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Health Act 2009

Overview of provisions
Direct payments for health care

117.Section 11 inserts new sections 12A to 12D into the NHS Act. New section 12A(1) allows the Secretary of State to make monetary payments directly to a patient, or another person nominated by the patient, to enable them to procure goods and services in connection with their health care. Such a payment is referred to as a “direct payment” (see new section 12A(5)).

118.Before a direct payment could be made, the patient would have to give their consent, either to receiving a direct payment themselves, or to a direct payment being made to a person nominated by them. For patients who lack capacity to consent, regulations under new section 12B(2)(c) may make provision for a direct payment to be made to a person on the patient’s behalf.

119.The Secretary of State may provide in regulations for PCTs to be able to make direct payments for mental health after-care services that PCTs must provide to patients under section 117 of the Mental Health Act 1983 (the Mental Health Act) (see new section 12A(4)). The patient would be required by the regulations to give consent before a direct payment could be made, as in the case of a payment under new section 12A(1).

120.The Government has set out its intentions for how direct payments might operate in Personal Health Budgets: First Steps. A health care direct payment would be analogous to a direct payment for social care. The health care that could be procured using this money is health care for which the Secretary of State is responsible under sections 2(1) or 3(1) of the NHS Act, anything for which the Secretary of State must arrange under paragraph 8 of Schedule 1, or vehicles that the Secretary of State may provide under paragraph 9 of Schedule 1 (see new section 12A(2)). Under section 3(1) of the NHS Act the Secretary of State must provide specified services or facilities to such extent as he or she considers necessary to meet all reasonable requirements. This includes hospital and other accommodation for the purpose of the services provided under the Act, medical, nursing and services or facilities for the care of pregnant women and children and for the prevention of illness, care of persons suffering from illness and the after-care of persons who have suffered from illness and for the diagnosis and treatment of illness.

121.Initially the Secretary of State has power to make direct payments for health care only in pilot schemes under regulations, as required by new section 12A(6). Direct payments for health care could in the future be made more widely available following review and an order made by the Secretary of State under new section 12C(8)(a). The order would be subject to approval by each House of Parliament under the affirmative resolution procedure.

Regulations about direct payments

122.New section 12B(1) gives the Secretary of State power to make regulations covering how direct payments will operate. The factors that regulations could provide for are identified in new section 12B(2) to 12B(4) and are similar to those already provided for in respect of social care direct payments.

123.The regulations could identify the groups of patients who might benefit, such as mental health patients; the health conditions for which direct payments could be made, such as those which are long term and are sufficiently predictable to allow a budget to be set; and the services that could be provided, such as nursing care (see new section 12B(2)(a)).

Direct payments pilot schemes

124.New section 12C(1)(a) provides for the Secretary of State to have power to make pilot schemes under regulations under new section 12B through which the Secretary of State could make direct payments. By directions in writing under sections 7 and 273(4)(c) of the NHS Act, the Secretary of State could delegate the operation of a pilot scheme to a PCT (or a Strategic or Special Health Authority). The Government intends to set up a programme of pilot schemes led by different PCTs to assess the effectiveness of direct payments. In Personal Health Budgets: First Steps, the Government invited PCTs to apply to become personal health budget pilots, and it has received a number of applications. The Government intends that there should be a further stage in the application process to select direct payment pilot sites.

125.A pilot scheme must have a specified duration and be subject to review (new section 12C(3) and (4)). The geographical scope may be specified (new section 12C(2)(a)), and a pilot scheme could also be distinguished by characteristics set out in regulations under new section 12B(2) (see section 12C(1)(b)). The Secretary of State is also able to make provision in regulations for changing or discontinuing a pilot scheme or schemes under new section 12C(2)(b).

126.The characteristics of a review of a pilot scheme may be set in regulations. For example, regulations may provide for a review to be undertaken by an independent person or that its findings must be published (new section 12C(5). New section 12C(6) sets out subjects that a review may, in particular, examine. The Government intends that the review of the pilot schemes should be independent, and the findings should be published. It also intends that the review should cover all the matters mentioned in new section 12C(6), such as the administration of a scheme, the effect of direct payments on cost or quality of care, or the effect of direct payments on patients’ behaviour.

127.New section 12C(7) to (10) provides for the Secretary of State to be able by order either to repeal the requirement for direct payments to be made only in accordance with a pilot scheme (see new section 12C(8)(a)), or to repeal new sections 12A, 12B, 12C and 12D (see new section 12C(10)). However new section 12C(7) requires the Secretary of State to have carried out a review of one or more pilot schemes before making any such order. Any such order would be subject to approval by each House of Parliament under the affirmative resolution procedure. If the Secretary of State chose to make an order under section 12C(8)(a), direct payments for health care would no longer need to be made as part of a pilot scheme, and the power to make pilot schemes provided by sections 12C(1) to (4) would be repealed. However, similar time limited schemes could be set up under regulations under section 12B, to continue to test possible extensions or adaptations of a direct payments model.

128.After reviewing a scheme or schemes, an order under new section 12C(8)(b) would enable the Secretary of State to amend, repeal or otherwise modify any other provision of the NHS Act to facilitate the making of direct payments, so long as the changes were necessary or expedient (see section 12C(9)). The power would enable lessons learnt about the legislation from piloting in schemes to be addressed. The order would be subject to approval by each House of Parliament under the affirmative resolution procedure. New section 12C(9) would not allow provision by order to alter unrelated aspects of the NHS Act.

129.New section 12C(10) allows the Secretary of State to repeal sections 12A, 12B, 12C and 12D, for example if, following a review, the Secretary of State does not believe that direct payments are a viable way of delivering services.

Arrangements with other bodies relating to direct payments

130.New section 12D(1) to (3) provides authority for the Secretary of State to arrange with bodies in addition to local authorities such as a mental health charity or private sector body involved in the provision of health care or social care services to assist in making direct payments. In particular, subsection (2) enables such arrangements to be made with voluntary organisations. In practice, a PCT or other NHS body might be making the arrangements on behalf of the Secretary of State. These organisations could help with any aspect of making direct payments, such as assessing patients, setting budgets or reviewing care plans.

Jurisdiction of Health Service Commissioner

131.Section 12 amends the Health Service Commissioners Act 1993 (the 1993 Act) to enable the Commissioner to hear complaints about services for which direct payments were made, including those provided by independent organisations. This gives patients receiving direct payments for health care similar rights to those enjoyed by patients accessing services from NHS organisations or from private sector organisations commissioned by PCTs.

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