CC makes final decision on hospitals merger

17 Oct 2013 04:20 PM

The Competition Commission (CC) has decided that there is not enough evidence that the proposed merger between The Royal Bournemouth and Christchurch Hospitals NHS Foundation Trust and Poole Hospital NHS Foundation Trust would result in overall benefits for local patients. The CC has therefore decided to prohibit the merger.

In a summary of its final report, the CC has confirmed its provisional finding that the merger would damage patients’ interests by eliminating competition and choice across a wide range of elective specialties, together accounting for about a third of the clinical revenues of each hospital. Since its provisional decision, it has therefore considered whether the merger would provide specific benefits for patients which would outweigh the harm from the loss of competition and choice.

In this context the hospitals said that the merger would allow them: to reconfigure A&E, with one hospital providing a full service and the other a minor injuries unit; to build a new maternity hospital; to set up a ‘hub and spoke’ arrangement for specialised haematology services; and to provide better consultant cover in cardiology at Poole.

The CC looked in detail at these proposals, taking full account of advice from Monitor to the Office of Fair Trading (OFT) and the views of local commissioners. It concluded that there had been insufficient analysis of the reconfiguration of A&E, in particular of the balance between the benefit of concentrating expertise on one site and the harm to patients who lived near the minor unit; that there was significant doubt that the maternity hospital would be built, given the pressure on NHS finances over the next few years; that there was similar doubt about the reconfiguration of haematology, given that it was seen as less important by the hospitals and the commissioner; and that it was not clear that the hospitals had to merge to bring about the proposed changes in cardiology.

Roger Witcomb, Chairman of RBCH/PH Inquiry Group and CC Chairman, said:

‘We’ve been acutely aware of the pressures facing NHS hospitals. However, while the broad aims of the merger are desirable ones, there simply isn’t enough detail in the hospitals’ plans for us to conclude that any of the claimed benefits are likely to materialise.’

‘As recent history in the sector shows, a merger isn’t automatically a good thing for patients and it is our job to examine any proposed merger carefully. The OFT, CC and Monitor will today publish a short document explaining how the three authorities review hospital mergers with the interests of patients as their primary concern, and we expect and hope that this will ensure that the process in future will be much shorter.’

This is the first merger between two NHS foundation trusts to be examined by the CC and it follows the enactment of the Health and Social Care Act 2012, which confirmed the OFT’s and CC’s roles in assessing the competition aspects of mergers involving foundation trusts. Foundation trusts are independent organizations which have a significant degree of autonomy in managing their affairs.

The trusts both provide a wide range of hospital and community-based services to patients in the wider Dorset area. The Royal Bournemouth and Christchurch Hospitals NHS Foundation Trust has 601 beds on two sites. Poole Hospital NHS Foundation Trust has 623 beds, across three sites.

The full final report will be published shortly. All information relating to the inquiry can be found on the inquiry home page.

Notes for editors

1. The CC is an independent public body, which carries out investigations into mergers, markets and the regulated industries.

2. The members of the Inquiry Group are: Roger Witcomb (Chairman of the Group and CC Chairman), John Cubbin, Tony Morris and Peter Jones.

3. The Enterprise Act 2002 empowers the OFT to refer to the CC completed or proposed mergers for investigation and report which create or enhance a 25 per cent share of supply in the UK (or a substantial part thereof) or where the UK turnover associated with the enterprise being acquired is over £70 million.

4. Further information on this inquiry, including the terms of reference and other key documents, as well as on the CC and its procedures, including its policy on the provision of information and the disclosure of evidence, can be obtained from the CC website at: www.competition-commission.org.uk.

5. Enquiries should be directed to Rory Taylor or Siobhan Allen or by ringing 020 7271 0242.