Objective: To investigate the external and internal governance of NHS foundation trusts (FTs), which have increased autonomy, and local members and governors unlike other NHS trusts.
Methods: In depth, three-year case studies of four FTs; and analysis of national quantitative data on all FT hospitals and NHS Trust hospitals to give national context. Data included 111 interviews with managers, clinicians, governors and members, and local purchasers; observation of meetings; and analysis of FTs' documents.
Results: The four case study FTs were similar to other FTs. They had used their increased autonomy to develop more business-like practices. The FT regulator, Monitor, intervened only when there were reported problems in FT performance. National targets applying to the NHS also had a large effect on FT behaviour. FTs saw themselves as part of the local health economy and tried to maintain good relationships with local organisations. Relationships between governors and the FTs' executives were still developing, and not all governors felt able to hold their FT to account. The skills and experience of staff members and governors were under-used in the new governance structures.
Conclusions: It is easier to increase autonomy for public hospitals than to increase local accountability. Hospital managers are likely to be interested in making decisions with less central government control, whilst mechanisms for local accountability are notoriously difficult to design and operate. Further consideration of internal governance of FTs is needed. In a deteriorating financial climate, FTs should be better placed to make savings, due to their more business-like practices.