STRUCTURE: The proposed takeover of a trust that has pioneered the integration of health and social care by an acute foundation trust has been approved, despite the acquisition’s business case receiving a “low” score.

South Devon Healthcare Foundation Trust was the only organisation that bid to become a merger partner for Torbay and Southern Devon Health and Care Trust after the latter last year decided it would not be able to achieve foundation trust status alone.

A paper to the NHS Trust Development Authority’s board meeting last Thursday said the business case “did not fully maximise the benefits of integration for patients”. It had also failed to demonstrate that the benefits could “solely be derived from an integrated organisation” rather than more effective co-working, the paper said.

However, in recommending that the board approved the acquisition, the paper highlighted the potential benefits to patients of more integrated care, the forecast financial savings and the fact the bid had the support of the care trust’s board as well as Torbay Council.

Torbay Care Trust provides and commissions social care under an agreement with the council. The paper said the council would be “reluctant” to allow an independent provider to carry out this role, potentially leading to the separation of the community and social care teams if the merger did not go ahead.

In addition, the paper said if services were to be taken over by an independent provider this could lead to the “variable sustainability” of some of South Devon’s acute services due to their interdependency with some of the care trust’s services.

The trusts, which have a combined turnover of £330m, already share back office functions including IT, human resources and estates. If a single integrated care organisation is established its 5,800 staff would serve a population of 675,000.

Following approval by the TDA last week, the next step will be the agreement of a business transfer agreement and the development of the case for change for submission to Monitor and the Office of Fair Trading. The OFT will assess the impact on competition while Monitor will assess the implications for South Devon. Both reviews are expected to take up to six months.

The paper said the “creation of a vertically integrated health and social care organisation” would be “a unique evaluation challenge for both Monitor and the OFT”.