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Monitor intervenes in relation to Mid Staffordshire NHS Foundation Trust
6 March 2009
What is the background to the intervention?
Mid Staffs NHS Foundation Trust is currently being investigated
by the Healthcare Commission following unusually high death rates
and concerns about poor nursing care at Stafford General Hospital
A&E department. The Commission had already highlighted “serious
concerns about the A&E department”.
The Healthcare Commission’s report is due to be published later
this month. Monitor has seen the draft report and is aware that it
is likely to highlight serious concerns in relation to aspects of
the leadership and structure of the A&E department, as well as
broader governance and senior management failings at the Trust.
So why has Monitor intervened now rather than wait until the
report is published?
On Monday, Toni Brisby (Chair) and Martin Yeates (Chief
Executive) resigned. Monitor was concerned that immediate action
was required in order to stabilise the situation at Mid Staffs.
Monitor’s letter to the Trust’s governors on Tuesday stated that
the action was necessary to avoid any further deterioration in
public confidence and in view of the clear risk of a “very serious
and damaging impact both on patient care and on the Trust’s
stability and reputation”.
When does Monitor have the power to intervene?
Monitor’s intervention powers are granted by section 52 of the
National Health Service Act 2006. In summary, before Monitor serves
an intervention notice on a Trust it must be satisfied that one of
the following apply:
- That the Trust is contravening or failing to comply with its
Terms of Authorisation (TOA) or with any relevant laws, and the
contravention or failure is significant
- That the Trust has previously contravened or failed to comply
with its TOA or any relevant laws and is likely to do so again in
future, and the contravention or failure was significant
- That the Trust has contravened or failed to comply with a
previous notice
Once Monitor is satisfied that the circumstances entitle it to
formally intervene in the running of an FT, it still has discretion
as to whether or not to do so, and must evaluate whether any
intervention would be lawful and serve a proper purpose.
The TOA contain some very broad general obligations. In this
case, Monitor has stated that Mid Staffs has contravened Condition
2 and Condition 5(1) of its TOA. Condition 2 requires the Trust to
exercise its functions “effectively, efficiently and economically”,
whilst Condition 5(1) requires the Trust to ensure that it has in
place appropriate corporate governance structures and maintains the
organisational capacity necessary to deliver its health
services.
What powers does Monitor have when it decides to
intervene?
The legislation grants very wide powers to Monitor,
including:
- It can require the Trust, its directors or governors to do, or
not do, specified things within a set period
- It can suspend or remove any or all of the directors or
governors
- It can appoint interim directors
In this case, Monitor has used its statutory intervention powers
to appoint David Stone as Interim Chair with immediate effect, and
to require the Trust to appoint an Interim Chief Executive of
Monitor’s choosing at a later date. It has today been announced
that Monitor has appointed Chesterfield Royal Hospital Foundation
Trust Chief Executive, Eric Morton.
The terms of these appointments, including the duration,
remuneration and allowances, will be specified by Monitor, although
the appointments are interim rather than permanent ones.
Could Monitor take any further action?
Yes. Monitor has put the Trust on notice that it intends to
continue to review the situation and that it may intervene again in
future, in particular following publication of the Healthcare
Commission’s report. This could include, for example:
- Requiring the Trust to comply with particular recommendations
in the Healthcare Commission’s report
- Requiring the Trust to appoint external advisers
- Further interim Board appointments
- In extreme cases, requiring the Trust to make alternative
arrangements to ensure the care of patients while a problem is
rectified
Has anything like this happened before?
Yes. This is the third time Monitor has used its formal powers
of intervention, although this is the first time that it has
formally intervened because of issues to do with clinical standards
and governance, rather than for reasons to do with financial
performance. In fact, Mid Staffs currently has a very respectable
‘4 out of 5’ risk rating for financial performance.
What are the implications for other Foundation Trusts?
It demonstrates the wide discretion that Monitor has in
those instances where there are ‘significant’ breaches of the
TOA.
In this and earlier interventions, Monitor cited breaches of
Condition 2 of the Trust’s TOA – the requirement for the Trust to
exercise its functions “effectively, efficiently and economically”
– as the basis for the intervention. This is despite the very
different underlying reasons for the earlier interventions and this
intervention.
Monitor’s compliance framework document contains some examples
of matters which it would regard as ‘significant’, but it does not
limit its wide discretion in such matters. Each intervention has
been particular to each Foundation Trust.
This could be the first occasion where Monitor
intervenes directly in a Trust’s arrangements for securing the
provision of clinical care.
Once the Healthcare Commission’s report on Mid Staffs is
published, it is possible that Monitor will intervene directly in
the Trust’s arrangements for securing the provision of clinical
care. This would be new territory for Monitor. Any formal
intervention in the provision of A&E services at Mid Staffs
will be the subject of far more public and media attention than
issues to do with the Board or the accounts have attracted in the
past.
It demonstrates that corporate governance and the
necessary Board skills in determining, assessing and
re-prioritising risks whether financial, patient safety or
organisational, should again be at the top of the agenda for
Boards.
The failings in corporate governance in the banking system have
demonstrated a need to thoroughly review corporate governance, in
theory and practice, with leadership and an organisational overview
being at the forefront of that review.
All Boards need to ask themselves searching questions; do we
really know whether or not our risk management systems work? Have
we been honest with ourselves in appraising our own skill sets? If
we find deficiencies how can we address them?
It will be of note to see what action, if any, the PCT
Commissioners decide to take.
They themselves have contractual rights of step in and/or
suspension of services. Clearly, along with Monitor and the
Healthcare Commission, they will want to be satisfied that
confidence in the services can be restored.
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