FIPO Road Show Meeting at BJBraun - Sheffield

10th March 2005

A small but select audience heard three presentations at this road show organised by FIPO at BJBraun close to Sheffield. The Chairman of FIPO presented some of the economic features facing the profession. Mr Glazer outlined the historical developmental of the independent sector and the impact of governmental changes in terms of ISTC’s, NHS contracting and HRGs.

There was clearly concern expressed in the audience about these matters. Contract prices for consultants were being driven down and there appears to be wide variation in the way in which trusts are handling this issue for surgeons and anaesthetists. The question of quality assurance in ISTC’s was also raised and it is evident that while there is anecdotal evidence about poor quality there is a need for more evidence. It was regretted that Dr Tom Mann had been unable to attend but he was responsible for setting in place some detailed care plans, KPI’s (Key Performance Indicators) and other procedure specific audits.

Mr Glazer alluded to the role of FIPO in networking independent MAC’s throughout the country and the fact that FIPO is working with the Healthcare Commission to that end in order to improve quality in the independent sector.

The next talk came from Mr Martin Murray of Sandison Easson and Co. Accountants, who had also sponsored this event along with BJBraun. Mr Murray pointed out that income streams for consultants depended predominantly on NHS salaries with other sources of income coming from medical reporting (medico-legal work), private practice and now increasingly NHS contract work. He discussed the new methods in which contracting was taking place between PCT’s and consultants. Mr Murray also pointed out that some innovations were being introduced for GP’s in the sense that they would also have to compete with other groups in providing certain services. Thus, for example, other independent groups could set up diabetic or hypertension services.

There was concern raised about the fragmentation of clinical care and also the fact that the market was in a very turbulent place and unlikely to settle for at least five years. Mr Murray finished his presentation by referring to Le Chatelier’s principle. Although this was a chemical principle it had also been applied to economic markets. In essence this stated that in after a period of turbulence and disarray all markets do tend to settle in to some form of equilibrium. He anticipated this over the next five years, but was unable to predict exactly what the healthcare market would eventually look like.

Part of the effect of the current phase of market changes induced by the government was to attract many new investors in to healthcare provision. Mr Murray cautioned consultants who were being attracted to a variety of venture capital investments in stand alone diagnostic or therapeutic clinics because many were founded on poor commercial principles and business plans, without guaranteed income flows and without management structures well versed in health care delivery.

Mr Andrew Hamer, consultant orthopaedic surgeon from Sheffield, then described the reaction of some orthopaedic surgeons in Sheffield to the challenges discussed by the previous speakers. It was evident that the advent of ISTC’s had affected orthopaedics as one of main specialities and was going to cause problems in the Sheffield area for routine NHS and other work. He then described the Sheffield Orthopaedic Company that had been set up involving twelve consultants. These consultants were working together in a limited company format with shared receptionist, secretarial functions, audits, clinical governance and with a great emphasis on the quality agenda. A novel feature of this group was the way in which there was utter transparency between consultant colleagues with no dysfunctionality and a proportionate allocation of income according to each consultant’s input.

This matter of the occasional difficulties encountered between individuals in partnerships or limited companies (in whatever profession) was discussed and is an evident danger for those embarking on similar ventures. The Sheffield orthopaedic group was in its second year and will be followed with interest as a model by many other consultants throughout the country.