Press release

CMA clears Foundation Trust hospitals merger

The CMA today cleared the proposed takeover of Heatherwood and Wexham Park Hospitals NHS Foundation Trust by Frimley Park Hospital NHS Foundation Trust.

Stethoscope

Frimley Park Hospital NHS Foundation Trust (Frimley Park) and Heatherwood and Wexham Park Hospitals NHS Foundation Trust (Heatherwood and Wexham) provide a wide range of NHS services to patients in Hampshire, Surrey, and Berkshire.

The ability of patients and commissioning bodies to choose between hospitals gives healthcare providers strong incentives to improve quality and efficiency of their services for the benefit of patients. The CMA analysed the merger on the basis of its impact on competition to attract patients for both inpatient and outpatient services, and to provide both elective (where the patient does not require immediate medical care) and emergency services for commissioning bodies.

It carefully examined evidence provided by the hospitals and a number of third parties, including Monitor, Clinical Commissioning Groups (CCGs), NHS England Specialised Commissioning Teams, other NHS hospitals, the Care Quality Commission, patients and patient groups, and local representatives. The majority of third parties supported the merger. Monitor told the CMA that in its view the merger represents the best available solution to improve patient services at Heatherwood and Wexham.

The CMA’s investigation looked at whether the merger is in the overall interest of patients and found that the merger will not lead to a material reduction in competition between hospitals in the area or loss of choice for patients, CCGs, or NHS England. It noted that there are a number of other strongly-performing NHS hospitals located nearby which offer similar services, including Royal Berkshire Hospital NHS Foundation Trust, Ashford and St. Peter’s Hospitals NHS Foundation Trust, Royal Surrey County Hospital, and the Royal Buckinghamshire Hospital.

In summary, the CMA does not believe that the merger will lead to a material reduction in the quality of services for patients (including clinical factors such as outcomes, infection rates and mortality rates and non-clinical factors such as waiting times and patient experience) and will not materially reduce the hospitals’ incentives to innovate and improve their services.

Nelson Jung, CMA Director of Mergers, said:

We are confident that this merger will not substantially weaken competition so as to reduce the quality or range of healthcare services provided to patients in the area. Our constructive discussions with the hospitals prior to their formal notification of the proposal, along with the close cooperation between the CMA and Monitor, has enabled us to complete this investigation swiftly.

Notes for editors

  1. The CMA’s role is to examine the impact that the merger could have on patient choice and the quality of healthcare services provided. The CMA undertakes an objective and evidence-based assessment of the effects of NHS mergers on competition and aims primarily to ensure that such mergers do not result in lower levels of quality of healthcare services for patients.
  2. Frimley Park has 725 beds on one site in Frimley, and runs outpatient and diagnostic services in Aldershot, Farnham, Fleet and Bracknell. Heatherwood & Wexham has 610 beds on two sites in Ascot and in Slough, as well as other outpatient and diagnostic services on four sites in Windsor, Maidenhead, Bracknell, and Chalfont St Peter. The Trusts both provide a wide range of hospital-based services as well as diagnostic and outpatient clinics.
  3. This is the fourth merger between NHS foundations trusts in the healthcare sector examined by the CMA or its predecessors, the Office of Fair Trading (OFT) and the Competition Commission (CC), since the enactment of the Health and Social Care Act 2012 (HSCA), which confirmed their role in assessing the competition aspects of mergers involving foundation trusts, and is the third to be given clearance to proceed.
  4. Under the Enterprise Act 2002 a relevant merger situation is or will be created if two or more enterprises have ceased or will cease to be distinct enterprises; and the value of the turnover in the United Kingdom of the enterprise being taken over exceeds £70 million; or as a result of the transaction, in relation to the supply of goods or services of any description, a 25 per cent share of supply in the United Kingdom (or a substantial part of it) is created or enhanced.
  5. The CMA notified Monitor when it decided to carry out an investigation under the UK merger control rules, pursuant to section 79 of the Health and Social Care Act 2012, which applies to mergers involving NHS foundation trusts. Monitor provided the OFT with its advice on the effect of the merger under investigation and this will be published on the Mergers case page as soon as is reasonably practicable. More information on Monitor’s other regulatory functions and role can be found on their website.
  6. The full text of this decision will be placed on the Mergers case page as soon as is reasonably practicable.
  7. The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. From 1 April 2014 it took over the functions of the CC and the competition and certain consumer functions of the OFT, as amended by the Enterprise and Regulatory Reform Act 2013.

Photo above by Tyler on Flikr. Used under Creative Commons, photo resized.

Published 14 May 2014