[Ip-health] McKinsey in the news: Conflicts of interest, campaign cash, new PATH CEO, firing people at the Global Fund

Jamie Love james.love at keionline.org
Mon Mar 26 11:26:13 PDT 2012

Top Obama donors among frequent White House guests, JACK GILLUM,
Associated Press March 26, 2012   Link:

@richardhorton1 in Twitter: Steve Davis, ex-McKinsey, takes over as
President and CEO of PATH. Can I register a protest at the ridiculous
respect given to McKinsey?

PATH Names Former Tech Exec Steve Davis as New CEO, Luke Timmerman,
3/26/12  Link: http://www.xconomy.com/seattle/2012/03/26/path-names-former-tech-exec-steve-davis-as-new-ceo/

NHS reforms: American consultancy McKinsey in conflict-of-interest row
Link:  http://www.guardian.co.uk/society/2011/nov/05/nhs-reforms-mckinsey-conflict-interest

McKinsey in charge to strategic layoffs at the Global Fund, nukes unit
dealing with drug pricing and IPR (not reported by anyone).


NHS reforms: American consultancy McKinsey in conflict-of-interest row
Firm receives £250,000 a year from government while also providing
paid-for advice to GPs affected by changes

Daniel Boffey
guardian.co.uk, Saturday 5 November 2011 17.57 EDT

Health secretary Andrew Lansley's NHS reforms have been highly controversial.

A global consultancy firm seeking to profit out of the fallout from
the shake-up to the NHS is being paid £250,000 a year by the
government for advice on the transition towards health secretary
Andrew Lansley's vision of the service.

The American firm, McKinsey Inc, with estimated revenues of £4.1bn a
year, has been advising the Department of Health on how best to manage
the radical changes since March. McKinsey is also one of a group of
private consultants that have united to provide paid-for advice to GPs
as they prepare for life after the reforms.

Family doctors need help from private companies because of the
government's decision to abolish primary care trusts as part of their
controversial changes to the health service, a move criticised as a
step towards privatisation.

McKinsey's advisory services emerged in a freedom of information
release published on the department's website. The job description
says: "Consultancy services in support of the NHS transition

The company was one of 57 external "organisation and change"
management consultants paid almost £5.5m by the government in the last
financial year.

It is unclear how McKinsey is assisting. However, in September this
newspaper revealed the company had been acting as a middleman between
Lansley's department and international firms, including the German
company Helios, which was at one time interested in taking over
selected NHS hospitals.

Christina McAnea, head of health at the Unison union, said the
revelation was evidence of the increasing hold private companies had
over health policy. She said: "It is clear that the Tory government's
direction of travel for the NHS is towards privatisation and they are
increasingly open about that.

"But what is also becoming obvious is the close relationships being
built between this Conservative government and the private companies
who are making, or want to make, a profit from the reforms in the
health and social care bill. It is worrying for everyone, but
particularly patients, because this is money that should be spent on
their care."

The total paid to consultants by the department, including IT and
legal professionals, in the last year was £9.7m, despite the
government's claims to be cutting down on extraneous spending on
management consultancy firms.

The department is currently employing 114 contractors, and leaked
documents seen by the Observer reveal the generous daily rates of pay
the government is now offering private firms for their advice.

The government rate card shows that consultants can earn up to £1,870
a day each working for the civil service. A junior consultant can earn
£400 a day. A three-month contract for a top consultant could net
their company almost £120,000 for just 60 days' work.

Gareth Thomas, Labour's shadow minister for civil society, said: "When
the rest of the country is struggling to make ends meet and jobs are
being axed, the government should be clamping down on excessive pay to
consultants. Ministers need to be transparent and explain why so many
consultants on such high pay are needed and whether they approved
these contracts or not."

McKinsey has long been a controversial figure in the health world, and
has made millions of pounds as one of the key private providers of
management and advisory services. A conglomerate including McKinsey,
KPMG and PricewaterhouseCoopers last week sealed a £7.1m contract with
31 groups of GPs looking for advice on how to manage budgets under the
system being introduced by the Lansley reforms.

Earlier this summer this newspaper revealed the existence of
confidential emails between McKinsey and the government showing that
the firm had helped the department to hold discussions last year about
"international players" running up to 20 NHS hospitals.

The emails suggested there had been "good discussions" on "how
international hospital provider groups may help to tackle the
performance improvement of English hospitals".

It said there was "interest in [a] new solution for 10 to 20
hospitals", but said this would be "starting from a mindset of one at
a time" due to "various political constraints".

The consultants suggested that a figure of £500m revenue "on the
table" and a "free hand on staff management" would be needed for
"international players" to run hospitals.

Private involvement has been suggested as a solution for NHS trusts
with financial difficulties that may not be able to attain foundation
trust status. One hospital trust, Hinchingbrooke Health Care, is
already set to be run in a franchise arrangement by the private firm
Circle, although the deal has been delayed awaiting ministerial

Further correspondence between McKinsey and a health department
manager revealed the department had held discussions with Helios,
which runs a number of hospitals. The agenda for a meeting between the
consultants and the department in February next year includes the item
"London/Helios discussion". The German firm has since said it is no
longer interested in moving into the UK market.

A spokesman for McKinsey declined to comment.

James Love.  Knowledge Ecology International
http://www.keionline.org, +1.202.332.2670, US Mobile: +1.202.361.3040,
Geneva Mobile: +41.76.413.6584, efax: +1.888.245.3140.  Sometimes I am
using my MaxRoam number: +447937390810

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