HEALTH watchdogs are set to intervene in the running of King’s Mill Hospital amid fears its operating trust will run out of cash within months.
Monitor, the independent regulator of NHS Foundation Trusts, has found that Sherwood Forest Hospitals NHS Foundation Trust could need external support to pay its PFI costs as early as January next year.
It is in significant breach of two of its terms of authorisation - the general duty to exercise its functions effectively, efficiently and economically, and its governance duty.
Monitor is now deciding what regulatory action it will take - which could range from requiring the hospital’s board to take – or not take – a specific action, to obtain external advice on a particular issue, or, in an extreme case, removing any or all of the directors or governors and appointing replacements.
But, in acknowledging the announcement, bosses at King’s Mill are keen to stress that it ‘in no way suggests that either Monitor or the CQC have raised any concerns about the quality of patient care.’
In a statement, they said that the hospital’s board identified the risks to maintaining on-going compliance as early as 2010, principally driven by the PFI, which was approved in 2005 with the support of the wider local health economy.
“The challenging size and scale of the PFI has been further impacted by significant reductions in income and utilisation of our hospitals as a consequence of more care for patients being provided closer to home and the centralisation of specialist services,” the statement said.
The hospital managed to remain within the terms of its authorisation during the financial year 2011/12 thanks to efforts by the board to make savings, and the end of year deficit - standing at £6.2m (excluding impairment) - was a significant improvement on the Trust’s approved plans.
Tracy Doucét, chairman of Sherwood Forest Hospitals NHS Foundation Trust, said that their ‘primary responsibility’ is to balance the cost reduction plans that the Trust needs to make, with maintaining high quality care.
She put much of the blame for the financial problems at the door of King’s Mill’s PFI contract.
“Both the board and Monitor recognise the additional challenges presented by our PFI and the degree to which this exacerbates the already significant financial pressures facing all NHS organisations,” she said.
“It is clear that right across the NHS, and in particular for many District General Hospitals and those Trusts with large PFI commitments, strategic and sustainable solutions will often be beyond the control of individual organisations.
“This will require the involvement of others in the local health economy. Sherwood Forest is no different in this regard.
“The board remains committed to continuing to deliver high quality care and services for our community and patients. We will continue to take the actions necessary to drive further efficiencies; to address our forward risks and to ensure financial stability.
“We will work pro-actively with our wider local health economy partners and with Monitor over the coming months to address the challenges and to deliver a sustainable health service for our patients.”