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NHS Direct pulls out of two NHS 111 contracts and admits others are ‘unsustainable’

NHS Direct has pulled out of providing NHS 111 in two areas of the country and said the contracts it is currently delivering in other areas have become ‘financially unsustainable’ in a major blow to the rollout of the new urgent care number.

The provider was contracted to cover a third of England’s population in 111 different areas with the new service, but papers for its latest board meeting show that it has been forced to cancel NHS 111 contracts in Cornwall and North Essex.

Pulse revealed details from a leaked internal NHS report earlier this month that questioned the future viability of NHS Direct after revealing a catalogue of failures during its rollout of NHS 111.

This latest revelation from the chief executive’s report for its July meeting, cast a further blow for the beleaguered provider, which said in the report it is currently delivering only 30% to 40% of its contracted call volumes.

Chief executive Nick Chapman said in his report: ‘Agreement has been reached with commissioners for North Essex and for Cornwall, that NHS Direct is not in a position to mobilise the 111 services for those areas.

‘These commissioners are expected now to make arrangements with alternative providers to mobilise the 111 service in their area.’

He went to say that in live NHS 111 areas contracted to the provider, staff levels were ‘above those planned to handle the full 100% of contracted call volumes’ and warned: ‘As a result of the lower than contracted call volumes, we expect to receive substantially lower income than originally budgeted.

‘The imbalance of costs and income on NHS Direct’s 111 contracts means that each of the 111 contracts as they currently stand are financially unsustainable.’

He also revealed that the calls currently being handled are ‘between 30% and 40% of the contracted levels, with call diversions to other providers and the 0845 contingency remaining in place’.

In a letter to Kernow CCG, which is in charge of commissioning NHS 111 for the whole of Cornwall, Mr Chapman wrote: ‘We are unable to take forward the service and NHS Direct no option but to exit from the contract. The reason for this is that since the launch of NHS Direct’s other 111 services, we have established that the contract terms which NHS Direct had entered into are in fact, financially unsustainable.

‘This is a very regrettable and unfortunate position, for which I apologise unreservedly on behalf of the Board of NHS Direct. We understand it is unacceptable to delay the service that as commissioners you have determined is needed for your patients.’

Pulse revealed last month that a leaked report - conducted by consultancy firm Deloitte - warned that its ‘overall viability’ was in doubt were it to lose big contracts in the North West and the West Midlands. This report has now been published on NHS Direct’s website.


Related images

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Readers' comments (18)

  • Suicidal underbidding in the expectation of an unforthcoming bailout I wonder?

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  • and all the sales director got was a written warning...

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  • "we have established that the contract terms which NHS Direct had entered into are in fact, financially unsustainable". Much like the direction primary care as a whole is going.....

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  • What an ignominious exit for NHS Redirect from the 111 market.

    Existing 111 providers must be licking their lips at picking up the forthcoming business in the interim until tenders can occur again- selflessly stepping into the gap and all that.

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  • And who is supposed to pick up the cost of the re-tender process?

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  • @ Nils Christiansen

    Don't worry- the costs of re-tendering will be met by the reductions (and associated savings) that the introduction of 111 has made on ambulance call outs / conveyances, A&E attendances and NEL admissions.

    Oh wait...

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  • When are we going to stop this delusion that market forces are going to save money, just compare our per-capita health spend to the US system (not to mention our better outcomes). I don't believe the rhetoric, it's all just an excuse for an ideology that abhors the entire public sector.
    We are dismantling something here that may never be put back together.

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  • And just think GPs used to do all this for nothing. When our work was valued it was at £6000 a year to provide and be responsible for ALL OOH cover!

    I'm retired now at 55 yrs of age and cannot stop smiling to myself.

    Get out whilst you can.

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  • @ Nils Christiansen

    they are not being retendered. the contracts are being novated directly to the ambulance trusts

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  • I am afraid that squeezing on price will have disastrous consequence. We are seeing it here and we are seeing it in the rise of A&E use as a result of ever more 'bare bones' contracts for OOH services. we cannot have a quality health services at economy rates. Sadly, I still think that neither our masters nor the media understand how cheaply they are getting services, especially within primary care.

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