Wragge & Co advises on a groundbreaking NHS project - creating the UK's first NHS hospital operated by a franchisee

Wragge & Co has advised on a groundbreaking project for NHS East of England (NHS EoE), the Strategic Health Authority, to procure a private partner to run Hinchingbrooke Health Care NHS Trust in Huntingdonshire.

Circle is the successful preferred partner. Its appointment follows a competitive tender for the franchise to deliver NHS services at Hinchingbrooke Hospital. It marks a first for the sector - creating an NHS Trust operated by a private franchisee. Circle will take over the operation of the Hinchingbrooke Hospital from 1 June 2011, subject to approvals by the Department of Health and other regulators.

Partner Bleddyn Rees led the legal team on the project and said: "This is completely new territory for the public healthcare sector. Yet again Wragge & Co has completed a landmark first for the sector. This is not just about one hospital in the East of England - there are a number of Trusts throughout the UK facing financial challenges. While the option of using a statutory franchise will not be appropriate for every financially challenged Trust, in the right circumstances it provides real value. Focusing on financial savings and quality it raises some unique challenges but also offers a huge amount of practical learning."

Andrew MacPherson, director of the Strategic Projects Team at NHS EoE, said: "Wragge & Co's healthcare experts brought innovative and collaborative ideas to the procurement process. The team's sector expertise and first-rate legal advice was integral in making the project happen. Preparing groundbreaking legal documentation from scratch, they performed at an exceptional level and were a genuine pleasure to work with."

Wragge & Co's Healthcare team has been advising NHS EoE over the last 12 months. Bleddyn Rees and associate Rhian Vandrill led the project with solicitor Lara Wilding. The wider team included employment expert Georgina Houghton, who advised on a form of the retention of employment model, and public law partner John Cooper and solicitor Robyn Farmer. Partner Simon Taylor and solicitor Louise Rason advised on competition and procurement elements. The team worked closely with Ian Baxter and Jennifer Deane at PwC, the project's financial advisers to NHS EoE.

Hinchingbrooke Health Care NHS Trust has a historic deficit in the region of £40 million and one of the main aims of the franchise is to repay that deficit while also securing the hospital's future and improving healthcare services for the local population. The new statutory franchise model has been developed to provide the best possible solution for the Trust and the tax payer and will bring long term value.

NHS EoE works with 40 local NHS organisations across Bedfordshire, Cambridgeshire, Essex, Hertfordshire, Norfolk and Suffolk. It is responsible for ensuring that the £8.1 billion spent on healthcare in the region delivers the best services and value-for-money for more than 5.6 million people.

Circle is a healthcare partnership, building and operating a network of UK hospitals co-owned by the clinicians and staff who work within them. It was advised throughout the competitive process by Capsticks.

Wragge & Co's full-service 70-strong healthcare practice is at the forefront of developments in this dynamic sector and adept at dealing with complex, innovative projects. The team draws on its substantial private sector experience from a broad range of industries to offer NHS clients commercially-sound advice.

Other sector firsts for the team include advising NHS EoE on the first ever competitive sale of an entire trust, Bedfordshire & Luton Mental Health and Social Care Partnership Trust, to South Essex Partnership University NHS Foundation Trust. They also helped Guy's and St Thomas' Hospital and Serco launch a £250 million, 10-year joint venture, aimed at overhauling NHS pathology services.