Health And Social Care Act 2012 What Does It Mean To Individuals And Businesses?

What Impact Will The Health & Social Care Act Have On Businesses and Individuals?

26.06.2012

The Health and Social Care Act 2012 (“the Act”) was given Royal Assent on 27 March 2012 and is quoted as being one of the “biggest reorganisations in the history of the health service”.  The Act focuses on restructuring the NHS with the intent to open the system up to competition and promote patient choice while reducing NHS administration costs.

The new structure abolishes Primary Care Trusts and introduces an independent NHS Board which amongst other tasks will provide commissioning advice and allocate resources.  The Act also increases GPs’ powers to commission services on behalf of their patients via new commissioning consortia.

Monitor, the body which currently regulates NHS Foundation hospitals, will have a duty to eliminate anti-competitive behaviour in the NHS generally.  Monitor will have powers similar to the OFT and its primary concern will be to promote the interests and welfare of people who use health care services.

There has been some controversy in relation to this because a tension could arise between open competition and the duty to promote consumer welfare.  Although on the face of it, competition is in the interests of the consumer and taxpayer because costs should reduce, it is feared that the standards of healthcare could be affected.  However, the emphasis will be on ‘patient choice’ and we will need to wait and see whether this works well in practice.

Commissioning consortia will be subject to procurement rules when they commission healthcare providers.  There will be more commissioning consortia than the PCTs that they are replacing and it is likely that commissioning health services will become more complex.  There will be a regulatory burden on the commissioning consortia which will fall on their members who may not be experienced in the area of procurement.  It will also be interesting to see how the government’s recent “Procurement Pledge” which adopts five commitments to attempt to make procurement more strategic will affect the way that procurement is undertaken by commissioning consortia.

Commissioning consortia will be wary of legal action being taken by private healthcare providers under the procurement rules and this may impact on both the level of services they commission and the time taken.

The rules of state aid will also apply to consortia.  “State aid” refers to forms of assistance from a public body or publicly funded body given to selected undertakings which has the ability to distort competition.  Commissioning consortia should be particularly wary of this where any payments above market rate may be made to healthcare providers.

Competition and procurement law advice is recommended in order to ensure compliance with the Act.  If you require any further information please contact Kerry Smith on 0370 238 8176.