Havering’s hospital trust loses £26m in arbitration

King George Hospital in Goodmayes is one of two hospital BHRUT are responsible for. Picture: Ken Mea

King George Hospital in Goodmayes is one of two hospital BHRUT are responsible for. Picture: Ken Mears - Credit: Archant

Havering’s hospital trust will have to foot a £26 million bill after losing a dispute with its commissioners.

The loss means that Barking, Havering and Redbridge University Hospital Trust’s (BHRUT) 2018/19 budget deficit will grow from £48.9m to more than £60m.

BHRUT took their Clinical Commissioning Groups - the bodies responsible for deciding which services to fund in the borough - to an NHS England arbitration over payment for work carried out between 2016 and 2018.

The CCGs commission Bhrut to carry out work for them and pay them for it.

They are biggest source of the trust’s income, with £391m paid in 2016/17.

This is not the first time the trust has taken its commissioners to court.

They did so last year and the year before.

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While the trust lost £26 million, the impact of that total will be spread across the budgets of two financial years due to the length of the arbitration process.

The impact that this financial loss will have on the trust’s services is not yet clear and discussions with the Department of Health and NHS area managers are due to take place in the coming months to decide where cut backs will have to occur.

BHRUT are currently in financial special measures and were rated “inadequate” for their use of resources in CQC’s latest inspection of the trust earlier this year.

The trust has a £500m turn over per year.

In April this year, BHRUT’s chief executive Matthew Hopkins and Chairman Joe Fielding issued a joint public statement, apologising for the financial situation the trust was in.

In the last few weeks the trust has signed a financial recovery plan and is working closely with PWC consultants to improve its financial position and processes.

In a joint statement, BHRUT and the area’s CCGs said: “We are pleased that the [arbitration] process has now concluded.

We found it to be a constructive and helpful experience.

The CCGs and trust will work together to translate the findings into an agreed contractual position for 2017/18, this financial year and beyond.

“We are committed to working collaboratively to progress our integrated care system with local partners, to ensure that we deliver a sustainable future for BHR and the very best quality care for local people.”

A spokesman for BHRUT said: “We have made significant changes and improvements to how we manage our finances in recent months.

“We recently finalised a comprehensive financial improvement plan, signed off by our board, which sets out how we will go about tackling the financial challenges we have been facing.

“We are committed to providing the very best care we can to our community in a sustainable way, and this will continue to be our top priority.”

Campaigner Andy Walker is fighting for more critical care beds at both King George and Queen’s hospitals in Redbridge.

He said: “North London residents seem to be getting an unfair deal. £26m, that could buy more critical care beds.

“You can see the trust are really feeling the pressure. The loss is a kick in the teeth, adding to the financial pressures.”