06.10.16
Foundation groups could be first step to full merger – NHS Improvement
NHS Improvement has published more detailed guidance on how the new foundation groups could be set up, but has said they could be a first step to a merger between trusts.
In August, the first four trusts accredited to lead hospital chains were named as Guy’s and St Thomas’, Northumbria Healthcare, Royal Free London and Salford Royal (pictured) NHS FTs.
The guidance lays out three potential models for foundation groups: corporate joint ventures, contractual joint ventures, and committees in common.
However, NHS Improvement said there were still “limits” to what trusts could achieve as separate bodies, and the models could be used as a framework on the way to “full merger or acquisition”.
For a joint venture, the trusts will form a company or a limited liability partnership (LLP). The advice said trusts would need to consider who would take responsibility for financial, operational and other risks.
Only NHS FTs can form corporate joint ventures because NHS trusts do not have the power to set up or participate in corporate bodies, except for income generation purposes.
Although FTs do not have the power to set up legally binding joint committees, they can delegate to committees in common. The guidance said trusts can place their own directors on the committees and delegate powers to them, as long as they consider conflicts of interest.
NHS Improvement recommended that each trust establishes its own committee. The committees would meet at the same time and with the same remit, but be accountable to their own trusts.
The alternative option, a contractual joint venture, would not involve creating a separate body but would create legally binding rights and responsibilities.
NHS Improvement said that the “co-ordinated, consistent decision-making across multiple organisations” in all three models would require “careful structuring”.
The regulator added that it would scrutinise any potential arrangements to ensure they included sufficient management capacity, were strategically sound and lawful, and would be properly implemented.
But it would not enact formal regulation of joint appointments or the formation of committees in common unless they were part of enforcement proposals. In the case of a contractual or corporate joint venture, it would carry out a transaction review if the group crossed certain thresholds for scale, monetary value and risk.
(Image c. David Dixon)
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