A deal between Oxford consultants and an American health care company has prompted new fears about the future of the local NHS.

The first fruit of a new public-private partnership at the Nuffield Orthopaedic Centre will be the creation of the Oxford Clinic for Specialist Surgery in September. NOC managers deny it is privatisation.

The new centre will offer orthopaedic surgery, neurosurgery, radiology, rheumatology, physiotherapy and related disciplines.

The clinic has been advertising for theatre nurses, recovery nursing staff and occupational therapists.

It follows the creation of a partnership between US firm Ascent Health, the NOC and a group of medical and surgical consultants, who set up their own company Oxford Musculoskeletal LLP.

The partnership will take over the lucrative private orthopaedic work at the NOC, which has always ploughed money back into the specialist NHS hospital. The deal will also fund improvements for private patients at the NOC.

NOC chief executive Ed Macalister-Smith said: "The purpose of the partnership is to pick up the private orthopaedic work that has been going on at the NOC site for many years and to develop and provide a modern new private facility for Oxford.

"In the past, the NOC, as an NHS organisation, ran the private services. We cannot invest NHS money to develop them and the fabric of the private facilities has fallen behind what is needed."

Mr Macalister-Smith said the clinic would take over the NOC's private Mayfair Ward, which would be substantially refurbished. While there were no definite plans to move off site, he added: "If everything goes well, other plans will be brought forward."

Oxford orthopaedic consultant Gavin Bowden, one of the key figures behind the project, said: "It is not a private venture. We are trying to develop a partnership to deliver services that will see an improvement in patient care.

"This is not a private hospital but a true partnership with the NHS."

He hoped to later create a new facility with the NOC in Littlemore.

The speed of developments has surprised the Oxford Keep Our NHS Public campaign.

Mark Ladbrooke, of Unison, said he feared what financial implications there would be for the NOC, which had borrowed heavily to invest in new buildings.

He added: "There is huge concern for staff being transferred in and out of the NHS. There are serious implications in changing people's terms and conditions.

"As for the bigger picture, I fear this will result in people getting less NHS for their money."

Mr Macalister-Smith met MPs yesterday after concerns were raised that the hospital and four other specialist orthopaedic centres in England faced having to abandon complex surgery because of the way internal competition is imposed on the NHS.