The Government wants NHS hospitals to be foundation trusts (or part of one) by April 2014.
Foundation trusts offer a range of benefits, including being accountable to local people through an elected board of governors (made up of staff, patients and other local residents). They also have greater freedom from Government control, including more power to decide how and where to invest money to improve the care they provide to patients.
Foundation trusts were launched in 2004 and are regulated by an organisation called Monitor.
It's not easy to become a foundation trust. You have to meet a significant number of standards to be granted foundation trust status, including proving that you can meet NHS performance standards, and that you have all the necessary systems in place to ensure the organisation is well managed.
You must also be able to prove that you are financially sustainable, i.e. that you will be able to balance your books in the future, which involves predicting the demand for the services you provide in years to come.
At its meeting on 10 December 2010, our Trust Board agreed that we were unable to become a foundation trust in our current form. As such, it was agreed that we would need to explore alternative options.
In making the decision, the Trust Board was very clear that it was in no way based on our performance as an organisation over the last few years and the work staff have done to improve the care we provide to patients.
In reality, it is based on detailed financial modelling which shows that it is not feasible for us to become a foundation trust in our own right when you forecast the income we can expect to receive from our primary care trusts in the future (and, after them (subject to legislation), local GP consortia).
As with many other hospitals across the country, we are facing significant financial challenges linked to reduced income and the increased move of patient care from hospital settings into the community.
Moreover, there are many other hospitals and hospital trusts in the country that are unable to become foundation trusts in their own right.
As a result of the Trust Board's decision, a special Transaction Board was set up in January 2011 to explore and, once approved, implement alternative options for our hospitals to gain foundation trust status.
Led by an independent chair, Jan Sawkins, the Transaction Board includes a range of representatives for different organisations, including our own Trust, as well as NHS London, NHS South England, NHS Surrey and NHS South West London. It also includes GPs from Sutton, Merton and Surrey.
The Transaction Board has been set up, and will operate, under guidelines outlined in NHS London's 'Approach to Transactions' (February 2010).
The Transaction Board is supported by a project team, as well as a number of specialist groups who offer advice and support. This includes a panel of doctors, nurses and other clinical staff from inside and outside of our hospitals (known as a clinical reference group (CRG)) who offer expert advice from a medical and nursing perspective.
There is also a panel of people who represent the local community, including councillors, voluntary groups and patients. This is called the local representatives' panel (LRP). The notes of LRP meetings are available to download (see below).
In January 2011, the Transaction Board identified a range of options for the future of Epsom, Sutton and St Helier hospitals, including de-merging the hospitals and re-merging them with others.
In April 2011, the Transaction Board formally invited organisations who might be interested in partnering with our hospitals to come forward (this is known as the pre-qualification questionnaire (PQQ) stage)).
Importantly, only NHS organisations were asked to apply. This followed a decision by the Transaction Board that it would not be accepting expressions of interest from non-NHS organisations. However, under the rules, non-NHS organisations (as well as other NHS bodies) could partner with them (as long as they led the 'bid').
The PQQ stage closed in May 2011 and, in June 2011, the Transaction Board announced the names of the organisations that had formally shown an interest in merging with our hospitals. They were:
Interested in merging with Epsom Hospital (including the Elective Orthopaedic Centre (EOC)):
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Ashford and St Peter's Hospitals NHS Foundation Trust*;
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Royal Surrey County Hospital NHS Foundation Trust
(withdrew from the bidding process in October 2011, see below for details).
Interested in merging with St Helier Hospital (including Sutton Hospital):
* Ashford and St Peter's 'bid' is in partnership with The Royal Marsden NHS Foundation Trust, Surrey and Sussex Healthcare NHS Trust and Central Surrey Health. However, Ashford and St Peter's will formally lead the 'bid'.
In July 2011, all three organisations were formally invited to 'tender' to merge with their selected hospital.
However, on 4 October 2011, we were informed by Royal Surrey that were no longer planning to bid to merge with Epsom and were withdrawing from the process. Royal Surrey's reasons for doing this were linked to their other strategic priorities and they were very clear that it is no reflection on Epsom Hospital, our staff or the services we provide.
Announcement of bids
On 14 November 2011, the Transaction Board announced that Ashford and St Peter's Hospitals NHS Foundation Trust had formally bid to merge with Epsom Hospital, whilst St George's Healthcare NHS Trust bid to merge with St Helier (and Sutton) hospitals.
On 23 January 2012, the Transaction Board issued an update about the assessment of the bids, including that both Ashford and St Peter's and St George's had passed the first phase of the review process.
On 27 January 2012, St George's informed the Transaction Board that they were withdrawing their bid to merge with St Helier and Sutton hospitals.
You can read their key reasons for the decision below:
Next steps for Epsom Hospital
The Transaction Board has agreed that, subject to Ashford and St Peter's being confirmed as the preferred partner for Epsom (this is due to be announced in June), the de-merger should continue whilst we make alternative arrangements for St Helier and Sutton. There are many reasons for this, including it being considered in the best interest of Epsom Hospital, its patients, staff and local people.
Next steps for St Helier and Sutton hospitals
The Trust is exploring alternative options for the future of St Helier and Sutton hospitals and expects to be able to announce further details in July 2012. This work involves clinicians from across the Trust, as well as local GPs, clinical commissioning groups (CCGs), local authorities, patient groups, MPs and other NHS partners.
Key dates for the project are:
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April 2011 - issued notice inviting organisations who might be interested in partnering with our hospitals to let us know (also known as the pre-qualification questionnaire (PQQ));
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July 2011 - identified preferred bidders and invited formal tenders;
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November 2011 - deadline for tenders;
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December 2011 to February 2012 - evaluate the tenders and make final recommendations;
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February 2012 to May 2012 - recommendation/s go to the Trust Board, Transaction Board, Ashford and St Peter's, NHS South England and NHS London;
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June 2012 - announce preferred partner for Epsom Hospital;
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June to October 2012 - development of plans to 'merge' Epsom and the preferred bidder (known as the 'full business case (FBC)');
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July 2012 - announce emerging options for the future of St Helier and Sutton hospitals;
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November 2012 - business case goes to NHS London and NHS South England;
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December 2012 - business case goes to Department of Health;
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February 2013 - proposals received by Secretary of State for Health;
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1 April 2013 - de-merger and establishment of new organisations.
The Transaction Board recognise the importance of patients, local people and staff being involved in helping to shape their final recommendation and have developed a detailed plan to communicate and engage with them.
As part of this, we have hosted a number of public meetings to keep patients and local people up-to-date and the answer their questions. Feedback from these events can be downloaded from this page, where videos and presentations are also available.
We will be organising further events and details will be publicised on our website and in the local media.
The Transaction Board was also keen to ensure that patient and public representatives, as well as Trust staff, were able to help shape the criteria used to select the final partners, and the emphasis we place on different aspects of them (known as the 'weighting').
As such, a number of events took place in June 2011 and early July 2011 for them to evaluate and determine the weighting of the criteria used to judge the tenders. The results were published in August 2011, with the ten criteria being prioritised as follows (with number one by most important):
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The new partner must deliver better outcomes and benefits for patients;
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They must provide better care for local residents;
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They must improve the way local health services work together (also known as integrated care);
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They must have plans in place for uniting the combined workforce, including managing, supporting and developing staff;
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The partner must be ready to merge, minimising uncertainty for both patients and staff;
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They must prove they are good at governing and leading their organisation;
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They must improve the efficiency and quality of services, delivering savings which can be reinvested;
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They must make the merger as simple as possible;
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They must provide good value to the taxpayer;
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They must merge within the agreed timetable for the project.
A concern that people are likely to raise is the impact that not going for foundation trust status in our own right might have on our plans to spend millions of pounds redeveloping both Epsom and St Helier hospitals.
As such, our Board has made it very clear that, whatever happens, it is still fully committed to both schemes. The projects have also received significant backing from the public, as well as politicians and other key stakeholders.
St Helier Hospital redevelopment
For St Helier, this means spending £219 million on building a brand new hospital wing (costing £127 million) and investing millions of pounds upgrading the remainder of the site. The outline business case for this project was approved in March 2010 and it continues to timeline. It also forms part of the Government's approved Comprehensive Spending Review.
Epsom Hospital redevelopment
With regard to Epsom, we have developed draft plans (also known as a strategic outline case (SOC)) to spend up to £70 million redeveloping the site.
Our Board agreed the SOC in late 2009 and it was sent to NHS London for approval prior to work starting on an outline business case. Our strategic health authority, NHS London, reviewed the SOC, but recognising that a large proportion of the income would come from NHS organisations in Surrey, they asked NHS South East Coast (the strategic health authority for Surrey) to approve it too.
However, it was at this time that it became apparent that we might not be able to become a foundation trust in our current form and, hence, approval by NHS South East Coast was delayed.
Discussing how the SOC might move forward, the two strategic health authorities have agreed that approval of it at this current time would be inappropriate and that it should be put on hold until the future stewardship of Epsom is clear. This will allow the new organisation in charge of the site to review the SOC and to ensure it matches their plans and aspirations for developing the site.
It's important to understand that the role of the Transaction Board is to find (and implement) alternative options for our hospitals to become foundation trusts. It is not about shutting services or moving them to other hospitals.
Importantly, the organisations bidding to take over Epsom or St Helier will be required to run all of the services currently provided at that hospital, including accident and emergency (A&E) and maternity. As such, there will be close scrutiny of the bidders' plans to maintain, improve and enhance services.
Furthermore, the services that are run at Epsom, Sutton and St Helier hospitals are guided by our local primary care trusts (NHS Surrey and NHS Sutton and Merton) and, in future, GPs and GP consortia (known as clinical commissioning groups). This is not something the Transaction Board will decide.
To keep up-to-date with this scheme please visit this page regularly.
Alternatively, you can:
In addition, we welcome requests for members of the foundation trust project team to attend meetings of local community groups and other stakeholders to talk about the project and to take questions.
To do this, please contact Antony Tiernan on 020 8296 2406 or email chairft@esth.nhs.uk.
