New panel will oversee NHS competition regime, DHSC decides

The new panel should “help ensure that… procurement processes are transparent, fair and propionate, enabling all providers to compete for contracts” and “are not unfairly excluded from offering services to patients and service users”, the Department of Health and Social Care said in a response to its consultation on the new rules governing the commissioning of healthcare services.

The PSR has been delayed for more than a year and, while today’s response gives a clear picture of the final shape, it does not say when it will be implemented. Government sources indicated they hoped to have it in place by the end of the year, but setting it up by then is expected to be challenging. 

Until the new regime is in place, previous competition legislation still applies.

The intent is to move the NHS away from always putting new contracts out to competitive tender and “towards collaboration across the health and care system”, the document says. 

The government’s response to the PSR consultation, which began more than a year ago, was welcomed by the independent sector and by the NHS Confederation, which called for it to be implemented “with haste” to minimise further disruptive delays.

Earlier proposals had said commissioners would have to publish details of their decisions under the regime, but providers and commissioners responding to the consultation said it may be “insufficient to ensure good governance”.

There was “repeated concern” that the “decision-making body” procuring a service (typically an integrated care board) “would itself be required to review and adjudicate on its own decision when challenged by a provider, without the involvement of an independent body”.

That may have seen more providers resort to costly judicial review.

The government acknowledged “there is potential merit in introducing a greater degree of independence into the review of decisions”, and therefore is now proposing to set up an independent panel “chaired by an independent person who can look at and advise on both issues relating to patient choice regulations… and PSR regulations”.

The proposal is reminiscent of the Cooperation and Competition Panel which operated between 2009 and 2013 with the role of considering competition complaints, before Monitor took on these powers, as a full economic regulator, under the Lansley reforms. 

The new panel will consider both competition/procurement disputes and — separately — issues about patient choice. Unlike the CCP, it will not consider NHS mergers and acquisitions, are there are now very little restrictions governing these. 

Sarah Walter, director of the NHS Confederation’s Integrated Care System Network, said ICSs are “very keen” to make the new independent review panel work and “hope this will help reduce the risk of avoidable judicial reviews and their associated costs”.

However, she added: “While we do support the proposals, the implementation of the PSR is running over a year behind schedule. Delays cause uncertainty for commissioners and providers of care alike and can be disruptive. With this in mind, we hope the proposals are implemented with haste so leaders can utilise the suggestions and continue to deliver high-quality care for their patients.”

David Furness, director of policy and delivery at the Independent Healthcare Provider Network, welcomed the consultation response “confirming how the new [PSR] will operate”.

“One of the most significant changes we believe is the move to establish independent oversight to resolve complaints which will help bring transparency and consistency to decision-making,” he added.

“There will be two independent panels – one relating to choice issues, and one for procurement issues – but operating as one. This is a positive step because, by ensuring transparency and consistency in decision-making, it will help to give patients and taxpayers maximum confidence about the decisions made on their behalf.”

Bar

Meanwhile, the government is proposing qualitative thresholds for when a contract has gone through “considerable change”, and will therefore need to be considered under the PSR. The bar is if the contract value has gone up by £500,000 or more since it was previously commissioned, and the value increased by at least 25 per cent. Under these circumstances, the service would need to be recommissioned either by identifying the most suitable provider or running a competitive tender.

HSJ asked the DHSC when the new regime, including the new panel, will be in place, but it has so far not answered. Sources have previously indicated the regime is intended to begin in October.