Healthcare: Public hospital to be taken over by private company

Triage is what happens when scarce medical resources are allocated to the most pressing needs first.

It's what hospitals do in casualty departments but, under recent UK National Health Service developments has not been properly implemented across whole hospitals.

As government interference in healthcare has undermined the idea of independent management, more and more elective treatments have fallen to be covered by the state. But the money that the state has allocated to the hospitals has not kept pace.

Moreover, endless centralised policy changes in how trusts are managed have resulted in a desperate short-termism in management polices.

Many trusts are running a deficit but, with an unmanageable GBP39 million, Hinchingbrooke Hospital, a general hospital, has hit the wall first.

The government has announced that the hospital is to be managed by Circle Healthcare, a part-public, part-privately owned hospital management company.

Although the UK's Labour Party, in opposition, is making much of what it claims is back-door privatisation of Hinchingbrook, the plan for its transfer from government to private management was originated by the Labour Party when it was in power. In fact it was that government that approved a short-list of three companies including Circle.

Circle works in a combination of investors and a significant minority owned by medical staff in the hospitals it manages. In this way, there is a mix of clinical and financial decision making in the strategies - and both sides have a financial stake in the outcome.

While the contract requires the continuation of essential services such as a casualty department, other - services are not protected. Therefore some of the elective services may be abandoned.

The NHS now works on the basis that all hospitals have to "sell" their services to local "commissioners." In this context, the word means someone who commissions services. Circle says that its success or failure will depend on the ability to deliver the best services at a cost that those commissioning its services are prepared to pay.