Each year, NHS organisations commission services that millions of patients rely on for their care. The NHS budget is well over £100bn and the majority of that funding is allocated to ICBs to commission services on behalf of their population.
January 2024 will see the introduction of a new set of rules governing how NHS organisations should go about commissioning services. This new Provider Selection Regime will apply to both ICBs and NHS Trusts and sets the rules for when and how competitive procurement should be used alongside other contracting routes.
In anticipation of the new rules, we wanted to find out more about the current state of NHS procurement. So, earlier this year, we made a Freedom of Information request to all 42 Integrated Care Systems (ICSs) across the UK, requesting data on their procurements of clinical services since they were established on a statutory basis on 1 July 2022.
We wanted to understand:
- How many procurements have ICBs undertaken
- What the outcomes were
- Whether we have seen a change in the providers of services as a result
- How consistent procurement behaviour and activity has been
We asked seven questions focused on the number of procurements that had taken place and what types of organisations had won the contracts.
So what did we find?
While all 42 ICSs responded, a number of them failed to provide details – and a number cited the commercial confidentiality exemption from the FOI Act – even for some very basic and non-commercially sensitive information.
The data provided was also inconsistent, which certainly raises questions about how accessible, transparent and clear the picture is.
The data showed that there had been 117 procurements in total, included primary care (such as APMS contracts) as well as some accreditation processes for choice-based services.
Working out at an average of 2.8 per ICS., this number is lower than might be expected, which may be partly attributable to inconsistent reporting, but also points to limited procurement activity.
We expect that some procurements have been delayed in anticipation of a new set of procurement rules, but these results do highlight the limited extent to which ICSs are using open procurement processes to contract service providers.
There was also a significant disparity between the number of procurements being reported. The highest number of procurements reported by a single ICS was 24 (that’s over 20% of the total), followed next by 10.
Again, this is partly attributable to inconsistent reporting but also further indicates limited procurement activity being undertaken by the majority of ICSs.
What are procurement processes being undertaken for?
Of the 117 listed procurements, 13 were new services (11% of total), which suggests that procurement is not being used as a tool for ICSs seeking to identify innovative new services or providers. Of these ‘new’ services, contracts were won by 15 private providers, 9 public and 7 charities.
ICSs also indicated that they had run procurement exercises for existing services, most of which will occur when a contract expires. Of these 104 preexisting services, the data shows that these are being run by a total of 138 providers, 111 of which are private, whereas 16 are public and 11 are charities.
The number of incumbent providers who successfully won back their contracts reduced slightly across the board: 96 private organisations were successful, compared to 11 public providers and 9 charities. Though the decline in successful incumbent providers was consistent across the provider types, a key takeaway here is that the type of contracts being re-tendered seem to be those largely run by independent sector providers.
Despite concerns regarding the consistency of the reported data, the findings provide a useful point of comparison against the incoming Provider Selection Regime which we hope will help us to better understand whether the new rules have been able to make a positive impact for patients and taxpayers.
The inconsistent data quality and depth was clear. Some did not respond at all, while others were unable to list the procurements that they had undertaken on the basis that it would take a disproportionate amount of resource to work out the answer.
We believe that this increases the importance of the new transparency requirements that form part of the Provider Selection Regime. For patients and taxpayers to have confidence about the services commissioned on their behalf, it’s essential that NHS commissioners operate openly and transparently. The inconsistent (and in some cases non-existent) data currently available makes it very difficult to determine with confidence what NHS commissioners are currently doing and it will be interesting to explore this again once the new regime takes effect.
Question a.) What is the total number of procurements (clinical healthcare services only) that XXXX ICS have conducted since 1st July 2022?
Question b.) Has XXXX made any procurements (clinical healthcare services only) of a new service under the current procurement rules since 1st July 2022? (by new service meaning not previously being delivered by a provider).
Question c.) If yes to b, how many procurements (clinical healthcare services only) of a new service has XXXX made under the current procurement rules since 1st July 2022? (by new service meaning not previously being delivered by a provider).
Question d.) If yes to b, what type of organisation won each procurement (clinical healthcare services only) – Please also provide the names of each successful organisation; and whether they are private, social enterprise, charity or public; and what the contract was for.
Question e.) If no to b (so an existing service), what was each type of incumbent provider? – Please also provide the names of each incumbent successful organisation; and whether they are private, social enterprise, charity or public; and what the contract was for.
Question f.) Of each of those listed in e, did the incumbent provider win the procurement (clinical healthcare services only)? – Please also provide the names of each successful organisation; and whether they are private, social enterprise, charity or public; and what the contract was for.
Question g.) If no to f, what was the provider type for each of the successful new providers? Please also provide the names of each successful organisation; and whether they are private, social enterprise, charity or public; and what the contract was for.