Spire Healthcare reports profit and revenue jump as its work for NHS increases

Spire Healthcare, one of the UK’s biggest private hospital groups, has reported a jump in revenues and profits as it carries out more work for the NHS and benefits from a surge in the take-up of private insurance among working-age people.

The FTSE 250-listed company, which runs 39 hospitals and more than 50 clinics, said its work with the NHS increased in the first half of the year, as the health service outsourced more procedures to the private sector and patients exercised the right to choose where they receive treatment.

“Spire stands ready to work with the new government to help address NHS waiting lists,” said Justin Ash, the Spire chief executive. “Waiting lists would be a lot longer if we weren’t doing what we do.”

The NHS waiting list was 7.62m cases in June, with 3.13 million of these patients waiting more than 18 weeks. The median waiting time for treatment was 14.3 weeks, almost double the pre-pandemic wait of 7.5 weeks in June 2019.

A review by Lord Ara Darzi , commissioned by Labour when the party came to power in July, found that years of neglect of the NHS by previous governments have led to long delays for hospital, GP and mental health services , resulting in thousands of unnecessary deaths and rupturing the “social contract between the NHS and the people”.

Keir Starmer set out his vision for the health service on Thursday, saying it would get “no more money without reform ” .

Ash said: “We are working with ICBs [integrated care boards] and trusts specifically at the moment to help them bring down waiting lists for those who have been waiting 65 weeks.” Spire has a partnership with Sussex ICB, responsible for planning health services for its local population.

Long NHS waiting times are prompting more people to go private and take out health insurance . While bigger employers have long offered discounted insurance as a benefit to their staff, more small and medium-sized firms are now following suit. Spire carries out workplace health MOTs, and has invested in its mental health and physiotherapy services.

Ash said more people under 35 were opting for private health insurance, either through their workplace or individually, while there had been a decline in the number of people who paid for private treatments themselves, except among the over-65s.

The hospital group has seen rising demand for orthopaedics such as hip and knee replacements, mental health treatments – talking therapies for anxiety and depression – and cancer surgery and chemotherapy.

NHS cancer targets continue to be missed. The percentage of patients receiving their first cancer treatment within two months was 67.4%, the latest data showed , far below the 85% target.

Spire’s pre-tax profit rose by 11.8% to £22.7m in the first six months of the year, while revenues climbed by 12.7% to £762.5m. It expects underlying annual profits to be between £255 and £275m this year, after notching up £130.6m in the first half.

Its work for the NHS made up a quarter of revenues. The firm said hospital admissions and outpatient procedures were broadly flat at 225,659. The average revenue per case rose by 4.7% to £3,495.

It invested £51.5m in technology such as robots for orthopaedics and cancer surgery, as well as MRI machines powered by artificial intelligence, which reduce the time it takes to scan a body part like a knee from 25 minutes to seven minutes.

Spire plans to open 10 new clinics in the coming years, including a second one in Harrogate later this year, and one recently opened in Abergele, north Wales.