Lewisham is just the start of hospital protests to come

As thousands prepare to march over threatened units, 60 trusts are about to go bust – yet services can't just go to the wall
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'Monitor is cutting hospital tariffs every year, so more hospitals risk falling into debt, worsened by commissioners now rationing hips and cataracts to save costs by calling them 'of limited clinical value'.' Illustration by Joe Magee

By next Friday the health secretary, Jeremy Hunt, is legally obliged to take a decision that will ricochet through the NHS. Does he agree with the administrator of the bankrupt South London Healthcare NHS Trust, that accident and emergency and maternity units at the thriving Lewisham hospital should be shut, despite monumental local opposition? Tomorrow a yet bigger march is set to outdo the last 15,000-strong protest, with GPs, hospital doctors, the council and even Archbishop Desmond Tutu in support. A flashmob of parents and buggies petitioned Hunt outside his department, but when they chanted, "Hurry up Hunt, my baby's getting cold!" he sent out a timorous correspondence secretary instead.

If this was a one-off, he could give them a bung to make the problem go away. But as many as 60 other trusts teeter on the brink of bust, each for different reasons. Some are badly managed, some have bad PFIs, some are in historically wrong expensive buildings, but for others there is no good reason why their funds increasingly fail to cover their costs: 2013 is the second of an eight-year squeeze, the hardest and longest in NHS history. Expect vociferous local campaigns against any closures of units that force patients to travel far. As with Labour cabinet members, Tory ministers Iain Duncan Smith, Chris Grayling and William Hague shamelessly support their local hospital protests, regardless of their own austerity policies. Seats are won and lost on this – and a new NHS party running doctor candidates against arch-austerians frightens them.

Lewisham has good reason for indignation. A high-performing, solvent, popular hospital is to lose everything but cold surgery cases: its profitable emergency and maternity patients will be used to keep afloat a distant bankrupt trust losing £1.3m a week. Sending Lewisham mothers from Bellingham to Queen Elizabeth in Woolwich takes an hour and 40 minutes on three buses. Besides, there is no spare capacity in all south London: jam-packed hospitals are turning mothers away, with lengthening A&E queues.

Hunt is obliged to follow four impossible conditions before signing any administrator's plan. First, local clinicians must agree – but none do in Lewisham, nor will they elsewhere. Second, the public, patients and local authority must have been "genuinely consulted": they were and they vehemently object, so what's "genuine" if a consultation is ignored, as so often? Even more impossible, the plan must be underpinned by "clear clinical evidence", but there rarely is any, only assertions that lives will be saved. Professor Alan Maynard, an eminent health economist, says the evidence doesn't exist to show that large A&E or maternity units necessarily do better, though it has become a managerial factoid. It may or may not be better in some places, depending, untested with genuine proof.

Lewisham will be left with a midwife-led maternity unit, dangerous on its own since more than a third of its mothers in labour are transferred with complications. Finally, Hunt must ensure any changes give patients "a choice of good-quality providers", but they can't choose a good hospital that has shut. If those are binding criteria he must turn this down, but if money trumps these he will have to say so.

Follow the money: £300m is being tendered out by Monitor, the quango driving NHS competition, to pay the administration costs of the "failure regime" for up to 60 bankrupt trusts over four years, according to Health Service Journal. The notorious Mid-Staffordshire hospital has £2.5m to pay McKinsey and Ernst & Young as registered insolvency practitioners: these are just starter sums, with much more for reconfiguration. The failed South London trust has £5m for McKinsey and Deloitte, more to come. McKinsey is the big NHS player likely to get the lion's share, as Mid Yorks, North Yorks, Epsom, St Helier, Morecambe, Barking, Peterborough, the Friarage, Imperial, Barts and scores more head towards the NHS Unsustainable Providers Regime.

Monitor is cutting hospital tariffs (the sum they are paid for treatments) every year, so more hospitals risk falling into debt, worsened by commissioners now rationing hips and cataracts to save costs by calling them "of limited clinical value". As more slabs of the NHS are put out to private tender, will ministers take fright at the protests or may the bankruptcies be welcome among the government's more extreme ideologues? It's worth noting that Monitor is run by an ex-McKinsey partner.

What exactly does "bankruptcy" mean anyway, in an NHS paid for by taxes where no service can go to the wall like Woolworths? This exposes the wastefulness of a semi-fictitious market mechanism that creates a bonanza for lawyers and consultants. Every public service needs an unceasing drive for efficiency. The purchaser-provider split did illuminate cost differences though, without necessarily explaining or solving them. For so many otherwise good and popular services to be declared broke shows the fabled "creative destruction" of the market breaking them – and not creatively.

Andy Burnham's green paper speech on Thursday outlined a plan to reintegrate the fragmented and competing shards of the NHS into a single budget with social care, under local authorities. The NHS will again become the "preferred provider". The idea is to release hospitals from perverse incentives to pull in patients, binding them into community care instead, without, he promises, another monstrous upheaval. Labour has time for thinking. But Jeremy Hunt will find the lull following the stormy passage of the Health and Social Care Act only short-lived, as it takes effect from April. Lewisham is just a harbinger of what's to come.

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