Ipswich: New manager Ian Milne has healthy ambitions for town’s Nuffield Hospital

These are difficult times for private healthcare. The plight of private sector health, which before the Credit Crunch was buoyed by much more favourable conditions, has been a hidden effect of the economic downturn.

With the widescale executive culling which near-economic collapse brought, private healthcare, by then an established corporate perk, took a big hit.

The sector has had to move swiftly to survive in a changing world. Its insurance clients, both from the corporate world and private, have been in decline, with many private customers now looking for elective care over blanket coverage.

However, fortune has shined on it in the form of Government policy, which has increasingly leaned towards using private providers as a means of bridging gaps in the National Health Service (NHS), act as a pressure valve, and ensure that waiting list targets can be met through initiatives such as Choose and Book, a national electronic referral service which gives patients a choice of place, date and time for their first outpatient appointment in a hospital or clinic and includes a choice of some independent hospitals as well as the NHS ones.

Ian Milne took over as hospital director at Ipswich’s Nuffield Hospital early this year, followed an 18 month interregnum when a series of temporary bosses were drafted in while a permanent replacement was sought.

His appointment brought to an end a protracted period of uncertainty and means that the hospital, one of a series across the country under the Nuffield umbrella, can now focus on building its business.

Ian’s background is in financial services. He worked for the Woolwich and Barclays Direct, where he became area director, managing a team of financial services advisers around north Essex and into Suffolk. Then, 12 years ago, he joined retailer Marks & Spencer as a national sales manager and was responsible for launching its in-house credit card. He then moved to the Oaks, a private hospital in Colchester, before joining the Nuffield.

The Ipswich Nuffield hospital employs 188 staff and is part of a social enterprise business, which means that any surplus it makes get ploughed back into healthcare.

“What that means is that we can give more back,” says Ian.

The hospital, set in a leafy suburb of Ipswich, and surrounded by woodland and secluded gardens, is small by NHS standards, but well equipped. It has 46 beds with en suites, two high dependency units, five theatres and a range of diagnostic equipment.

Unlike NHS hospitals, where it has become a major headache, parking is devoid of hassle, and free of charge. The ambience inside deliberately leans more towards a hotel than a hospital, and free tea and coffee are available in the reception area.

“It makes it a nice environment. You have a hotel feel rather than a hospital feel. You don’t have the number of people traipsing through. The NHS trust does a fantastic job. We are not doing emergency care –they have it tough. It’s easier for us with infections because we have single rooms,” he says.

Surgery is carried out by hospital consultants, who tend to divide their time between NHS and private work, and usually come in one or two days a week to carry our a series of procedures. It means that patients can be assured that those carrying out the surgery are experts in the field.

Yet despite all this, across the UK, the private market as a whole is declining as insurance gets more expensive, explains Ian.

“The recession has hit very hard with corporate clients,” explains Ian. “People have lost their jobs.”

At the same time, the self-pay market has also been falling, and people are no longer using their savings to pay for private medical healthcare.

Some elderly people have stopped paying their premiums, and have taken the view that they may as well put their money away and pay for private treatments as and when they need them.

It’s a situation which could easily become critical if left untreated, so to counter this big cultural shift, hospitals like the Nuffield must move nimbly to survive and position themselves in new markets.

The private healthcare market has its critics, and there are those who argue that handing over straightforward procedures from the NHS to private hospitals is handing it a crutch, and is only likely to make life harder for state-run hospitals left with complicated jobs and still the same overheads. But Ian believes the critics are wrong-headed, and that relieving the NHS of some of the burden of routine operations allows the state-run service more scope to deal with complex cases.

In his quest for new markets, Ian has various factors on his side. While corporate healthcare is in decline, about 16% of people local to his catchment still have private medical insurance. The problem is that a number of them forget they have got it – and this is one area which Ian is keen to address. But how does such a glaring oversight occur?

“Because they go to see their GP and they have got a problem and the GP says: ‘I think you have so and so and you want to go to a hospital,’ and it’s not until they are down the line they realise,” he explains.

At the moment, Ian is trying to persuade more GPs to get on board and ensure patients are aware of the choices they have.

“We are trying to attract GPs at the moment. Outreach choice is about especially GPs giving the patient the choice about where they go for their care. They can choose it on facilities, quality of care, etc. The other thing they need to think about is there’s more than one choice,” he says. Patients can elect to go for NHS treatment, but might also be able to come to the Nuffield, where they can choose whether they use their insurance or self-pay.

Just by asking the question, GPS could be saving the NHS about £1,500 per medical procedure that otherwise goes on the tax bill, he points out.

“I think it’s habit. They are busy. Let’s be frank, they are really busy. They have got to ask questions, diagnose and then move it forward. I’m not being critical of them, but we are just saying you might be saving,” he says.

Ian has brought on board a GP relationship manager, Alex Wortley, also previously of the Oaks hospital, to drive this particular aspect of the business.

Against the harsh economic backdrop, the Ipswich Nuffield has already been “bucking the trend a bit” and has grown its self-pay elective procedures service. Other than a period around 2010, when it suffered a dip due to “a lack of stability and leadership” at the time, the business as a whole has been growing, explains Ian. “Part of that is we have got no major competition here. The Oaks was the biggest competition which is 20 miles away. The self-pay market is significantly stronger here than in Colchester,” he says.

This is partly down to the demographic. The private healthcare market in the Ipswich area is helped by some very wealthy pockets in the town itself and also around Woodbridge, Aldeburgh, Southwold, and even down to East Bergholt and Dedham, where patients will consider coming to Ipswich.

The arrival of Ian, who is looking at the long term, provides patients and staff with a sense of stability and forward momentum.

Very often, hospital managers in the private sector only stay for three or four years before they move or get head-hunted, but Ian is clear that he intends to get his feet under the table and stay for some time. He is hoping a long period of stability will help the hospital to build sustainable relationships, with GPs, consultants and staff.

“I think that’s one of the big things that’s created some comfort here for patients and staff is I come from a unit where I have been for eight and a half years so that gives them some comfort of stability and I’m looking to be here for some time,” he says. He believes that the insured market will remain stable, but that there won’t be huge growth in this area, so in order to expand the business he must look elsewhere. He sees potential growth in elective procedures. Cataract surgery, for example, costs somewhere in the region of £2,000 and the effects can be life-changing. There is a “myth”, he says, that private surgery will be expensive, but that is often not the case.”