Foundation Trusts seeking to take advantage of a loophole that could allow them to increase the income they generate from private patient care are walking a legal tightrope according to health law experts at Browne Jacobson. Unison is seeking a judicial review unless Monitor, the Foundation Trust regulator, steps in to stop the growing numbers of Foundation Trusts setting up joint ventures, special purpose vehicles and charities to get around a legislative cap.
Oliver Pritchard, a health law specialist at law firm Browne Jacobson, said: “Many Foundation Trusts would like to increase their income from private patients, and see this as an essential part of exercising the supposed greater autonomy and flexibility which Foundation Trust status was supposed to confer on them. But the principle of the cap is enshrined in the legislation and is also set out within each Foundation Trust’s ‘Terms of Authorisation’, so any changes to the level of the cap, either for an individual Foundation Trust or generally, would require new legislation. Not even Monitor has the power to alter the cap.”
Salisbury NHS Foundation Trust has also established a separate company, Odstock Private Care Limited (OPCL), which it funded by means of a loan, to carry out private patient work using Salisbury District Hospital’s facilities so as to take advantage of the loophole. Salisbury Foundation Trust had hoped that OPCL would qualify for charitable status thereby benefiting from tax advantages. However, the Charity Commission has decided that OPCL does not meet the necessary criteria to qualify. This decision will call into question the plans of some of the other Foundation Trusts to use charitable vehicles.
