Weird goings on in Northumberland, Tyne and Wear Sustainability and Transformation Partnership

Just as NHS Improvement Chief Executive Jim Mackey is due to return to his position as Chief Executive at Northumbria Healthcare Trust, where he has been seconded from for a couple of years, the media are full of stories about Newcastle Hospitals Trust’s sacking of its Chief Executive, Leonard Fenwick.

Following completion of investigations that started in January, Newcastle hospitals Trust Board fired its Chief Executive on 17 August, after reporting “…a number of concerns to the NHS Counter Fraud and Security Management Services, known as NHS Protect,” according to the National Health Executive blog .

Northumbria Clinical Commissioning Group minutes from April 17 record that “the counter fraud issue” related to personal health budgets.

It seems unlikely that there were 2 counter fraud issues going on at the same time in the area, although the Minutes don’t identify what “the counter fraud issue” is.  And Newcastle hospitals Trust Board has refused to reveal what “serious…issues” it reported to NHS Protect.

Counter fraud issue or witchhunt? What happened to the “duty of candour”?

Media reports state that the Chief Executive’s dismissal was on the grounds of gross misconduct – variously described as bullying staff,  suspension of senior consultants who bunked off during working hours for a quick shag with Trust secretarial and clerical staff,  as well as the undisclosed “concerns” that the Newcastle Hospitals Trust Board reported to NHS Protect.

Surely if Leonard Fenwick’s wrongdoings were serious enough to be reported to the NHS Counter Fraud and Security Management Services, the public should know what he has been charged with?

Presumably, if the charges stick it will be a police matter and he will end up in court – as happened to  NHS England’s former National Lead for Equality and CEO of Torbay and South Devon NHS Foundation Trust, Paula Vasco-Knight, and her husband Stephen Vasco-Knight.

For his part, Leonard Fenwick has described the investigation as “witchhunt” against him on account of his being old skool.

Some of his Executive Reports to Newcastle Hospitals Trust Board meetings indicate that Leonard Fenwick seemed underwhelmed by Jim Mackey’s plans for Northumbria Healthcare Trust, and concerned about their effects on NHS organisations “north of the Tyne.”

His September 2015 Executive Report to the Newcastle hospitals trust Board was lukewarm about “Vanguard-inspired” plans that were “heralded as a first in the NHS”, for Northumberland Clinical Commissioning Group to hand over

“its budget and nearly of of its functions to a provider – led … “Accountable Care Organisation”, with the CCG’s and primary care budgets for the area being held in a Special Purpose Vehicle which would be jointly governed by Northumbria Healthcare NHS Trust together with representatives of Primary Care, Public Health and others.”

His report pointed out the Northumbria ACO’s

“impact and consequences in relation to ‘North of the Tyne’ as a whole… may prove to be rather problematical under the given circumstances.”

The Accountable Care Organisation was meant to have gone live this April but didn’t because there were shenanigans over NHS England ordering Northumberland Clinical Commissioning Group to conceal how broke it was – but that ruse didn’t work because the info came out and now the Accountable Care Organisation launch has stalled

Leonard Fenwick seems also to have been underwhelmed by NHS Improvement’s accreditation of Northumbria Healthcare Trust as a Foundation Group hospital.

His October 2016 Executive Report to the Newcastle hospitals trust Board noted that:

“guidance on options for structuring Foundation Groups… encompasses corporate joint ventures: committees in common; contractual joint ventures; and how NHS Improvement will provide further support and insight.

It is heralded that the accredited Foundation Trusts…will help to ‘improve efficiency’ and the quality of clinical services by sharing excellent practice via for example ‘single group structure’.

Further it is cited in this context “we expect that other providers will join these foundation groups to share expertise on areas such as strength and depth of management, clinical expertise and back office functions”.

It drily added:

“In the context of the evolving Strategic Transformation Plan for Northumberland, Tyne and Wear, the role and status of the now heralded Northumbria Healthcare Group does require informed consideration.”

Secretary of State says there are “too many Trusts in the NHS”

Foundation Group hospitals were set up when – as Leonard Fenwick pointed out in his September 2015 Executive Report to the Newcastle hospitals Trust Board – the Secretary of State had “heralded”:

“there are “too many Trusts in the NHS” and a need to “up the pace of work on hospital chains and other provider reforms”. These comments come amid renewed interest in the so called ‘chains’ in both Government as well as NHS England whom it is understood are selecting sites for its ‘Acute Care Collaboration Vanguard’.”

By May 2016, this theme of “too many Trusts in the NHS” seems to be reflected in Simon Stevens and Jim Mackey’s thinking about Sustainability and Transformation Plans.

Overcoming some of the veto power of individual NHS organisations

A May 2016 article from the Health Service Journal, “Stevens floats ‘combined authorities’ for the NHS”, outlines Simon Stevens’ intention of setting up NHS versions of combined authorities based on Sustainability and Transformation Plan areas in order to “pool sovereignty” and “overcome some of the veto power” of individual organisations “that would “otherwise stand in the way of changes proposed through STPs.”

The Health Service Journal article reported that the example Simon Stevens gave of the “pooling of sovereignty” was the area surrounding Royal Free London Foundation Trust, which took over Barnet Hospital and Chase Farm Hospital in 2014, and whose chief executive David Sloman is the STP leader for the patch, potentially forming a combined authority type arrangement.

He said: “I could see that spanning both hospitals and commissioners and it could consolidate a number of CCGs in north central London.”

Further on in the HSJ article Simon Stevens said some STP leaders were asking of him and NHS Improvement chief Jim Mackey: “Do you mean it, have we got permission to actually get going and remove some of the veto power that exists?” He said: “In some cases individual organisations or [clinical commissioning groups] are very local focused, but perhaps there are positive gains from more shared, larger scale change.” Some wanted “the ability just to, where there is disagreement, call it and make a decision.’ He said the difficult decisions typically involved “the disposition of hospital services”.

This is the context for Northumbria Healthcare Trust Foundation Group’s innocuous- sounding announcement of its intentions:

“As set out in the NHS Five Year Forward View, acute care collaboration vanguards will design and spread excellence in hospital services and management across multiple geographic locations.”

It is testing 3 new approaches:

  • raise standards across a chain of hospitals (a model of hospital ‘chains’ frequently used in other countries).
  • Individual clinical services at local district general hospitals being run on-site by specialists from regional centres of excellence
  • Forming ‘accountable clinical networks’ integrating care across district general hospitals and teaching hospitals for key services.

It offers consultancy support, long term partnerships and business services.

Northumbria Foundation Group’s “strategic partnership” with Ribera Salud

The Northumbria Foundation Group website trumpets its “Strategic Partnership” with Ribera Salud, which started in 2016.

Now half-owned by American health insurer Centene, Ribera Salud is the Spanish public/private partnership (or Accountable Care Organisation) that pioneered a form of Private Finance Initiative that covers not just buildings but “integrated” health care delivered by hospitals, GPs and community services for the whole population in designated areas.

Ribera Salud is the holding company for the Special Purpose Vehicle Ribera Salud Unión Temporal de Empresas consortium. The shareholders were initially:

  • The medical insurance company Adeslas S.A. (51%)  as the technical provider of health services, with regional savings bank Agbar S.A as its majority shareholder.
  • Regional savings banks Bancaja, CAM and Caixa-Carlet by means of a jointly-controlled entity – Ribera Salud S.A.- (45%), which was the financial partner for the project.
  • Construction companies Dragados and Lubasa, which each took a 2% holding.

However, in 2010 Bancaja merged with six regional savings banks to form the Bankia group. In 2012 Bankia was bailed out by the Spanish government after declaring a profit of €328m in May and two weeks later adjusting that figure to a loss of €4.3bn. One year on, this was revised to €19bn – the largest corporate loss in Spanish history.


Massive corruption scandals emerged involving 83 executives of one of Bankia’s constituent regional banks embezzling millions of euros on black credit cards.

The European Commission ordered Bankia to divest and sell its shares in Ribera Salud and in 2014 they were acquired by the American sub-prime health insurance company Centene. It later emerged in a January 2016 report in the newspaper El Confidential that Centene Corporation’s purchase of Bankia’s shares was conditional on a secret agreement that the company would buy out the remaining 50% of Ribera Salud’s shares from the Bank of Sabadell in 2019.

In this way, Centene Corporation placed part of its business in the Valencia Region, where it controlled three Hospitals in the provinces of Valencia and Alicante (Alzira, Torrevieja and Elche).

New Valencia health law ends Alzira model and takes the health service back into direct public management and provision, as Ribera Salud comes under police investigation for corruption

However it is going to lose these, since in July 2017 the Green/Socialist/Podemos coalition government in Valencia passed a new health law to take back the Alzira health “concession” into direct public management and Ribera Salud is UNDER POLICE INVESTIGATION FOR EMBEZZLEMENT AND CORRUPTION.

The charge is that Ribera Salud has been making suppliers of ortho-prosthetic materials pay a “commission” to get contracts. The matter could be criminal, in particular embezzlement of public funds and prevarication  according to the police, since prostheses are paid by the Valencian Government. Ribera Salud has declined to comment. The investigation has now passed to the Anti-Corruption Prosecutor’s Office in Valencia and they have named Alberto de Rosa, CEO of Ribera Salud , and Pablo Gallart, the company’s director, as vicariously liable in the alleged scam.

Does Northumbria Foundation Group Hospital know or care about any of this? Apparently not. According to David Evans, chief executive of Northumbria Healthcare NHS Foundation Trust,

“To me, the real deal is about moving to the Riberia Salud-type ACO model…If many people in the NHS look up what an ACO is in the USA context, they will probably find it scary. Some American ACOs are, frankly, aggressive money-making institutions. We have aligned ourselves with Ribera Salud Grupo in Valencia. We like their concept of a truly integrated service out of hospital, run by a joined-up delivery system: that is where we want to be… We have dipped into a range of ACO-type systems around the world: the Riberia Salud model looks like it could work in the NHS.”

This blurb leaves out all the evidence about what has gone wrong with the Aliza Public Private Partnership/Accountable Care System  – including the fact that, as with PFI contracts in the UK:

“contracts may have been designed to mitigate risks to the private sector.” (Spanish healthcare Public Private Partnerships: the ‘Alzira model’. Acerete, B., Stafford, A. and Stapleton, P. (2011), Critical Perspectives on Accounting. Vol. 22, 533-549)

A study by Dr Anne Stafford of Manchester Business School, and others, assembled evidence that the financial reality is at odds with “the rhetoric, which declares this project to be a success story.”

The capitation (per person) payment was set too low (204 Euros), which caused the failure of the Accountable Care System (the Ribera Salud Unión Temporal de Empresas – RSUTE – consortium).

Compensation paid out by regional government was 69.3 million Euros. The Accountable Care System consortium was re-constituted (RSUTE II) at a higher, and progressively higher, capitation amount (379 Euros in 2004 up to 639 Euros in 2012).

Under the RSUTE II consortium there were doctor shortages, a doctors’ strike and continued staff dissatisfaction. According to a study carried out by the Universities of Zaragoza/Manchester and Manchester Business School, there were allegations that the consortium ‘cherry picked’ the most profitable medical and surgical specialities. At the same time it was referring HIV and other chronic disorders to other non-RSUTE II hospitals. The annual bill for regional government was very high.

And here is Hunt’s call to denationalise the NHS and

“break down the barriers between private and public provision”.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.