News story

NHS mergers: putting patients' needs at the heart of plans to change healthcare

NHS providers considering a merger are urged to contact Monitor early in their planning to ensure proposals work well for patients.

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Monitor will then provide expert support at an early stage to help NHS foundation trusts understand whether a particular merger is the best way forward and makes sense from quality, operational, financial and (where relevant) choice and competition perspectives.

This new approach applies to joint ventures and major investments as well as mergers and acquisitions, and is set out in a suite of resources on transactions, merger benefits and a competition review of NHS mergers published today.

The package includes guidance on how Monitor will advise on patient benefits should a transaction need to be reviewed by the Competition and Markets Authority (CMA) and also on Monitor’s risk assessment.

The approach builds on the informal advice already offered to providers by Monitor, and fulfils a commitment made to the sector by Dr David Bennett, chief executive of Monitor, in January 2014.

Dr Bennett said:

In the current challenging financial climate, mergers and other transactions can help providers deliver quality care on a sustainable basis. However, they can also introduce significant risks for providers and their patients.

Some providers are anxious that the competition rules will obstruct them in their efforts to improve patient care, for example by preventing necessary reconfiguration or integration of services. This should never be the case.

Our aim is that NHS mergers will only be advanced when it is clear they are likely to have a positive overall effect for patients.

This would mean they would comply with the competition rules, and if they are reviewed by the CMA, the process should be quicker and more straightforward.

Monitor and the CMA recently published a joint guide for NHS managers on the competition review of NHS mergers.

Matt Tee, Chief Operating Officer of the NHS Confederation, which represents NHS organisations, said:

The NHS Confederation appreciates the efforts that Monitor is making in producing clear guidance on merger controls and related regulatory frameworks, and providing more support for NHS organisations which contemplate mergers, as in the best interest of the communities they serve. It is an issue we hear regularly from our members and the point we often hear is the need for greater clarity.

We would recommend that our members get involved in Monitor’s work and take up Monitor’s offer to support them early in the process, as they consider whether to go down the merger route. Mergers are not always the answer, but where our members think they are it is good they have guidance and support to help them think the process through.

Monitor needs to ensure it continues to work with the system to ensure the rules do not become their enemy and they remain open to refining their approach as they develop.

Read Monitor’s resources on transactions, merger benefits and a competition review of NHS mergers.

Listen to Monitor’s podcast Supporting NHS providers considering transactions and mergers to hear Director of Provider Appraisal Miranda Carter and Executive Director of Co-operation and Competition Catherine Davies talk about the guidance.

Published 4 August 2014