Business models, partnerships, mergers and acquisitions

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There are a number of options open to foundation trusts seeking new ways to provide care, from partnerships and joint ventures to full mergers and acquisitions.

Partnerships

The foundation trust model is a form of "public benefit corporation" closely aligned to the aims and objectives of the mutual movement. As organisations performing a function for the public good, foundation trusts have much in common with social enterprises.

Foundation trusts can play a valuable role in establishing partnerships with other organisations to achieve innovation, redesign of services and quality improvement. These can take a range of forms from time limited agreements  to full joint ventures.

Mergers and acquisitions

Recent government policies such as Transforming Community Services have led to a wave of mergers between foundation trusts and other NHS organisations. Moreover, the NHS provider sector is changing, with more organisations uniting to provide services across wider areas and release efficiencies. The aim of universal foundation trust coverage is likely to mean that further mergers and acquisitions will take place in the coming years.

Undertaking a merger or acquisition can be a crucial strand of the sustainability strategies of NHS providers, but it is important that processes such as due diligence, stakeholder engagement, and change communication are carried out effectively.

Business models

As the NHS changes, foundation trusts need to ensure their business models are sustainable for the future. In addition to changes in the way NHS services are designed, new business ventures, jointly owned enterprises and the development of innovative products and services can all have an impact on the business model.

How FTN can help

Whichever approach a foundation trust chooses, there are a number of regulatory and legal issues to be aware of.

The FTN has been representing the views of member organisations in stakeholder engagement work to design the new Monitor provider licence, which contains requirements relating to competition, integration and business model design.

We are also developing a resource with global law firm Sidley Austin, which will be available here in due course.