Andy Burnham extends preferred provider vow

Following his announcement in September that the NHS would be the “preferred provider” of services, Andy Burnham has written to Brendan Barber promising that where NHS service providers underperform, the primary care trust will work with the provider, giving them “at least two formal chances” to improve.

It doesn’t clarify anything at all - it’s a thoroughly incoherent bit of policy. I find it hard to see how it helps anyone

David Worskett

Even after this point, the health secretary has assured Mr Barber, the PCT will give the NHS provider every opportunity to continue to provide the service if it can demonstrate improvement.

The letter says: “Only if there was insufficient improvement within a reasonable timescale, and the scale of underperformance was significant, would the PCT consider engaging with other potential providers or other solutions (eg franchising).

“If market testing was subsequently pursued, the PCT would be expected to continue to engage the provider and its staff, and give them the opportunity to compete on a fair and equal basis.”

Andy Burnham assures Mr Barber an almost identical scenario would occur if NHS providers needed to improve services or their capacity; where there was a risk of clinical or financial uncertainty; or where patient choice needed to be increased. Tendering for alternative providers would be a last resort and the original NHS provider “would be able to bid on a full and fair basis”.

In contrast, it says where an independent or third sector contract expires, the PCT would tender openly from the outset, giving NHS providers a chance to bid.

Mr Burnham’s letter was included as an appendix to one sent by NHS chief executive David Nicholson to all PCT and strategic health authority chief executives last week.

Mr Nicholson said the letter was to clarify how the commissioning process will change in light of the shift in policy.

There will be new guidance to replace Necessity - Not Nicety, which was published just five months ago, and the Department of Health will issue a revised procurement guide and “refined” rules for cooperation and competition.

Mr Nicholson wrote: “In addition to the revised guidance, there will be implications for assurance processes, including for world class commissioning and transforming community services.”

But he said: “It is too early to tell what these are likely to be”.

He added the DH “remained committed” to the establishment of regional commercial support units and the national strategic market development unit and to the participation of independent and third sector providers “where this is the right model for patients”.

Primary Care Trust Network director David Stout warned against “inventing new barriers” to commissioning high quality services in the current financial climate.

NHS Partners Network director David Worskett described the policy shift as a “great pity”, which risked slowing procurement. He said Mr Nicholson’s letter still failed to address whether the “any willing provider” policy had been dropped.

“It doesn’t clarify anything at all - it’s a thoroughly incoherent bit of policy. I find it hard to see how it helps anyone,” he said.

HSJ’s Intelligent Information for World Class Commissioning conference is on 8 December, for details see www.hsj.co.uk/conferences