Providers of NHS healthcare: changes to procuring NHS services from 18th April18/03/16
On 18th April 2016, CCGs’ and NHS England’s temporary exemption from the Public Contracts Regulations 2015 (PCR 2015) when procuring healthcare services for the NHS will come to an end.
For the first time, NHS Commissioners will be under a statutory obligation to advertise their healthcare services contracts, subject only to a few exceptions. Is your organisation geared up for these changes?
What happens after 18th April 2016?
CCGs' and NHS England's procurement of healthcare services is currently regulated by a dual regime; the Procurement, Patient Choice and Competition Regulations (No. 2) 2013 – the “s75 Regulations” – and the “Part B” regime under the Public Contracts Regulations 2006.
From and including 18th April 2016, where a contract for healthcare services is above €750,000 (£589,148), NHS Commissioners must award that contract in line with the PCR 2015 using a so-called “light touch regime”. As a minimum, the “light touch regime” requires:
- publication of a contract notice or PIN in the OJEU (and contract award notice in the OJEU); and
- an award procedure which complies as a minimum with the EU principles of non-discrimination and equal treatment.
The main change is therefore that NHS Commissioners will for the first time be under an express statutory obligation to advertise their healthcare services contracts, subject to only limited exceptions. This is in contrast to current requirements, where there is no express statutory obligation to advertise. Our view is that the “light touch regime” and therefore new advertising requirement will apply to a high proportion of healthcare services contracts awarded by NHS Commissioners, including primary, acute, community and potentially some of the new contracts implementing vanguards or other new integrated models of care.
The inference from the PCR 2015 is that some form of bespoke competitive process is likely to be required following publication of the advert, and the government has confirmed this view in recent guidance. However, there is some flexibility here and the form of competitive process is by no means prescribed; approaches may therefore differ depending on circumstances facing NHS Commissioners and their incumbents.
Other aspects of the PCR 2015 will also apply to the new light touch regime – for example, NHS Commissioners will need to have regard to obligations on publication of standstill award notices, retention of clear audit trails and procurement reports and identifying and remedying any conflicts of interest. The majority of NHS commissioners will have been doing this as a matter of best practice, but the PCR 2015 has put these requirements on a stronger statutory footing.
Does this affect processes that started before 18th April 2016?
No. Contract award procedures that started before 18th April 2016 will not be affected by this change, even if the NHS Commissioner enters into the contract after that date.
What does this mean for providers of NHS healthcare services?
The changes may be welcome to new providers wishing to get involved in the provision of NHS healthcare services, since in theory the changes should see an increase in advertised healthcare services contracts by NHS Commissioners and therefore increased visibility in respect of opportunities.
Conversely, however, there may be some nervousness for incumbent providers of healthcare services, who may feel less certain about their future contracts. Any incumbents would be advised to have early conversations with their NHS Commissioners prior to their contracts coming to an end, in order to understand upfront any commissioning and procurement intentions, so that they can plan ahead.
How can we help?
We are working with a range of providers of NHS healthcare services developing new models of care and integrated service delivery for their patch. Implementation of these new models of care can raise some thorny procurement issues. We can help you through this and your conversations with NHS Commissioners to better understand how the requirements under the PCR 2015 might impact on implementation and potential options to address this.
Regardless of whether you are an incumbent or a new entrant to the market, our extensive knowledge of the s75 Regulations and PCR 2015 also means that we can assist you in structuring your bids in a way which improves the prospects of a good result and can generally help you understand the process and NHS Commissioner behaviour. Our experienced Dispute Resolution team can also advise you on the best methods of managing procurement challenges, either in relation to the PCR 2015 or s75 Regulations.
Please contact if you would like to discuss further or if we can be of any further assistance.