STRUCTURE: The proposed merger between two Surrey foundation trusts has been given the go ahead by the Competition and Markets Authority.
- Competition authority concludes merger between Royal Surrey County Hospital FT and Ashford and St Peter’s Hospitals FT would not reduce patient choice
- CMA says “continued tariff deflation” could affect providers’ ability to provide quality services
- Trust boards to consider full business case and public engagement before proceeding
The CMA has ruled that a merger between Royal Surrey County Hospital FT and Ashford and St Peter’s Hospitals FT would not reduce choice for patients in the area.
The decision was outlined in a report from the authority, which also said that further cuts to tariff prices could have an “adverse impact” on the ability of the providers to deliver “the same or a better range and quality of services”.
There are a number of other nearby hospitals that attract significant numbers of patients from the local area and are viewed as a “credible alternative” by both patients and GPs, the CMA’s inquiry group concluded.
The final decision was made ahead of an extended October deadline.
The trusts told the CMA that if they remained as standalone organisations they would expect to deliver deficits for the next five years.
Both trusts argued that the delivery of seven day services in some specialties would only be possible if they merged due to financial and recruitment constraints they face individually.
North West Surrey Clinical Commissioning Group said it supported this argument but would like to see a “more robust” business case regarding bringing together clinical services because it had concerns about “clinical alignment”, which it said can be the “biggest challenge” for mergers.
The inquiry concluded that if the merger did not go ahead “neither Ashford and St Peter’s nor Royal Surrey County would exit the market in the near future”.
It said: “However, the parties would come under financial pressure, mainly due to continued tariff deflation and increasing requirements to deliver quality and efficiency improvements compounded by the increasing difficulty and cost of sourcing skilled staff.
“We consider that, as is the case for other NHS providers of acute services, this may have an adverse impact on their ability to provide the same or a better range and quality of services as is the case currently, and to make capital investments.”
The two trust boards will now consider the full business case and financial plans for the merger and decide whether to proceed.
Ashford and St Peter’s chief executive Suzanne Rankin said: “Naturally we are pleased to receive the CMA’s final report, which confirms their final position. We are particularly pleased that, following a really detailed assessment, the CMA has given us an unconditional clearance, with no suggested remedies or actions.
“This is an extremely positive position to be in and recognises both the benefits the proposed merger would bring to patients and the commitment to high quality care shown by the staff of our two organisations.”
Nick Moberly, chief executive of the Royal Surrey County Hospital, who is leaving at the end of the month to become chief executive of King’s College Hospital FT, said: “Today’s announcement… marks an important milestone in our planning and is a very positive step forward.
“Subject to approval by both boards later in the autumn, we will then embark on a wide engagement campaign to ensure people understand what these proposals mean for both patients and staff, and to hear their views.”
CMA report and trust statements
16 September 2015