Competition regulators have launched a formal inquiry into a long-mooted merger which would form one of the largest acute trusts in the country.
The Competition and Markets Authority investigation will consider the merger between University Hospitals Birmingham Foundation Trust and Heart of England FT.
In approved, the combined trust would have a turnover of over £1.4bn - more than any other that currently exists, although it would be the second largest if another planned trust merger in Manchester goes ahead.
UHB and HEFT already share chief executive Dame Julie Moore and chair Jacqui Smith. Dame Julie is also the STP lead for Birmingham and Solihull.
The CMA investigation will specifically consider whether the merger “may be expected to result in a substantial lessening of competition within any market” and whether this would be outweighed by any patients benefits.
HSJ has been told the regulator has been holding informal “sensitive conversations” with the trusts for months, including raising potential challenges to the merger.
Under “phase one” of the investigation process the authority is engaging in open consultation until 17 July.
HSJ understands if the trusts, and likely NHS Improvement, provide strong evidence of patient benefits, the authority could clear the merger in as little as two months.
However, if this does not occur, the investigation will enter a second phase, which will involve a more detailed and longer examination of the loss of competition balanced against possible patient benefits. “Phase two” can last for up to 24 weeks.
These questions would likely revolve around areas where the trusts’ services overlap, such as elective surgery, and whether a loss of that patient choice would be outweighed by improvements in care.
In its preliminary findings on a proposed merger between Central Manchester University Hospitals FT and University Hospital of South Manchester FT, the CMA said it accepted that financial pressures on the NHS had “dampened the role of competition”.
The Birmingham merger plans were formally announced in September last year. At the time, Dame Julie said current arrangements were “not sustainable”. She said: “If we are to continue working together to maximise clinical benefits for patients, we need to implement a transformation that will deliver better access to better quality services for patients, supported by the most effective structure.”
A statement issued by UHB this morning said: “The process to build a case for change… is ongoing.
“The case will outline the benefits a merged organisation would deliver to patients in Birmingham, Solihull, Sutton Coldfield and South Staffordshire.
“The notification document has been submitted to the Competitions and Markets Authority and they are reviewing our case.”
HSJ understands NHS Improvement has lodged evidence relating to the merger with the authority.