NHS England has today published its consultation on the proposed NHS Provider Selection Regime. The consultation on these proposals will run until 7 April 2021.

It is stated that this consultation should be read alongside other published information on the establishment of statutory ICS Boards, including Legislating for Integrated Care Systems: five recommendations to Government and Parliament.

The much anticipated consultation seeks to set out the proposals for the future of healthcare commissioning. The White Paper “Integration and Innovation: working together to improve health and social care for all” states “The reforms within these legislative proposals will remove the current procurement rules which apply for NHS and public health commissioners when arranging healthcare services. They will do this by creating the powers to remove the commissioning of these services from the scope of the Public Contracts Regulations 2015, as well as repealing Section 75 of the Health and Social Care Act 2012 and the Procurement, Patient Choice and Competition Regulations 2013.” It goes on the say “The powers within the Bill are intended to enable us to develop a new provider selection regime which will provide a framework for NHS bodies and local authorities to follow when deciding who should provide healthcare services. The provider selection regime will be informed by NHS England’s public consultation.”

The consultation document therefore provides an insight as to what the current regime could be replaced with.

As expected, the document recommends that government legislates to remove the current rules governing NHS procurement of healthcare services stemming from both the Health and Social Care Act 2012 and the Public Contracts Regulations 2015; and that these are replaced by a new regime specifically created for the NHS, underpinned by a new duty that services are arranged in the best interests of patients, taxpayers and the population.

The proposal is that the new regime would be established via a combination of primary and secondary legislation and set out in detail in statutory guidance. This new regime would apply to bodies responsible for arranging healthcare services for the purposes of the health service (NHS and public health) – including local authorities where they are commissioning healthcare services. Local authority commissioning of healthcare services, including public health, would be subject to the same rules as the rest of the NHS, to encourage and simplify joint working between local authorities and NHS bodies.

This regime would apply to the following bodies:

• ICS Boards when commissioning healthcare services for the purposes of the health service (whether NHS or public health)
• NHS England when commissioning healthcare for the purposes of the health service (whether NHS or public health)
• local authorities when arranging healthcare services as part of their public health functions
• local authorities when arranging NHS healthcare services as part of section 75 partnership arrangements with the NHS
• NHS trusts and foundation trusts when arranging the provision of healthcare services by other providers.

This regime would not apply to:

• social care services
• any public health services not arranged by NHS bodies or local authorities (for example those arranged by the Secretary of State directly such as Test and Trace)
• other non-clinical services such as consultancy or catering
• procurement of goods or medicines
• community pharmaceutical services, as separate regulations already set out how community pharmaceutical services are to be arranged, negating the need for additional rules.

The way in which decision-makers reach decisions about who provides services would depend on the type of service under consideration, and the kind of decision being made. Broadly there are three decision circumstances in scope of this regime for decision-making bodies, which are:

Continuation of existing arrangements

The document states that there will be many situations where the incumbent provider is the only viable provider due to the nature of the service in question, and a change of provider is not feasible or necessary – many NHS services are already arranged in this way. There will be other situations where the incumbent provider/group of providers is doing a good job and the service is not changing, and there is no value in seeking another provider. In these situations, it needs to be straightforward to continue with the existing arrangements.

Identifying the most suitable provider for new/substantially changed arrangements

It goes on to say that there will be situations where existing arrangements need to change – for example, when a service is changing considerably; when a new service is being established; when the incumbent is no longer able/no longer wants to provide the service; or when the decision making body wants to use a different provider. In these situations, the decision-making body should consider a set of key criteria. If after having done so they have reasonable grounds for believing that one provider/group of providers is the most suitable provider (which may or may not be the incumbent), they may award the contract to that provider without conducting a tendering process. This would have to be done in a way that is fully transparent.

Competitive procurement

For situations where the decision-making body cannot identify a single provider/group of providers that is most suitable without running a competitive process, or the decision-making body wants to use a competitive process to test the market.

The consultation states that “It is important that the outcomes of decision-making bodies’ decisions reached under this regime are made public, and that sufficient scrutiny is applied to ensure the regime is being followed. We propose that the regime requires decision-making bodies to take a number of steps to evidence that they have properly exercised the responsibilities conferred on them by this regime.”

Until the law changes it is important to note that the existing requirements continue to apply.

We will digest the proposals further and provide further commentary in due course, but in the meantime, if you have any queries on the issues highlighted in this article, please contact one of our specialist procurement law team.