22nd August 2014 3

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HealthChat - CNO Jane Cummings in conversation with Roy Lilley - 10th November 5.30pm King's Fund London Book Here.  Come and chat, network and enjoy a glass of wine. Some tickets left at �39.95

News and Comment from Roy Lilley

Here are two aphorisms about business that have stood me in really good stead over the years.

  • The business of business is the avoidance of risk.
  • There is no sweetness in nothing.

People who've never run a business think businesses like risk. Wrong; no business carries more risk than it absolutely has to. Business is risk averse.


Sweetness? If you can't make a margin, get out. If there is no profit in a business don't do it. Operating at a loss is a mug's game. Working at break-even for a controlled period, maybe. Otherwise if you run at a loss you screw-up your cash-flow, increase your borrowings and watch your liabilities push a profit out of reach.


I know these two adages to be rock solid true. And, if you ignore them you run the risk of screwing up your good name. Building a brand, what you stand for, is a number one priority. If you are short of money you'll cut corners and knock chunks off your brand value.


Businesses delivering hands-on clinical care for the NHS run a huge risk. The tariff is tightening, service delivery is tailing off, regulatory demands are becoming unmanageable and the consequences of poor workforce planning coming home to roost.


Against this background I was not in the least bit surprise to read the Stock Market announcement that Serco is pulling out of their clinical, NHS contracts. They've lost �18m to date. James Illman from the HSJ has a neat up-sum.


This is a wise and sensible decision for Serco. They are a public company and cannot continue to risk shareholder and brand value. It is also deeply troubling for a privatising coalition. This decision will reverberate across the private sector who will think twice about market entry.  The DH will be in a flap not knowing how to replace the capacity.


Why should the private sector be any better at running NHS services than the NHS? The simple answer is; it isn't. We know CircleBrook have had bungs to keep going.   Because NHS staff come to work and wear a different badge does not make the systemic problems of the NHS go away. There are too many patients and not enough money. Sustainability is as much of a problem to the private sector as it is the NHS.


What about Virgin? They are a private company and we will never know what their books look like. I can take a guess. Their balance sheet is the same colour as their logo. They will be suffering just like Serco and Circle and the rest of the NHS.


It seems to me Virgin's philosophy is; if you can grab enough market share two things happen. Economies of scale will release cash for a margin and over time that margin will release a profit. Second, market dominance.  Boss the market and you can dictate the price and terms. If it is, it's wrong; neither of these two philosophies work in health. Releasing a 5% efficiency gain on a contract running at a loss is not a 5% profit. The only reward for market dominance in health means doing more for less; global funding is capped and politics makes a mess of the rest.


History would seem to be telling us 'grab and boss' don't go so well!  What's happened to Virgin Cola, Virgin Casino, Virgin Brides, Virgin Cosmetics, Virgin Clothing, Virgin Cars, Virgin Underwear, Virgin Megastore, Virgin Records, Virgin Flowers, Virgin Pulse, Virgin Charter, Virgin Student.  


If Virgin do a Serco and it would make sense, there will be a huge gap on the supply-side and there is no plan B.  All the DH could do is throw money. 


Over the last two weeks we have talked about the mess that primary care has got into and last week how the neglect of mental health is reaping a terrible harvest. Politicians look powerless. LaLite has a gazelle-meets-lion-at-the-waterhole look about him and has started the pre-election bung strategy far earlier than anyone predicted.


Dr Shirt-Off is joke figure and the least impressive minister I have seen in over 30 years of health watching. No-Man Lamb, nice man that he may be, looks completely out of his depth; he stands, wringing his hands, in the smoking ruins of the services he is responsible for.


This is the worst health team I have seen since 1974 but it doesn't matter because Labour is worse. They are yet to lay a glove on any minister or any policy.  Both parties confuse fire-fighting with policy and carping with critique.  The NHS exists in a strategic vacuum.  What are we working towards?  What are the goals and what is the vision?  What exactly is our nation's health policy other than a wish-list, shopping list or another to-do-list. 


Safe, accessible, compassionate are not policies they are foundation stones.  The building blocks are missing; where what and how.  What does the future look like?    


There are urgent matters to address; post 2015 funding, sustainability of the system, the shape of primary care, the viablity of secondary care, paucity of IT, crippling workforce shortages, eroding confidence in NICE, the moribund inspection regime, failure of public health, a faux-market, eroding and corroding morale at the front-line, relationships with the private sector, widening differences between health and social care, and the overwhelming numbers of people turning to the NHS for help.      


Is there no one with the nouse, grasp of the issues, practical acumen, voice, determination or vision to make a sensible decision about the future of healthcare... with the exception of Serco.


Have a good weekend and enjoy the Bank Holiday.  

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CNO England 
Jane Cummings
in conversation with
Roy Lilley
10th November
King's Fund
Some tickets left �39.95 - Book Here
Thank You Jane! 
After my exposing the Practice Death-List issue Jane got on the case, faced the media and got the practice changed.
Here is a link to her Blog; please take a moment to read it.
Well done to her  
and thank you! 
Unlike No-Man Lamb who is still in hiding, the BMA who wrote the junk and NHSEmployers who have no business at all writing clinical guidelines.
Thank goodness for the nurses!
This is what I'm hearing;
if you know different,
tell me here
>>  I'm hearing Monitor have a problem with the CQC; a damning Trust report might bring on a call for special measures that Monitor might not be able to manage and if top Trust management go, how are they replaced.
>>  A good question is doing the rounds;
if a Trust is in special measures is is right/moral/safe for a CCG to continue purchasing from them?  They have a duty of care, don't they?   Withdrawing contracts and pulling money out of the Trust brings further destabilisation.
>>  I wonder when the HSJ will merge with the Local Government Chronicle. 
I think that's how they started?
>>  I'm hearing to bolster consultant ranks in A&E
several hundred have been recruited from overseas?
Today's Larf
Martin Shovel
cartoon martin