HM meets…Jim Easton

As demand for self-pay treatment continues to climb, Practice Plus Group is diversifying its traditional NHS offering into private-pay. CEO Jim Easton talks to HM about how the company is leveraging its experience of delivering high quality care at NHS tariff prices to positively disrupt the market with a lower price point model

Practice Plus Group has been a partner to the NHS since Tony Blair’s Labour government took the bold decision to bring independent sector providers into the NHS family in a bid to tackle the spiralling waiting lists of the 1990s and early 2000s.

Twenty years on from the announcement of the first independent sector treatment centres, and the Group’s entry into the market as part of Care UK, which it became independent from in 2020, the Group’s CEO Jim Easton has been exploring how the sector can help tackle the latest waiting list crisis as part of the Elective Recovery Taskforce formed by Rishi Sunak in December last year.

As a former NHS leader and hospital director, as well as a seasoned independent sector CEO, Easton has spent much of his career focusing on the innovation and efficiency needed to drive down waiting times for patients. But Covid has transformed the landscape and Practice Plus Group is now drawing on its experience of delivering high clinical quality at high volume for NHS tariff prices to launch a lower price point proposition for private patients.

Private work now represents 15% of Practice Plus Group’s secondary care revenues and as HM found out when it caught up with Easton, it not only has the potential for significant growth, but also to be a positive disruptor in the sector at large.


The following interview with Jim Easton has been edited for brevity and clarity.

You were asked to join the Elective Recovery Taskforce launched by the Prime Minister at the end of last year. What has the experience of working with colleagues across the independent sector and NHS to tackle the waiting list backlog been like?

It’s been great to participate in what’s been a really high level, managerial and political vehicle looking at what the independent sector can do to support the NHS and get patients treated in these challenging times.

It has reinvigorated some of the ideas that helped the NHS tackle waiting lists before, such as putting patient choice front and centre. There is a real determination to get that back working as an engine for faster access for patients and that is really encouraging.

While some of those solutions were used in the early 2000s, you’ve now got the technology and apps to drive it, so that patients literally have information on the best choices for them in the palm of their hand.

Overall, it has been a very positive exercise and will provide the opportunity to drive more contribution from the sector to the enormous challenge of 7 million-plus people on NHS waiting lists.

It has been a great piece of direction. The question now is one of implementation and how that feeds through into national and local arrangements to bring the policy to life.

So, I think the focus will move very quickly from an energising piece of national direction and policy to how we make that work with a high degree of effectiveness in all parts of the country.


Alongside patient choice, do you think some of the same levers that were used to successfully drive down waiting lists in the 2000s by increasing independent sector capacity could be employed today?

There is an argument for additional capacity and, of course, what we can bring is some external capital to make that work, but I haven’t yet detected a big national policy push inside the NHS.

I think the interesting time will come when we start getting beyond tackling the very long waits. The further you drive down your waiting time target, the more patients you have to treat to achieve it and my own view is that once you start driving that down to a year and beyond, you will need more additional capacity in the system. I don’t think that argument has landed yet with our policy colleagues in the NHS, but I think it will be interesting as the NHS tries to dig down into those much bigger cohorts of patients.

And one of the big differences now to the early 2000s is that there was spare physical capacity and staffing in the NHS.

“Right now, for big chunks of the year local NHS hospitals are running as acute hospitals and their elective capacity is overwhelmed”

so it’s much harder to free up that capacity internally.


How can the independent sector be used to increase NHS elective capacity?

In essence, there are two ways in can happen. We can either be given chunks of the existing waiting list that’s currently sitting in NHS organisations or patients can be given the ability to choose us from the point of referral.

That first method is administratively challenging so I think one of the conclusions of the Task Force is likely to be that the best way of using the sector is to open up choice and encourage patients to come directly into the independent sector.

We will still offer to take patients off of waiting lists and do that now, but history has taught us that it’s much more complex to lift and shift people who are already locked into one pathway onto another.


At the same time as NHS waiting lists are rising, so too is demand for private treatment. Does the independent sector have enough capacity to really help make a dent in NHS waits at the same time as meeting private demand?

I think there is enough capacity in the sector generically to make a very significant contribution. Can it tackle the whole elective backlog by itself? No, but it can make a material contribution as part of the solution.

When you get down to the nuts and bolts, capacity falls into two different categories. Is there enough physical capacity in the independent sector in terms of beds, theatres and physical estate? Yes, definitely. Most of us are using our beds much less intensively than we were even five years ago as we have moved to shorter lengths of stay and more day case procedures. And if they are used efficiently, maybe for some extended hours, there is certainly enough physical capacity in theatres.

Then you come to the question of human capacity and that is a much more nuanced question and depends on the different types of operating model. We have a large employed workforce so we have the capacity to drive some additional contribution from those colleagues. We’re highly productive and have organised ourselves to be profitable just from NHS work for many years, so definitely have the ability to do more.

Overall, its workforce that is the limiting factor, but we have spent a lot of time and effort doing the very dull kind of logistical work that means we can get the very best out of resources and our people while ensuring that they are still looked after and not overworked.


Practice Plus Group has now entered the private pay market. What is different about your private pay proposition?

We’re using our efficiency and our clinical muscle to introduce what we think is quite an interesting and different offer in the market.

Just three years ago, we were a 100% NHS provider so very different to most of our independent sector colleagues.

We have been entering the private market over the last couple of years in particular, but we’ve been doing it in quite a different way.

Because we have to be profitable from NHS work, we’ve got a very efficient model – our doctors are employed and we focus on quite a tight range of specialities.

Our private model is predominantly self-pay. We’ve seen some insured work, but it is really directed at self-pay because that efficient way of working has enabled us to develop a very different price point.

“A hip or knee replacement for us is about £3,000 cheaper than our colleagues quote in the traditional private market.”

We have a slightly different hotel model but our clinical metrics are among the best in the industry. Patients still get a nice experience – many can be accommodated in single rooms, but crucially, they also get great clinical outcomes.


There is emerging evidence that rising NHS waits are driving more people to consider private healthcare. What has been the experience with your private pay model at Practice Plus Group?

We’ve attracted a real mix of patients. Some were customers of the traditional private patient market who have seen value in our proposition, but if you look at the demographics, at least half are people who probably wouldn’t normally have thought about private pay as an option. And that lower price point is really helping them make a choice.

We haven’t seen anyone do this in the market in the UK before, so I think it is going to be very interesting as we grow the offer in our existing sites and, hopefully, new sites in new locations.

We are opening up the market to new people and I think we’ve got a real chance to open up a new middle market for private healthcare in the country, which could be exciting and energising for the whole industry.


Is the business focused on both insurance and self-pay?

It is predominantly a self-pay model and we are already seeing substantial growth in that market.

The insurance journey has been slower, but we’re now starting to see a small increase in numbers. It has taken time to get insurers to think about how their models can be applied to us in terms of patient flows and consultant accreditation because we are slightly non-standard.

We are seeing handfuls of insured patients – that may grow to be a substantial number – but the growth we are seeing at the moment is very significantly self-pay.


After many years focused on NHS activity, why launch a private pay proposition now?

It seemed to us that the time was right. For many years we have contributed to low waiting times in the NHS. We’ll continue to do that but the NHS is quite cash limited and can’t actually use all of our capacity, so it makes sense to enter the private market. But we wanted to do that in a way that wasn’t just dipping our toes into the traditional private market. We wanted to do something quite different and that took time to work through. Because it’s a different proposition, we weren’t sure that if we built it, people would come.

Initially, we had to make sure it would work at a small scale. It’s taken a couple of years to incrementally put the model on the ground and get it working effectively. Logistical elements such as scheduling patients and getting the mix right in our centres took time, but now we are ready to go from what’s currently a good business making a really good contribution to driving into the next phase of a much more substantial and wide-ranging market, with the potential to develop new physical locations around the country.


How will you balance your longstanding NHS activity with your private pay offering?

We’re always going to be a great partner to the NHS, delivering what our NHS customers need and want is in our DNA. But

“why would you sit on unused capacity that you could mobilise for more patients and improve the commercials or the business even further?”

This would be quite difficult to do from scratch. There are high barriers to entry but we already had a fantastic entry point with our nine centres and being able to mobilise them allows us to enter the market in a meaningful and substantial way.

If you go back three years, it would have been very difficult for us to differentiate our NHS and private proposition because our NHS waiting times were short. Sadly, post Covid although our waiting times are typically much quicker than the local NHS hospital, they are still longer than they were pre-pandemic and can be several months long. So, the choice that people are making when deciding to go private is whether they want to be seen more expeditiously than that.


What are your priorities for the next 12 months?

We’ve got three substantial healthcare businesses. Our prison healthcare business continues to be the most successful provider in the market and is growing organically so we see further growth in that business. We also run a big chunk of the country’s 111 helpline and GP out-of-hours service and we’re very excited about the opportunity for that to become a platform for some of the out-of-hospital technology developments both for self-pay customers and the NHS. We are not a tech company, but we can be a fantastic partner using the infrastructure that we have for those people who are developing tech to support people out-of-hospital.

And then, we share the general view that right now more people are looking to turn private because even if the NHS does its best job on waiting times, the actual experience for patients is going to be long waiting times for some time to come. Plus,

“we’re excited about bringing this new private offer to market and making it more affordable for people to get access to high quality surgery”

and creating some interesting and positive disruption in the market at the same time.