Profiteers of misery
Published by The Mail on Sunday (11th November, 2018)
A cluster of ‘fat cat’ private operators is creaming off hundreds of millions of pounds from the NHS after muscling in on the cruel but lucrative trade in locking up people with autism and learning disabilities.
The Mail on Sunday can reveal that seven providers are charging taxpayers up to £730,000 a year for each patient held in controversial and secretive secure psychiatric units.
There are 2,375 people with autism and learning disabilities held in assessment and treatment units (ATUs) at a cost of about half a billion pounds a year, with scores more held in other secure units. One man alone is thought to have cost taxpayers more than £10 million after being held against his family’s wishes for more than 17 years.
Two giant US healthcare companies, a global private equity group and a Guernsey-based hedge fund have joined two British firms and a major charity operating in the sector and are giving their bosses massive pay packages.
They are expanding operations despite Government pledges to move people with autism and learning disabilities out of secure units and into the community after a series of abuse scandals.
Furious families says they are ‘profiteering from misery’ and Labour is demanding an urgent statement from Health Secretary Matt Hancock after an investigation by this newspaper found half-a-million-pound pay packages and profit margins as high as 31 per cent.
‘It’s nothing short of a national scandal that private companies are being allowed to hive off millions of pounds of NHS money to detain people with learning disability and autism, some in such monstrous conditions,’ said Barbara Keeley, Labour’s Shadow Minister for Mental Health and Social Care.
Two weeks ago, we exposed how hundreds of people with autism and learning disabilities are being routinely abused in some facilities, confined in horrific seclusion cells, fed through hatches like animals, aggressively restrained and forcibly drugged.
The revelations led Mr Hancock to order an urgent inquiry into the use of segregation and long-term seclusion. The Equality and Human Rights Commission warned the NHS could face a formal investigation for human rights abuses of vulnerable people.
Now The Mail on Sunday can reveal that firms in this sector include:
- An American healthcare giant whose boss earned £39.5 million in one year, despite his firm facing allegations of fraud and ‘preying’ on vulnerable people to boost profits in secure units;
- Another huge US firm that handed five executives almost £15 million last year and has been snapping up British operators, including the Priory Group, famous for also treating celebrities;
- A controversial British company that paid one director more than £1 million over two years despite claims that their staff failed to stop patients self-harming, with one patient later dying, and allegations of a sex assault in a hospital;
- Groups controlling firms that run a secure unit in Norfolk which are owned by two families who pocketed £2,261,782 in pay and dividends over the past year;
- Another British firm, backed by private equity and formed only 23 months ago, which runs 55 units and turns over £176 million, with 31.4 per cent profit margins;
- A charity that is Britain’s biggest provider of specialist psychiatric care that gave its departed chief executive nearly £1 million over the past two years, despite being at the centre of claims that it fed teenagers in solitary confinement through hatches.
Angry families complain their children are seen as ‘cash cows’ and are milked by private providers that can charge the NHS more than £14,000 a week and whose own staff help make decisions on sectioning people under mental health laws.
‘It’s an outrage given the numerous cases of neglect, abuse and deaths of vulnerable people in their care,’ said Isabelle Garnett, an autism activist whose teenage son suffered badly during two years detained in secure units.
This newspaper has revealed families are having teenagers and young adults with autism and learning disabilities taken away and stuck in supposedly short-stay ATUs and secure units for many years.
Darren Slater, who has autism and learning disabilities, has been held for 17 years, despite having his own house bought with NHS compensation for a birth mistake. ‘There is a lot of money being made out of all this,’ said his father Brian.
Another mother said she was forced to feed sweets to her teenage son with autism through metal bars after seeing him transported between secure units in a cage in a van. ‘I was so angry but so powerless,’ said Julie Newcombe, whose son is now free.
She set up Rightful Lives with others to expose human rights abuses. ‘How can the Government waste millions imprisoning children and tell families there is no money for support at home? There is a huge conflict of interest within the private sector because heads on beds equals money in the bank, which means profit becomes the ultimate barrier to discharge.’
The NHS spent £477.4 million in 2016 on people with autism and learning disabilities just in ATUs, which are meant to assess and treat psychiatric needs, rather than resolve care shortfalls. Instead, people are becoming trapped, often from adolescence, in an abusive, medicated and stressful system that can make conditions worse.
Ministers have promised repeatedly since the 2011 Winterbourne View abuse scandal to move such people out of unsuitable secure units and into community care. Many units rely on carers paid only marginally above minimum wage levels.
Yet the number of adults with autism and learning disabilities locked up in ATUs fell only slightly over the past three years, while the number of children more than doubled. Last year, there were 28,880 restraint incidents in England alone.
One reliable source confirmed he had seen confidential data showing a health body paying average rates in 2016 of £2,007 per person a day.
Over the past decade, the proportion in privately-run beds has soared from one-fifth to more than half, as new players such as Acadia, a Tennessee-based healthcare group, moved into the profitable trade in vulnerable people.
Acadia spent £1.3 billion on the Priory Group two years ago. It now has 61 hospitals in Britain – ten holding people with autism and learning disabilities in secure units and three ATUs – among its 586 facilities and 18,000 psychiatric beds worldwide. Chief executive Joey Jacobs was reported to have earned £7.5 million last year alone in salary, bonuses and stock.
One mother I spoke to was close to tears over treatment of her child in a Welsh unit run by Priory. ‘I’m fighting for her life,’ said Gillian Mead, whose daughter Lee, 43, was sectioned for the first time in April and claims to have been often restrained. ‘Lee has lost about five stone, and says “I want to come home” all the time. It’s awful.’
Last year, the Priory Group made £62.2 million profit, with most revenues funded by taxpayers. It handed one director £243,000 in remuneration. ‘The number of people with learning disabilities and autism placed in our secure hospitals by NHS England amounts to just two per cent of Priory Group beds and this number is falling,’ said a spokesman. He added that patient safety and family engagement were a priority and that all units were subject to regular official inspections.
Universal Health Services is another huge US healthcare firm snapping up British psychiatric services. In June, it bought the Danshell Group, specialising in autism and learning disabilities at its 25 facilities. Universal’s founder is Alan Miller, reportedly the richest chief executive in the hospital industry – in 2016 he collected more than £39 million in pay, bonuses and stock.
Yet in 2016, a year-long Buzzfeed investigation in nine US states accused the firm of pressuring staff to fill beds in hospitals for financial gain, even by falsely making patients appear suicidal. The claims were strongly disputed by the firm.
Its British operations are run by Cygnet Healthcare, which boasted in recent accounts of earning revenues from 220 NHS purchasing bodies – a rise of 44 in a year – and almost doubling income as profits surged to £40.4 million.
The fast-expanding firm gave its highest paid director a £508,000 pay package, a £162,000 increase on the previous year. Yet at one unit, staff injected patients in face-down restraints with medication, against official guidance. A secure unit in Woking was put in special measures after 24 serious incidents in a children’s ward, including sexual assault and staff failures to stop ‘significant’ self-harm including cutting and ligature-tying.
A Cygnet spokesman said the Woking unit was now judged ‘good’ with safe care, while the firm was making ‘significant investments’ to ensure people with autism were treated in non-hospital environments if possible.
British firms include Huntercombe, which ran the ATU – since closed – in which one young woman was fed so much in seclusion that she died from obesity in 2013. The firm handed its highest-paid director £1,059,000 over the past two years – it is not known if this is chief executive Valerie Michie.
Huntercombe runs ten hospitals, of which three units with 91 beds focus on patients with autism and learning disabilities.
An inspection earlier this year into one of them, the 40-bed Cedar House in Kent, found services and safety ‘required improvement’. Serious incidents registered included three cases of patients swallowing batteries, two other cases of self-harm and an allegation of sexual assault, plus use of ‘heavily soiled’ bed linen. One man also died in hospital after sticking batteries up his nose.
Huntercombe is owned by hedge fund Terra Firma, registered in low-tax Guernsey and run by Guy Hands, one of Britain’s richest men, worth an estimated £265 million.
‘We ensure no patient in our hospitals is isolated,’ said a spokesman, adding there had been no serious injuries caused by ‘rarely-used’ restraint over the past year.
The spokesman added: ‘We are committed to supporting safe discharge to community-based support services. However, we have no influence over the availability of those services.’
The family-owned Jeesal Group runs Cawston Park in Norfolk. It holds one man whose father told me he is so powerfully sedated, he sleeps sometimes 15 hours a day – and one source claimed such care is costing the NHS £12,000 a week.
Accounts indicate two families called Akman and Subramaniam own one group holding company and shared £1.59 million last year in dividends, with another £52,684 paid to directors and £128,998 to family members.
A linked company run by one of the founders paid her another £81,000 and £415,000 in dividends to five shareholders sharing her name, plus one trust.
The firm did not respond last week to requests for comment. Previously it said ‘typical’ rates for Cawston Park were £4,242 a week and the holding company paid chief executive Tugay Akman £1,596, with his family taking dividends of £60,000 last year.
‘Since 2014, we have discharged over 100 people back into the community,’ said business development director Andrew Gordon, who insisted that the firm’s margins were 9.62 per cent last year.
Other players moving into the sector include Elysium, which is backed by private equity group BC Partners through a firm in Luxembourg. It already operates at 55 English locations despite only launching in December 2016, and paid its three directors £726,000 last year.
Three directors of Cheswold Park Hospital in Doncaster, which has been accused of over-use of restraint and medication errors, are also being investigated by the tax authorities over £24.9 million payments to a secret trust in Belize over seven years.
St Andrew’s Healthcare is at the centre of some of the most distressing claims, including the case of 17-year-old Beth, locked up and fed through a hatch. Although a charity, its latest accounts show it paid £100,000 or more to 73 employees last year and shared £1,736,000 among seven directors.
Anne Longfield, the Children’s Commissioner for England who has responsibilities for children in care, has written to the NHS asking how many children have been placed with the organisation. According to her data, 193 children were admitted to its low-secure unit in the year leading up to August 2017. The charity – which has spent £45 million building the biggest adolescent unit in Europe at its Northampton hospital – declined to comment.
The Mail on Sunday has seen a letter from Norman Lamb, Care Minister in the Coalition, to a housing charity in May 2013 insisting Ministers were ‘committed’ to ensure ‘everyone inappropriately in hospital will move to community-based support no later than 1 June, 2014.’
Yet only last week a Government inspector backed the opening of a 54-bed facility in Wrexham operated by ASC Healthcare, which is controlled through a Jersey firm.
‘The huge sums spent on these places would be far better used to support people to live longer, fuller and healthier lives in their local communities,’ said Chris Hatton, professor of public health and disability at Lancaster University.
How one patient has cost £10m
No case better illustrates the poignancy of this issue – and the sums spent– than that of Tony Hickmott. He has been locked up for almost 18 years at Cedar House, a 40-bed secure unit near Canterbury owned by Huntercombe, despite his mother Pam saying he never harmed anyone when living at home.
Pam says she was told in 2003 it was costing £600,000 a year to keep her son in conditions she describes as ‘worse than a prison’. Since then, fees are likely to have risen. But even if they had stayed the same, this one case has cost taxpayers more than £10 million. ‘He could have been in the best hotel for this money,’ says Pam. ‘He’s only got autism but he’s been left so damaged by this.’
A recent inspection found safety and services at Cedar House needed improvement. Huntercombe says the typical length of stay there is six to 12 months and fees are agreed with the NHS.