NHS foundation trusts were established through the 2003 Health and Social Care (Community Health and Standards) Act 2003; consolidated into the National Health Service Act 2006, which has now been amended by the Health and Social Care Act 2012.
They are not-for-profit, public benefit corporations, created to devolve decision making from central government to local organisations and communities. They provide and develop healthcare according to core NHS principles- free care, based on need and not ability to pay.
Some of the ways in which an NHS foundation trusts is different to NHS trusts:
• They are not directed by government so have greater freedom to decide, with their governors and members, their own strategy and the way services are run
• Not required to break even each year, although they must be financially viable. They can borrow money within limits set by the regulator, retain surpluses and decide on service developments and innovations for their local community
• They are accountable to:
o Their local communities through their members and governors
o Their commissioners through contracts
o Parliament (each foundation trust must lay its annual report and accounts before Parliament
o The Care Quality Commission (through the legal requirement to register and meet the associated standards for the quality of care provided)
o Monitor, as their regulator.
NHS foundation trusts can be more responsive to the needs and wishes of their local communities - anyone who lives in the area, works for a foundation trust, or has been a service user there, can become a member of the trust. These members elect the Council of Governors.
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