11. June 2012 16:42
Monitor, the Government’s economic regulator, is intervening to force a specialist hospital to improve its financial performance.
The Royal National Hospital for Rheumatic Diseases in Bath, Avon, is failing to meet the financial criteria for Foundation Trust status due to its specialist nature and limited size.
According to the Care Quality Commission, the quality of patient care at the Trust is not an issue.
The rheumatic diseases hospital has limited opportunities to achieve economies of scale and cannot prevent fluctuations in its income.
Monitor said that the Trust alone cannot meet FT criteria, and so a “long-term strategy” is needed to increase its profitability.
While the strategic option (a merger or takeover) is determined, the Trust is required to develop and deliver a business plan that includes the funding necessary to support it in the interim.
Monitor’s Chief Operating Officer, Stephen Hay, said: “In this case, there is no single cause for the problems, but the relatively small size of the Trust and limited number of specialist services it provides are important factors.
“That is why the Trust is focused on delivering a long-term strategy setting out how these services will be provided in the future.”
The statement follows the recent decision of Torbay and Southern Devon Health and Care Trust, a pioneering provider of integrated care, to merge with an existing or emerging FT rather than seek independent FT status.