Cassel Hospital (Hansard, 9 February 1990)

§ Mr. Jeremy Hanley (Richmond and Barnes)

I am grateful for the opportunity to set before the House the circumstances which led to the proposed closure of a uniquely important hospital of world repute. I am particularly grateful that my hon. Friend the Under-Secretary of State for Health is giving of his busy time to be here. He is a man who combines the qualities of compassion and a keenly analytical mind. I hope that I shall be able to convince him, as a fellow chartered accountant, that my plea for the continuation of the Cassel hospital is based as much on good financial sense as its medical achievements and the emotions that proposed hospital closures often cause.

The hospital was founded in 1919 by Sir Ernest Cassel, the father of Edwina Mountbatten, to care for those suffering from extreme psychological trauma as a result of service in the first world war. In the next 30 years the hospital built up a reputation second to none in the way in which it treated severe mental disturbance, not only in those who were seemingly destroyed by their experience of the carnage of war but thereafter in those who could be regarded as suffering from the civilian equivalent of shell shock, causing their minds to desert from some current horror and all too frequently affecting not only themselves but their family and their community.

The hospital's reputation grew and it became rich in endowments in addition to the generosity of Sir Ernest Cassel. Then, in 1948, on the creation of the National Health Service, all its assets, its present building and land, its staff accommodation and endowments were given to the nation on the understanding that it would continue to function as a national hospital in the same pioneering experimental way relative to mental and emotional disturbance as it had done before.

The hospital is situated on the south side of Ham common in my constituency of Richmond and Barnes and is a local landmark in one of the most beautiful corners of what has become London. Its value lies not only in its real estate but in the way in which it forms a traditional part of the Ham community. Although its patients may come from far afield, and although it is controlled by a health authority outside my constituency boundaries, many of the helpers and friends of the hospital are my constituents and they regard the hospital and its existence as a noble, harmonious and civilising part of our community.

In the more than 40 years during which the hospital has continued to develop from the principles of the famous partnership of the medical director, Dr. Main, and the doughty matron, Miss Weddell, its reputation and that of the team which works therein have spread world wide. The hospital trains doctors and nurses employed in general medical and psychiatric hospitals and also those in general practice in community work who come from far afield. The hospital's creation of the concept of a "therapeutic community" has been adopted in countless countries where it is recognised that in many cases it is not just the patient alone who needs to be treated but the whole family, particularly in child abuse cases or in cases where families have to come to terms with a cataclysmic episode in the life of a family member.

1202 On one visit to the hospital I saw a nurse from Stoke Mandeville being trained to explain to a mother or wife that a loved one might never walk again, or worse. On other occasions I have seen doctors and nurses and on my last visit I saw people from Sweden taking away with them skills unique to this institution and thus to the United Kingdom.

I have received letters from all over the world from professors, doctors and past patients who are utterly amazed that anyone should be considering closing the Cassel hospital and breaking up its remarkable team. A typical response is contained in a letter that I received yesterday from a doctor in Germany. He says: the Cassel Hospital has an international reputation as a special institution for the psychiatricpsychotherapeutic treatment of particularly difficult patients. For decades it attracts specialists from all over the world who wish to be informed about or trained in therapeutic methods. This fact is acknowledged in the international scientific literature for years. It would be a great loss for Great Britain and the whole of Europe if this hospital were to be closed down at a time when new prospectives and certainly new prospects as regards funding can be expected in the course of European unification. Furthermore I take the liberty to point out that a cost saving in this clientele can certainly not be achieved in this manner, on the contrary, when missing specialised treatment other medical services of the district will be claimed to a higher degree. German investigation shows that the demands for such services reduce drastically after psychotherapy".

What is the threat of closure and how has it come about? For one reason or another, despite being a national institution, the Cassel hospital has found itself being funded by a district health authority, Riverside, one of the districts of the North West Thames regional health authority. The hospital and all its patients are thus funded by a mere district even though nearly half its patients are referred from outside its region. In years gone by, many more of its patients came from further afield but there has been a national retrenchment as economies proved essential.

It may not be generally understood outside the National Health Service—it was certainly not understood by me until I studied the problem—that if a patient is referred on medical grounds from, say, Birmingham to a London hospital, no payment is made by the health authority in the patient's home town. The full cost of treatment is borne by the district which funds the hospital and there is no mechanism for that funding to be transferred. It is natural that Riverside health authority should want to make the most of its revenue and its assets, especially when it is building a major new hospital in Chelsea.

In an Adjournment debate two nights ago to which my hon. Friend the Under-Secretary of State for Health replied, it was said that the estimated cost of the whole Chelsea hospital scheme had risen from £78 million to a staggering £173 million. Those are last year's figures. My hon. Friend the Member for Welwyn Hatfield (Mr. Evans), who opened that Adjournment debate, said that in 1989–90 only three of the 14 regional health authorities In England were in deficit. One of those, North West Thames, had a deficit of approximately £13 million—more than twice the size of the other two deficits put together. One can see why Riverside is eyeing the prospect of closing the Cassel hospital to save £1,250,000 of revenue expenditure which, it is sometimes claimed, currently treats only 80 in-patients per year. I shall expand on those figures later in my speech.

1203 The sum of £1,250,000 could treat hundreds more patients resident in the immediate Riverside district, and the really great prize, it is said, is the hospital itself. It was once a hotel and might possibly revert to that use. It has been valued, with the extremely attractive land which forms part of its beautiful site just 10 miles from Westminster, at £10 million. That would make quite a contribution to the new hospital at Chelsea.

The hospital offers accommodation for 55 patients at any one time, but—and it is a very big "but"—it handles more than 4,000 out-patient consultations every year, of which 2,500 form part of ongoing treatment. There are 750 new referrals each year, and there is a small day unit for school age children in which the teacher co-ordinates academic work with the work of psychotherapists. Further specialised nursing derives from in-patient nursing methods.

Not just 80 patients per year but thousands receive treatment at Cassel. There has also been careful costing by its administration as to how the hospital can continue under a charging-out regime. The hospital could pay for itself and become no burden on Riverside. When I asked the district health authority what would happen if the hospital closed—where patients would go and where the staff would take their skills—the answer was that no one knows because Cassel is unique.

Even if the unit were transferred to a site in the country, so that the glittering prize of £10 million in real estate could be realeased, it would take years to build up confidence in the new establishment and to impart the same confidence in those further afield who knew the Cassel of old.

It is tragic that at a time when so much emphasis is being placed on the importance of the family unit, consideration is being given to the closure of the one institution that really works with, and cares for, the family. In the past four years, Cassel's family work has been concerned mainly with cases where child abuse has occurred. Parents and children separated by local authorities or by the courts have been brought together in the hope of rebuilding the family unit. The High Court, Great Ormond Street hospital, the Tavistock clinic, many local authorities, and countless general practitioners and psychiatrists have become accustomed to using Cassel as a last resort in an effort to help families of the kind all too frequently featured in our newspapers and on TV news.

A considerable number of the single adults treated at Cassel were abused as children. If only their families could have been given the help granted to some of those at the hospital now. Many patients are socially dependent; they have poor relationships, make no contribution to society, and are often unable to work at all. Often they have made endless and expensive demands on psychiatric and social services and are depressed, dejected and at times even self-destructive.

A five-year follow-up study of a group of 28 patients published at the 15th European conference on psychosomatic research proved the cost-effectiveness of psychotherapy. York university's health services unit calculated that £500,000 had been saved by treating that small group of 28 patients alone. That was attributed to the patients having a greatly reduced need for in-patient treatment and having moved from being 98 per cent. 1204 unemployed to more than 90 per cent. employed. The group had become brighter, more sociable and more constructive.

Several studies of similar patients have been made in West Germany and Scandinavia. Even Germany's health insurance industry now willingly finances the training of psychotherapists and their clinical work. Cassel can prove that its former patients require a much reduced level of hospitalisation in any year than if they had not undergone treatment there. That accords with research showing that out of 1,004 patients, 845 required a hospital stay for any reason of only 0.78 days in any one year instead of the expected 2.4 days—representing a great saving in Health Service costs.

The unit is cost-effective even now. I mentioned that its total budget is £1.25 million. When training, out-patients and consultations for other institutions are taken into account, the daily bed cost is only £34.25—compared with the recently established Charter Clinic in Chelsea where bed costs are reported to be £200 per day. The hospital is thus an efficient and economical organisation, and inexpensive—priceless, indeed—for what it does. Considerable economies result because patients and their families often work in the treatment programmes. Nurses and patients eat and live together. The hospital becomes a home to those who probably have no home, or certainly not one that we might recognise.

The costings carried out by the hospital administrators show that the total revenue that could be earned by 1991 would be between £2.25 million and £2.5 million. If they could charge, as they have never been able to do, district and regional health authorities and overseas visitors for the services that they provide—this is an expanding market—they could more than pay their way. They would have the capacity to raise private money from businesses and charities, and therefore would be no burden on the state or the district health authority.

To do that, however, they need the security of long-term residence at their existing premises. I blame no one for the present position. The Cassel hospital wants to survive, and its existence has been justified time and again. The staff possess unique skills, and they serve both the nation and the wider world.

The district health authority needs to use money as efficiently and effectively as possible so as to treat the maximum number of patients with the funds at its disposal. I do not blame the authority. I believe that it has a greater demand for general medicine and surgery and could treat many more of its own residents if funds were diverted elsewhere. I can see the authority's argument. It is merely studying its assets and seeking to manage them efficiently, and so it should. Perhaps, however, the measurement of such assets lies not in balance sheet values alone, and the authority should perhaps realise that the institution developed at the Cassel hospital is quite literally priceless.

The Government cannot be blamed—except for the fact that what is clearly a national service finds itself funded by a mere district health authority. After all, the Government are giving to the National Health Service more money than ever before in our history and, next year, for the first time, even more than is spent on defence.

The Government have said that self-governing hospital trusts within the NHS could be a successful way to maximise funding of special bodies—the Cassel hospital 1205 could be one of them—but an even better suggestion, which I know that the Minister would warmly welcome, would be the contracting route, as from April 1991.

The hospital needs to stay alive until April 1991, however, and its death is imminent. The district health authority meets again at the end of this month with plans to close the hospital. The community health council may be able to stave off closure until the summer, and then there will be appeals to the Department of Health, but we are still talking about a death sentence and the hospital might not reach April 1991.

I ask the Minister to appreciate that the Cassel hospital is a unique resource, and to give Riverside health authority the breathing space that it needs to come up with a permanent solution for funding the Cassel. It would be an act of material vandalism for the unit to be broken up simply to pay for some 5 per cent. of a new general hospital, however great the need for that might be.

Sometimes people who do not understand the Cassel say that it is a Rolls-Royce service that we can ill afford in the National Health Service. If to be a Rolls-Royce service is to be the very best that exists—an example and a target for all and the best service that can be offered—the Cassel is indeed a Rolls-Royce, and its existence shows what is possible within the NHS and sets standards to which others should aspire. It is a unit which provides answers to questions repeatedly raised over the years in official child abuse inquiries so that the tragic mistakes made in many places, from Greenwich to Cleveland, need not reoccur. If we cannot afford a unit which offers such hope and has proved so much, I despair not only for the future of the National Health Service but for those children and families whose suffering will continue, and for the nation and its Social Service and Health Departments which will have to bear the cost—and not just the financial costs—of continuing illness and abuse.

§ The Parliamentary Under-Secretary of State for Health (Mr. Roger Freeman)

I congratulate my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) on a powerful presentation of the problems of, and prospects for, the Cassel hospital. I am in a slightly difficult position because if the community health council appealed against a decision about the future of the hospital, I should ultimately have to adjudicate. My hon. Friend will understand, therefore, that I shall have to be circumspect in what I say. Nevertheless, as a Minister who is responsible in part for mental health, I have a particular interest, in the work not only of this hospital, but of all our psychiatric hospitals. My hon. Friend was right to describe the unique nature of the hospital's work.

My hon. Friend and I are both chartered accountants and I agree with him that in the Health Service, value is not just a balance sheet or financial value. Many other aspects of service must be taken into account. There is no question but that the hospital provides a unique range of services. My hon. Friend rightly touched on its work in child abuse cases. It is also unique in that its patients are drawn from a wide range of districts. I gather that about 50 per cent. of the patients are drawn from outside the region that is responsible for the hospital. One quarter of all the training places for consultant psychotherapists in the United 1206 Kingdom are at the Cassel. I also understand that it is the only place where psycho-social nurses are trained, and that, too, is an important point.

My hon. Friend drew attention to the fact that whereas the hospital deals with 4,000 to 6,000 out-patients a year, it may care for only 80 in-patients a year. He rightly suggested that, with a revenue budget of £1 million to £1.25 million, the cost per in-patient place must be about £10,000 per annum. I am neither surprised nor put off by that figure. St. Andrew's, a hospital in Northamptonshire just outside the southern end of my constituency, provides places for people with severe behavioural problems at a cost of about £50,000 a year. That is the order of magnitude with which we are dealing. It is important that the House should appreciate that treatment costs for the disturbed and those needing psychotherapy are high. We must face that fact in the National Health Service.

When Ministers are asked to adjudicate on closure, major rationalisation or change of service proposals, they have to assess the consequences for patient services. These proposals appear not to be in the classic mould of proposals by a district or region wishing to treat patients in hospital A or hospital B—a rationalisation or centralisation move. As my hon. Friend rightly asked, if the hospital closes, where will the patients be treated? He is right that that question has not been answered. That is clearly a material fact which must be addressed in any proposal and a satisfactory answer must be given. No one doubts that the hospital provides a unique range of services.

My hon. Friend put his finger on the problem when he said that Riverside district health authority, part of North West Thames regional health authority is responsible for financing an institution that has a client base broader than the district, which, although geographically small, is nevertheless important to the citizens of London. The argument runs that it is inappropriate for Riverside to be asked to bear the full burden of the cost of the hospital.

My hon. Friend drew attention to the Adjournment debate earlier this week when my hon. Friend the Member for Welwyn Hatfield (Mr. Evans) argued in an impassioned debate that faster progress should be made by the North West Thames regional health authority towards transferring relatively—not absolutely—resources from the inner and outer London district health authorities to the shire district health authorities, as that is where the population is moving to and where it is growing.

It is important to appreciate the reasons for the pressures. There are pressures on Cassel because of Riverside's revenue deficit, which is forecast to be about £5 million for 1989–90. The regional health authority has placed an obligation on Riverside to balance its books within the next two financial years.

The North West Thames regional health authority also faces a problem over shifting resources relatively from the London districts to the shire districts, a point which my hon. Friend was right to acknowledge. There is also the problem that Cassel's patients are drawn from the whole country, not just from the district or the region.

My hon. Friend referred to the Chelsea and Westminster hospital. I am aware of revenue pressures there, but I am not aware of capital pressures: that as the cost of the Chelsea and Westminster hospital has undoubtedly increased because of the rise in construction costs, we must therefore look around for capital assets to sell. That may be a consequential benefit of any proposal 1207 that may or may not be advanced, but that is not the driving force; it is clearly and understandably revenue based.

My hon. Friend said that the death of the hospital is imminent. The district health authority is to meet on 22 February to decide whether to proceed with the closure of Cassel. If it decides to close the hospital, it must consult. Statutory obligations are laid on the district health authority to do so. If the community health council, which it must consult, objects, the matter must go to the regional health authority. If the CHC is able to sustain its objection, the proposal will come to Ministers. That allows time for proper evaluation of the consequences of closure and of the strong feelings held by patients, residents and consultants. I shall want to be kept closely informed.

I do not intend to comment on Cassel's future. My hon. Friend will understand the difficult position in which I am placed; I may or may not be asked to adjudicate on its future. In general terms, however, I believe that my hon. Friend is right when he says that if a hospital is faced with the prospect of closure for whatever reason—whether on account of rationalisation or for financial reasons—it is appropriate to look forward to 1991–92, when contracts will allow money to follow the patient. My hon. Friend must be right when he says that hospitals in this position should begin to look forward and ask themselves, 1208 whatever their circumstances, "Which districts are our patients coming from? Can we persuade the clinicians in those districts financially to support the flow of patients, even though it may cost £10,000 per patient? Can we persuade the district health authorities to support financially a particular hospital?" That is a perfectly appropriate exercise. I suggest that all hospitals, whether or not they are faced with this predicament, ought to look forward to 1991–92, try to understand their patient flows, begin to explain to fellow clinicians the value of the work that has been done and seek appropriate financial support.

Furthermore, one must not necessarily assume that a hospital needs to stay within the National Health Service even if it wants to provide services to NHS patients.

Ministers have no philosophical objections to the provision of revenue from the National Health Service to pay for the essential treatment of patients in hospitals that may not be within the NHS—whether they be independent or voluntary.

Because of my responsibilities for mental health, I am deeply interested in the future of Cassel hospital and the care of the patients and their families. I assure my hon. Friend that if the closure decision comes to Ministers for adjudication, I will visit my hon. Friend, his constituency and the hospital and talk to the clinicians, administrators and patients.