Three trust mega-merger delayed by a year

Basildon and Thurrock University Hospitals Foundation Trust, Southend University Hospital FT and Mid Essex Hospital Services Trust, which have combined revenues of around £850m, originally planned to merge by this April.

The trusts told HSJ the delay was partly caused by their clinical reorganisation, which has sparked some controversy, being referred to the health and social care secretary by local councils.

The plans include the creation of a “treat and transfer” model, which would first be rolled out for stroke services. A hyper acute specialist unit is being created at Basildon. Stroke patients will be taken to two local hospitals, but if they deteriorate to critical levels, they would be transported via ambulance to the HASU.

The plans prompted concerns from campaigners and senior clinicians about the safety of secondary ambulance transfers and which ambulance provider would have capacity to provide the specialist service, as revealed by HSJ last year.

This month a report by chief commercial officer Jonathan Dunk for the trust board said NHS Improvement had told the trust leaders at a November meeting it was “supportive of a target date for the merger of 1 April 2020”.

Mr Dunk told HSJ the merger was a separate process to the clinical reorganisation, but the councils’ intervention in the latter had “impacted the merger timescale particularly in being able to start the formal approval process to access the £118m of capital investment earmarked by the Treasury to support the [local] clinical changes”.

He added: “This will remain the situation until the outcome of the review process is complete and the secretary of state has responded to the referrals by Southend on Sea Borough Council and Thurrock Council.

“We are not currently aware of a timescale for his response but in the meantime continue to work across our hospital group to bring clinical and corporate teams together where we can, and where this is in the best interest of our patients, staff and communities.”

The board papers also confirmed the merger intended to create a new NHS foundation trust, subject to approval from NHSI and the Competition and Markets Authority. 

However, the trusts are pressing ahead with both clinical and back office consolidations. The three trusts’ corporate functions will be brought together in a new corporate hub in Britannia House, Southend.

A board paper said that “significant progress” had been made on the “corporate services alignment project”, which involves the future of around 500 staff.

It added: “Service based consultations and implementation is now advancing… a corporate services [hub] in Britannia House, Southend will be a centre of expertise for essential corporate services such as procurement, finance and HR, creating a positive environment where experts can share and promote best practice whilst releasing efficiency savings associated with economies of scale. The first teams will relocate to Britannia House from April 2019.”

The trusts’ merger business case projects the non-clinical services redesign will save £12m a year. The trust said that it “did not anticipate that there will be materially fewer jobs, nor are we planning for redundancies”.

Mr Dunk added: “The majority of the financial savings associated with this consolidation are associated with reduced temporary staffing, procurement expenditure [from purchasing at greater scale and] and estates running costs, which improved service will deliver, and do not result from redundancies.”

At the time the merger was initially announced, it would have created the 11th biggest NHS provider, based on the most recently available turnover figures.