Monitor, the healthcare regulator, appears to have backtracked on an unpopular proposal to force charitable healthcare providers to contribute to a slush fund for failing NHS trusts, following fierce lobbying by hospices and health charities.

Back in 2011, Monitor produced a draft provider licence which all healthcare service providers would have to obtain in order to deliver NHS services.

The licence contained various requirements, including some that charities accepted, such as registration with the Care Quality Commission.  But one particular clause that raised the sector’s hackles was a requirement to contribute to a “risk pool” to ensure continuity of services in the event of a service provider suffering financial distress.

Mark Jackson, chief executive of St Richard’s Hospice in Worcester, told civilsociety.co.uk that the sector understood that Monitor wanted to find a way of preventing any repeat of the kind of crisis that occurred when the Southern Cross care home chain collapsed – but this was not the way to do it.

“This is nothing other than a slush fund to bail out failing NHS trusts,” Jackson said. “But our charitable mission is to look after patients, not to look after the NHS.

“If Monitor wants to know if a charitable provider is financially viable they can go to the Charity Commission website and look at our audited accounts.

“This is a classic case of the public sector trying to reign in the independence of charities.”

Help the Hospices: positive conversations with Monitor

Help the Hospices took up the case on behalf of the hospice sector, and its director of public policy Jonathan Ellis told civilsociety.co.uk last week that he felt Monitor was “starting to listen” to the sector’s concerns, following many months of lobbying.

“Charity law states that a charity can only spend its resources on delivering its charitable objectives,” he said. “So Monitor are still looking at this. Over the last couple of months we’ve had some increasingly positive conversations with Monitor about their willingness to engage with the sector to try and find a more appropriate way forward.”

The Charity Commission also confirmed that it was aware of the potential conflict between charity law and the risk pool levy, and would submit a response to Monitor in due course.

Monitor: No immediate plans to bring in a risk pool

But after civilsociety.co.uk approached Monitor about the sector’s concerns, it finally issued a response suggesting that it had backed down on the proposal.

A spokesman said: “There are no risk pool payments right now, and no immediate plans to introduce a provider-funded risk pool approach - we are still in discussion with the Department of Health on this.”

He added that Monitor had intended to consult on the proposal this year but as discussions are still ongoing no consultation will be issued until there is greater detail available.

Mark Jackson responded: “This is indeed good news, and I am glad to see that common sense has prevailed.”

The NHS Provider licence went live for NHS foundation trusts in April this year and the intention is that the licence for independent healthcare providers will go live next April.