CMA clears Foundation Trust hospitals merger
14 May 2014 03:47 PM
The CMA today cleared
the proposed takeover of Heatherwood and Wexham Hospitals NHS Foundation Trust
by Frimley Park Hospital NHS Foundation Trust.
Frimley Park Hospital NHS
Foundation Trust (Frimley Park) and Heatherwood and Wexham Hospitals NHS
Foundation Trust (Heatherwood and Wexham) provide a wide range of NHS services
to patients in Hampshire, Surrey, and Berkshire.
The ability of patients and
commissioning bodies to choose between hospitals gives healthcare providers
strong incentives to improve quality and efficiency of their services for the
benefit of patients. The CMA analysed the merger on the basis of its impact on
competition to attract patients for both inpatient and outpatient services, and
to provide both elective (where the patient does not require immediate medical
care) and emergency services for commissioning bodies.
It carefully examined evidence
provided by the hospitals and a number of third parties, including Monitor,
Clinical Commissioning Groups (CCGs), NHS England Specialised Commissioning
Teams, other NHS hospitals, the Care Quality Commission, patients and patient
groups, and local representatives. The majority of third parties supported the
merger. Monitor told the CMA that in its view the merger represents the best
available solution to improve patient services at Heatherwood and
Wexham.
The CMA’s investigation
looked at whether the merger is in the overall interest of patients and found
that the merger will not lead to a material reduction in competition between
hospitals in the area or loss of choice for patients, CCGs, or NHS England. It
noted that there are a number of other strongly-performing NHS hospitals
located nearby which offer similar services, including Royal Berkshire Hospital
NHS Foundation Trust, Ashford and St. Peter’s Hospitals NHS Foundation
Trust, Royal Surrey County Hospital, and the Royal Buckinghamshire
Hospital.
In summary, the CMA does not
believe that the merger will lead to a material reduction in the quality of
services for patients (including clinical factors such as outcomes, infection
rates and mortality rates and non-clinical factors such as waiting times and
patient experience) and will not materially reduce the hospitals’
incentives to innovate and improve their services.
Nelson Jung, CMA Director of
Mergers, said:
We are confident that this
merger will not substantially weaken competition so as to reduce the quality or
range of healthcare services provided to patients in the area. Our constructive
discussions with the hospitals prior to their formal notification of the
proposal, along with the close cooperation between the CMA and Monitor, has
enabled us to complete this investigation swiftly.
Notes for
editors
- The CMA’s role is to
examine the impact that the merger could have on patient choice and the quality
of healthcare services provided. The CMA undertakes an objective and
evidence-based assessment of the effects of NHS mergers on competition and aims
primarily to ensure that such mergers do not result in lower levels of quality
of healthcare services for patients.
- Frimley Park has 725 beds on one
site in Frimley, and runs outpatient and diagnostic services in Aldershot,
Farnham, Fleet and Bracknell. Heatherwood & Wexham has 610 beds on two
sites in Ascot and in Slough, as well as other outpatient and diagnostic
services on four sites in Windsor, Maidenhead, Bracknell, and Chalfont St
Peter. The Trusts both provide a wide range of hospital-based services as well
as diagnostic and outpatient clinics.
- This is the fourth merger
between NHS foundations trusts in the healthcare sector examined by the CMA or
its predecessors, the Office of Fair Trading (OFT) and the Competition
Commission (CC), since the enactment of the Health and Social Care Act 2012
(HSCA), which confirmed their role in assessing the competition aspects of
mergers involving foundation trusts, and is the third to be given clearance to
proceed.
- Under the Enterprise Act 2002 a
relevant merger situation is or will be created if two or more enterprises have
ceased or will cease to be distinct enterprises; and the value of the turnover
in the United Kingdom of the enterprise being taken over exceeds £70
million; or as a result of the transaction, in relation to the supply of goods
or services of any description, a 25 per cent share of supply in the United
Kingdom (or a substantial part of it) is created or enhanced.
- The CMA notified Monitor when it
decided to carry out an investigation under the UK merger control rules,
pursuant to section 79 of the Health and Social Care Act 2012, which applies to
mergers involving NHS foundation trusts. Monitor provided the OFT with its
advice on the effect of the merger under investigation and this will be
published on theMergers case
page as soon as is reasonably practicable. More information on
Monitor’s other regulatory functions and role can be found on
their website.
- The full text of this decision
will be placed on the Mergers case
page as soon as is reasonably practicable.
- The CMA is the UK’s
primary competition and consumer authority. It is an independent
non-ministerial government department with responsibility for carrying out
investigations into mergers, markets and the regulated industries and enforcing
competition and consumer law. From 1 April 2014 it took over the functions of
the CC and the competition and certain consumer functions of the OFT, as
amended by the Enterprise and Regulatory Reform Act 2013.