Agenda item

Susan Acott (Chief Executive, Dartford and Gravesham NHS Trust) and Mark Devlin (Chief Executive, Medway NHS Foundation Trust), and Dr John Allingham (Medical Secretary, Kent Local Medical Committee) were in attendance for this item.

(1)       The Chairman welcomed the two Chief Executives to the Committee along with the opportunity to consider once again the development of the proposed merger between the two Trusts. He observed that the current HOSC Agenda was probably the largest on record and although the value of short, focused, report was both his and the Committee’s preference, there was a solid justification for the detail provided for this and other items on today’s Agenda.

(2)       One of the papers provided to the Committee was the Outline Business Case for the integration of the two Trusts. This was the starting point for the short introduction provided by Mr Devlin. He explained that this was a live document which would be continually updated. It would shortly be presented to the Strategic Health Authority, NHS South of England, and would go to their next board meeting. It was also explained that the proposals were also currently being considered by the Co-operation and Competition Panel (CCP) and while stage 1 would be completed during April, they could require a stage 2. The CCP gave advice to Monitor and the Department of Health. The timetable for any merger to take place had been put back to 1 April 2013 and so the public engagement phase was still ongoing as it had been extended.

(3)       The exact process for approval of the merger differed for each Trust, but ultimately the Boards of both Trusts would need to approve the merger. This final decision would be made after a series of approved steps, most likely in December 2012 or January 2013. Being an NHS Trust, Dartford and Gravesham NHS Trust needed the go ahead from the Department of Health (DH). The work on this would be carried out by the DH Transaction Board, which would seek the view of NHS South of England. Being a Foundation Trust, Medway NHS Foundation Trust needed to seek the views of Monitor, the Foundation Trust regulator.

(4)       One of the important financial aspects which were being closely considered as part of the merger discussions was the Private Finance Initiative (PFI) arrangement at Darent Valley Hospital. Nationally, 22 Trusts had been identified for whom a PFI arrangement was a significant issue. These Trusts were put into 3 categories – ones which needed to do more, ones for whom some recommendations could be made, and others which had done as much as they were able on their own in terms of efficiency savings and so on. Dartford and Gravesham NHS Trust, along with 6 others around the country, was in this third group. This meant that, subject to meeting 4 tests, it could access additional monetary support which had been put aside by the Department of Health. The details of this scheme were as yet unclear, including the timescales around any money becoming available. In response to a question as to whether 1/7^th of the money would be adequate, the point was made by the Trust representative that while in absolute terms the PFI was small, as a percentage of the turnover, it was large.

(5)       Members raised a number of points about the lessons which could be learned from other mergers. Reference was made to the merger resulting in the formation of Maidstone and Tunbridge Wells NHS Trust, the results of which were still unfolding, as well as recent analyses of mergers carried out by the King’s Fund and Centre for Market and Public Organisation (CMPO) at the University of Bristol, the latter having cast doubt on whether mergers lead to cost savings. Representatives from both Trusts explained that past mergers had been looked at very closely in order to ensure a smooth transition. In response to the CMPO report, it was explained that these were mergers occurring between 1997 and 2003 and was a top down process often involving failing hospitals. The current proposals for merger arose from the two Trusts making their own decision, and neither Trust was failing. It was reported that the two Trusts had compatible clinical cultures and this provided something solid to build on. Both Trusts also served a series of natural communities and so would hopefully not seem remote and impersonal. Talks were underway with other NHS organisations to make sure the whole North Kent health economy was aligned to ensure there was a successful implementation.

(6)       It was also stressed that the implementation would not be carried out in a big bang. The focus was on a series of milestones – what needed to be in place on day 1, by month 6, month 12 and so on. The intention was to avoid any dip in performance. One Member posed the question as to how a successful merger would be measured and requested 5 key performance indicators which would enable this to happen. Both Chief Executives responded positively to the challenge of producing said indicators and undertook to consider and write back to the Committee.

(7)       There were a series of specific issues raised around the detail of transition. On car parking, which both Trusts acknowledged as a key issue, the situation at Darent Valley was complicated by the PFI which meant the Trust did not own the car park. However, permission to expand had been agreed and the first phase in front of the accident and emergency department had been implemented. Medway was also looking to increase the space available for car parking. More broadly on transportation, there were discussions underway with bus companies and local authorities on this. The Trusts also hoped that having full outpatient clinics at both sites would reduce travelling.

(8)       Information systems were another area of discussion. It was explained that systems were needed for both administration and clinical/patient management tasks. The patient administration system at Medway was in need of replacing within the next 18 months, so this was a good time to procure a compatible system across both sites. In response to a specific question on the appointment system, it was explained that the Trusts would not consider outsourcing this, but would perhaps introduce an internal call centre approach. They took on board the views of Members that any appointment system required flexibility to accommodate clinical need and the views of clinicians who understand their patients’ needs.

(9)       RESOLVED that the Committee thank Susan Acott and Mark Devlin for their continued engagement with the Committee and that the Committee would welcome working together with the Trusts on 5 key performance indicators for a successful transition.