Health Services: CCG Contracts — Friend or Enema! Part 2

Stephen Ashcroft of Brian Farrington, brings us the second part of  his three-part series on this month's hot topic, Health Services.  Part 1 was published here

Service Conditions

The 2014/15 NHS Standard Contract reflects the requirements set out in ‘Everyone Counts: Planning for Patients 2014/15 to 2018/19’. The contract comprises three parts:

1.The Particulars

2.Service Conditions (SC)

3.General Conditions (GC)

In part one  we considered The Particulars, and in this second post we will consider the Service Conditions.

This section consists of 50 pages and contains critical ‘clauses’ that place obligations on a Service Provider. The detail is very precise as to which conditions will apply to Service categories. Some conditions will apply to all, whereas others are category-specific, e.g. some may only be applicable to Radiotherapy or Substance Misuse.

Again, our commentary is selective. The Service Provider (and the CCG representative) must, diligently and carefully review the whole document.

At SC3 “Service Standards” this sets out what the Provider must do, namely:

3.1.1          not breach the thresholds in respect of the Operational Standards

3.1.2          not breach the thresholds in respect of the National Quality Requirements

3.1.3          not breach the thresholds in respect of the Local Quality Requirements

3.1.4          ensure that Never Events do not occur

3.1.5           meet the applicable national standards and outcomes measures from time to time set out  in Guidance.

To those who are not initiated in contract detail, any capitalised words or phrases should be defined in the contract to remove uncertainty about their meaning. SC3 has demanding obligations on the Provider. At clause 3.3 the CCG reserves a number of rights to deal with a non-compliant Provider, including removing a Service User from the Provider’s care. Clearly, this outcome is unwelcome and could have a detrimental impact on the Provider’s service.

Providers should scrutinise the contract for the obligations placed upon them. For example, at SC9 ‘Consent’ it states (9.1) “The provider must publish, maintain and operate a Service User consent policy which complies with Good Practice and the Law.” If this wording is scrutinised, what exactly does “publish” mean? It is not a defined term, so would it be acceptable to have it available on the Provider’s website or does hard copy have to be available?

What does ‘maintain’ actually mean? Does it require an annual review? How does the Provider satisfy the ‘operate’ requirement? The definition for ‘Good Practice’ can be found in the third document “General Conditions” of the 2014/15 NHS Standard Contract. The Law is not defined but at GC39 of the General Conditions the Governing Law and Jurisdiction is that the Contract will be subject to the laws of England. This rather simple ‘Consent’ clause is an illustration of the need to navigate around all the contract terms and conditions and to be absolutely clear what the obligations and risks really are.

All Providers will be interested in SC36 Payment Terms specifically Clause 36.3 “Prices.” It states that the prices payable will be:

36.3.1          for all Services for which the National Tariff Rules mandate or specify a price:      the National Price; or      the National Price as modified by a Local Variation.      (subject to Service Conditions 36.16 to 36.20 (Local Modifications)) the National price as modified by a Local Modification approved or granted by Monitor

For the relevant year

There are situations where particular services will be tendered to a CCG and a price submitted. What happens then? The Provider is advised to consider the length of time to which the price will apply. Is there an annual review and, if so, what is the mechanism? Is it linked to the Retail Price Index or Consumer Price Index?

By the way, who is Monitor?  As always in procurement consider your stakeholders internally and externally - and it would appear Monitor can have a major impact on prices. Monitor is an executive non-departmental public body of the Department of Health, the sector regulator for health services in England. The Health and Social Care Act 2012 gave Monitor additional duties including setting prices for NHS-funded care in partnership with NHS England as well as supporting commissioners to protect essential health care services for patients if a provider gets into financial difficulties.

In Part Three we will explore key facets of the General Conditions of the 2014/15 NHS Standard Contract.


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