Monitor has concluded that quality improvements borne of a recent reconfiguration of acute services in Bristol are not sufficient to outweigh the loss of patient choice resulting from the “merger”. The competition regulator said the decision would have “important considerations” for the “wider health system”.

The Co-operation and Competition Panel, which became part of Monitor in April, stopped short of recommending the trusts involved reverse the reconfiguration due to the longstanding nature of the Bristol plans.

However, it advised commissioners planning to centralise services to consider whether they could potentially secure greater quality improvements through competitive tendering. The panel said commissioners must “ensure that the incentives for improving quality and efficiency are maintained in the longer term”.

Foundation Trust Network chief executive Chris Hopson said the decision was “cause for concern”.

He added: “What the CCP appears to be saying is that preserving patient choice and competition are likely to be prioritised over perfectly sensible proposals to reconfigure services.”

The Bristol reconfiguration took place in April but the proposals had been under development with commissioners since 2005.

Head and neck, ear nose and throat, oral and maxillofacial, and orthodontic services have been centralised at University Hospitals Bristol Foundation Trust, while breast care and urology services have transferred to North Bristol Trust.

The panel announced in February that it would review the plans as they constituted a merger, due to the fact that previously independent services were coming under common management and control.

In a report published last week, the panel accepted there were patient benefits from centralising head and neck cancer, ENT and OMF services that were probably best realised through merger. These included an increased number of clinical nurse specialists and a treatment room available 24 hours a day.

However, it concluded that while cancer patients and those requiring complex care would benefit this did not outweigh the loss of choice for other patients, which in turn could reduce providers’ “incentives to maintain quality.”

Further, it concluded that although the merger had enabled improvements to the services to be made quickly, these could have been realised without merger.

The report said: “Where there is an impact on incentives to maintain quality, parties should consider carefully and be ready to explain what benefits to patients the merger will secure that could not be achieved in another way.

“In our view, new models of care can often be implemented through processes that enable providers to compete to provide services.”

A joint statement from the trusts and their main commissioners said: “Commissioners are committed to working with both Trusts to ensure that the quality and efficiency benefits outlined in the original plan are delivered in line with expectations.”