NHS provider selection regime

The NHS provider selection regime is a relatively new set of rules pertaining to the procurement of health care services in England specifically. Introduced in October 2023, these new rules came into effect as of January 1, 2024, and are for Integrated Care Boards (ICBs), NHS trusts and foundation trusts, and local or combined authorities within England.

The provider selection regime – PSR – was introduced as part of the regulations stipulated in the Health and Care Act 2022, which also saw integrated care systems (ICS) made statutory and made promises towards integrated care, the provision of health and care, and introduced stricter data protection rules and punishments as NHS Digital continues to grow in importance.

According to NHS England, the PSR has three core objectives:

• To “introduce a flexible and proportionate process for deciding who should provide health care services”
• To “provide a framework that allows collaboration to flourish across systems”
• To “ensure that all decisions are made in the best interest of patients and service users”.

Joined-up care is both the long term goal of the NHS and the UK government, and integrated care is how this is achieved. Interoperable software solutions from organisations like The Access Group are helping healthcare organisations establish a proper digital care setup, but more effort and guidance is needed to educate and support staff in utilising these solutions to engage with other colleagues and services across the UK to enhance the level of healthcare available.

The other UK nations:

Due to the differences between national executives, the Sennedd Cymru both introduced and passed the Health Service Procurement (Wales) Bill, which adapts NHS Wales’ existing procurement processes to be more in line with those of NHS England so that there is no imbalance benefitting England moreso than Wales. It is unclear as to NHS Scotland’s response, and Northern Ireland’s assembly only recalled in February 2024 – after two years hiatus – so a response from their authority may take some time.

Provider Selection Regime regulations

The full Provider Selection Regime regulations can be found on the UK Legislations website. It is a long legal document however, so we’re providing a simplified rundown for you below.

What are the PSR regulations?

The PSR regulations are labelled ‘statutory guidance’ but the truth is that these aren’t guidelines: these are legally enforceable rules that should be adhered to by NHS England, ICBs, local or combined authorities, and NHS or foundation trusts.

The regulations are for the procurement of health care services in England or the arrangement of said services. The aim of the game is accountability and proper scrutiny, and the Health and Care Act 2022 makes legal requirements for transparency within the decision-making process of choosing a provider for health and care services.

The legal documentation refers to health services as being those services that improve the “physical and mental health of the people of England and in the prevention, diagnosis and treatment of physical and mental illness.”

These ‘in-scope’ health care services are services provided by the organisations we’ve already listed, but for extra context they cover hospital care, community care, mental health services, primary care, palliative care, ambulance services, other patient transport, and local authority services surrounding substance use, sexual and reproductive health, or general health visits.

How does the PSR give organisations greater flexibility?

The UK government webpage about the Provider Selection Regime states that the PSR “would give decision-makers in the NHS and local government the flexibility they need to arrange services that best promote the interests of patients, the taxpayer, and the population.”

The flexibility would be granted based on criteria such as the quality and innovation of a provider’s services, the value for money, their ability to integrate with existing services, their capacity to collaborate, how sustainable the service is (which feels like it ties into the value for money), the social value of onboarding the provider, and the opportunities generated by partnership to tackle issues like health inequality or to improve patient choice.

Is anything exempt from the PSR regulations?

Yes. The PSR doesn’t apply to non-healthcare services, such as medicine acquisition, catering, cleaning, or business services. It also doesn’t apply to goods – many of which are related to the above areas.

In cases of mixed procurement (aka in collaboration with a healthcare service) then organisations are advised to read up on the NHS’ mixed procurement rules.

PSR framework

We’ve mentioned above about the most suitable provider process. This is one of five processes within the Provider Selection Regime framework, and we will explain each below.

Direct Award Process ‘A’

This process is where an Integrated Care Board (ICB) can directly award a contract to a provider, without having to allow competition. The stipulation for this however is that it must be announced UK e-notification service, within 30 days of agreement.

This approach has to be pursued when “there is an existing provider of the health care services to which the proposed contracting arrangements relate” and when “the relevant authority is satisfied that the health care services to which the proposed contracting arrangements relate can only be provided by the existing provider (or group of providers) due to the nature of the health care services.”

Direct Award Process ‘B’

Process B follows much of the same requirements, however it has to be pursued when all of the following criteria are met:

• The contract arrangements are about patient choice regarding the provider,
• The relevant authority doesn’t restrict the number of providers,
• The authority will honour and offer contracts to all providers who meet the requirements of their service and the patients,
• and the authority has a process in place to accept provider interest or propositions to cater for these health care services.

Direct Award Process ‘C’

Process C is slightly different. The relevant authority can still make a direct award, but it has to be an existing contractor. It also has to go through six specific stage of assessment criteria, including publication of the intent to award the contract and then tackling objections or compliance issues.

Direct Process C can only be used when processes A or B aren’t mandated, and only when an existing contract is due to expire. It is a fast-track process to renew with a trusted provider on similar contract terms, and the provider has satisfied the current contract in place.

Most Suitable Provider Process

The Most Suitable Provider Process is another direct award, but it’s not labelled as such. It is an eight-step process to determine which provider amongst many is the most suited to the health and care services required.

Competitive Process

The final process, Competitive, is a 10 step process with definitively defined criteria from the ICB. Offers are invited, assessment is performed, and a contract is provided to the best organisation. It’s fair and transparent.

Provider Selection Regime parliament

The PSR launched in January 2024, as per the 2022 Act, but the reason it went through the UK Parliament in the first place was because of the rapid evolution of healthcare.

Frontline digitisation is optimising existing workflows and helping maximise efficiency for clinical staff and patients, but the mechanisms of the healthcare system also need addressing, which is what the PSR is for. It has been introduced to give new flexibility and variety for the selection of providers for health care services. The needs of the people are the priority, and inflexible commissioning means their wishes can’t be taken into account.

Integration and collaboration are big words within the NHS these days because of their connotations. The NHS wants to provide a coherent, joined-up care approach regardless of which country you’re in. Trusts or health boards cannot improve without overarching support to push change through, but rapid change without transparency leaves room for corruption, incompetence, and wastage through bureaucracy. This is where politicians have a duty to enshrine requirements in law and investigate the elements that aren’t working and demand alternatives.

In line with the PSR, our Access Adam Care Commissioning software enables you to be fully compliant with all elements of the Provider Selection Regime. It allows NHS and local authority bodies to have oversight of their entire provider market at the click of a button; to provision care and services in a predetermined timeframe through the multiple award options. Our software allows you to manage provider contracts and all legal and compliance documents, to ensure the services you are provisioning meet the new criteria.

This brings us neatly to the end of our PSR guidance. It’s a complex subject matter but our hope is that we’ve effectively broken it down into layman’s terms so that you can understand the core goal of such legislation: to introduce greater transparency and flexibility to the health care provider selection process.

If you’ve enjoyed this blog, why not continue your reading journey with our blog on NHS collaboration and our top tips for trusts (and health boards).