CONTROVERSIAL plans to award a multimillion-pound NHS contract to a private company have fallen through.

Bosses at Bupa CSH announced yesterday it was pulling out of negotiations for a £235m contract to manage musculoskeletal (MSK) services in West Sussex.

Coastal West Sussex Clinical Commissioning Group (CCG) caused outrage when it said Bupa CSH was its preferred bidder for the contract.

MPs and campaign groups were furious at the proposals and said the change could put vital services at risk at Worthing Hospital and St Richard’s Hospital, Chichester.

An independent assessment into impact of the plan showed Western Sussex Hospitals NHS Trust, which runs both hospitals, could lose more than £13.4 million over five years and it would also have problems recruiting and keeping staff.

Negotiations have been taking place between the CCG, hospital trust and Bupa CSH to try to find a solution before a contract could be agreed and signed.

However Bupa CSH has withdrawn from the process because of the potential financial impact on the trust.

CCG bosses are now trying to work out what they need to do next.

Campaigners believe the contract should be given to Western Sussex Hospitals, which had also bid to run the service.

Questions are also being asked about how and why the contract was awarded to Bupa CHS in the first place.

Members of the Don’t Cut Us Out, Health Alert and 38degrees groups said yesterday was a “victory for the people of Coastal West Sussex”.

In a statement they added: “We were right to challenge the CCG on this ill planned procurement and without our persistent challenges they would now be rolling out an MSK service that Bupa CSH has itself acknowledged would worsen the financial position of our local hospitals.

“Why did the CCG not listen and waste so much time and resources in spite of the problems that were highlighted early on?”

A spokesman for Bupa CSH said: “Our priority was to provide high quality and better coordinated care for local patients, and we have worked hard with the CCG to try and find a solution.

“However, the recent impact assessment means we cannot deliver the model we proposed without either compromising on the quality of care or destabilising other services.”

CCG clinical officer Katie Armstrong said: “Bupa CSH’s bid was very strong. They echo our patient values and would have been a good partner to work with.

“We need time to discuss the options with our board but expect to be able to outline our next steps shortly.”

Western Sussex Hospitals chief executive Marianne Griffiths said: “Sustaining and improving the quality of services available to all our patients remains our top priority.

“We recognise and support the improvements that Coastal West Sussex CCG wants to make for patients in MSK services and look forward to working with them collaboratively to make this ambition a reality.”