Former Downing Street adviser 'could make millions from NHS reforms'

Hospital consultants have claimed that controversial reforms to the NHS could hand multimillion-pound contracts to a private company led by the Prime Minister's former special adviser on health. The consultants are challenging the reform to allow the private sector to bid for the right to organise commissioning for the majority of family doctors surgeries in England.

One of the leading companies that stands to gain from the change is UnitedHealth, a US healthcare corporation whose European president is Simon Stevens, Tony Blair's former health adviser at 10 Downing Street. Mr Stephens worked at the Department of Health as a special adviser to Alan Milburn, the former Health Secretary, before being recruited by Mr Blair to promote NHS change in Downing Street. His proposals helped pave the way for the switch to more commissioning by GPs, a shift of power that the Prime Minister believes will enable family doctors to offer more choice to patients over where they go for their treatment.

A legal attempt by a patient to stop her local family doctor practice in Derbyshire being run by UnitedHealth was rejected in the High Court in June. North Eastern Derbyshire Primary Care Trust chose UnitedHealth Europe as the preferred bidder to run two practices.

Patricia Hewitt, the Health Secretary, denied yesterday she was privatising the NHS after protests at the first bids were invited by the Department of Health for private companies to take over primary care trust (PCT) "commissioning". But she also made it clear she would not back down in spite of opposition by consultants, NHS staff and Labour MPs.

"Some PCTs have indicated that, to support them in their task, they would like to consider the possibility of buying in some management and support services, including the detailed data analysis that helps to underpin sound commissioning. In order to give PCTs this option, the Department of Health intends to place a national framework contract with suitably qualified providers," said the Health Secretary.

"There is no obligation on any PCT to use such services; each PCT board will make its own decision following appropriate local consultation. Our intention is that those PCTs that wish to go down this road will be able to activate a call-off contract quickly and cheaply, without the need to go through expensive and time-consuming local tenders."

However, the consultants' warned that it was leading to the privatisation of the NHS. They said it will put up to 75 per cent of the primary care trust budgets in the hands of private management companies.

Labour MPs also are alarmed about the plan to allow private companies to organise the purchasing of care inside the NHS. Clare Short, the former cabinet minister, and Frank Dobson, the former health secretary, are leading a backbench campaign to protect the NHS from privatisation.

Peter Fisher, president of the NHS Consultants Association said: "The majority of patients say they want the security of knowing that their local hospital is competent, accessible, and then they can forget about it until they get ill. They don't want a vast range of choices.

"UnitedHealth has Simon Stephens in charge. They won a high court case about running contracts in Derbyshire where there were difficulties in getting staff to run the service, but you are now seeing a situation where they are going into areas where there is no difficulty in getting staff."

Private companies were gaining an increasingly bigger stake in the NHS. "There are all sorts of dangers in that." There was also an "overload" of government reforms to the health service which was "demoralising" staff.

On its website, UnitedHealth says: "Our parent company, UnitedHealth Group, purchases healthcare for some 70 million people, and contracts with over 4,000 hospitals and 400,000 doctors. In the UK we are working to improve commissioning for 2.5 million people."