Annual Report and Accounts 2012/13 - Hillingdon Hospital NHS Trust

Regulatory ratings
Monitor, the independent Regulator of
Foundation Trusts, assigns Foundation Trusts
two risk ratings each quarter:
• A financial risk rating (rated 1-5, where
1 represents the highest risk and 5 the
lowest); and
• A governance risk rating (rated red
(highest risk), amber-red, ambergreen
or green (lowest risk)).
The financial risk rating is based on a range
of metrics across four areas: achievement
of plan, underlying performance, financial
efficiency, and liquidity. The governance
risk rating is based on a combination of:
service performance (measured on the
Trust’s performance against key performance
indicators selected by Monitor from
the Department of Health’s Operating
Framework); the views of third parties such
as the Care Quality Commission and NHS
Litigation Authority; the provision of the
mandatory services that Foundation Trusts
must provide; and other instances where the
Board may fail to accurately certify on their
performance or governance. In addition,
Monitor retains the discretion to amend the
governance risk rating should a Foundation
Trust fail to meet the statutory requirements
of other bodies.
The Trust’s risk ratings for 2011/12 and
2012/13 are presented below.
The Trust had planned for a risk rating of
four for the 2011/12 financial year. However,
the rating of three for each quarter of the
year was due to two of the four financial
criteria being one rating below the planned
level. These were in respect of achievement
of plan and financial efficiency. The
reason the actual rating in these cases was
below plan was the Trust only made a surplus
before impairments of £262k when the
plan was for a surplus of £2.542m. This was
primarily due to three factors: (a) a shortfall
on the Trust’s planned efficiency savings; (b)
the Trust undertook an amount of activity
that under the terms of its contracts with
commissioners it was not going to be paid
for either in part or full 10 ; and (c) price
inflation on goods and services required by
the Trust had a greater impact on operating
costs than originally planned. Monitor
therefore requested that the Trust reforecast
its financial position and capital programme.
Annual Plan
2011/12
Q1 2011/12 Q2 2011/12 Q3 2011/12 Q4 2011/12
Financial risk rating 4 3 3 3 3
Governance risk rating Green Amber-red Amber-green Green Green
Annual Plan
2012/13
Q1 2012/13 Q2 2012/13 Q3 2012/13 Q4 2012/13 9
Financial risk rating 3 3 3 3 3
Governance risk rating Green Green Green Green Green
9 The Q4 risk ratings are based on the Trust’s submission to Monitor at the end of April 2013: the Trust does not have
Monitor’s confirmed Q4 ratings at the time of finalisation of the report (May 2013).
10 These included in areas such as emergency activity, readmitted patients, follow-up outpatient appointments, and
Consultant to Consultant referrals.
Directors’ report
13