A radical shake-up of community pathology services which will see NHS trusts compete with private firms for contracts worth £500m has taken a major step forward after commissioners started a procurement process.

Tender documents for three contracts across the east and west midlands were published in the Official Journal of the European Union on Wednesday, with bidders given until 1 March to submit expressions of interest.     

If the contracts - worth £100m annually and believed to five-year deals - all go to private sector bidders, the region could be left without any NHS providers of community pathology services.

The reconfiguration is the most significant response yet to Lord Carter’s Department of Health-commissioned review of NHS Pathology Services in England and could be used as a blueprint for other regions.

NHS Midlands and East, which is overseeing the project, hailed the move as a great opportunity to save money, improve services and stressed patients would seen no difference in service.

A statement by the strategic health authority cluster added: “The step marks a significant milestone in the nationwide initiative to transform pathology services and comes after several months of discussions and negotiations with the region’s primary care trusts and emerging clinical commissioning groups.”

But the Royal College of Pathologists raised doubts over the project’s ability to deliver an improved service.    

College president Archie Prentice said while the college supports the continual upgrading of pathology services for the NHS in the interests of best patient care, the college has had “little involvement locally and none nationally” in the project.

“It is unclear whether a cost-cutting reconfiguration of this scale and complexity will deliver the improvements claimed. We hope in the best interests of patients that it will,” he added.  

The new arrangements for the community pathology services, used mainly by GPs, are expected to give live in June 2014 and affect a population of around 9.5 million residents.

The move follows a similar procurement process which is underway in the East of England. Crucially, only NHS trusts were allowed to bid for contracts in there but the process has still raised fundamental questions about some hospital pathology facilities.

Basildon and Thurrock University Hospitals Foundation Trust and Southend University Hospital Foundation Trust could face cuts after their bid was unsuccessful.   

Lord Carter’s review, delivered in two tranches in 2006 and 2008, concluded a substantial consolidation of services would slash the pathology bill by up to 20 per cent and improve patient safety.