HCA is a leading provider of healthcare services in the USA. The company has 182 hospitals and 130 freestanding surgery centres in 20 US states and employs approximately 294,000 people. In the UK the company operates as HCA Healthcare UK and runs seven hospitals and two partnerships with the NHS. Its subsidiary, HealthTrust Europe is headquartered in Birmingham, England, and works across the UK. HealthTrust Europe was established in 2016, when a local NHS purchasing organisation joined HealthTrust Europe to build a group purchasing organisation (GPO).
Strategy
HCA Healthcare UK's primary source of income is the corporate market and international clients. HCA's strategy with the NHS has been to set up joint ventures through its HCA NHS Ventures business.
HCA Healthcare UK operates six hospitals in central London: The Harley Street Clinic, The Lister Hospital, London Bridge Hospital, The Portland Hospital, The Princess Grace Hospital, and The Wellington Hospital. Outside of London, it has hospitals in Cheshire - the Wilmslow Hospital - and its newest hospital, The Harborne, in Birmingham opened in late 2023. Three of the London hospital provide walk-in urgent care services for those who can pay (£120 a visit). HCA also has a range of outpatient and diagnostic centres, LOC in Harley Street, at The Shard, private care at Guy's hospital, in the City of London, in Golders Green, Chiswick Medical Centre, and Sydney Street. The company also has a clinic in Glasgow. The company also has a partnership with the Institute of Sport Exercise and Health in London.
HCA has three joint clinically active ventures with NHS hospitals: a blood and bone cancer treatment centre with the University College Hospital London, and with the Christie cancer hospital in Manchester, The Christie Clinic, a private patient unit for cancer patients from across the North of England.
HealthTrust Europe LLP provides procurement and related services to the UK public sector via a framework agreement in place between the company and University Hospitals Coventry and Warwickshire NHS Trust (the UHCW framework). HealthTrust Europe is a Group Purchasing Organisation (GPO) that has negotiated a number of contracts. The concept is that as part of the GPO, members have access to good deals with suppliers leading to savings. HealthTrust Europe lists several contract areas including anaesthetic & oxygen therapy consumables; central sterile services department (CSSD) consumables; and venous thrombosis embolism (VTE) prevention systems and consumables. HealthTrust Europe also offers workforce solutions and ICT solutions.
Politics
HCA Healthcare UK donated a total of £17,000 to the Conservative Party over two donations in 2010 and 2011.This was revealed amidst news that HCA had been awarded a multi-million pound contract to treat NHS patients with brain tumours. HCA Healthcare UK was a part of the Private Hospitals Alliance (formerly H5) which lobbied Westminster on issues regarding healthcare and the role of private companies in delivering NHS services.
Financials
HCA revenue for 2022 was $60.2 billion - up from $51.5 billion in 2021, and net income attributable to HCA Healthcare was almost $5.6 billion - down from $6.9 billion in 2021.
According to HealthTrust Europe's accounts on Companies House, for the financial year ended 31 December 2022, the company's turnover was £23.3 million (2021: £19.9 million) and profit for the year was £13.7 million (2021: £11.4 million).
Companies House filings for HCA International reported turnover of £512.1 million in 2021, up from £484 million in 2020. The parent company is HCA International Holdings Ltd. According to Companies House filings there is a complicated web of companies associated with HCA registered in the UK.
Investors
In 2006, Kohlberg Kravis Roberts and Bain Capital Partners, together with Merrill Lynch and the Frist family (which had founded the company) completed a $31.6 billion acquisition of HCA. Then in March 2011, HCA raised $3.8 billion in what was at the time the US’s largest private-equity backed initial public offering (IPO). Following the IPO the three private equity companies and the Frist family continued to own a majority share of HCA (62% in December 2011).
HCA has been buying back shares from both companies; in April 2015, HCA agreed to buy back 3.8 million shares from Bain Capital affiliates for about $294 million. In 2022 the company bought back $7 billion or 30 million shares.
Contracts
Covid-19 contract
In March 2020, HCA International was part of the deal with the government for using all its premises and staff for NHS patients during the Covid-19 pandemic. NHS England block-booked almost the entirety of the private hospital sector’s services, facilities and nearly 20,000 clinical staff for the foreseeable future to help cope with the surge of covid-19 patients. The agreement only covered England and added around 8,000 hospital beds, nearly 1,200 more ventilators, more than 10,000 nurses, 700 doctors and 8,000 other clinical staff. This deal, which means the NHS is paying all operating costs for the hospitals, has been a lifeline for the company, as the lockdown meant that no private work was possible.
In June 2020, a £5 billion deal to extend the March deal to help the NHS clear the backlog of work was agreed by NHS England and the private hospital companies, however this was blocked by the Treasury. The Treasury did not believe the deal represented good value for money and that the evidence was not substantial. The block-contract basis of contracts with private providers continued, however, as NHS England prepared a new four-year framework contract for increasing capacity. In December 2020, the leading private providers were reported to be in advanced talks with NHS England over a new three-month outsourcing contract, which aims to provide a ‘smooth transition’ to the four year framework contract, which would begin at the end of March 2021.
In October 2020, the HSJ reported that HCA International was the recipient of the fifth largest contract for staff and capacity from NHS England, according to a series of contract award notices, however the time period of 2020 this covered is unclear. The contract with Spire amounted to £153.2 million.
An exclusive article in the Health Service Journal in January 2021 reported that HCA has pulled out of any renewed contracts to treat NHS patients – because the fees on offer were not high enough. The private hospitals were unwilling to return to rules under the first block-booking of beds that ensured low-priority private patients were not treated ahead of NHS patients – including cancer patients – who needed surgery urgently.
In a recent Healthcare Markets magazine interview, HCA UK chief executive John Reay indicated that while the company was keen to “continue partnering with the NHS,” its priority was restarting activity for its core private patient base, where demand was again increasing.
These block contracts have been criticised after leaks revealed that the capacity paid for by NHS England at companies such as HCA International was very under-utilised. HSJ reported that two-thirds of the private sector capacity that was block-purchased by the NHS at a cost of an estimated £400 million a month went unused by the NHS over the summer, despite long waits for operations.
Other contracts
HCA International does not have contracts with specific commissioners in the NHS, but works with the NHS on joint ventures through its HCA NHS Ventures business.
In 2017, the HealthTrust GPO consisted of 15 members.
HealthTrust Europe through its GPO has:
South Warwickshire NHS Foundation Trust Payroll Services
Imperial College Healthcare OPD Outsourcing
Supporting the NHS to Deliver Savings on Agency Staff Spend
Outsourced Outpatient Pharmacy Service Delivers Significant Cost and Efficiency Savings
HealthTrust Europe’s Nursing and Care Services Framework Approved by Monitor
First GPO Contract Delivers Cost Saving Opportunities
Total Workforce Solutions Tender Published, worth $1 billion
Concerns
Care Quality
In May 2018, a CQC report found that two in five private hospitals are failing to meet safety standards. The private hospital sector was warned by Jeremy Hunt, the then Health Secretary, to put its house in order if it wished to partner with the NHS. Of major concern is that some private hospitals currently avoid liability by saying a clinician is not an employee if something goes wrong. In addition, a clearer process is needed for managing a patient if their health deteriorates in private care and they have to be transferred to the NHS in an emergency.
Patient Safety
In June 2019, it was reported that NHS consultants can refer patients to private facilities, even those that they have shares in, which opens up the possibility of a conflict of interest - will the consultant prioritise patient safety/ best interests or their own financial gains. The situation was highlighted by a report from the CHPI. HCA Healthcare co-own the private patient unit at The Christie Hospital, Manchester. It has been found that 1 in 5 of the the trust's oncologists have shares in that unit and were entitled to £2.35 million dividends made in 2013-17 out of the overall £22.6 million dividends produced in these years aside from their private work and NHS income.
In March 2022, an employment tribunal over the dismissal of the chief executive of HCA's Portland Hospital exposed safety issues at the company's hospital's. Aida Yousefi lost her employment tribunal claim that she was dismissed for whistle blowing over patient safety issues, but the tribunal highlighted that other staff had warned of safety concerns due to staffing issues. Emails shown at the tribunal also showed that HCA's management frowned upon the warnings.
Fraud and malpractice in the USA
The major concerns with HCA International revolve around the behaviour of its parent company in the USA, which has been found guilty of large-scale fraud over the years, and has been the subject of an extensive investigation by the US Department of Justice into the company’s practices.
The parent company, HCA, was the subject of one of the US’s longest running investigations into fraud in the healthcare industry. The investigation began in 1993; by June 2003, following two settlements, one in 2000 and one in 2002, HCA had paid the US government a total of over $2 billion in criminal fines and civil penalties for systematically defrauding federal healthcare programs.
HCA was found to have unlawfully charged the government in its cost reports for running its hospitals, that it paid kickbacks (incentives) to doctors in return for Medicare and Medicaid referrals, and that it unlawfully charged the government for costs in connection with wound care facilities. Despite the severity of the crimes, no senior executives went to prison, although a few mid-level executives were found guilty of fraud.
In 2012 a scandal erupted in the USA concerning unnecessary cardiac procedures being carried out on patients at HCA hospitals. In August 2012 The NY Times published articles based on an extensive investigation it had conducted into cardiac procedures carried out at HCA hospitals, primarily in Florida, but also in some other states. The NY Times reviewed thousands of pages of confidential memos, e-mail correspondence among executives, transcripts from hearings and reports from outside consultants, as well as interviews with doctors and others.
The NY Times concluded that “a review of those communications reveals that rather than asking whether patients had been harmed or whether regulators needed to be contacted, hospital officials asked for information on how the physicians’ activities affected the hospitals’ bottom line.” The NY Times also notes that “the documents [reviewed] suggest that the problems at HCA went beyond a rogue doctor or two.” Concern over unnecessary cardiac procedures surfaced in 2003, again in 2004, and once again in 2008.
HCA had carried out its own reviews, but had not always revealed the findings. In August 2012 HCA had to reveal to investors that the US Department of Justice is conducting an investigation into whether heart procedures performed at HCA hospitals were medically necessary and also the company's billing practices. The investigation will cover the period October 2003 to the present.
A NY Times article notes that HCA has declined to provide evidence that it had alerted Medicare, state Medicaid or private insurers of its findings, or reimbursed them for any of the procedures that the company later deemed unnecessary, as required by law. Furthermore, HCA also declined to show that it had ever notified patients, who might have been entitled to compensation from the hospital for any harm.
