The health economy in South London has been failing for some time, the merger to form South London Healthcare (SLHT) made things worse not better.   Around £1m a week was being put into subsidising SLHT, money which could be better spent elsewhere.  So an experienced NHS manager is put into the role of Trust Special Administrator (TSA).  The analysis confirms the depth of the problems – poor management, no real benefits gained from the merger, low productivity and high overheads in part due to PFI schemes.

The solution – break up the trust, improve efficiency through better management, transfer the assets (and staff) to other better performing NHS bodies, subsidise the excess costs of PFI , give interim support during transition.

But there is a problem.  Whilst two trusts earmarked to get parts of the break-up of SLHT were already Foundation Trusts (FTs) the other, Lewisham (LHT), was not. Transferring a “loss making” hospital to LHT would create a major strain; with the risk that an expanded LHT would itself fail further down the track.  So, could LHT just be left to reconfigure to get the necessary financial savings by (in part) using traditional routes to reconfiguration, taking 2 to 3 years and facing major opposition?

The TSA confronted this issue by ensuring that reconfiguration by LHT would have to take place, by spelling it out in terms of “recommendations”.  This also meant that LHT could avoid the lengthy formal processes for reconfiguration.  However, a Judge has ruled that making recommendations in respect of LHT is beyond the powers of the TSA.

In fact the TSA could have phrased his report to suggest or imply what changes would be needed and what would be expected from LHT in return for support and major expansion, but without making formal recommendations.  Since LHT are effectively managed through the Trust Development Authority they could have been bullied into compliance.

But the deal for Lewisham is on hold because of the Judicial Review decision.  The key issue is so fundamental that the DH have to appeal.  No trust really exists in isolation and any major change in one trust will impact on a number of others – so limiting the scope of the NHS failure regime to a single trust will not work.  The DH will have to win on appeal or else bring in new legislation (unless they can do it via Regulations).

On to Stafford

Meanwhile a different TSA approach is underway in Stafford.  It is clear that current high levels of clinical performance at Stafford have been achieved through comprehensive financial support, which is not sustainable. The trust is not “sustainable”.  Some services at Stafford are operating at levels of activity some consider too low.  The commissioners have said they only support continuing with a limited range of services from Stafford. Not promising.

So we have new TSA through the gang of three who have now (to no surprise) proposed downgrading the hospital, even if they have actually proposed more services than the commissioners support (I see a Judicial Review in the offing).  To say their proposals are unpopular is an understatement.

The proposals cannot be properly evaluated as there is not enough detail provided.  There is no time scales although it is obvious transition will take several years; and a lot might happen in that period!  There is no plan just a suggestion that if progress is made at Stafford, if capital investment is approved for new facilities in Stoke and if there is a following wind then University Hospital of North Staffs can have StaffordHospital transferred to them – nobody appear to know what happens to the staff involved.

It’s a pig’s breakfast of a solution and does nothing to end what is almost a decade of uncertainty around Stafford.

Tens of millions of £s have been spent on external consultancy in Stafford and implementing the proposals will rack up £ms more, to the usual suspects.  This is annoying as throughout they have done nothing of any great value.  The methodology of comparing costs with “average” costs at other settings and projecting patient flows based on questionable trends and a vague “commissioning strategy” is not very robust.  The failure to look at more imaginative solutions and the absence of any whole system analysis is no doubt due to limitations placed on the TSA role, but it makes analysis superficial.

As with Lewisham the solution depends on transferring a “failing” hospital to a trust which is not a FT and is itself in danger of failing.  So again the solution has to be founded on a reconfiguration which is hugely unpopular but which can be implemented by the TSA powers rather than going through the proper process (I see a Judicial Review).

What this should tell us is that the whole approach is bonkers.

The approach to “failing” trusts and indeed to “reconfiguration” is based on the assumption trusts can be treated as if they were independent business within some kind of market.  What both the above have shown is that whilst trusts may have some autonomy and some freedoms they are still intrinsically linked to other NHS bodies around them.  The market idea that “failure” allows a bad provider to exit and be replaced by a “good” provider is simply nonsense when applied to an acute trust.

Whilst we have this notion of competition, markets and failure and the need for trusts to be sustainable in this totally artificial microcosm then it is no surprise that attempts at reconfiguration of any kind are resisted; why should we buy into such an absurd process.  So we all campaign against closures and cut backs wrapped up as something of alleged benefit.

Until we drop the whole idea of competition and markets and of trusts as competing separate individual business units then we should oppose the service cuts and closures however they are dressed up.  We should only consider supporting reconfiguration (of either a whole trust or just some services) when it is clearly demonstrated to those who will be impacted that overall the change is in the best interests of the NHS as a whole and local communities.

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  1. Jos Bell says:

    It should be noted here that the merger of the Lewisham Healthcare NHS Trust and QEH Woolwich FT is proceeding within the next couple of weeks, NO MATTER WHAT THE LEGAL OUTCOME. This move is supported by the Save Lewisham Hospital Campaign, by Lewisham Council and by Lewisham Hospital itself – which indeed made this offer to the DH prior to any shenanigans with 5A 2009 of the 2006 Health Act ie the TSA model. The two combined hospitals can thence become the mandatory FT under the newly named Lewisham and Greenwich Hospitals Trust. Where in that equation is it necessary to order the dismantle of 60% of the Lewisham Hospital site by (at the time of writing) breaking the legislation to grab at assets which were outside the legal remit of the TSA – all at excessive cost deficiency and no clinical benefit?

    Reference to the July High Court proceedings will show that the HT/FT argument was explored in detail – but in the end seemed to be immaterial to the legislation that the govt chose to adopt and ‘adapt’. The premise of their Appeal will be studied with interest.

    1. Ricahrd B says:

      The transfer of QEH to LHT was expilicitly ruled within the vires of the TSA and so the appeal is as Jos says irrelevant to that transaction. It is however very dangerous – unless the terms of the transfer (which I haven’t seen and probably nobody else has) give some guarantees about transitional funding and support for the PFI. Such an acquisition might actually make it more likely that the new organisation is unsustainable.

      “The two combined hospitals can thence become the mandatory FT” – in theory maybe but only if the new organisation can meet the requirements set by Monitor – dont see that happending any time soon. Any new L&GHT would be under direction of TDA which is driving all sorts of interesting things elsewhere. The saga is only just warming up.

      QEH is not an FT – it was part of SLHT was which not an FT.

      1. Jos Bell says:

        Of course, yes, the two combined hospitals brand new trust will have to meet Monitor’s criteria, but they would never be able to do so separately. The merger offer was Lewisham’s all along.

        The key point is that the transfer of QEH to LHT would have been possible without recourse to the TSA and Hunt attacking Lewisham ( with impunity ) at the same time. The Woolwich PFI has been addressed within the terms of the merger, with a large slice to be paid off as well as an additional subsidy allocation towards the remainder, so this would not be a flatline fund situation. Of course it would have been better if the PFI, worked up under Major and then unfortunately signed off by Labour in early ’98 would have been much more carefuly designed in the first place!

        This will also enable the mismangement problems at QEH to be addressed.

        However, at the same time, Greenwich Council sees fit to do this – sadly so separatist that they don’t understand the fact that their already desperately overstretched hospital will implode without the retention of Lewisham.

        Had the govt taken time to bring the two parties together ( as Lewisham would wish) and enable the local bodies to produce a workable solution in line with local knowledge, instead of driving a wedge with threats and by playing with the law, the past year would have been very different indeed.

        Change is not so much the issue – the manner of implementing change and those proposed changes being chaotically at odds with the Picture of Health findings is. Whyever did they think this ‘Syrian’ approach was a good idea?!! I imagine they now realise it was not.

        1. Richard B says:

          Absolutely, very well put.

          The management at Lewisham have got a desparately difficult job to do and they will probably not be free to do it. Depressing.

          And we have nasty goings on elsewhere – where there are not the well organised and motivated activists that Lewisham has got.

          1. Jos Bell says:

            Indeed. Sadly considerably more issues to address

  2. The problem with the NHS is underfunding.

    Uk Health system is the most Efficient Link:

    The splitting up of the NHS into Trusts is a deliberate policy that sets trust against trust to enable them to be privatised and has nothing to do with delivery of care, hospitals and health care are not shops or factories supplying goods, the NHS is an institution which was set up to provide a service the private sector was unable to do hence, the birth of the NHS in 1948.

    What the NHS needs is funding, ask yourself where did this government get the money to go to war in Syria? Why can they find that money so readily and yet tell us we can’t fund the NHS? The truth is people have been programmed to accept the government always acts in our interest, when the reality is they don’t.

  3. Shibley says:

    very interesting. thanks Jos, Mervyn and Richard.

  4. Martin Rathfelder says:

    Markets can drive up quality, but the fundamental mechanism by which they do so is by driving poor providers out of business. The failure to establish a credible failure regime calls into question the market regime which the NHS has been working on since 1990.

  5. Martin: Markets sell things, where do you buy cancer?

    Underfunding causes failure to deliver care, when are you going to address that issue.

    We fund wars at the drop of a hat, wouldn’t it be more productive to spend that on health. Swords turned into ploughshears ring a bell.

  6. Val Hudson says:

    Where is there an example of markets driving up quality in healthcare and who has defined that quality? Where has a market driven up quality in a long term condition?

  7. Martin Rathfelder says:

    I’m not suggesting that markets have driven up quality of healthcare – though its possible there are examples. I’m suggesting that the nature of healthcare makes it very difficult to see how competition, at least in the commercial sense, can operate to drive up quality. In health quality is generally invisible. Price is very visible.

  8. Brian Fisher says:

    Well, Martin, you did say that “Markets can drive up quality” and there is no reasonable evidence that they have done in the UK or US. As I understand it, the high quality of the French and German health services are not the result of competition, but mainly the result of generous govt funding.

  9. Martin Rathfelder says:

    I wasn’t meaning in healthcare. It’s very clear that competition can drive up quality in other areas – in particular where the consumers are able to discern quality. But in healthcare the evidence of beneficial commercial competition is very thin. It does seem clear however that doctors are competitive and what might be described as clinical competition could be beneficial.

    1. Jos Bell says:

      clinical co-operation where the patient is the focus is much more preferable…

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