Dealing with financially unsustainable providers: how will the failure regime work?

Tony Harrison, Anna Dixon

The financial pressures within the NHS are being particularly harshly felt by acute hospital trusts, with some trusts and foundation trusts being rated as at financial risk and others declaring themselves financially unsustainable. With the current economic situation more organisations are likely to find themselves financially challenged and unable to survive in their present form.

This paper explains why a failure regime is required in the NHS, outlines how the failure regime for NHS trusts (currently being applied in South London) works and how the failure regime for foundation trusts introduced by the Health and Social Care Act 2012 will work in future. It concludes with a discussion of key issues that need to be resolved if providers of acute services to the NHS are to be put on a financially sustainable footing.

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