New NHS Primary Care procurements
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1 MAY 2008 New NHS Primary Care procurements GPC guidance for GPs and LMCs (England only)
2 Contents 1 Introduction page 3 2 New primary care services page 3 3 The process of procurement page 4 4 Local consultation page 6 5 Alternative Provider Medical Services page 9 6 Further information page 12 Appendix 1 List of PCTs that are to procure new practices page 13 Appendix 2 Timeline of the procurement process page 14 2
3 1 Introduction In October 2007, the Parliamentary Under Secretary of State, Lord Darzi, published an Interim Report of the NHS Next Stage Review. This England only report highlighted the variation in quality and access to primary medical care services across the country. It made the immediate recommendation that Primary Care Trusts (PCTs) procure new GP practices and GP-led health centres to remedy these health inequalities. In December 2007, the Department of Health launched the procurement framework Delivering equitable access to primary medical care, and has since sent a number of letters to the Strategic Health Authorities and the BMA concerning this procurement process. This guidance draws together the various documentation that is publicly available and intends to provide GPs and LMCs with a factual guide to the local changes taking place in primary healthcare. 2 New Primary care services GP practices The Next Stage Review gave the commitment that the NHS would establish 100 new GP practices across the 25% of PCTs with the poorest primary healthcare provision. To determine these under doctored PCTs, each PCT was ranked across three categories, with a weighted factor applied: the number of whole time equivalent primary care clinicians (weighted factor 60%) health outcomes (weighted factor 30%) patient satisfaction with GP access (weighted factor 10%) The 38 PCTs ranked lowest using these measures are to procure between 1 and 3 new GP practices. On 15 January 2008, the Department of Health confirmed that that those PCTs ranked also wished to participate in the programme, and as such, a total of 113 practices will be procured across 50 PCTs in England. A list of the PCTs that will be procuring new practices, and the number of practices that each is to procure, can be found in Appendix 1. The Department of Health has set out the core criteria for the new GP practices the minimum features that should be reflected in the practice service specifications. The Department of Health expects PCTs to build on these features so as to provide primacy care services that reflect local needs. The core requirements for the procurement of GP practices are: Provision of core GP services List size of at least 6,000 patients Extended opening hours (minimum of 5 hours per week) The intention of being an accredited training practice Engagement in practice based commissioning Extended/wide (and overlapping) practice boundaries 3
4 Health centres The Next Stage Review committed the NHS to the procurement of one new health centre for each PCT in England. These centres are to be co-located and integrated as far as possible with other community-based services. The following core requirements are expected of each health centre: Maximising opportunities to integrate and co-locate with other community-based services, including social care Easily accessible locations (e.g. reflect commuter needs) Open 8am-8pm, 7 days a week Bookable GP appointments and walk in services Registered and non-registered patients GP-led care Polyclinics and health centres seems fairly similar, but there are some key differences: Health centres Polyclinics v Health centres Polyclinics Derived from Next Stage Review Interim Report One per PCT in England GP-led care, variety of services Open 8am-8pm Similar in size to a large GP practice (although they may grow over time) Derived from Lord Darzi s review of London Mostly in London Very board range of GP and community services (greater than in health centres) Open up to 24 hours a day Comprises approximately 25 whole time equivalent GPs plus other health care professionals such as consultants Lord Darzi published the report Healthcare for London: a framework for action in July This recommended that PCTs in London develop polyclinics that offer a greater range of services and easier access than traditional GP practices. It is also expected that these polyclinics will be more broadly based than the health centres. It is envisaged that 10 polyclinic pilots will be conducted by April Those PCTs not identified as part of the polyclinic pilot programme are expected to procure a GP-led health centre instead. 3 The process of procurement Timescales The Department of Health expects to see staggered commencement of the new practices and health centres from December 2008 onwards. It also expects to see some front-runner services starting before then. Key miles stones in the procurement process have been set out: Milestone Task Reporting date 4
5 1 SHAs to sign off PCT project specifications 29 February PCTs to have placed adverts and Memorandum of 16 May 2008 Information (MOI) 3 PCTs evaluate Pre-Qualifying Questionnaire (PQQ) and 29 August 2008 select bidders 4 SHAs sign off Invitation to Tender (ITT) and PCTs to 31 October 2008 issue to selected bidders 5 Contracts awarded and signed 31 December 2008 A detailed diagrammatic timeline of the procurements has been produced by the Department of Health, and can also be found in Appendix 2. Funding Following the 2007 Comprehensive Spending Review, it was announced that an additional 250 million would be provided to support the delivery of the new GP practices and health centres. This sum represents the full additional investment from the Department of Health that will be reflected in PCT allocations from 2010/11 onwards. 200 million will be included in the 2009/10 PCT allocations. Although it is understood that the 250 million will be recurrent funding from 2010/11, there has been no specific reference to funding levels from 2011/12 onwards. The Department of Health confirmed in a letter to Strategic Health Authorities on 25 January 2008 that funding for GP practices will be based on a fixed rate allocation for each practice. These allocations are detailed in the table below: Number of practices Procurement cost allocation in Indicative allocation in Indicative allocation in In addition to the reimbursement of procurement costs in , PCTs will receive reimbursement of any in-year service costs incurred. Allocations in will be subject to PCTs meeting procurement timescales and calculated according to the date that services commence. The Department of Health stated in a letter to Strategic Health Authorities on 21 December that funding for health centres would be included within PCT s overall allocations. Costings have been based solely on the core GP services that will need to be procured, including walk-in and bookable appointments 8am-8pm, 7 days a week. Available estimates for the cost of running a health centre have varied significantly, and there has been no formal confirmation from the Department of Health of any figures. Principles of procurement 5
6 The Department of Health has provided a set of principles that underpin the procurement programme: The new access fund monies are for new capacity not expansion or replacement of existing surgeries or health centres. However, PCTs may use funding for services that were already in planning stage at the time of Our NHS, Our Future. Investment is for additional capacity (i.e. extra GPs, nurses and support staff). The procurements are for new and innovative services, not necessarily new buildings or facilities. PCTs may wish to utilise LIFT or other community developments to host the new services, either on an interim or longer-term basis. Every health centre will have GP services at its core. Anyone (regardless of where they are registered) should be able to get bookable GP appointments or walk-services 8am to 8pm, 7 days a week. All services are to be commissioned following an open and transparent tendering process, most likely using APMS as the contracting vehicle. PCTs are to work out how GP services can be potentially integrated and colocated with other services (e.g. pharmacy, diagnostic, social care). The provision of these wider services may not itself be part of the procurement. PCTs will, however, need to make sure that the new service providers are sufficiently innovative to work with the PCT to help achieve this wider integration. Flexibility in procurement A central tenant of Lord Darzi s review has been the importance of determining primary healthcare services locally. In May 2008, Lord Darzi published two further reports as part of the NHS Next Stage Review. Leading Local Change set out five key pledges detailing how the NHS will handle change to services in the future. The report, aimed at the public, patients and staff, set out a rigorous process requiring any change to be transparent, clinically evidenced, locally led and for the benefit of patients. This document was accompanied by Changing for the Better, operational guidance that identified eight key steps to enable service change through the five pledges to be realised. Lord Darzi has also previously acknowledged that a one-size-fits-all model of health centre would not work. The GPC understands that PCTs have a degree of flexibility in how the Department of Health s proposals are implemented, although we are not aware of any PCT that has decided not to procure these new services at all. It is therefore very important that LMCs, GPs and patients engage with local consultation processes and attempt to influence the eventual shape of the new services. 4 Local consultation Every PCT is required to conduct a local consultation on the service changes that Lord Darzi has proposed. Under the Health and Social Care Act (2002), chapter 15, section 11 (public involvement and consultation), patients must be consulted on: 6
7 the planning and provision of new services the development and consideration of proposals for changes in the way those services are provided the decisions to be made affecting the operation of those services. It is common practice to consult GPs and LMCs on these issues also. The manner in which a local consultation should be conducted has been laid out in the Sedley requirements, following a court case on this issue 1. These requirements provide four key provisions that local consultations should follow. 1. The Local consultation shall take place at a formative stage PCTs must consult the public at the beginning of the process of procurement, before any substantive decisions have been taken. The proposals cannot be changed after the consultation process has already commenced if this does happen then the consultation process must start again. 2. Sufficient reasons for the proposals to be understood shall be given PCTs must write formally to patients, setting out in clear language exactly what it is that the new proposals entail. It is this formal communication, and not any informal discussions with the PCT, that represents the start of the consultation process. 3. The consultation process must allow adequate time for consideration It is generally considered that an appropriate period of time for consultation is three months. The time scales for each stage of the consultation must be clear, as must the method by which comments and feedback can be sent to the PCT. 4. The local consultation must conscientiously take into account the comments made in finalising any proposals The consultation must be a genuine exercise there should be no inference that the decisions have already been taken. The consultation must ask the views of appropriate people, and provide all the information necessary to consider the proposals. A PCT that did not follow these consultation requirements properly could be deemed to have failed to consult on the proposed service changes. If a flaw in the consultation were suspected, then a formal letter should be sent to the PCT detailing where the consultation has been conducted inappropriately, and providing evidence of this. If repeated letters to the PCT are ignored, please contact the BMA for further advice on either , or at: askbma@bma.org.uk. Unfortunately, it is likely that the consultation process in each PCT will be different and as such it is not possible to offer any more specific advice on how to approach, and what to expect from, the local consultation. 1 The Sedley requirements arise from the findings of R v. Brent London Borough Council, ex parte Gunning [1985] 84 LGR
8 If a PCT is required to consult locally, it must do so properly. However, if a PCT fails to do this for whatever reason, the sanctions that can be applied to that PCT can only induce a delay in the decision to procure new services, rather than an end to the procurement process. For example, a PCT may improperly consult regarding a new service and be taken to court as a result. Even if the court found against the PCT, provided they subsequently conducted an appropriate consultation, the PCT could still decide to procure the services in the original manner, having taken suitable consideration of the views of local stakeholders. It is important to ensure that proper local consultation has taken place, and as part of this, it is crucial for GPs and LMCs to encourage patients to engage with any consultation process. Overview and Scrutiny Committees As well as consulting with patients, PCTs should also look to consult with their local health Overview and Scrutiny Committee regarding these new services. Since January 2003, every local authority with social services responsibilities (150 in all) have had the power to scrutinise local health services. Overview and Scrutiny Committees are comprised of elected local councillors who are empowered to consider the issues affecting the health of local people (the overview role) and to call the NHS to account on behalf of the local communities (the scrutiny role). The primary aims of health Overview and Scrutiny Committees are to ensure that: health services reflect the views and aspirations of local communities all sections of local communities have equal access to services all sections of local communities have an equal chance of a successful outcome from services. As such they can: review and scrutinise any matter relating to the planning, provision and operation of health services in the area of the committee s local authority; make reports and recommendations to local NHS bodies and the local authority on any matter reviewed or scrutinised; report to the Secretary of State for Health or Monitor: o where the committee is concerned that consultation on substantial variations or developments of services has been inadequate o where the committee considers that the proposal is not in the interests of the health service. The Overview and Scrutiny Committees are not decision-making bodies. However, they are very influential and their recommendations carry a lot of weight. They do have the power, in certain circumstances, to call in a decision. That means asking the decision maker to hold off implementing the decision until he or she has formally reconsidered it, in the light of scrutiny's concerns. Overview and Scrutiny Committee meetings are public meetings and anyone can attend. Members of the public, as well as interested stake holder organisations are also able to suggest topics for the committees to investigate. In the past, the BMA, in conjunction with 8
9 other health unions, has successfully used this mechanism to prevent unwanted and destabilising local service change being implemented. Details of Overview and Scrutiny Committees and how to contact them can be found on local authority websites. These bodies are potentially very powerful, and GPs and LMCs should look to involve Overview and Scrutiny Committees whenever new primary care services are being proposed, and similarly encourage patients and patient groups to contact their local committee. Local BMA assistance Where GPs have concerns at the direction that a procurement process is taking, or where they feel that their own practice will be affected by the new services, then they should inform both their LMC and their local BMA Industrial Relations Officer. BMA Regional Services staff can provide advice, guidance and assistance in times of difficulty, and in conjunction with LMCs may represent BMA members in both private and public meetings if appropriate. The BMA are able to play a useful role in addressing local problems. BMA regional Services can be contacted through askbma, on or at askbma@bma.org.uk 6 Alternative Provider Medical Services (APMS) The Department of Health has stated in several documents that the new procurements will be made...most likely using APMS. This clearly implies that there is the potential for PCTs to use the GMS and/or PMS contracting route for new services if they wished. However, it also appears likely that many will opt for the APMS route. Tendering for new services GPs need to consider the situation very carefully before entering into a tendering process for new services. Tendering can be very costly, and the full implication of the potential acquisition of new services must be understood. PCTs can enter APMS contracts with any individual or organisation that meets the provider conditions set out in the Directions, including GMS or PMS providers through a separate contract, groups of other health professionals, the independent sector, the voluntary sector and other NHS trusts. The way in which potential providers bid for APMS contracts will obviously depend on the contract procurement process adopted by the PCT. Once the contract has been advertised and before submitting a formal bid, potential providers may be asked to submit an expression of interest. Pre-qualification questionnaires may also be used to short list potential providers before detailed offers are requested. Prequalification questionnaires are used for potential providers to provide information upon which their suitability to be sent an invitation to submit a preliminary offer can be judged. The information requested by the PCT as part of the pre-qualification questionnaire must reflect 9
10 the declared shortlist criteria and be relevant to the service. It is usual for PCTs to evaluate the prequalification questionnaire information on the basis of a pass/fail system. PCTs are allowed to exclude service providers that do not meet certain economic, financial and technical requirements and are permitted to set whatever selection standards they consider appropriate, providing they are proportionate to the contract. During the procurement process potential contractors should have the opportunity to ask questions of the PCT and will usually have an opportunity to attend briefings. The Department of Health recommends that briefing meetings are held during procurement processes and that individual enquiries which are answered for one tenderer should be copied to all to ensure a level playing field. The decision not to attend briefing meetings should not be held against prospective bidders and notes of all questions and answers at any briefing meeting should be copied to all tenderers In some cases, the PCT will provide potential bidders with a business case pro forma for tendering for the APMS contract. This provides bidders with a framework on which to build their bid, even if use of the pro forma is not compulsory. PCTs may, for example, direct bidders to explain their strategies for meeting PCT requirements regarding access, quality, service provision, training, patient liaison and service management and monitoring. PCT tendering packs may also set out considerations that potential providers are required to take into account in their bids. This too will help bidders to write a comprehensive response. In the absence of a pro forma, bids are likely to need to cover the following: 1. Name of the provider making the bid. 2. Service aim a statement summarising the main purpose of the service which could also refer to the principal health gains to be achieved. 3. Service objectives a statement describing how the main objectives of the proposed services will be achieved referring to the practice s relevant expertise in the area. 4. Anticipated commencement dates for service provision. 5. Management arrangements including the name of the service manager, the member of the practice team who will be responsible for establishing and maintaining the service, other proposed staffing, job descriptions and responsibilities. 6. Relationships with other providers/agencies arrangements for ensuring co-operation should be explained, for example we intend to establish both formal and informal links with the local hospital physiotherapy service, and the currently limited community based service, to avoid duplication of these. Bidders may also wish/be asked to outline plans for taking forward practice based commissioning as part of the service. 7. Timetable for developing the service, which could include both a short term timetable and longer term timetable encompassing service evaluation and necessary modification. 8. Resources and level of support required from the PCT. 9. How the service and service delivery will be evaluated by the practice, possibly including for example an assessment of value for money, impact on waiting lists etc. 10. Additional supporting information e.g. the medical aspects of the service to be offered, the population and its needs, the particular strengths and interests of the practice and individual members. 10
11 Potential bidders shortlisted by the PCT on the basis of their tender will generally be required to attend a further selection process including, for example, an interview and delivery of a presentation. Pricing the contract There are no statutory requirements for the price of APMS contracts, the price of each being negotiated locally by the PCT and provider. When tendering for APMS contracts GPs need to cost all the components of any service they are proposing to provide. These costs, which include the expense of acquiring and maintaining new skills, the time and resources incurred by the GP and/or practice manager in organising a service, and the staff, premises and equipment actually used to provide it, must all be met if a service is to be financially secure and successful. It is important to remember that there may be opportunity costs when practices provide a new service if other current commitments are dropped to accommodate the new work. Any such loss of practice income should be assessed when bidding for the new service. It may be helpful to summarise the resources required for the bid and then to provide a detailed analysis of costs. Potential providers will need to estimate the level and range of staff required to deliver the services outlined in the service specification and should think about how these staff will be sectored. In some cases potential providers will need to consider the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) arrangements. These regulations preserve employees terms and conditions when a business, or part of one, is transferred to a new employer. PCTs may be willing or expecting to offer a period of guaranteed funding to new providers while services are established. Such payments may help to counteract the risks involved in taking on new services but are also open to accusations of unfairness, particularly where GMS and PMS practices in the same area are not entitled to similar guarantees. GPs wishing to engage in APMS will wish to establish how the APMS contract will be funded throughout its duration. The BMA has produced detailed guidance on APMS which can be found by logging into the BMA website here: BMA members are also able to access comprehensive business support services and guidance, details of which can be found here: 7 Further information 11
12 Lord Darzi s Next Stage Review interim report, Leading Local Change and Changing for the Better can be found here: The BMA provides regular updates on its dedicated Next Stage Review pages, found here: These pages also contain all the letters sent by the BMA to Lord Darzi and the Department of Health. The Department of Health website details the procurement framework and provides comprehensive guidance on the procurement process:
13 Appendix 1 List of PCTs that are to procure new practices Rank PCT SHA Number of practices 1 Manchester PCT North West SHA 3 2 Barking and Dagenham PCT London SHA 3 3 Knowsley PCT North West SHA 3 4 Sandwell PCT West Midlands SHA 3 5 Wolverhampton City PCT West Midlands SHA 3 6 Heywood, Middleton and Rochdale PCT North West SHA 3 7 Liverpool PCT North West SHA 1 8 Sunderland Teaching PCT North East SHA 3 9 Birmingham East and North PCT West Midlands SHA 3 10 Halton and St Helens PCT North West SHA 3 11 Heart of Birmingham Teaching PCT West Midlands SHA 3 12 Barnsley PCT Yorkshire and The Humber SHA 3 13 Leicester City PCT East Midlands SHA 3 14 Oldham PCT North West SHA 2 15 Blackburn with Darwen PCT North West SHA 3 16 Stoke on Trent PCT West Midlands SHA 3 17 Hounslow PCT London SHA 3 18 Hull PCT Yorkshire and The Humber SHA 3 19 Nottingham City PCT East Midlands SHA 3 20 Blackpool PCT North West SHA 3 21 Ashton, Leigh and Wigan PCT North West SHA 3 22 Dudley PCT West Midlands SHA 3 23 Bolton PCT North West SHA 1 24 Greenwich Teaching PCT London SHA 3 25 Sefton PCT North West SHA 2 26 Medway Teaching PCT South East Coast SHA 3 27 Salford PCT North West SHA 2 28 Hartlepool PCT North East SHA 2 29 Tameside and Glossop PCT North West SHA 3 30 Walsall Teaching PCT West Midlands SHA 3 31 Newcastle PCT North East SHA 3 32 Redcar and Cleveland PCT North East SHA 3 33 South Tyneside PCT North East SHA 3 34 Calderdale PCT Yorkshire and The Humber SHA 3 35 North Lancashire PCT North West SHA 2 36 Luton Teaching PCT East of England SHA 2 37 Havering PCT London SHA 1 38 Hammersmith and Fulham PCT London SHA 2 39 Rotherham PCT Yorkshire and The Humber SHA 1 40 Enfield PCT London SHA 1 41 Bury PCT North West SHA 1 42 South Birmingham PCT West Midlands SHA 1 43 Telford and Wrekin PCT West Midlands SHA 1 44 Newham PCT London SHA 1 45 Gateshead PCT North East SHA 1 46 Coventry Teaching PCT West Midlands SHA 1 47 Bristol PCT South West SHA 1 48 North Somerset PCT South West SHA 1
14 49 Middlesbrough PCT North East SHA 1 50 East Lancashire PCT North West SHA 1 14
15 Appendix 2 Timeline of the procurement process 2007 TIMESCALES & PERFORMANCE MILESTONES Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr OSC approval and commencement of local PCT consultations (up to ITT) SHA sign off PCT project plans and statement of intent PCT Procurement Framework launch and Conference SHA sign off PCT specifications PCTs build procurement teams PCTs place advert Exception reporting milestones 1. SHAs sign off PCT project specifications (29 Feb 08) 2. PCTs to have placed adverts and MOI (16 May 08) 3. PCTs evaluate PQQ and select bidders (29 Aug 08) 4. SHAs sign off ITT and PCTs issue to selected bidders (31 Oct 08) 5. All contracts awarded and signed (31 Dec 08) Regional bidder workshops PCTs place MOI EOIs recieved ITT developed and signed off by SHAs PCTs issue PQQ to bidders PCTs evaluate PQQ PCTs select bidders PCTs issue ITT to selected bidders MOI Memorandum of Interest Bidders respond to ITT PQQ Pre Qualifying Questionnaire ITT Invitation to Tender PCTs evaluate bidder responses Successful bidder selected, contract awarded and signed Services commence Staggered implementation 1
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