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Regulator reports improved performance for foundation trust sector but highlights challenges ahead

24th June 2009

Results published today by Monitor, the independent regulator of NHS foundation trusts, indicate that foundation trusts are continuing, in most cases, to meet national standards and targets in key areas such as combating healthcare associated infections. 

The report reviews data on key service performance issues and includes the end of year financial position for the 115 NHS foundation trusts authorised at 31 March 2009.

At the end of 2007/08, MRSA presented a governance issue of significant regulatory concern for Monitor – but the past year has seen a marked improvement. Although ten foundation trusts ended the year in breach of their full year targets, this compares with thirty six trusts in 2007/08. In addition, none of the five trusts under threat of formal action related to Monitor’s escalation process in 2007/08 breached their MRSA targets in 2008/9, demonstrating the positive impact of regulation.

This review is the fourth quarterly report for the year 2008/09 and the first to include monitoring against the new 18-week referral to treatment waiting time target. All foundation trusts had met the target for treating non-admitted patients by year end, with only one trust declaring a breach of the target for admitted patients.

However, the report also shows areas where further improvement is required. In particular, the four hour A&E waiting time target has been a consistent challenge for foundation trusts, and Monitor has warned foundation trusts who persistently fail to address performance on this issue that they will be subject to formal escalation procedures, with the possibility of regulatory action.

Foundation trusts remained financially strong in 2008/09. For the full year they exceeded their planned performance with an aggregate surplus (before exceptional items) of £522 million. However, the EBITDA margin of 7.1%, although slightly ahead of plan, is below the level in 2007/08 of 8%.

Commenting on the report, Executive Chairman William Moyes said “This report sets out clearly that most foundation trusts can deliver national standards of care and meet health targets and also manage their finances well – in a relatively stable economic climate. The challenge is to do so as public sector finances get tighter.

“We have recently written to the boards of all foundation trusts requiring them to prepare plans for the next two to three years which will continue to improve the quality of their services as available funds become more scarce.”

Dr Moyes also voiced concern that the pipeline of applicant trusts flowing from the Strategic Health Authorities to the Department of Health and to Monitor has slowed considerably, with no trusts being considered by Monitor’s Board this month.

“We are very clear that the strongest position from which to weather the tough times ahead is with a healthcare system which can demonstrate good governance and strong finances – a healthcare system which has completed the transition to an all foundation-trust model.   While we recognise the considerable challenges many trusts who have not yet entered our process face, it is vitally important that we see an increase in the number of well prepared trusts coming through to us.”

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