Monitor has taken Queen Elizabeth Hospital King’s Lynn Foundation Trust out of special measures.
The Care Quality Commission last week recommended that the trust be removed from the regime, following an inspection that found “marked improvement in the quality of care being delivered”.
However in a statement today, Monitor warned that the trust “still faces significant financial challenges”.
King’s Lynn was placed in special measures in October 2013 following concerns over poor care and weak leadership, becoming the first trust to enter special measures outside of the 11 Keogh review trusts.
The trust leadership has agreed to implement the findings of a report by a contingency planning team sent into the trust by Monitor last year, develop a plan to secure clinical and financially sustainable services, and clear its deficit of nearly £14m
The trust has also agreed to develop an implementation plan with West Norfolk Clinical Commissioning Group and work with the commissioner to address its “residual long term challenges”.
Monitor transformation and turnaround director Paul Dinkin said: “The leadership of Queen Elizabeth Hospital has made great progress in improving its services for patients, and deserves to be removed from special measures.”
However, he warned there were “significant long term challenges to the sustainability of the local health and care system”.
“These undertakings, agreed between Monitor and the trust, will go a long way towards fixing these problems,” Mr Dinkin said.
“But further changes to how healthcare is funded and provided will need to be considered by the trust and their commissioners.”
Trust chief executive Dorothy Hosein said: “It is of great credit to everyone at the hospital that we were able to illustrate not only marked improvements, but an established plan to continue on our journey to excellence.
“Staff were able to clearly demonstrate to inspectors an understanding of every aspect of our hospital, where changes have been made and why, and what we aspire to enhance further in the future.”