

    Only Mr Milliband and Mr Burnham are now in a position to espouse this simple policy and deliver it. We know it can be done (and is probably the best approach) in a country that’s a bit short of cash – Clement Atlee did it (and we’d never been so broke). Come on boys – time to be brave!

  2. Reblogged this on Vox Political and commented:
    This is vital reading for anyone who has ever thought that introducing private companies into NHS service provision might ever be a good thing: It isn’t.
    The intrusion of ‘for-profit’ companies into our health service means, by definition, that money intended to buy care for the sick will become company profit instead; now we see that there is also a huge risk of these private providers making fraudulent claims the patients have more severe conditions, in order to attract higher payment.
    Despicable – and entirely unsurprising.

  3. Reblogged this on Grannie's Last Mix and commented:
    Alongside the savage cuts to welfare benefits the underhanded privatisation of OUR health service is the most important issue on the political agenda. Cameron’s band of corrupt cronies have taken it far further than Thatcher ever dared to whilst simultaneously demoralising many thousands of the people who need it most. They can spout all the rhetoric about ‘efficiency’ and ‘better care’ they want but they can never get away from the fact that the single most basic underlying principle of any private enterprise is shareholder profit. And in the NHS that is at direct odds with its own principle of putting patients first. NO privatised healthcare system can reconcile these two opposing principles and this blog shows us which of those principles is certain to win out.
    Please read it and share as widely as you can.

  4. It is inconceivable that anyone would consider Private healthcare anything other than for profit. Therefor it can only be more expensive to run,due to admin costs,thereby reducing the money available for patient care. This seems to me to be a No Brainer.

    1. Of course. Unless you succumb to the constant ‘private is more efficient’ brainwashing – nonsense in view of G4S, A4E, Atos etc!

  5. Stephen, followed your comments on Dorset Eye, I post there too.
    Join us on http://www.ukcolumn.org to fight sgainst all the gangsters who think they have the Nation under their corrupt thumbs! James.

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