The trust running hospitals serving Redbridge has reportedly been referred to the government after auditors found it does not have sufficient plans to address its debt.
It comes as Barking, Havering and Redbridge NHS Trust (BHRUT) is poised to update Redbridge council on how it is tackling its debt, which is running at £40million.
BHRUT is among 19 trusts referred to the government by the Audit Commission which have not broken even and failed to convince auditors that their improvement plans would work in the medium term.
Barts Health NHS Trust, which runs Whipps Cross University Hospital in Leytonsone, has not been referred to the government despite having a simialr level of debt to BHRUT.
However, The Princess Alexandra Hospital NHS Trust in Harlow, which serves Epping Forest, is on the list.
The BHRUT referral to secretary of state from health, Jeremy Hunt, will result in closer scrutiny of trust performance.
BHRUT chief executive Matthew Hopkins is due to address the council's health scrutiny committee tonight.
Redbridge Clinical Commissioning Group will also be in attendance to discuss the action plan.
The Care Quality Commission has criticised the standards of care at both King George Hospital in Goodmayes and Queen's Hospital in Romford.
Matthew Hopkins said: “We are working hard to tackle a £38million deficit and to improve the care we provide for residents of Barking, Havering, Redbridge and further afield. My first job since taking on the Chief Executive role permanently is to get the right leadership team in place to drive forward improvements and next week I will be announcing the appointment of a new Director of Finance.
"Our Improvement Plan, which has been developed with the help and support of all our local NHS and council partners, sets out the challenges ahead and the changes we are making to improve standards of care by implementing new ways of working; many of these will also lead to financial savings. For example, we plan to substantially reduce the number of agency staff we use. This will save millions of pounds, but we also know it will improve care for patients by having permanent, dedicated staff on our wards.”
The public can attend the health scrutiny committee meeting at 7.15pm at Redbridge Town Hall, in High Road, Ilford.