Dorset hospital trusts merger plan blocked
Two NHS hospital trusts in Dorset will not merge, the Competition Commission (CC) has decided.
The Royal Bournemouth and Christchurch Hospitals and Poole Hospital Trusts wanted to become one to save money.
It is the first time the Competition Commission, which normally rules on companies and commercial markets, has intervened in the NHS in England.
The trusts said the decision was "fundamentally wrong" and that they would "explore alternative options".
In a statement, the trusts added they were "deeply disappointed" and felt the merger was the best option to ensure "high-quality hospital services to local people".
"The assessment of the merger was always weighted to put competition ahead of benefits to patients, and we do not believe the NHS is best served in this way.
"The two trusts have worked extremely effectively together over the last two years and we will continue to explore areas where we can work in partnership. However, this will not be to the scale we had hoped.
"It will be much more difficult to make further savings as individual organisations, but we now need to explore alternative options and work closely with our commissioners as we look to the future."'Not enough detail'
The merger was referred to the commission by the Office of Fair Trading, amid concerns about allowing two competing trusts to combine.
This is a significant development for the NHS in England.
Hospitals which are foundation trusts have greater freedom to borrow and spend their budget, keeping any surpluses.
They almost entirely treat NHS patients and most local communities regard them as part of the health service.
Now the Competition Commission has intervened in the NHS - for the first time - on the grounds that as foundation trusts are independent hospitals they can be treated as "enterprises" under European law.
It follows the controversial changes in the coalition's health legislation which confirmed the role of Monitor as a regulator for healthcare in England.
If Monitor has concerns about proposed mergers, it can involve the Office of Fair Trading and the Competition Commission.
The commission has now said its own research showed patients value choice.
Those concerned about increasing competition in healthcare will see this as a further step towards the NHS having to compete in a market.
This ruling also has implications for more than 40 other hospitals in England that may be considering mergers to make themselves financially viable.
The Royal Bournemouth and Christchurch Hospitals NHS Foundation Trust has 601 beds across two sites, whilst Poole Hospital NHS Foundation Trust has 623 beds across three sites.
But the CC said the merger would "damage patients' interests by eliminating competition and choice".
Its chairman Roger Witcomb said the organisation was "acutely aware of the pressures facing NHS hospitals".
"While the broad aims of the merger are desirable ones, there simply isn't enough detail in the hospitals' plans for us to conclude that any of the claimed benefits are likely to materialise," he said.
Poole Hospital NHS Foundation Trust is already being investigated by health sector regulator Monitor amid concerns over its finances and warned it faced a deficit if the planned merger failed.
The commission said it did not believe Poole would close as a result of the merger being blocked.
A spokesman for the Foundation Trust Network said the decision raised "significant fears about how competition law is being applied within NHS settings and on trusts' ability to make much needed changes to how services are delivered".
The NHS Confederation described the decision as a "body blow for change in the NHS".Bottom line
Annette Brooke, the Liberal Democrat MP for Mid Dorset and North Poole, said she was deeply concerned by the decision.
"We have a big financial problem at Poole hospital and I think it's really important that it is made financially viable," she said.
"One can certainly see there is a logic in merging management across two hospitals that are so close together [and] the bottom line is whether patients actually want choice over better services."
Shadow health secretary Andy Burnham said: "It's a sad day for the NHS when competition lawyers, and not doctors, are deciding what's best for patients."
A spokesman for the Department of Health said: "The review of mergers is a matter for the independent competition authorities. They must make their decisions in the best interests of patients."