Health bosses have admitted mistakes were made following a controversial decision to award a multimillion-pound NHS contract to a private company.

Coastal West Sussex Clinical Commissioning Group (CCG) wanted the £235 million contract to run services dealing with bone, muscle and joint problems in the county to go to Bupa CSH.

However, this sparked anger from campaign groups which said the change would have an impact on Worthing Hospital and St Richard’s Hospital in Chichester.

An independent assessment into the contract revealed it could cost Western Sussex Hospitals NHS Trust, which runs both hospitals, £13.4 million over four years. It was also suggested there would be problems attracting and retaining staff if the trust lost the service.

Bupa CSH announced in January it was pulling out of the project and CCG bosses are taking legal advice about their next steps.

Members of the Don’t Cut Us Out and 38 Degrees campaign groups met with senior CCG members to highlight their concerns about any future plans for the service.

Jan Birtwell, from 38 Degrees, said the CCG had made mistakes during the procurement process and it wanted to get things right for the future in the interests of improving services for patients. She said: “They genuinely seem to want to improve services and patient care and experience.

“We made it clear that we also wanted this but that we do not agree outsourcing or privatisation is the way to do this and will fight future decisions to put services out to tender.”

Margaret Guest, chairwoman of Don’t Cut us Out, said: “We understand that the CCG might feel constrained by current central health policy which makes it difficult for them to challenge the need for competitive tendering and procurement of musculoskeletal (MSK) services in this instance.

“However we ask them to be brave and bold and on behalf of patients to take a stand and work in collaboration with local communities and current NHS providers to deliver a service both in hospital and in the community that is high quality, sustainable and publicly accountable.”

The CCG denied there had been errors during the procurement process but admitted it could have done more to explain it all to the public and what the next steps would be once it had announced Bupa CSH as its preferred provider.

A spokeswoman said: “We are determined to reach a resolution on this as soon as possible, but we need to take the time to make sure we act correctly. All current contracts remain in place, and will do so until the end of September 2015.”