Finance woe 'will prompt major NHS revamp'

Some services will need to close, MPs say

Financial difficulties will force NHS services in England to undergo major reorganisations which could hit the poorest the hardest, MPs say.

The Public Accounts Committee said for hospitals this could mean services being closed or whole units merged.

The MPs said the difficulties were linked to historic debt, bad management and the current drive to make savings.

And they warned the changes had to be carefully managed by ministers or else patients would suffer.

Committee chairman Margaret Hodge said it remained unclear whether the problems many of these organisations were facing could be resolved without radical change.

"These trusts will be forced into reconfigurations or even mergers.

"This may deal with the financial challenges involved but could leave some deprived communities with unequal access to high quality healthcare when hospital departments are closed and services moved.

"London is in a particularly shocking state and nobody has got a grip on long-standing problems."

The MPs' report said the issue was coming to a head because of the drive to get all NHS trusts to achieve foundation trust status by 2014.

That allows them more freedom on how to spend or borrow, but requires them to get their finances in order.

At the end of September, 139 NHS trusts, including those who ran ambulance and mental health services as well as hospitals, had achieved foundation trust status.

It leaves another 113 looking to get there in just over two years.

Of those, 70 are hospital trusts. The MPs said four out of five of these were facing financial difficulties and were likely to struggle to achieve foundation status.

What is more, many are in deprived communities and so the MPs said changes would need to be carefully managed to ensure the most vulnerable did not lose out.

David Stout, deputy chief executive of the NHS Confederation, which represents managers, said the report presented a "stark picture" of the challenge facing the NHS.

"We know there is no easy solution and some trusts face long-term and deep-seated issues."

'Poor performance exposed'

But he added that closing services did not necessarily mean care worsened as some specialist care was better provided in larger centres.

Chris Ham, chief executive of the King's Fund, a leading health think-tank, agreed the MPs were right to highlight the issue.

"The government needs to work closely with struggling hospitals to find solutions - this will include mergers and, in some cases, service closures."

But Health Secretary Andrew Lansley said he was prepared to tackle the issue.

He said the problems trusts were facing had been "swept under the carpet for years".

"While there are plenty of top performing trust boards, we are determined to root out poor performance by shining a light into every area of the service."

He said independent assessments would be carried out on trusts to identify what was going wrong.

"Tough solutions may be required for these problems, but we will help the NHS overcome them," he added.