A change in the rules to help scores more NHS hospitals achieve independent foundation status was announced yesterday by Patricia Hewitt, the health secretary.
She said she would drop the requirement that only the highest-performing three-star trusts can apply for independence from government control. Two-star hospitals and mental health trusts will be able to qualify if they can satisfy Monitor, the foundation regulator, that they are clinically and financially sound. The decision is likely to renew concerns among Labour MPs who feared the foundation policy would create a two-tier NHS, giving an elite group opportunities to succeed at the expense of other hospitals.
When legislation to establish foundation status passed through the Commons in 2003, Tony Blair's majority was cut from 161 to 17, at that point the lowest since he came to power in 1997. More than 60 Labour MPs, led by former health secretary Frank Dobson, voted against it.
Ms Hewitt said trusts would be assessed using a new "diagnostic tool" to measure their readiness for independence. To provide "external rigour" the process will be overseen by the private sector consultants Deloitte and McKinsey.
Sue Slipman, director of the Foundation Trust Network, said the tool would be used to separate trusts into three groups: those that can achieve foundation status if they get the right help; those that can make it if the government adjusts the rules for payment by results; and those that are "unlikely to be viable".
She said: "We think a majority of acute hospitals can become foundations by 2008, but it is unlikely all will be able to do so."
Mr Dobson said last night: "This is exactly as we predicted and contrary to all the promises that were made."
Ms Hewitt's predecessor as health secretary, John Reid, promised that all hospital trusts would have the opportunity to achieve foundation status by 2008, eliminating the danger of a two-tier service.
There are 32 foundation trusts. Another 62 acute and specialist trusts have three stars and were eligible to apply for independence under the old rules. Allowing two-star trusts to apply will add a further 53 potential candidates. But 47 acute and specialist trusts with fewer than two stars will remain excluded until they improve.
The shadow health secretary, Andrew Lansley, said the move would "reopen divisions in the Labour party about private sector involvement in the NHS".
