STRUCTURE: Commissioners have raised concerns that an imminently expected merger between Ealing Hospital Trust and North West London Hospitals Trust will not produce an organisation financially strong enough to attain foundation status.
The three local clinical commissioning groups, Ealing, Brent and Harrow, also asked for assurance that they would not be asked to financially support the merged trust if its bottom line did not improve. The trusts are due to merge in October.
The chairs of the three CCGs wrote to the trusts to give commissioner support for the merger, but also to raise a list of potential problems.
The letter said: “The CCGs are concerned that the merger business case as set out will not deliver an organisation that will be financially stable [enough] to achieve foundation trust status.
“We wish to understand the merged trust’s further plans to achieve foundation hospital status beyond merger and whether these involve a possible further transaction.”
The CCGs also asked for reassurance that the merged trust would be able to deliver a surplus after three years.
Their letter highlights a “number of material risks” to this target, including the need to deliver cost improvement programme and merger savings, and the need to win community services contracts.
It continues: “[We] expect the NHS Trust Development Authority to play a key assurance role in the monitoring and delivery of these savings, and the management of the risks, to ensure that the merger benefits are realised.
“We also seek assurance that, were the base case not to be achieved, the TDA would not be looking to the CCGs to provide financial support to the merged trust.”
The letter also raised concerns about the relationship between North West London Hospitals and Ealing CCG. It said North West London did not currently “see Ealing CCG as an important customer”, and the trust’s communications about proposed service changes were “only routinely sent to Brent and Harrow”.
TDA programme director Anne Gibbs responded that it would not be “appropriate” for the authority to make any “commitment” about financial support the merged trust might require in future as the contract was between the trust and the CCGs.
However, she added that the TDA would give the trusts “bespoke support” to “ensure a successful merger and address the clinical quality issues and financial challenges going forward”.
A spokesman for the CCGs told HSJ: “The CCGs have had regular discussions with the two trusts about their merger plans and how this will improve care for patients.
“This is so we can be assured that the merger will bring benefits to patients and that there is a strong financial case for the merger.
“We fully expect that the merger to go ahead next month with the full support of the CCGs.”
A spokesman for Ealing Hospital Trust said: “Ealing Hospital Trust has had regular discussions with the CCGs to assure them the merger will bring benefits to patients and that there is a strong financial case to support the transaction.
“Both trusts are now awaiting final approval for the merger, but we fully expect it to go ahead in October 2014 with the full support of the relevant CCGs.”
Joint letter from Ealing, Brent and Harrow CCGs