Diagnostics / Pathology


This sector divides into two distinct areas: diagnostic imaging of a patient and pathology - the diagnosis of disease based on analysis of bodily fluids and tissues.

The privatisation of diagnostics and pathology services, has been ongoing for several years and several companies are now well established with large long-term contracts. As many of these services, in particular in pathology, are not patient-facing, the involvement of private companies is often much less obvious than in clinical services.


The private sector is involved in all aspects of diagnostics and pathology - from MRI scans to identification of bacteria in infected tissue, from genetic testing to a simple hearing test - every aspect of diagnosis for the NHS is now carried out somewhere in the country by a private company under contract to an NHS organisation.

Work by the NHS Support Federation has found that diagnostics has been one of the leading areas in terms of number of contracts for the past four years.

This sector divides into two distinct areas - diagnostic imaging of a patient and pathology, the diagnosis of disease based on analysis of bodily fluids and tissues. Each area has seen privatisation take place in a different way.


In diagnostic imaging, privatisation was boosted by the Health and Social Care Act 2012. Contracts in this area are varied and include framework contracts, short-term contracts to clear a backlog of work and standard contracts. Recent examples include:

  • University Hospitals of Coventry and Warwickshire NHS Trust awarded a four year framework contract worth £5 million for a diagnostic imaging service to include CT, MRI, X-Ray, PET/CT, Mammography, Cardiac Cath Lab, Bone Densitometry. Listed on the contract are Alliance Medical Ltd, Diagnostics Healthcare Ltd, and InHealth Group Ltd.
  • The Pennine Acute Hospitals Trust awarded a three year contract to Northern Medical Ultrasound Ltd worth £1.5 million to provide diagnostic ultrasound services.
  • Bradford City and Bradford Districts CCGs awarded place on an AQP (any qualified provider) contract for community endoscopy services to Bestcare Diagnostics Ltd and Robin Lane Medical Centre.

A notable example of the major privatisation of diagnostics is the way PET-CT scanning has been commissioned across England in the last few years.

In 2014, NHS England commissioned the first lot of contracts for PET-CT scanning (the phase I procurement). These covered much of the North and East of England.

Alliance Medical was awarded all four regional lots of the PET-CT contract managed by the East of England strategic projects team. The remainder of PET-CT services are provided by individual trusts, charities and partnerships.

In 2017, the regions not covered by phase I were included in the phase II procurement process. In March 2019, the first lot was awarded in the process, this was to InHealth and covered the Thames Valley (Oxfordshire and Buckinghamshire).



Government reports produced in 2006 and 2008 encouraged a new model of organisation for pathology departments, which reduced the number of hospitals that had their own pathology services. Hospital trusts would instead share services with neighbouring trusts - this was known as the hub and spoke model of working.

Although the reports themselves did not explicitly advocate the use of the private sector, some areas went down the route of using private companies. In 2019, there were four partnerships between pathology departments in hospital trusts and private companies (details below).

In September 2017, NHS Improvement reiterated the development of the hub and spoke model and outlined plans to create 29 pathology networks across England in a bid to save £200 million by 2021. The NHSI plan calls for 105 individual hospital pathology services to be linked together through the hubs, to create networks which will each serve populations of between 1.5 million and 2 million. The hub will be a lead provider, where complex and high volume tests are processed, while the spoke centres will provide more routine hospital laboratory services.

By November 2019, only 16 of the planned 29 pathology networks had agreed on a model.

In September 2018, eight hospital trusts located in South London, Surrey and Sussex advertised a pathology contract worth more than £2.2bn which aims to link all the trusts. The contract covers the full range of pathology disciplines for the trusts. If successful, this could lead to the development of the largest pathology network ever to have been developed.

This procurement may well result in privatisation of the pathology network and one trust in the region, Lewisham and Greenwich Trust, refused to be part of the procurement because it is considering a solution that keeps its pathology provision within the NHS.

A hub and spoke model is planned for development in Kent and Medway. In January 2019, the four acute trusts involved were considering options including a private sector partner or outsourcing of pathology completely. Plans include less urgent pathology services being concentrated in just one or two hubs, although each acute hospital without a hub would keep an essential services laboratory. The four trusts are expected to decide on whether to have one, two or three hubs by the end of February 2019 and the decision on whether to run the service in-house, partner with a private company or outsource completely is expected to be made in summer 2019.


Over the years several issues have been found with the use of private companies in both diagnostic imaging and pathology.


In pathology the most widely reported problems have been with the company Viapath, established by Serco in partnership with Guy’s and St Thomas’ hospitals, In 2014, Viapath  was found to have overcharged the NHS for diagnostic tests. The venture has also been dogged by allegations of cost-cutting and clinical failings.  Internal documents showed amongst senior consultants who claimed that staff cuts and a lack of investment since privatisation left some laboratories close to disaster.

In internal emails clinicians said the company had an “inherent inability… to understand that you cannot cut corners and put cost saving above quality.” The trust and Viapath say the problems have now been resolved. But this only happened after the intervention of senior medical staff and changes to the structure of the joint venture that reduced Serco’s role.

In June 2017 during a quality assurance visit to Pathology First laboratories major issues with quality were found. A report by Public Health England's concluded that: 'A number of working practices, particularly within the laboratory, compromise service quality and potentially patient safety'.

Pathology First is run by Southend University Hospital NHS Foundation Trust, Basildon and Thurrock University Hospitals NHS Foundation Trust and the private company, Integrated Pathology Partnerships. Pathology First provided pathology services to over 100 GP practices.

As a result, 4,668 smear test samples require re-examination. By June 2018,  NHS England reported that re-examinations have revealed that 31 women were incorrectly given the all-clear, despite their smear tests revealing symptoms related to cervical cancer.

Meanwhile, re-examination to date has resulted in 31 women being told they have abnormal results, despite previously being given the all-clear; and 95 women have been told to re-visit their GP practice for a new smear test.

Diagnostic imaging

There have been concerns around the phase I and phase II commissioning of PET-CT diagnostic imaging by NHS England.

After the phase I round of awards, in which Alliance Medical won a large portion, a consortium of hospital trusts lodged a formal challenge to the procurement decision.

The consortium consists of the University Hospitals of North Midlands Trust, Wirral-based Clatterbridge Cancer Centre Foundation Trust and the Royal Liverpool and Broadgreen University Hospitals Trust.

The scanner, the consortium would have used is based at Royal Stoke University Hospital but is partly owned by Keele University and was installed following a £1m research grant, and charity donations of £250,000.

The phase II award to Inhealth in the Thames Valley in early 2019 was met with horror by many in the local area and NHS employees, including the team that currently carries out scanning based at the Churchill Hospital in Oxford. The Churchill Hospital team has an international reputation for cancer care and would no longer be involved with the PET-CT scanning under the new contract.

The Guardian reported that doctors at the hospital said they were “disgusted” by the loss of the contract. The doctors warned that people receiving cancer treatment will now have to be taken by ambulance to two new locations where InHealth has its scanners. This could have a detrimental effect on their health.

Under InHealth’s plan, people with cancer being treated as inpatients at the Churchill would have been taken by ambulance to have a PET-CT scan at GenesisCare private cancer clinic at Littlemore, four miles away on the outskirts of Oxford.

The doctors are also worried about the quality and an increase in rescanning, which would lead to more suffering for the patients.

Another concern is the loss of expertise to the NHS as the expert team at the Churchill Hospital will no longer be required as the hospital will have to hand back its leased scanners.

As a result of pressure from MPs, doctors and the public, NHS England had to backtrack on certain aspects of the phase II award to InHealth in March 2019. The scanners will remain at the Churchill Hospital and continue to be used and operated by the current staff. However, InHealth still have the contract in the rest of the region and will set up scanners in Swindon and Milton Keynes.

NHS/Private partnerships

Pathology First

A collaboration between Basildon and Thurrock University Hospitals FT and Southend University Hospital FT and the private laboratory Integrated Pathology Partnerships (iPP) which provides pathology services across south Essex. It was launched in October 2014. Major problems were found with this service during a quality assurance visit in 2017. This led to smear test samples from 2,500 women having to be re-examined.

Health Services Laboratory LLP

HSL describes itself  as 'a progressive partnership'  between the Australian company TDL (The Doctors Laboratory),  UCLH (University College London Hospitals NHS Foundation Trust), The Royal Free London NHS Foundation Trust and North Middlesex University Hospital . It carries out all the routine and specialist pathology departments from these NHS Trusts.


This was a joint venture between Serco and Guy's and St Thomas' Hospital Trust and King's College Hospital, and for several years it was the largest pathology service provider in the UK, processing more than 22 million tests a year in London and Bedford. The company was established in 2009 as a joint venture between Guy’s and St Thomas’ and Serco. King’s College Hospital joined them in 2010. In early 2020, Viapath lost the contract for covering a large swathe of south and east London and as a result Serco decided to withdraw from the venture. In June 2020 it was announced that King’s College Hospital FT and Guy’s and St Thomas’ FT will pay an undisclosed sum to Serco for its share of Viapath. Viapath lost the contract to German company Synlab. In November 2020, Synlab, Guy’s & St Thomas’ NHS Foundation Trust and King's College Hospital NHS Foundation Trust signed a completion agreement for a joint venture for the South East London contract. The new contract will begin 1 April 2021.

South West Pathology Services (SPS)

Southwest Pathology Services is a joint venture between Taunton and Somerset NHS Foundation Trust, Yeovil District Hospital NHS Foundation Trust and private sector partner – Integrated Pathology Partnerships (iPP) who are run by LABCO and Sodexho. The joint venture was established in June 2012, serving a population of 500,000 and over 100 GP practices.


Alliance Medical

Alliance Medical is an independent provider of medical imaging services to health organisations across Europe. In the UK, the company provides a wide range of scanning techniques, including MRI and PET-CT, at 37 static sites and in 45 mobile units.   The company has a 10 year contract for PET-CT scanning in NW England. It is owned by the South African healthcare company, Life Healthcare, which acquired Alliance Medical in 2016. For a full overview of this company see our Private Providers section.


Inhealth is the largest private supplier of diagnostic procedures in the UK and works for almost all hospital trusts. The company has a large number of individual contracts with CCGs and hospital trusts, as well as being listed on several central framework agreements for screening services (NHS Supply Chain and NHS Shared Business Services National Procurement Frameworks), such as for interventional cardiology. For a full overview of this company see our Private Providers section.

Everlight Radiology (formerly Radiology Reporting Online Ltd)

Everlight Radiology is an Australian company established in 2006. The company first entered the UK market in 2010 as Radiology Reporting Online – a partnership with University College London Hospitals NHS Foundation Trust (UCLH). The company has had numerous contracts with hospital trusts, some of short duration as the company is bought in to clear a backlog of images that need analysis. For example, in August 2017, the Queen Elizabeth Hospital King's Lynn NHS Foundation Trust, awarded the company a one month contract for remote radiology reporting services.

Other contracts are more long-term, for example in April 2018 Everlight Radiology was awarded the teleradiology tender for three Trusts across Mid and South Essex.  The contract comprises urgent after hours emergency and routine radiology reporting services for Mid Essex Hospital Services NHS Trust, Basildon and Thurrock Hospitals NHS Foundation Trust and Southend University Hospitals NHS Foundation Trust.

The Doctors Laboratory Ltd

TDL's parent company, Sonic Healthcare Ltd , is an Australian clinical diagnostic organisation employing over 22,000 people. Sonic is one of the world's largest providers of clinical diagnostics, and offers  extensive laboratory pathology services to the medical community in Australia, New Zealand, South East Asia, Germany, Belgium, Switzerland, Ireland, UK and the USA.

As well as the Health Services Laboratories partnership, TDL also has contracts with other trusts, community and acute, for managed pathology services.

Mediscan Diagnostics Services Ltd

Mediscan Diagnostic Services is a provider of ultrasound diagnostic services at 137 clinics across 54 CCGs in the UK. They also provide audiology, dermatology, ophthalmology, physiotherapy, MRI, and endoscopy services across 30 clinics. In several areas, Mediscan is under contract to reduce waiting times for the NHS.

Synlab/Integrated Pathology Partnerships

Integrated Pathology Partnerships (iPP) was established in 2010 to work in partnership with the NHS to deliver pathology testing services in the UK. iPP now conducts more than 24 million tests per annum and employs over 600 staff across seven sites in the UK.

iPP is a wholly-owned subsidiary of Synlab, which operates in 35 countries across four continents, employing more than 19,000 members of staff and conducting over 500 million tests per annum. Synlab was bought by the private equity company Cinven in August 2015.

iPP offers a full range of diagnostic tests and services ranging from phlebotomy, routine and urgent tests. Since 2010, iPP has formed joint venture (JV) partnerships with five NHS Foundation Trusts in Taunton, Yeovil, Southend, Basildon and the Christie in Manchester. In addition, the company works with CCGs in community testing, point of care testing and phlebotomy.

The company has three operating companies: iPP Limited and iPP Analytics provide a fully-fledged testing service in Somerset and Essex respectively. iPP Facilities manages the laboratory facilities, equipment and logistics at all of the iPP laboratory locations.

In January 2020, Synlab was named as the preferred provider to take over the £2.25 billion, 15 year contract to provide pathology services to most of south east and central London. Synlab will replace Viapath, the current provider.

In November 2020,  Synlab and Guy’s & St Thomas’ NHS Foundation Trust and King's College Hospital NHS Foundation Trust signed an agreement to act as a joint venture in respect of the South East London Pathology Procurement. The new joint venture will commence, and services will begin to be delivered, on 1 April 2021.

The contract covers the provision of pathology services to South London and Maudsley FT, Oxleas FT, the Royal Brompton and Harefield FT, and to Guy’s and King’s FTs, the two trusts who jointly own Viapath. 

In 2012 Synlab was excluded from the procurement process to provide pathology services to Royal Free London FT and UCLH as the company lied - the company said it was in the process of developing a laboratory close to the trusts’ sites which would meet the requirements of the tender but this was not true.


Diagnostics can be split into two distinct areas:

  • Imaging of a patient through the use of technology to ‘view’ the body, for example magnetic resonance imaging (MRI), X-Ray, ultrasound, echocardiography, endoscopy, and
  • Pathology, the diagnosis of disease based on analysis of bodily fluids and tissues using a wide range of diagnostic procedures, for example DNA analysis, microbiology, microscopic analysis of tissues and cells.

Together pathology and diagnostic imaging cover a very wide spectrum of work - there are around 20 disciplines in the area of pathology alone. Diagnostics and pathology services are integral to the ability of all other specialisms in the NHS to work efficiently and accurately, for example, accurate imaging is often needed before surgery can proceed; genetic analysis is often needed to determine the correct cancer drug to be used; viruses have to be identified; and antibiotic resistance needs to be determined if infections are to be treated correctly. To add to this there is also the nationwide diagnostic screening programmes, such as for cervical cancer and breast cancer, that have identified problems and led to early and much more successful treatment.

Who commissions diagnostics and pathology services?

The main commissioners of these services are hospital trusts and CCGs. Various contracts are used including framework contracts, in which a number of organisations are listed, and standard NHS contracts of varying lengths. The use of AQP (any qualified provider) is still used widely in diagnostics, under which providers are paid per patient/procedure.

In diagnostic imaging, in recent years it has become common for hospital trusts with large backlogs in diagnostic imaging to award short-term (one month to a year) contracts to private companies to rapidly reduce the backlog.

In pathology, many hospital trusts still have in-house pathology laboratories or are part of wider networks and use pathology labs in neighbouring trusts. However, some trusts and CCGs have contracts with private companies for pathology services. In some areas the hospital trusts are partnered with private companies to form the network of pathology services.

Who provides these services?

In diagnostic imaging, the services are supplied by hospital trusts, community clinics and a number of private companies. Several diagnostic techniques require large and expensive equipment, such as MRI, limiting the number of providers and locations. Other techniques, such as x-ray, ultrasound and ECGs, can be performed with less expensive equipment and can be provided at a wider number of locations and by a much larger number of providers.

Diagnostic ophthalmology services is an area that for many years has been served by private opticians based on the high street that everyone is familiar with; for some years now these companies have increasingly been offering community audiology services commissioned by CCGs. Referrals from GPs for diagnostic audiology and ophthalmology services can be to hospital trusts and community clinics or to opticians/audiologists based on the high street depending on the contracts in place with the CCG.

In pathology, government reports in 2006 and 2008 outlined the development of the ‘hub and spoke’ network of consolidated specialist pathology services, with satellite laboratories. Several pathology networks have since been developed along this model.  This model of working also led to increased use of private companies working in collaboration with NHS laboratories. The oldest partnership between NHS and private companies in pathology is Viapath, established in 2009 as a  joint venture between Serco and Guy's and St Thomas' Hospital Trust and King's College Hospital.

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