Procurement law and the Provider Selection Regime – when will the changes happen?

There is a lot of change on its way to procurement law. The way healthcare services are commissioned is also going to change. For the NHS, ICBs will go live on 1 July 2022.

Whilst a great deal of attention is, rightly, being paid to what the new landscape may or may not look like, and much debate is taking place around the detail, there remains (understandable) confusion on the ground around what is changing, and when.

A brief summary of the timelines are set out below.

Public Contracts Regulations 2015

The Public Contracts Regulations 2015 will be changed. A Procurement Bill has just been published. The new law, once it has been through the Parliamentary process, and inevitably amended from what has already been published, is expected to come into force in 2023, with contracting authorities being given 6 months to prepare for go live of the new rules. As well as the new Act, there will be new regulations and guidance.

Until the law does change, the current rules should be followed.

Healthcare commissioning

Separate to those changes, there is a stated intention to change procurement rules when commissioning healthcare services. The proposal is that the commissioning of healthcare services will be removed from the requirements of the Public Contracts Regulations 2015. The National Health Service (Procurement, Patient Choice and Competition) (No. 2) Regulation 2013 will also be repealed. In its place, a new regime will be introduced that will govern:

  • how ICBs or NHS England commissions healthcare services;
  • how local/combined authorities arrange healthcare services as a part of their public health functions or as part of section 75 partnership arrangements with the NHS; and
  • how NHS Trusts/Foundation Trusts arrange the provision of healthcare services by other providers.

This will be known as the Provider Selection Regime. We are expecting new regulations, as well as statutory guidance.

The current stated date for the Provider Selection Regime to come into force is 1 August 2022 (at the earliest). However, given we are nearly in July, this timetable is highly unlikely to be met, and therefore we expect that the Provider Selection Regime will come in (subject to Parliamentary approval) towards the back end of 2022. It is not currently known how much notice will be given regarding the introduction of the new regime.

This means that when ICBs come into existence, ICBs will need to comply with the requirements of the Public Contracts Regulations 2015 (in particular the Light Touch Regime), and the National Health Service (Procurement, Patient Choice and Competition) (No. 2) Regulation 2013, for a short time at least. This is likely to lead to some inevitable difficult commercial/strategic commissioning decisions for upcoming procurements, whether they relate to new contracts or existing contracts coming to an end etc. Failure to apply the current law correctly will mean that a commissioner puts itself at real risk of challenge.

There are still some questions on how certain services will be classified, i.e. whether certain services will fall within healthcare service or not. We need to wait for the outcome of the recent DHSC consultation, as well as the draft regulations/draft guidance to be published.

Information about our core procurement team and their contact details can be found here.

Please contact us should you wish to discuss how we can assist you and your team.

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