NHS bedside telephone supplier goes into administration

Administrators have been called in to the controversial group that supplied NHS bedside telephones and other services.

Administrators have been called in to the controversial group that supplied NHS bedside telephones and other services.

Patientline, which had attracted severe criticism for charging a premium rate of 49p a minute on incoming calls, went into administration after the banking syndicate backing the company decided that it had no hope of financial recovery.

The bankers have formed a new company to buy the Patientline assets and continue operations.

The company won contracts from NHS trusts to install bedside terminals in hospital wards providing telephones, television and other entertainment services.

The Department of Health later persuaded it to embark on a costly upgrade of the equipment so that it could be used by doctors to call up patient records and by patients to order meals. But the NHS never committed to pay for the extra facilities, which were not used.

The company tried to recoup its outlay by raising charges. The price of an outgoing call was capped by regulators at 10p a minute, but the rate for incoming calls was raised to 49p a minute, and patients were charged up to £3.50 a day for watching television.

The rates provoked a backlash. Revenues dropped further when many hospitals relaxed their bans on using mobile phones inside wards.

The Patientline banking syndicate, the Royal Bank of Scotland, HSBC Bank plc, Bank of Scotland, and IKB Deutsche Industriebank, has formed a new company, Hospedia, to buy the group's assets. The deal is subject to approval by the Office of Fair Trading.

The group will continue to operate more than 80,000 bedside terminals at more than 200 NHS hospitals across Great Britain.

Tim Sherwood, Hospedia chairman, said: "This is great news not only for patients and hospitals, but also for staff and suppliers. Our goal is to rebuild consumer confidence in NHS bedside entertainment systems.

"The restructured debt and new finance gives much needed stability to the business, allows for the delivery of new innovative services and gives a real opportunity to begin to provide improved value for money".

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