Legal briefing: mutual trusts

Mergers and acquisitions are currently the daily talk of the business and financial pages. However, a quieter 'merger boom' may be about to emerge, this one in the NHS - perhaps heralded by the recent merger of Heart of England foundation trust and Good Hope Hospital trust. In a similar vein, South Staffordshire Healthcare foundation trust.recently acquired a mental health, learning and disability directorate from Shropshire County primary care trust. .....

Mergers are very much seen as a tool in the strategy to enable all acute, mental health and ambulance trusts to eventually achieve foundation status..Mergers and acquisitions.also encourage the sharing of best practice between trusts and help resolve financial issues arising from over-capacity, where trusts operating in the same health economy may duplicate the provision of some clinical services..

When reconfiguring services via mergers and acquisitions, trusts need to consider how their local community will view such changes to services and have in place strategies to communicate the reconfiguration effectively and positively across the local health economy. Some key points for trusts to consider here are:

• The change should be communicated not as a closing down of services but as a redesign in order to improve health provision.
• Trusts should share as much financial and clinical information as possible with the public to enable them to fully understand the issues and consult with the trust on them..
• Clinicians need to be engaged with the reconfiguration from the earliest stages and be the public face of the trust where possible to explain the reasons for the reconfiguration to the public.
• Clinicians' support can prove a more powerful and influential voice in the public's eyes than that of management.
• Likewise, it is important to engage local media at a very early stage and secure their support for the reconfiguration as far as possible.

From a legal perspective, it is clearly crucial that a merger is appropriately and correctly executed to prevent future disputes. For example, certain land registration tasks will be required as estates transfer between the trusts.

In addition, where a foundation trust takes over an NHS trust, it will be necessary to ensure staff, assets and liabilities are legally and correctly transferred - the Transfer of Undertakings regulations must be observed. These include detailed consultation requirements, plus stipulations around employment terms and conditions and the transfer of employee information between trusts.

Merging NHS and foundation trusts may be a complex and onerous transaction from various points of view - not least the legal implications and communications challenges - but it is one we are likely to see occurring more and more frequently in the coming years, as the drive towards foundation trust.status gathers pace.

Paul Ray is a partner and health market expert at law firm Browne Jacobson. For more information, please contact 0121 237 3900 or visit www.brownejacobson.com