The NHS’s biggest pathology reorganisation will take place in May, after the Office of Fair Trading ruled it would not be investigating the plan further.
The competition watchdog announced this week that the consolidation, which involves six trusts and will be hosted by Cambridge University Hospitals Foundation Trust, does not “qualify” for OFT scrutiny.
The plan is a collaboration involving six trusts. Cambridge University Hospitals and Ipswich Hospital Trust will be hubs carrying out most pathology work for the area. East and North Hertfordshire and Hinchingbrooke Health Care trusts, and Colchester Hospital University and West Suffolk foundation trusts will retain host satellite laboratories which will carry out only urgent work.
A new provider organisation established to run services under the arrangement, called the Transforming Pathology Partnership, said it now planned to transfer staff and services on 1 May, rather than a previously planned date of 1 April.
An announcement on the partnership’s website said: “The contracting processes for establishing the new organisation are complicated and this short delay will ensure that all the arrangements between the six trusts, five clinical commissioning groups, the OFT, and Public Health England are completely ready for the start of the new service.”
The OFT this week said, following an initial consultation, that the arrangement did not qualify for further investigation. A short statement on the regulator’s website said full details of its decision “will be available shortly”. The OFT instigates review of a merger if the enterprise being acquired has a turnover of at least £70m, or if the enterprises coming together have a combined market share of 25 per cent or more.
The decision follows concern over the past year that mergers and formal collaborations to run pathology services, which are being pursued in several areas, could face lengthy review and potentially being blocked by competition authorities. A Monitor briefing note published last summer warned the pathology sector could be especially susceptible to competition rules because of the explicit desire to consolidate services.
The only OFT investigation to date into a pathology consolidation has been the joint venture between University College London Hospitals Foundation Trust, the Royal Free London Foundation Trust and the private provider The Doctors Laboratory, which took place last year.
The OFT cleared the merger and said that “a sufficient number of competitors will continue to provide a strong competitive constraint in any event, the OFT is of the view that the transaction will not give the joint venture the ability to increase price or worsen non price aspects of the competition offering (such as quality of results and turnaround times)”.