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Health and Social Care Act 2001

Health and Social Care Act 2001

2001 CHAPTER 15

ANNEX A: OUTLINE OF THE EXISTING LAW

337.The following paragraphs provide a brief description of the current legislative framework for the NHS and social services. The legislative framework for the NHS in England and Wales is mostly set out in the National Health Service Act 1977 (“the 1977 Act”). This has been amended quite substantially by various enactment’s, notably by the National Health Service and Community Care Act 1990 (“the 1990 Act”), the Health Authorities Act 1995 (“the 1995 Act”), the National Health Service (Primary Care) Act 1997 (“the Primary Care Act”) and the Health Act 1999 (“the Health Act”) .

338.The legislative framework for social services in England and Wales is set out in the National Assistance Act 1948, the National Health Service Act 1977 (“the 1977 Act”), the National Health Service and Community Care Act 1990 (“the 1990 Act”) and the Community Care (Direct Payments) Act 1996 (the “Direct Payments Act”) .

339.This Annex describes the existing legislation about the NHS. Annex B describes the existing legislation about social care; and Annex C describes other relevant legislation.

Existing legislation about the NHS

National Health Service Act 1977

340.Under the 1977 Act, the NHS is essentially split into two different systems. The first is the system which consists primarily in the provision of health care in hospitals. It also covers those services described as “community health services”, for example the services provided by district nurses, midwives or health visitors in clinics or individuals’ homes, and the provision of medical services to pupils in state schools. This system is the subject of Part 1 of the 1977 Act. The responsibility for securing the provision of these services to patients rests with the Secretary of State, although under his powers in section 16C (formerly section 13) of the 1977 Act he has delegated most of his functions to Health Authorities. Health Authorities enter into arrangements with bodies known as NHS trusts for the provision by the Trusts of hospital and community health services.

341.The other main part of the NHS structure is what might be described as “the NHS on the high street”. This is dealt with under Part 2 of the 1977 Act which governs the arrangements made by Health Authorities for the provision of services by the following professionals:general medical practitioners (GPs) (i.e. family doctors), general dental practitioners (GDPs), ophthalmic opticians and ophthalmic medical practitioners (also known as optometrists), and pharmacists . They respectively provide what are termed general medical services (GMS)(section 29ff), general dental services (GDS)(section 35ff), general ophthalmic services (GOS)(sections 38-40) and pharmaceutical services (PhS)(sections 41-43) respectively. The remainder of Part 2 contains other provisions relevant to the provision of these “high street” services, which are often referred to as family health services.

342.The 1990 Act, the Primary Care Act and the Health Act introduced a number of changes to these systems of health care. Broadly speaking, these changes were as follows:

(a)

the 1990 Act introduced what is known as the internal market; by creating a divide between the planning and purchase of Part 1 services, on the one hand, and the provision of those services, on the other:

(b)

the Primary Care Act in effect enabled what were previously Part 2 services to be delivered, not under Part 2, but under a more flexible system within Part 1 of the Act – these changes applied only to doctors and dentists, and not the other family health services practitioners; and

(c)

the Health Act made a number of changes, but in particular provided for the abolition of GP fund-holding (introduced by the 1990 Act), the establishment of Primary Care Trusts (a new type of NHS body to both commission and provide NHS care) and new arrangements to improve the quality of NHS services and co-operation between NHS bodies and local authorities.

343.The two systems, Part 1 and Part 2, are very different. It should be noted that despite the changes introduced by the Primary Care Act the provision of Part I services is distinct from the provision of services under Part 2. The changes proposed in this Act will not alter this divide. The following is a more detailed description of the two systems.

Part I system – hospital and community health services

344.The system provided for under Part 1 of the 1977 Act (and Part 1 of the 1990 Act – discussed below) is the system under which all of the NHS, apart from family health services, is provided, including its hospitals. The core duty to ensure the provision of a health service is laid upon the Secretary of State (1977 Act, section 1) in extremely broad terms, and is supplemented by the provisions of the sections 2 to 5.

345.Section 3 sets out those general services which it is the Secretary of State’s duty to provide to such extent as he considers necessary to meet all reasonable requirements. Most of the services that may be described as hospital and community health services are included under this section.

346.Section 5(1) and (1A) impose duties on the Secretary of State to provide medical and dental services to state school pupils. This is the basis for what is described as the school nursing service.

347.Section 2 confers wide ranging powers for the Secretary of State to provide such services as are appropriate to discharge any duty imposed on him by the Act (including his general duty under section 1), and to do any other thing whatsoever which is calculated to facilitate, or is conducive to or incidental to, the discharge of any duty imposed on him by the Act . Further miscellaneous powers relating to specific matters are conferred by section 5(2) (for example, the conduct and assistance of research and development (section 5(2)(d)).

348.Sections 8 to 18 of the 1977 Act go on to provide for the administration of the NHS. These sections have been substantially amended since 1977, most recently by the Health Act. As amended, they provide for the setting up of Health Authorities (section 8), Special Health Authorities (section 11) and Primary Care Trusts (section 16A, as inserted by section 2 of the Health Act). Health Authorities, Special Health Authorities and Primary Care Trusts are independent statutory bodies, although their membership is determined in accordance with regulations (and in the case of Special Health Authorities, the establishment order) and some of the appointments to their membership are made by the Secretary of State. Health Authorities and Primary Care Trusts are established for territorial purposes. Each Health Authority is established for such area of England and Wales as set out in the establishment order made under section 8. The entire area of England and Wales is covered by Health Authorities . Each Primary Care Trust is established for the area specified in its establishment order under section 16A(3). Each Primary Care Trust area is wholly contained within the area of a Health Authority, but there is no requirement for total coverage. Some areas of England are covered by Primary Care Trusts , others are not. There are no Primary Care Trusts in Wales, as the relevant provisions of the Health Act have yet to be brought into force in Wales. Special Health Authorities are established for specific functional purposes – they are established for the purpose of performing any functions of the Secretary of State which he may then direct them to perform under section 16C.

349.The Secretary of State may direct a Health Authority or Special Health Authority to exercise his functions (section 16C, formerly 13, of the 1977 Act). A Health Authority may direct a Primary Care Trust established in their area to exercise those of its functions which it is permitted to delegate (section 17A, inserted by section 12 to the Health Act). The Secretary of State may direct Health Authorities that delegable Health Authority functions are or are not to be exercisable by Primary Care Trusts, or are to be exercisable by Primary Care Trusts to any specified extent (section 17A(4)). The Secretary of State may also give directions to a Health Authority, Special Health Authority or Primary Care Trust about the exercise of any of their functions (section 17). A Health Authority may also give directions to a Primary Care Trust about the exercise of any functions which the Health Authority has directed the Primary Care Trust to exercise (section 17B). These Direc­tions may be given by regula­tions or by instru­ment in writing (section 18). There is very little further prescrip­tion in pri­mary legislation as to what the Secretary of State must do or how he must do it in rela­tion to the provision of that part of the NHS which is not concerned with family health services. It will be seen that this way of providing services is a great deal more flexible than the regula­tory system envisaged under Part II. There are probably historical reasons for this, but those reasons are no longer relevant.

350.Health Authorities­ may, in accordance with regulations and any relevant directions, delegate their functions (whether Part I or Part II) to each other, or to committees or others (section 16 of the 1977 Act (as substituted by paragraph 9 of Schedule 5 to the Health Act)). Similar provision is made for Primary Care Trusts (section 16B of the 1977 Act (as inserted by section 2(1) of the Health Act)). Regulations have been made under both provisions.

351.Health Authorities and Special Health Authorities are funded under the provisions of section 97, as substituted by paragraph 47 of Schedule 1 to the 1995 Act and amended by section 36 of the Primary Care Act and by sections 4 and 8 of the Health Act. Health Authorities are paid money in each year under section 97(1) and section 97(3). Section 97(1) concerns the remuneration of persons providing Part II services and is not cash-limited (in other words the Secretary of State must pay whatever it has cost the Health Authority, and he cannot impose a ceiling on the expendi­ture). Under section 97(3) a Health Authority is paid money not exceeding the amount allotted to them by the Secretary of State. This amount is allotted towards meeting their "main expendi­ture" which includes all expenditure attributable to the performance of their Part I functions, and all their administrative costs. The money paid in respect of Part I services is therefore ultimately cash-limited. To enforce the cash-limits set by the Secretary of State, Health Authorities have various financial duties imposed upon them by section 97A of the 1977 Act (as substituted by paragraph 48 of the 1995 Act and amended by paragraph 23 of Schedule 2 to the Primary Care Act).

352.Primary Care Trusts are funded by Health Authorities under section 97C of the 1977 Act, as inserted by section 3 of the Health Act. There is a similar distinction between cash-limited and non-cash-limited funding. PCTs are also subject to a set of financial duties similar to those for HAs.

NHS TRUST Part II system – family health services

353.The system provided for under Part II of the Act is quite different. The broad structure of the Part II system is similar for doctors, dentists, persons providing ophthalmic services and persons providing pharmaceutical services. The existing system will first be described as it refers to doctors. The different arrangements as they apply to the other professional groups will be set out later.

General Medical Services

354.Under section 29 of the 1977 Act, it is the duty of each Health Authority in accordance with regulations to arrange for medical practitioners to provide personal medical services for all persons in the area who wish to take advantage of the arrangements. These services are described as general medical services (GMS). A principal feature of the system as it operates in practice is that (apart from certain exceptional cases) it is not the Health Authority itself which provides the GMS; instead, it enters into separate statutory arrangements with independent practitioners for the provision of those services. GPs are not employees of the Health Authority; they are independent professionals who undertake to provide GMS in accordance with the body of regulations governing that activity. Those Regulations are currently the National Health Service (General Medical Services) Regulations 1992 (S.I. 1992/635) as amended.

355.The remainder of 1977 section 29 sets out certain things which must or may appear in the Regulations. Section 30 deals with the matter of applications by medical practitioners to be included in what is known as the “medical list”: that is the list kept by each Health Authority of GPs who provide GMS in its area. Sections 31 and 32 provide for each GP on a medical list to have undergone vocational training. Section 33 provides for the system for admitting GPs to medical lists. Section 34 provides for regulations to be made relating to the Medical Practices Committee (“MPC”), which has a role in admitting GPs to the medical list. The MPC is set up under section 7 of the 1977 Act. Sections 29A and 29B (as inserted by section 32 of the Primary Care Act) make further provision relating to medical lists and vacancies.

356.It is the duty of each Health Authority, in accordance with the Regulations, to administer the arrangements made for the provision of GMS and other family health services (section 15 of the 1977 Act). The Health Authority must also perform such management and other functions relating to those services as may be prescribed.

357.In contrast to the Part I system, therefore, the duty to make arrangements for those services is conferred directly upon Health Authorities, rather than upon the Secretary of State. Nonetheless, in exercising functions under Part II, Health Authorities may be the subject of Secretary of State directions issued under section 17 of the 1977 Act. Health Authorities are able to delegate their Part II functions in accordance with regulations made under section 16 of the Act.

358.Subject to any Secretary of State directions under section 17A(4) of the 1977 Act, Health Authorities may direct Primary Care Trusts to exercise their functions in relation to GMS, but not in relation to other Part II services (see section 17A(3) of the Act). The Secretary of State has directed Health Authorities that they may delegate only a limited range of GMS functions to Primary Care Trusts.

359.This broad structure of the Part II system is similar for dentists, persons providing ophthalmic services and persons providing pharmaceutical services, but there are significant differences, most notably relating to persons providing ophthalmic and pharmaceutical services.

360.The provision for dentists (section 35 of the 1977 Act) is in very similar terms to that for doctors in section 29, although it will be noted that the duty upon the Health Authority is subtly different. In the case of doctors, the Health Authority­ must arrange for suffi­cient PMS to be provided for everybody in the area who wishes to take advantage of the arrange­ments. In the case of dentists this duty is not quite the same: the duty is not to arrange the provision of GDS for every­body in the area who wishes to have GDS, but rather to arrange with dentists in the area that any person for whom those dentists have under­taken to pro­vide GDS receive the promised GDS . There is also no equi­valent of the MPC to control the entry of GDPs to dental lists; and there is no equivalent of section 29(2)(c) of the 1977 Act (which provides for the assign­ment of patients to doctors). How­ever, subject to that, the systems are by no means dissimi­lar: there exists a dental list of GDPs who under­take to provide GDS. There is a system of dental vocational train­ing (although it has been introduced by regula­tions and not by primary legislation). The relation­ship between the Health Authority and the GDP is (usually) again a statutory one between a Health Authority and an indepen­dent pro­fessional. Unlike the case of GPs, how­ever, there is in regulations provision in the case of dentists for the employ­ment of salaried dentists at health centres. These dentists are employed by the Health Authority, and repre­sent one of the rare occa­sions when it is the Health Authority itself which provides the services in ques­tion via its employees.

361.So far as chemists and opticians are concerned, opticians are provided for in section 38 of the 1977 Act, again according to the same scheme where­by the Health Authority­ makes statutory arrangements with independent practi­tioners (who, in this case, might be individuals or bodies such as companies). However, the range of services to be provided by opticians is very much smaller. The only content now surviving of general ophthal­mic services (“GOS”) is sight testing for children, for persons whose resources are less than their requirements, and for other prescribed persons.

362.For pharmaceutical services (“PhS”), pro­vided for under section 41 of the 1977 Act the arrangements are again made by Health Authorities with independent persons or bodies. The system is gov­erned by regula­tions; but the duty this time is to arrange for the provi­sion, to persons who are present in the Health Authority's area, of drugs, medicines and listed appli­ances which are pre­scribed for them by health service doctors, dentists, or nurses, and of such other services as may be prescribed . So far as PhS are con­cerned, there are detailed regula­tions (made under sections 42 and 43) relating to entry on to a phar­maceuti­cal list.

363.Sections 43A and 43B of the 1977 Act, as substituted by section 10 of the Health Act, provide a structure for the remuneration of persons providing Part II services. Section 10 of the Health Act has, however, yet to be brought into force. Neither have the original sections 43A and 43B inserted by the Health and Social Security Act 1984 (c.48) been commenced. In effect the original sections inserted by the 1984 Act must be complied with because of section 7 of the Act, which provides that a determina­tion of remuneration made before the coming into force of those provisions is deemed to be validly made if regulations authorising it could have been made had that provision been in force at that time . It is therefore not open to the Secretary of State or anyone else to make a determination which is inconsist­ent with the provisions of sections 43A and 43B as inserted by the 1984 Act. What in fact happens is that the Secretary of State makes and publishes a determi­na­tion for each of the professions, which takes the form of the separate document referred to in each of the sets of Regula­tions governing the four professions. These determina­tions therefore have the force of law, although they are not subject to any further degree of formality or Parliamentary procedure. The revised version of sections 43A and 43B, substituted by section 10 of the Health Act, were intended to provide a new framework to govern the remuneration of Part II practitioners, but have yet to be brought into force.

364.Each profession has in each Health Authority area a local representative committee (called the Local Medical Committee, the Local Dental Committee, and so on). These represent local practitioners and are provided for under sections 44 and 45 of the 1977 Act.

365.Practitioners may be removed or suspended from the list in which their names are included by the NHS Tribunal, which is pro­vided for under sections 46-49 of the 1977 Act. The NHS Tribunal is an independent body which hears representations by Health Authorities and others against family health service practitioners, that is people with whom Health Authorities have made arrangements for the provision of general medical, general dental, general ophthalmic or pharmaceutical services under Part II of the NHS Act 1977 . Health Authorities (and others) may make representations that to allow a person to continue to be family health service practitioner would be prejudicial to efficiency of the service in question. The Tribunal may direct that a practitioner’s name is to be removed from one or more lists of people with whom Health Authorities have made arrangements for the provision of family health services. A person who has been removed from a list is no longer entitled to provide the service in question. The NHS Tribunal may also disqualify a person from involvement in any capacity in the provision of family health services.

366.The powers of the NHS Tribunal were extended by the National Health Service (Amendment) Act 1995, amongst other things to give it powers of interim suspension from lists. The powers of the NHS Tribunal were further extended by section 40 of the Health Act 1999, in particular to extend its jurisdiction to people who have acted fraudulently towards or in connection with the NHS (although this section has yet to be brought into force).

367.The remainder of Part II contains a number of miscellaneous provisions.

Funding the NHS

368.Health Authorities are funded under the provisions of section 97 of the 1977 Act, as substituted by paragraph 47 of Schedule 1 to the 1995 Act and amended by section 36 of the Primary Care Act and sections 4 and 8 of, and paragraph 31 of Schedule 5 to, the Health Act . Health Authorities are paid money in each year under section 97(1) and section 97(3). Section 97(1) concerns the remuneration of persons providing Part II services and is covered in the next section. Section 97(3) concerns Part I expenditure and administrative costs. Under section 97(3) a Health Authority is paid money not exceeding the amount allotted to it by the Secretary of State. This amount is allotted toward meeting its “main expenditure”, which includes all expenditure attributable to the performance of its Part I functions, all its administrative costs, and certain other expenditure. The money paid in respect of Part I services is therefore cash limited. To enforce the cash-limits set by the Secretary of State, Health Authorities have various duties imposed upon them by section 97A of the 1977 Act (as substituted by paragraph 48 of the 1995 Act and amended by paragraph 23 of the Schedule 2 to the Primary Care Act and paragraph 32 of Schedule 5 to the Health Act) . It is possible for the Secretary of State to make one off direct payments to NHS trusts by way of public dividend capital, loans or payments under NHS contracts. Direct payments to Primary Care Trusts can only be made by NHS contracts.

Intervention Powers

369.Section 84 of the 1977 Act enables the Secretary of State to appoint an inquiry in connection with matters arising under the 1977 Act, Part I of the 1990 Act or Part I of the Health Act. In addition to these formal inquiries, the Secretary of State conducts or appoints a variety of ‘informal’ inquiries, investigations and reviews in the exercise of his powers under section 2(b) of the 1977 Act. Finally, the Commission for Health Improvement may investigate matters relating to the management, provision and quality of health care for which NHS bodies are responsible (see section 20(1)(c) of the Health Act).

370.The Secretary of State has powers to intervene if NHS bodies fail to perform their functions or fail to comply with regulations or directions (section 85) and if, by reason of an emergency, a service under the 1977 Act may cease to be provided (section 86).

Community Health Councils

371.Community Health Councils ("CHCs") were established in 1974 and are now provided for in section 20 of, and Schedule 7 to, the 1977 Act. The Secretary of State has a duty to establish CHCs for Health Authority areas or parts of Health Authority areas. The members of each CHC include local authority and voluntary organisation representatives and persons appointed by the Secretary of State. Each CHC has a duty to represent the interests in the health service of the public in its district. Further provision for CHCs is made under the regulations under paragraph 2 of Schedule 7 - see the Community Health Councils Regulations 1996 (S.I. 1996/640, as amended by S.I. 1999/646, 1999/2906 and 2000/657). In particular-

  • CHCs review the operation of the health service in its district and make recommendations and provide advice to their local Health Authority

  • Health Authorities must consult CHCs on proposals for substantial developments of the health service in the CHCs' districts and on proposals for substantial variations in the provision of such service

  • Health Authorities must provide information to CHCs about the planning and operation of health services in their area and meet CHCs at least once a year

  • CHCs may inspect premises controlled by NHS bodies

372.In addition to their general duty, CHCs have various specific functions relating to reviewing the operation of the health service in their districts, which are conferred by regulations. They also provide advice and information to the public on local health services and assist patients making complaints about the services provided by NHS bodies and practitioners, although these additional functions are not specified in regulations.

373.CHCs are advised and assisted by the Association of Community Health Councils in England and Wales (“ACHCEW”), which was established by the Secretary of State under paragraph 5 of Schedule 7 to the 1977 Act. The National Health Service (Association of Community Health Councils) Regulations 1977 (SI 1977/874) provides for the establishment and operation of ACHCEW.

Health and Medicines Act 1988

374.Section 7 of the Health and Medicines Act 1988 extended the Secretary of State’s powers for financing the NHS, by providing that he had powers to undertake a range of activities (for example, supplying goods or services, or exploiting intellectual property) in order to make more income available for improving the health service . The exercise of these powers is however limited by the provisos in subsection (8); in particular that anything he proposes to do will not to a significant extent interfere with the performance by him of any duty imposed on him by the 1977 Act.

375.The Secretary of State has directed Health Authorities that they may exercise these powers. NHS trusts and PCTs exercise similar powers by virtue of paragraph 15 of Schedule 2 to the 1990 Act and section 18A (5) of the 1977 Act (inserted by section 5 of the Health Act), respectively. Authorities and trusts are however subject to any directions the Secretary of State may make under section 17 of the 1977 Act about the exercise of such powers.

The National Health Service and Community Care Act 1990
NHS trusts

376.Section 5 of the 1990 Act, and the immediately following provisions, provide for the setting up of bodies known as NHS trusts. These are not Health Authorities but are separate, independent bodies set up to assume responsibility for the ownership and management of hospitals or other establishments or facilities previously managed or provided by a Health Authority; or to provide and manage hospitals or other establishments or facilities that were not previously so managed or provided . Section 5(1), as amended by section 13 of the Health Act, now provides that trusts are established to provide goods and services for the purposes of the health service. A trust’s functions are conferred by its establishment order made under section 5(1) and by Schedule 2 to the 1990 Act.

377.Nearly all the hospitals in the country are now run by NHS trusts, although increasingly, smaller “community” hospitals are being run by Primary Care Trusts. The essential difference between NHS trusts and the hospitals run directly by Health Authorities is that the latter were funded by money paid to Health Authorities for the purpose by the Secretary of State under (what is now) section 97(3) of the 1977 Act; whereas (subject to certain exceptions) NHS trusts have no money paid to them directly by the Secretary of State, but instead must compete with each other for orders for their services placed by Health Authorities . Health Authorities are thus now seen as “purchasers” or “commissioners” of health care on behalf of the local population; while trusts are included among the “providers” of this health care. Health Authorities may also choose to purchase health care from private sector institutions.

378.This system created the “internal market”, whereby the whole of the operation (including trusts) is still the NHS, but for internal purposes the purchasers or commissioners were split from the providers.

379.The 1990 Act conferred on NHS trusts a substantial degree of autonomy. As well as not being funded centrally, the Secretary of State was able to give directions to NHS trusts only in relation to a limited range of subjects (paragraph 6 of the Schedule). The Health Act restricted this freedom by extending to NHS trusts the Secretary of State’s power of direction under section 17 of the 1977 Act (section 12 of the Health Act).

NHS Contracts

380.The nature of the arrangements between Health Authorities and trusts is not that of an ordinary contract enforceable at law. Instead the 1990 Act provided for a system of NHS contracts (section 4), which are explicitly not contracts enforceable at law (section 4(3)), but which had attached to them a special form of internal arbitration by the Secretary of State. The list of bodies between whom certain agreements take the form of NHS contracts rather than ordinary contracts is contained in section 4(2).

The National Health Service (Primary Care) Act 1997
Personal Medical Services and  Personal Dental Services

381.The Primary Care Act introduced a new method of delivery of family health services. Personal medical services (PMS) and personal dental services (PDS) may be provided under agreements known (in the initial stage at least) as “pilot schemes” (sections 1-3 of the Primary Care Act). These agreements are made between the Health Authority and one or more of the persons listed in section 3(2), which includes NHS trusts, GPs and NHS employees. Before a pilot scheme may be made, the proposals for the scheme must be submitted to, and approved by, the Secretary of State (section 4 and 5). The system of pilot schemes is intended ultimately to be replaced by a permanent regime.

382.Pilot schemes allow PMS and PDS (essentially the same as GMS and GDS) to be provided under the Part I system. The provisions of the 1977 Act apply in relation to functions of the Secretary of State in relation to pilot schemes as if the functions were functions under Part I of the Act. NHS trust may enter into a pilot scheme as a provider of PMS or PDS. The 1977 Act (and in particular section 17) has effect in relation to services under pilot schemes as if the services were provided as a result of delegation by the Secretary of State (by directions given under section 13 of that Act) of functions of his under Part I (section 9 of the Primary Care Act) .

383.These provisions allow PMS and PDS to be provided otherwise than through the rigid regulatory system of Part II of the 1977 Act. They allow Health Authorities the power to determine locally the content of the service in their area or the practitioners with whom they choose to make the arrangements.

The Health Act 1999

384.Part I of the Health Act made further changes to both the Part I system and the Part II system.

Primary Care Trusts

385.Primary Care Trusts are a new tier of administrative body below Health Authorities, and are primarily concerned with the Part I system, although they may exercise certain Health Authority functions relating to GMS. Primary Care Trusts are established by the Secretary of State by orders under section 16A of the 1977 Act (as inserted by section 2(1) of the Health Act), with a view to their carrying out the activities listed in paragraphs (a) to (c) of that section. Their functions are conferred, in the main, by directions given by Health Authorities under section 17A of the 1977 Act, as inserted by section 12 of the Health Act.

386.In the exercise of the functions under Part I of the 1977 Act delegated to them by their Health Authorities, Primary Care Trusts have taken on the “commissioning” activities of Health Authorities. Unlike Health Authorities, however, they also provide certain services (usually community health services rather than hospital services) in the exercise of those functions. A Primary Care Trust is something of a “hybrid” between a Health Authority and an NHS trust. The other significant feature of Primary Care Trusts is that the regulations for the membership of Primary Care Trusts made under paragraph 5 of Schedule 5A to the 1977 Act, as inserted by Schedule 1 to the Health Act, provide that a substantial number of Primary Care Trust members and Primary Care Trust committee members must be GPs, local nurses and other health care professionals providing or assisting the provision of services under the 1977 Act .

Part II services

387.The Health Act provides new powers for the Secretary of State to require persons providing Part II services to have indemnity cover (section 9), a new structure for the remuneration of Part II practitioners (section 10, which has not yet been brought into force) and makes further provision for the disqualification of such practitioners by the NHS tribunal on the grounds of fraud (section 40, which again has not yet been brought into force) .

Quality

388.Section 18 of the Health Act imposes a “duty of quality” on Health Authorities, Primary Care Trusts and NHS trusts. Sections 19 to 24 provide for the establishment and operation of a new independent statutory body known as the Commission for Health Improvement, which is responsible for monitoring the quality of care for which NHS bodies have responsibility. The Commission is able to conduct a variety of reviews and investigations (section 20(1)).

The NHS and Local Authorities

389.Local Authorities are responsible for the provision of what may be described as "social care", e.g. residential accommodation for the disabled or elderly. The enactment’s under which functions in this respect are conferred on Local Authorities are set out in Schedule 1 to the Local Social Services Act 1970 (c.42) and other legislation. Section 21 and Schedule 8 of the 1977 Act make provision for the exercise of certain specified functions. Local Authorities also exercise functions in respect of housing (eg. the Housing Act 1985 (c.68)) and education (the Education Act 1996 (c.56)).

390.Sections 22 and sections 26 to 28BB of the 1977 Act, as amended by sections 27, 29 and 30 of the Health Act, make provision for co-operation between the NHS and Local Authorities. Section 22(1) of the 1977 Act, as substituted by section 27(2) of the Health Act, places a general duty on NHS bodies (on the one hand) and Local Authorities (on the other) to co-operate in the exercise of their functions in order to secure and advance the health and welfare of the people of England and Wales . Sections 26 to 28 make provision for the supply of goods and services by the Secretary of State to Local Authorities and vice-versa. Section 28A of the 1977 Act, as amended by section 29 of the Health Act, makes provision for Health Authorities in England to make payments towards expendi­ture by various Local authority bodies on community services, such as social services, housing and education for the disabled. Section 28B makes similar provision for Wales.

391.The Health Act makes further provision for co-operation between the NHS and local authorities. Most importantly, section 31 makes provision for NHS bodies and Local Authorities to enter arrangements under which an NHS body exercises Local authority functions or vice-versa. Provision is also made for arrangements to operate a “pooled fund” from which payments may be made towards expenditure on either NHS or Local authority functions. In addition to section 31, section 28 provides for Health Authorities, with the assistance of Primary Care Trusts, NHS trusts and Local Authorities, to prepare plans setting out a strategy for improving both the health of the local population and the provision of health care to that population. Section 30 of the Health Act inserts a new section 28BB into the 1977 Act, which makes provision for Local Authorities to make payments towards expenditure incurred by NHS bodies: this provision mirrors section 28A of the 1977 Act.

Health Authority funding and  performance

392.The Act made it possible for the Secretary of State to increase a Health Authority’s allocation where certain conditions around performance are satisfied. The intention was to reward Health Authorities that demonstrated the most progress in implementing their plan for improving health and health care. All Health Authorities including those making good progress from a low baseline are eligible. The Secretary of State is allowed to attach conditions to how the money should be spent and if it is not spent in accordance with the conditions he can claw it back.

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