Week 3 of SR's investigation

Kenneth Roy
Intensive care

Today the Scottish Review reveals that the private
operator selected by NHS Greater Glasgow and Clyde
to deliver its 'rent-a-bed' scheme for the dying is being nursed round-the-clock by a Glasgow-based firm of
crisis management consultants

After only two weeks, the Scottish Review's investigation into the Glasgow NHS land deal, and its impact on St Margaret of Scotland Hospice, is yielding remarkable results. There is a growing cross-party momentum: first, for the restoration of funding to the hospice; second, for an independent inquiry into the affair. From Labour there has been a pledge to save the hospice, while the Conservatives have put up the idea of a 'special representative' to broker a settlement of the dispute. Then at the weekend came a strongly worded statement from former minister Ross Finnie calling into question 'the dubious circumstances' of NHS Greater Glasgow and Clyde's decision to withdraw funding from the hospice.
     Meanwhile, the official assurance that John Bannon, MBE, who went public in the Scottish Review a week ago today, is the only dissenting voice within the ranks of Andrew Robertson's board has been swiftly proved to be mistaken. A second member has now spoken out: Amanda Stewart, a local authority representative, has told her local newspaper that she tried to stall the decision about the hospice and won 'some support'; and that she could not understand the rush to push it through. This statement flatly contradicts the impression of unity being put about by the board to selective contacts in the media.
     In the face of serious accusations and equally serious political fallout, the disunited board and its management team remain silent. The central question remains unanswered. Why did the board decide to threaten the integrity and viability of Scotland's state-of-the-art six-star hospice – graded 'excellent' in every department by the Care Commission – in favour of a new 'facility' at Blawarthill Hospital which will make care of the dying a business to be conducted for profit?

This morning, the mystery around that question is deeper still.
     The Scottish Review has discovered that the commercial care home provider selected by NHS Greater Glasgow and Clyde to deliver its 'rent-a-bed' scheme at Blawarthill is being nursed round-the-clock by a Glasgow-based firm of crisis management consultants.
     Media House, which operates from offices in St Vincent Street, describes itself as a market leader in the 'highly specialised area' of crisis management. Its 'crisis team' provides not only 'emergency response' but 'recovery advice'. In the case of Southern Cross Healthcare Group, the NHS's partners at Blawarthill, Media House's stated objective is 'to create a cohesive and comprehensive crisis management plan for all [its] UK care homes...Media House provides 24/7 crisis management support'.
     Media House was founded in 1991 by Jack Irvine, who remains its executive chairman. A former senior executive at Rupert Murdoch's News International, he was once Scottish editor of the Sun newspaper and more recently a member of a working party examining public perceptions of the Scottish Parliament. The company's website says that Mr Irvine has 'carved out a niche in crisis management'.
     His business partner, Tom Cassidy, also a former journalist (with Mirror Group Newspapers and Express Newspapers) later worked in the PR and public affairs department at Greater Glasgow Health Board. 'While at GGHB,' his biog states, 'Tom helped steer the organisation through the most tumultuous period in its history – including hospital closures, the establishment of numerous management trusts, staff reductions and the removal of a high-profile chairman in a politically sensitive environment'.
     It is Mr Cassidy who runs the 'Crisis Desk' at Media House, 'where he has a very successful track record in lobbying government bodies'.
     What exactly is Media House's role in 'crisis managing' Southern Cross Healthcare Group? This is unclear, but in a brief 'case study' of its five-year association with the care home provider, under the heading 'Results', Media House points out that it recently 'handled the ministerial launch' of one of the group's new care homes, which was opened by the Scottish health minister, Shona Robison.

The most intriguing question, however, is why Southern Cross Healthcare Group – the biggest care home provider in Britain – requires a crisis management consultant, why it has required one for the last five years, and why it continues to require one.
     Is it a financial crisis?
     We have studied the 2009 results of the company. Revenue jumped 5% to £937m, the number of homes it owns to 744, the number of beds to a staggering 38,124. The average weekly fee for a place in a Southern Cross home is £546 – or £28,392 a year. Yet, despite this apparent buoyancy, Southern Cross incurred a loss of £12.7m compared with £5.2m in the previous year, and although its net debt has reduced in recent years the company still owes £33m. In 2007 its share price was 605p. It declined to a low of 149p – a destruction of shareholder wealth that can only be imagined. Yet at almost the peak of its fortunes a former chief executive was able to bank £6.6m by selling 1.2m shares at 550p.
     The company may have expanded too rapildy. Since 2004 it has tripled the number of homes it operates, overtaking BUPA as market leader. It bought a portfolio of homes on borrowed money and then struggled to sell them when the going got tougher; it broke its banking covenants and was forced to issue a profits warning. The company has successfully refinanced its debt, but inevitably questions linger about its prospects. On one occasion it voiced concern about the 'higher than normal attrition rates of nursing residents, resulting in lower than anticipated occupancy levels' – another way of saying that too many of its residents were dying. One possible explanation is that local authorities, Southern Cross's main clients, are delaying sending elderly people into residential care because of the cutbacks in council spending.
     Is it a management crisis?
     There is a recent record of instability. In September 2008, the new chief executive left without a pay-off after only eight months in the job. There were three finance directors in 12 months. The third to be appointed in that period, Richard Midmer, is still there. A pressure group among the shareholders protested when it was reported that Mr Midmer had been given a £385,000 bonus for negotiating a debt-restructing package. He and the new chief executive are credited with turning the business around to some extent.
     Is it a quality of care crisis?
     Southern Cross has been prosecuted five times in the last seven years. In the most recent case, brought by the Health and Safety Executive, the company was fined £80,000 after Maisie Jones, aged 82, a patient with dementia, fell from a first-floor window of a home in Oxford. Southern Cross pleaded guilty to breaching health and safety regulations. Her daughter said outside the court: 'They charge an awful lot of money, so not to fix a window lock with a screw was unforgiveable'. An official from the Health and Safety Executive described Mrs Jones's death as 'preventable, resulting from the failure to control a well-recognised hazard'.
     Earlier prosecutions followed the scalding of residents at a care home in Durham; the suffocation of a resident who slipped in his chair at a 'care centre' in Hemel Hempstead; the suffocation in bed of a 69-year-old woman in a home in Walsall – the fine on that occasion was £175,000; and the death of an 89-year-old woman as a result of a bed accident in a home in Telford.
     In Scotland, the Care Commission received 684 complaints about Southern Cross homes in a four and a half year period to August 2008; of these, 373 were completely or partially upheld.

Whether the nature of the problem being managed by Media House is financial, managerial or related to quality of care, or a mixture of all three, there is one indisputable fact: Southern Cross is a company which, by its own admission, needs crisis management.
     Why – we return to the central question – would any public body, given the choice of maintaining the 'excellent' continuing care beds at St Margaret of Scotland Hospice, or transferring them to Southern Cross Healthcare for that company's profit, choose the latter? The public is entitled to an answer – if not from the Greater Glasgow and Clyde Health Board then from the Scottish Government.
     The Scottish Government should consider also whether it is comfortable about being linked so publicly – and in the name of one of its ministers – with the crisis management of Southern Cross Healthcare.