Merger of Two Acute Trusts is Terminated

The merger of two acute foundation trust has been postponed following one of the providers involved deciding that merging would not offer the best chance of financial stabilisation.

Royal Surrey County and Ashford and St Peter’s foundation trusts were intended to merge, following an announcement back in May 2014.

The intention at that time was to create a provider with an annual turnover of approximately £600 million.

But further investigation has suggested that services to patients may suffer were the merger to go ahead.

Hints of difficulties emerged back in March, when plans to conduct the merger were paused.

At the time, Royal Surrey’s deteriorating finances were deemed an issue, with the trust accruing a £10.2 million deficit in 2015/16.

With financial problems still rife, the Royal Surrey has now announced that the merger will not go ahead, at least in the foreseeable future.

Following a self-assessment, the Royal Surrey concluded that opting for a sustainability and transformation plan and “wider healthcare networks” would result in the best care outcomes.

“Therefore, after careful consideration, Royal Surrey’s board has concluded that it no longer believes merging offers the greatest opportunity for long term financial and operational stability and feels that it is unlikely that this position will change in the foreseeable future,” a statement released by the CCGs read.

One of the controversial aspects of this decision is the fact that Ashford and St Peter’s has not carried out a self-assessment.

There may thus be some suggestions that the CCG will be opposed to this verdict.

However, reports indicate that the board of Ashford and St Peter’s has accepted that the merger will now not proceed, and will pursue other options to improve care and services instead.

In particular, plans are being developed to network some of the clinical services delivered by the CCG across a wider geography than is currently covered by the two trusts.

For example, Frimley Health Foundation Trust board papers say stroke services may be consolidated at Frimley Park, at the expense of the Royal Surrey.

Frimley Health’s September board papers moot a “possible closure” of the Royal Surrey’s hyper-acute stroke unit in Guildford, which could increase Frimley’s workload by approximately 60%.

Both trusts are partners in the Surrey Heartlands STP.

Back in December 2015, the NHS shared planning guidance 16/17 – 20/21 outlined a new approach to help ensure that health and care services are built around the needs of local populations.

 
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Privatised Hospital Considering Embarrassing NHS Trust Merger

The first NHS hospital to be run privately has hit major financial difficulties, with administrators now considering drastic steps in order to safeguard its future.

Hinchingbrooke Hospital in Cambridgeshire and Peterborough and Stamford NHS Trust have agreed to a review of “organisational form”.

The cash-strapped institution is faced with the prospect of merging with the NHS trust in an attempt to prevent it from collapsing completely.

But not all observers have praised the potential merger.

Huntingdon MP Jonathan Djanogly said he feared they were “weasel words” for a takeover of Hinchingbrooke.

Nonetheless, the hospitals have already announced that they intend to work together in a more collaborative fashion.

Peterborough and Stamford NHS Trust, which runs the City Hospital in Peterborough, is nearly £40 million in debt.

The trust is just one of the many in the NHS that is struggling to break even, with an overall deficit of £2 billion predicted for the health service as a whole in the existing financial year.

With the situation in Huntingdon evidently serious, decision-makers at the hospital are exploring numerous avenues.

Hinchingbrooke’s chairman Alan Burns said the two trusts would be looking at all possibilities, including a merger.

“Because [Peterborough and Stamford] are a foundation trust and we are not, if anything it would be an acquisition not a merger. We are looking at making the best use of money without a diminution of services.”

However, the resident MP of the constituency in which the Huntingdon hospital resides indicated that he was far from happy with the proposals that have been made.

Conservative MP Jonathan Djanogly was explicitly critical of the planned merger.

“To move from that to an outright takeover of Hinchingbrooke by Peterborough is, as far as I and my constituents are concerned, out of the question. They say they are going to look at the ‘potential organisational form’ – at the very best that’s NHS techno speak, but at the very worst it’s weasel words for a takeover.”

With the issue becoming something of a political hot potato, the trust has indicated that it will deliver the outline business case on the future of the hospital by April of this year.

What is clear is that the financial position of the institutions are such that some form of drastic action is necessary.

In December, the National Audit Office revealed Peterborough and Stamford Hospitals’ debt for 2014-2015 was £38.5 million, while Hinchingbrooke’s deficit for the same period was £11.4 million.

It was in this context that the decision to privatise the Huntington hospital was taken.

 
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Monitor Announces New South Devon NHS Trust Merger

A new hospital acquisition approved by the health regulator for the NHS will benefit patients and the general public in Devon.

In particular, thousands of patients located in South Devon are set to benefit from more integrated healthcare after the move by Monitor.

South Devon Healthcare NHS Foundation Trust has acquired Torbay and Southern Devon Health and Care NHS Trust, effectively merging the two organisations.

As the two trusts already collaborated on a close basis, indeed already sharing some back office functions, the potential for the two to cooperate on a wider basis is obvious.

Resulting from the decision will be a joint healthcare provision in the South Devon region, with the two trusts jointly providing acute, community and social care services.

Although Monitor has already approved this transaction, the process of assessing its legitimacy is nonetheless ongoing.

The health regulator has particularly requested the newly created trust to continue making improvements with regard to patient flow.

Both A&E and routine procedures are affected by this ongoing monitoring, and the health regulator has also requested the trust to improve its existing plans to integrate care.

Speaking on the subject of the South Devon acquisition, Miranda Carter, Executive Director of Provider Appraisal at Monitor, was keen to point out that this was a logical move, and beneficial for patients in the region.

“South Devon Healthcare provides valued services for patients across South Devon and Torbay, including general, elective and emergency care. By integrating these services with Torbay and Southern Devon’s community and social care services it will be able to provide local people with care that is more convenient, closer to home, and with a greater focus on keeping people healthy and out of hospital,” Carter pointed out.

In addition, Carter suggested that the model acquisition which has been created in South Devon could act as a template for other regions in the United Kingdom.

“This is a good example of the kind of innovative change that will help trusts to improve care for patients, whilst also offering better value for money services and meeting the challenges faced by the NHS,” Carter noted.

The Executive Director of Provider Appraisal at Monitor was also keen to outline to the newly created trust that it has certain responsibilities.

“Now that we have approved this acquisition we expect the trust to press ahead with plans and ensure services integrate smoothly for patients and staff,” Carter reminded the newly created trust.

Following the merger, the trust will be called Torbay and South Devon NHS Foundation Trust.

 
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CMA Provisionally Clears NHS Trust Merger

The Competition and Markets Authority (CMA) has provisionally cleared the proposed merger between two hospital trusts, following an extensive investigation.

Ashford and St Peter’s Hospitals NHS Foundation Trust (ASP) and Royal Surrey County Hospital NHS Foundation Trust (RSC) will form a new organisation should the merger go ahead.

The two trusts previously provided clinical services in Ashford, Chertsey and Guildford.

Mergers in the NHS can be controversial owing to the fact that competition is considered one of the most important factors in providing quality services.

Thus, the merger of the two trusts was referred for an in-depth phase 2 inquiry in February after the initial CMA investigation concluded that the proposed acquisition could reduce healthcare competition.

Patients currently have the opportunity to choose which hospital to attend for consultant-led outpatient appointments.

This form of patient choice therefore has a positive knock-on effect on the quality of healthcare, as competing hospitals strive to provide a superior service in order to attract patients and, concurrently, funding.

However, the CMA examined evidence from ASP and RSC about the provision of healthcare services in the area of the merger, and found that the proposal will not result in a significant reduction in competition.

Speaking about the decision, Simon Polito, Chairman of the inquiry group, was keen to emphasise that the investigation had diligently considered the merger, owing to its importance for NHS care.

Polito stated: “Choice of hospital for patients and commissioners has an important role to play in the NHS, as do a number of other factors that help to maintain and improve the quality of services. Indeed, we have been struck throughout this investigation by the commitment and professional pride in the provision of high quality care for patients shown by the many different NHS representatives we have encountered.”

The Chairman was also keen to outline the methodology behind the decision-making process: “The impact of a hospital merger on competition will largely depend on the number and strength of alternative service providers in the local area. There are a number of hospitals nearby which currently attract significant numbers of patients from the local area. We consider that these are viewed as credible alternatives by patients and GPs.”

Concluding, Polito was adamant that the correction decision had been reached: “Against this background, and following a detailed investigation, we are satisfied that in each of the services where the hospitals overlap, the merged trust will face significant competitive pressures from other local hospitals.”

Tasked with carrying out investigations into mergers, the CMA is the UK’s primary competition and consumer authority. Launched in 2013, it is an independent, non-ministerial government department.

 
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