The NHS spin-out that has the ear of social funders

Chime is a community interest company that provides audiology services in Devon, reports Andy Hillier

Chime: healthcare services
Chime: healthcare services

It has been almost five years since Jonathan Parsons and his colleagues decided to leave the NHS and, he says, they have no regrets. Parsons is the managing director of Chime, a specialist community interest company that provides hearing services in Exeter, and mid and east Devon.

The CIC span out of the local NHS primary care trust in 2011 after the introduction of the government's Right to Request scheme, which enabled front-line NHS staff to set up social enterprises to provide healthcare to NHS patients.

The audiology service had operated under contract from the primary care trust since 2004, but Parsons says that it did not have the level of autonomy it wanted. He says: "We had a contract, we had a budget and it looked straightforward enough, but budgets would change beyond recognition and money would go to other bits of the hospital."

One of the things we have learned is that being in business involves taking a risk

Jonathan Parsons

In 2010, the service started to explore the possibility of becoming a social enterprise. This involved working with a charitable deaf school, the Exeter Royal Academy for Deaf Education, which offered advice on how to structure its governance. Parsons says this was invaluable: "The charity has been around for a number of years, which gave the clinical commissioning group confidence about our governance."

Chime then met the CCG to discuss the plans in more detail and was able to reach an agreement after nine months of negotiations. The CCG awarded Chime a five-year contract worth about £2.6m a year to deliver adult and children's audiology services in Exeter, and mid and east Devon.

"The agreement gave us the freedom to spend the money in any way we wanted, as long as we achieved the aims set out in that contract," Parsons says. "For example, it allowed us to strike a deal directly with hearing-aid manufacturers and avoid the NHS supply chain costs. As a result, we have been able to make significant savings."

Chime now runs hearing clinics in 15 locations in Devon and employs 55 staff, which is 13 more than when it was spun out of the NHS. It has had an income of about £3.2m a year for the past two financial years, with sales of non-NHS-funded hearing aids and devices helping to boost its income.

Earlier this year, it opened a hearing centre in the Harlequins shopping centre in the middle of Exeter. This offers NHS hearing services for adults, provides advice and sells commercial hearing aids and accessories that link hearing aids to devices such as televisions and mobile phones. "We knew that if we wanted to increase our capacity we were best off going to a high-street location," Parsons says. "We knew that the demand was out there."

To fund the high-street location, Chime secured £200,000 of investment from the social lender Social and Sustainable Capital. "In an ideal world, the CCG should probably fund it, but in the current financial climate the answer would be no,"

Parsons says. "It's always a risk, but I'm comfortable with the investment. One of the things we have learned is that being in business involves taking a risk."

He says Chime now hopes to deliver its services in other parts of the country, but expansion is not always easy in audiology. "We provide some services in Torbay in Devon, but that's not our core area," Parsons says. "It has been slow to get traction in someone else's patch because there's a loyalty to the local service."

He is confident, however, that Chime will be able to encourage other NHS commissioners to use its model, now that it has a track record of delivering a valuable service.

Raising standards

Most importantly, Parsons says, spinning out of the NHS allowed Chime to raise the standard of service: for example, some NHS services offer patients hearing aids for just one ear because they are unable to afford to pay for aids for both, but Chime now fits two hearing aids in the majority of cases because it is able to purchase them at more competitive rates. It is also able to fit more complex in-canal hearing aids for free. "We have been able to keep our offer really high," he says.

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