Scandal of doctors hit by cash crisis
Pensions crisis hits Camidoc
Published: 3 September, 2010
by TOM FOOT
CAMIDOC is on the brink of collapse following a Robert Maxwell-style pension fund manoeuvre that forced health bosses to drop the out-of-hours doctors co-operative after 14 years in Islington.
Acting chief executive Dr James Hood said the not-for-profit group “will almost certainly go into liquidation” during an extraordinary meeting on Wednesday.
Harmoni Ltd, a profit making company, will take over the running of the out-of-hours contract, as revealed by the Tribune last month.
More than 200 doctors, in a letter delivered to MPs last night (Thursday), raised concerns the safety of patients would be compromised by the switch to Harmoni.
Dr Hood told a meeting pension fund payments had been used to fund the service after demand rocketed in 2008 – but that three requests for more funding has been “ignored” despite a “substantial increase in activity”.
He told the meeting on Wednesday: “It was in fact an incorrect and illegal action. It only came to my attention in November 2009 and we then drew it to the attention of the PCT. “We haven’t got the funds to pay the full arrears to each doctor. We can pay some but not all. The fundamental perversity of all this [dropping Camidoc] is that a lack of funding has caused the problem.”
He added: “Our financial scrutiny was perhaps not as rigorous as it ought to have been.”
The health scrutiny meeting at Camden Town Hall heard how NHS Camden knew employer pension contributions were being used inappropriately in December but continued to offer Camidoc a three-year contract in March.
In a letter issued to doctors, and seen by the Tribune, NHS Islington chief executive Helen Petterson said: “In December 2009, Camidoc brought to the PCTs’ attention that it was experiencing financial difficulties. It had low reserves and was delaying payment of employer contributions to the NHS Pension Agency.
“It was not until June/July 2010 that the PCTs learnt that Camidoc had been withholding payment of employee pension contributions to the NHS Pension Agency in addition to the delay in payment of the employer contributions.
“The PCTs concluded from the report Camidoc was technically insolvent as at May 31. The PCTs were also concerned around Camidoc’s ability to deliver a sustainable ongoing service.”
Harmoni will receive emergency “set-up costs” of £200,000, split equally between the four commissioning PCTs Camden, Hackney, City and Islington.
Last night, a letter signed by more than 200 Camidoc doctors was delivered to MPs.
It warned that Harmoni did not carry in their cars emergency medical equipment including oxygen tanks and defibrillators.
Ms Petterson admitted this was true, adding that any “potential life-threatening medical emergencies would be dealt with by the LAS (London Ambulance Service).”
The decision to appoint Harmoni without public consultation has been met by two legal challenges, from Camidoc and solicitors Leigh Day & Co. Dr Hood said the PCT had offered Camidoc money in exchange for dropping its legal action, adding: “Those are in my opinion strong-arm tactics”.