Wessex Health

The voice of health service staff

 

January 2009

Foundation trust failure: who's for the chop?

 

 

 

 

As the original deadline passes, 80-odd trusts are lagging in the race to achieve foundation status

Monitor tightens private patient income rules

 

 

 

Monitor has ruled that income from foundation trusts' joint ventures and associate ventures will count towards their private patient income cap

NHS told to cap spending as more than half of £1.8bn surplus is lost

 

 

The dire state of public finances means the NHS will be permitted to spend less than half the surplus it has generated over the last two years

INDEX

Monitor consulted on how it applied the cap following a legal challenge by Unison

15 December 2008

 

 

Income from foundation trusts' joint ventures and associate ventures will count towards their private patient income cap

Monitor tightens private patient income rules

 

Monitor has ruled that income from foundation trusts' joint ventures and associate ventures will count towards their private patient income cap

 

However, the regulator has also recommended that the government changes the legislation on the cap on the proportion of income foundations can earn from private patients

 

Monitor consulted on how it applied the cap following a legal challenge by Unison

 

A majority of respondents said the current rules should be retained but Monitor said its board accepted a "more restrictive" regime was needed

 

Executive chair Bill Moyes said in a statement:

 

"Having given careful consideration to all the consultation responses, our board recognises the arguments for treating joint venture and associate arrangements in the same way as subsidiaries to the trust and therefore considers that income derived from these should be brought in under the cap"

 

Legislation

In addition to announcing the change in interpretation Monitor has written to the Department of Health about the

 

"real and diverse problems and disincentives [that] arose in connection with this restriction being set by reference to private patient income levels some six years ago"

 

Monitor board minutes in November state:

 

"Whilst the department was not giving a commitment to introduce legislation to amend the private patient income cap, it was giving serious consideration to the issues raised in that letter

 

The department also stated that it keeps the policy under review and would continue to discuss with stakeholders the potential to improve the fitness for purpose of the cap"

 

Foundation Trust Network disappointed

The Foundation Trust Network said it was disappointed with Monitor's decision and called for the government to "review the legal framework" on private income

 

Director Sue Slipman said:

 

"The private patients cap was intended to put limits on foundation trusts to ensure that they remain recognisably public service providers

 

No one disagrees with this objective but the rules that govern it are increasingly inequitable, unworkable and need review

 

The situation is patchy, with different trusts having different levels of private work allowed

 

Mental health is not allowed to do any private work and consequently some of the best service providers in England are barred from supporting the government's own welfare agenda

 

This does not seem sensible and is clearly inequitable

 

This decision will put further pressure on the government's policy of allowing top-up payments for drugs which have not been approved by [the National Institute for Health and Clinical Excellence], as those patients will be considered part of a foundation trust's overall allowance for private work"

 

This decision will put further pressure on the government's policy

 

If they don't hit that deadline, we will look at a range of options, including management franchises, mergers and acquisitions

15 December 2008

 

 

By the end of the year, some 80-odd acute trusts will still not have reached the elevated (Foundation) status

Royal United Hospital Bath are having difficulty making the necessary criteria for Foundation Trust status

Foundation trust failure: who's for the chop?

 

As the original deadline passes, 80-odd trusts are lagging in the race to achieve foundation status

 

Alan Milburn's original 2008 deadline for all trusts to become foundations is fast expiring

 

By the end of the year, some 80-odd acute trusts will still not have reached the elevated status

 

Over the last few months strategic health authorities, at the behest of NHS chief executive David Nicholson, have been analysing which of the remaining trusts they expect will reach the new "final-final" deadline for foundation status of December 2010 - and what their intentions are for those that will not

 

For some SHAs, the implications are so controversial they refuse to talk about their plans

 

"There will be huge ramifications for London

 

Not everyone will meet the 2010 deadline for foundation status"

 

is all a spokesperson for NHS London will say

 

NHS South West declined to comment

 

Others, such as NHS East of England, are prepared to be more candid

 

This SHA has set its own cut-off point of next December for applications to be with the Department of Health - the last approval hoop before they reach foundation trust regulator Monitor

 

"If they don't hit that deadline, we will look at a range of options, including management franchises, mergers and acquisitions

 

We will not tolerate slippage on this"

 

says director of strategy Stephen Dunn

 

"If trusts are not on track over any point next year, we may intervene before December

 

If they cannot become foundations, we will take action"