GP consortia: new roles and new rules

Primary care trusts, as public bodies as well as NHS commissioners, need to apply EU public procurement rules in each commissioning task undertaken. But will the new GP commissioning consortia be required to do the same? As a matter of policy, they may well be. But will they legally be required to comply with EU procurement law in the way primary care trusts are?

The procurement guide for commissioners of NHS-funded services appears to advocate due procurement process as a requirement of all NHS commissioners, without offering any view on whether GP consortia will actually be “contracting authorities” for the purpose of the EU rules.

If they are not, they will be under no legal requirement to comply with the EU rules, regardless of any policy.

The key will be whether such consortia are “bodies governed by public law”, for which the EU rules set out a three-stage test. Each stage has to be satisfied for an organisation to be required to comply with the EU rules as a “contracting authority”.

The incorporation test – as groupings of GPs working together for a common aim, consortia would satisfy this test.

The specific purpose test – this requires the bodies to have been established purely for the purpose of healthcare commissioning, with no commercial element to their operations.   

The control test – this looks at how far the financing, management supervision and boardroom control of the undertaking concerned lies with a public body as opposed to the private sector. Assuming that the first two tests are satisfied, it only remains necessary to determine whether (a) over half of consortia’s financing is public, (b) they are to be subject to management supervision by the NHS or a particular part of it, and (c) their activities are to be subject to boardroom control by the health service or particular part of it.

It is the control test which, in the case of GP consortia, may be trickiest to answer, at least until the bones of the white paper are fleshed out. On the basis that the handing of the ability to commission services to GPs represents a devolution of power from the NHS, you would expect that their activity will be fairly tightly regulated.

The fact that GP commissioning is likely to be anchored on a largely statutory footing will mean that total freedom on the part of the consortia to control their own activities is unlikely. Budgets will be allocated directly to consortia and there will be strict controls on the way those budgets will have to be applied.

Good news

On this basis, the likelihood is that, in relation both to financing and management control, GP consortia will satisfy the third limb of the test. This is good news – since, by being required to apply the procurement rules, they are more likely to commission services which are genuinely in the best interests of patients and taxpayers. The power and budgets afforded to them will not be able to be applied in setting up contracts which
have been procured in anything less than a totally fair and transparent way.

As there is an expectation within the white paper that there will be a shift to commissioning for outcomes with an emphasis on health and well being, it is likely that some commissioning will either be integrated with that to be commissioned by local authorities or, like the current example of learning disability services, be transferred en bloc to local authorities.

There would be a definite slope in the level playing field if some services are subject to the full rigour of EU law – ie those that sit with and may transfer to local authorities – while others are not, ie those that may sit with the new GP consortia.

We anticipate that both the regional arms of the National Commissioning Board and the extended remit of Monitor, as an economic regulator, will have a role in levelling the playing field, so that all publicly funded health services are the subject of EU law. It would certainly maintain contestability in those services that fall to be commissioned by the GP consortia.

It would also give providers certainty as to the marketplace and rules of engagement so that the scope of current provision is extended, whether by reference to private-public and third sector partnerships or by reference to the emerging social enterprises “umbrella’d” under primary and community care service provision.