Hinchingbrooke Hospital asks for £9.6m bailout as Circle withdraws Published duration 10 February 2015

image caption Circle became the first private firm to manage an NHS hospital three years ago

The first privately-managed NHS hospital in the country has applied for a £9.6m government bailout.

Healthcare company Circle signed a 10-year contract to run Hinchingbooke Hospital in Cambridgeshire in 2012.

Last month Circle said it would end the deal by 31 March.

A spokesman said the hospital trust has applied for the money from the government as it would be left with a deficit for this financial year of between £7m and £12m.

Under the terms of its contract, Circle retained the right to end the deal if the amount of money it had to put in to the trust exceeded £5m, a sum which a company spokesman said had been reached.

'Strong track record'

On 9 January the company said its franchise was " no longer viable under current terms ".

The same day, the hospital was placed in special measures following a Care Quality Commission inspection.

The health watchdog rated Hinchingbrooke "inadequate", highlighting particular concerns over accident and emergency and medical care.

image caption "Patient care will not be affected," a Department of Health spokesman said after Circle announced its withdrawal

A Circle spokesman said: "[Our] financial track record at Hinchingbrooke is strong.

"We've saved the taxpayer £23m, and kept our word on the original bid by making 5% savings each year, as planned, but the landscape changed around us, with high A&E admissions and reduced funding.

"That's why the trust now requires further investment. Circle has invested the full £5m required under the contract."

The hospital trust has applied to the NHS Trust Development Authority, the government body that provides support and governance to all NHS trusts, for £9.6m.

The hospital is currently holding its last public board meeting under Circle's management, at which its financial position is expected to be discussed.