Earlier this summer I wrote about the proposed merger of Chelsea & Westminster Hospital Foundation Trust with West Middlesex NHS Trust. Since then Chelsea & Westminster (C&W) have given evidence to the Health, Adult Social Care and Social Inclusion Policy and Accountability Committee. At that meeting we heard senior clinicians and hospital directors strongly argue for the clinical rational behind the proposed merger. This aspect of the merger was heavily scrutinised by the committee, however missing from this was any financial details whatsoever.
This was a serious obstacle to proper scrutiny of a merger that’s origin was due to financial difficulties faced by West Middlesex NHS Trust. Representatives of C&W explained that this was due to confidentiality reasons. Whilst that is to an extent understandable, in my view it was misguided, as it cast further doubt onto the validity of the merger proposal. To their credit, C&W directors extended an offer to members of the committee to meet with their financial director to review the full business case for the proposal.
I have recently met with C&W’s finance director, Lorraine Bewes, and their strategic director, Dominic Conlin. On the condition that I signed a confidentiality agreement, they discussed with me in detail and showed me the financial case behind the proposed merger. I of course intend to honour the agreement I signed, and for full disclosure, have shared this article with Ms Bewes and Mr Conlin before publishing it.
My areas of concern regarding the merger have always been primarily on its effect on residents of Hammersmith and Fulham. For the residents who are primarily served by West Middlesex, it is fairly clear that the merger will be of benefit, as without a merger with a strong, viable trust, there would be a significant risk that West Middlesex Hospital could cease to function. For these reasons, it is understandable why the Department of Health, the Trust Development Authority, Monitor and the Secretary of State, will most likely support the merger.
I want to therefore focus on my concerns for the people of Hammersmith and Fulham, and share some of the answers that I received from C&W.
Financial Burden of West Middlesex’s existing deficit and PFI contract
One of my concerns, shared with colleagues, was how the combined trust would be able to manage the deficit and PFI costs associated with West Middlesex. It was explained to me that compared to other PFI contracts at hospital across the NHS, the West Middlesex contract was comparatively small. The money that the new trust would receive from the NHS to help manage the merger would more than cover this. The NHS are also funding a new electronic patient record system for the new trust, which will see it become one of the most advanced in the NHS.
This will hopefully speed up how the trusts communicates with patients and other parts of the NHS to reduce time and costs associated with referrals and making appointments, and ultimately improve care. I have also seen that the business case plans for a current deficit over both trusts to be turned into a significant surplus over 10% in several years. It will be challenging to turn around the hospitals’ finances to that extent, and the trust should be judged on whether that is achieved.
Managerial Challenge associated with the merger
One of the criticisms laid at C&W by the CQC report was that their leadership requires improvement. That is not an ideal position to be starting such a challenging organisational change. C&W has been led by Elizabeth McManus, as interim Chief Executive, since the departure of Tony Bell in November last year. Ms McManus is to be replaced as Chief Executive by Lesley Watts, who will start in mid-September. With the merger with West Middlesex expected if final approvals are given, on the 1st of September, this is a particularly challenging time to be taking on such an important role. It is critical for both hospitals that Ms Watts hits the ground running, and that the whole management team supports her in taking the hospitals forwards and making the changes agreed with the CQC. It has been explained to me that many of senior management team from C&W have already been spending some of their time at West Middlesex in advance of the merger, and that the proposed larger merged trust is already helping to attract senior clinical and management staff. That is all well and good, however the challenge facing the management team at the new trust if the merger goes ahead is an extremely significant one. It is critical for patient services and outcomes that they are successful.
Risks Associated with merger plan’s assumptions not turning out as expected
The business case for the merger trust is based in part on increasing the number of patients seen on the West Middlesex site. This will depend on whether significant numbers of patients choose to come to West Middlesex; on whether local clinical commissioning groups commission new/expanded services at West Middlesex; and that large neighbouring trusts, such as Imperial, do not successfully compete for these additional services.
There will of course be other risks, both known and unexpected, that could derail plans. It has been explained to me that if the merger does not go ahead, C&W will face risks perhaps greater than those of the merger. Not being able to turn the deficit around, and compete with larger nearby trusts to attract patients as well as leading clinicians are valid concerns.
Concern that services based at C&W could move to West Middlesex
C&W have said that they have no plans to move services from C&W to West Middlesex. Residents of Hammersmith and Fulham have heard that before however, following the creation of Imperial College NHS Trust. We have been assured that services will not be moved, and that if such a proposal was put forward it would have to undergo full public consultation. That in my mind is not sufficient, so I have written to the Chair, Chief Executive and Governing Body of Chelsea and Westminster to ask for their guarantee that patient services will not move away from Chelsea and Westminster.
In conclusion, I still believe that this merger carries significant risk, but as argued by C&W there is significant or greater risk by not going forward with West Middlesex. The combined trust will be strongly incentivised by the NHS to take over West Middlesex, as well as invest in a new IT infrastructure.
My biggest concern is that services for patients in Hammersmith and Fulham could suffer through either being moved to West Middlesex or through the management of the trust being distracted by the merger and away from what counts patient care and outcomes.
Finally from a local authority perspective, Labour councillors on the scrutiny committee and members of the administration have not been to C&W to meet with their finance director and scrutinise the business case. This is in addition to there being little to no contact between C&W and the leadership of Hammersmith and Fulham council since the Labour Administration took over last year. For a council that put such electoral stock in local healthcare issues, they have serious questions to answer. Do they not care about a hospital that provides services to a significant majority of patients in Fulham, and most families across the borough with children? Or do they only care at election time?