Changes to provider licence requirements reflect integration and NHS England newfound enforcement powers

NHS England has launched the first substantive consultation on changes to the NHS provider licence since 2013 with a view to bringing requirements in line with the Health and Care Act 2022 and accompanying policy changes. Existing licence conditions reflect a different statutory and operating environment focused on economic regulation and competition and fails to reflect the emphasis on integration and collaboration as highlighted in the new legal framework. The consultation proposals aim to reflect the statutory and policy requirements which providers are adopting as part of the shift into integrated care systems.  

Notable proposals include the following:

• NHS Trusts, previously exempt, will now need to be licensed, along with all NHS foundation trusts and independent providers of NHS services;
• Requirements to reflect the expectations around collaboration and co-operation between trusts, foundation trusts and NHS Controlled Providers across integrated care systems with a view to delivering core system objectives including planning, service delivery and improvement and delivering system financial objectives;
• Consistent co-operation in the delivery of agreed system financial plans, reflecting the new statutory duties to manage collective financial resources and deliver joint financial objectives in line with NHS England directions and financial requirements. In practice, this means that each provider will be expected to deliver the financial position agreed with the ICB and other system partners each year, even if that position represents a deficit. There is also a clear expectation that providers will not use more than their fair share of NHS resources as allocated by ICBs, which will be reflective of local population needs;
• Conditions mirroring the expectations of relevant bodies to comply with the Triple Aim duty (i.e. the likely effects of decisions relating to: the health and well-being of its population; the quality of services provided to individuals; and efficiency and sustainability in relation to the use of resources);
• Conditions to reflect digital obligations with a view to promoting digital maturity, in particular for relevant bodies to meet baseline capabilities that are critical to care delivery such as cybersecurity protection and functional electronic patient records;
• Reframing the integrated care condition as a positive obligation to integrate service provision and reduce health inequalities. This constitutes a clear shift from what is currently phrased as a broad prohibition not to act in manners which undermines the delivery of integrated care;
• Removal of the ‘competition’ requirements currently prohibiting licence holders from entering into arrangements to prevent competition in the provision of healthcare services or otherwise engage in conduct which has the effect of preventing competition. This reflects a change in priorities from competition to collaboration, as well as NHS England’s lack of statutory responsibility for competition oversight (although general competition law will continue to apply where relevant);
• Expansion of the patient choice condition to reflect and support the implementation and delivery of personalised care;
• Conditions to reflect the requirements of the Health and Care Act 2022 relating to tackling climate change and delivering net zero emissions;
• Amendments to the Fit and Proper Persons condition to bring it in line with the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014.

The consultation ends on 9 December 2022 and it is expected that proposals will take effect from next year. Existing arrangements will be maintained until such time as the modified licence takes effect.

Updated Enforcement Guidance

A consultation is also underway with regard to proposed updates to the existing Enforcement Guidance. Amongst other things, the updated guidance reflects the processes NHS England will apply when using its licence enforcement powers. Other proposed revisions to the guidance including the following:

• Alignment with the Health and Care Act 2022 and new responsibilities, in particular reflecting the abolition of Monitor and NHS Improvement, as well as the transfer of functions to NHS England including that of statutory accountability for oversight of both ICBs and NHS service providers;
• Reflecting NHS England’s approach to its newfound enforcement powers over ICBs and relevant providers. This includes details of enforcement processes in relation to compliance with patient choice provisions as well as licence enforcement mechanisms applicable to trusts, foundation trusts, licensed independent providers of NHS services and licensed NHS Controlled Providers;
• Rights of appeal in the event of enforcement action;
• Alignment with current policy including the NHS Oversight Framework and operational best practice, including reducing the emphasis on investigations in the event of suspected provider licence breach.

Following consultation, the revised guidance will replace and supersede Monitor’s Enforcement Guidance.

Relevant bodies affected by the proposals should consider responding to the consultations to ensure that NHS England receive a wide range of views and keep a look out for further updates from Team Bevan Brittan on these important topics.

If you require assistance with these matters or would like to understand how we can support you then please contact Vincent Buscemi or Leila Souss.