The Health Care Services (Provider Selection Regime) Regulations 2023

PART 2 Procurement processes

Overview

6.—(1) A relevant authority wishing to procure relevant health care services to which these Regulations apply must follow the appropriate process determined in accordance with this regulation.

(2) This regulation is subject to regulations 13 (modification of contracts and framework agreements during their term), 15 (abandonment of, or repetition of steps in, a procurement) and 18 (contracts based on a framework agreement).

(3) Where—

(a) there is an existing provider of the relevant health care services to which the proposed contracting arrangements relate,

(b) the relevant authority is satisfied that the relevant health care services to which the proposed contracting arrangements relate are capable of being provided only by the existing provider due to the nature of the relevant health care services, and

(c) the procurement is not to conclude a framework agreement,

the relevant authority must follow Direct Award Process A.

(4) Where—

(a) the proposed contracting arrangements relate to relevant health care services in respect of which a patient is offered a choice of provider,

(b) the number of providers is not restricted by the relevant authority,

(c) the relevant authority will offer contracts to all providers to whom an award can be made because they meet all requirements in relation to the provision of the relevant health care services to patients,

(d) the relevant authority has arrangements in place to enable providers to express an interest in providing the relevant health care services, and

(e) the procurement is not to conclude a framework agreement,

the relevant authority must follow Direct Award Process B.

(5) Where—

(a) the relevant authority is not required to follow Direct Award Process A or Direct Award Process B,

(b) the term of an existing contract is due to expire and the relevant authority proposes a new contract to replace that existing contract at the end of its term,

(c) the considerable change threshold is not met (see paragraphs (10) to (12)),

(d) the relevant authority is of the view that the existing provider is satisfying the existing contract and will likely satisfy the proposed contract to a sufficient standard, and

(e) the procurement is not to conclude a framework agreement,

the relevant authority must follow one of Direct Award Process C, the Most Suitable Provider Process or the Competitive Process, such choice being at the discretion of the relevant authority.

(6) Where—

(a) the relevant authority is not required to follow Direct Award Process A or Direct Award Process B,

(b) paragraph (5) does not apply,

(c) the relevant authority is of the view, taking into account likely providers and all relevant information available to the relevant authority at the time, that it is likely to be able to identify the most suitable provider, and

(d) the procurement is not to conclude a framework agreement,

the relevant authority must follow either the Most Suitable Provider Process or the Competitive Process, such choice being at the discretion of the relevant authority.

(7) Where—

(a) the relevant authority is not required to follow Direct Award Process A or Direct Award Process B, and

(b) neither paragraph (5) nor (6) applies,

the relevant authority must follow the Competitive Process.

(8) Where the procurement is to conclude a framework agreement, the relevant authority must follow the Competitive Process.

(9) Where, having taken steps to follow a particular process chosen at its discretion in accordance with paragraph (5) or (6), the relevant authority decides that a different process would be more suitable, the relevant authority may decide to abandon the procurement in accordance with regulation 15 and follow a different process in accordance with paragraph (5) or (6).

(10) Subject to paragraphs (11) and (12), the “considerable change threshold” in paragraph (5)(c) is met—

(a) where the proposed contracting arrangements are materially different in character to the existing contract when that existing contract was entered into, or

(b) where—

(i) changes in the relevant health care services to which the proposed contracting arrangements relate (compared with the existing contract) are attributable to a decision of the relevant authority,

(ii) the lifetime value of the proposed contracting arrangements is at least £500,000 higher than the lifetime value of the existing contract when that existing contract was entered into, and

(iii) the lifetime value of the proposed contracting arrangements is at least 25% higher than the lifetime value of the existing contract when that existing contract was entered into.

(11) The considerable change threshold is not met where—

(a) paragraph (10)(a) applies solely as a result of a change in the identity of the provider due to succession into the position of provider following corporate changes including takeover, merger, acquisition or insolvency and the relevant authority is satisfied that the provider meets the basic selection criteria, and

(b) paragraph (10)(b) does not apply.

(12) The considerable change threshold is not met where—

(a) paragraph (10)(a) does not apply, and

(b) paragraph (10)(b) applies where the change between the existing and proposed contracting arrangements is in response to external factors beyond the control of the relevant authority and provider including, but not limited to, changes in patient or service user volume or changes in prices in accordance with a formula provided for in the contract documents.

Direct Award Process A

7.—(1) Where the relevant authority follows Direct Award Process A, the process is that the relevant authority—

(a) awards any contract without a competition, and

(b) submits for publication on the UK e-notification service a notice of the award.

(2) The notice referred to in paragraph (1)(b) must—

(a) include the information set out in Schedule 2, and

(b) be submitted for publication within 30 days of the contract being awarded.

Direct Award Process B

8.—(1) Where the relevant authority follows Direct Award Process B, the process is that the relevant authority—

(a) awards any contract without a competition, and

(b) submits for publication on the UK e-notification service a notice of the award.

(2) The notice referred to in paragraph (1)(b) must—

(a) include the information set out in Schedule 2, and

(b) be submitted for publication within 30 days of the contract being awarded.

Direct Award Process C

9.—(1) Where the relevant authority follows Direct Award Process C, the process is that the relevant authority—

(a) follows the steps set out in this regulation, and

(b) awards any contract without a competition.

(2) Step 1 is that the relevant authority decides, taking into account the key criteria and applying the basic selection criteria, whether it is content that the existing provider is satisfying the original contract and will likely satisfy the proposed contract to a sufficient standard.

(3) If the relevant authority is so content, step 2 is that the relevant authority submits for publication on the UK e-notification service a notice of intention to make an award to the existing provider.

(4) The notice referred to in paragraph (3) must include the information set out in Schedule 3.

(5) Step 3 is that the standstill period begins the day after the day the notice referred to in paragraph (3) is published.

(6) Regulation 12 makes further provision relating to the standstill period, including the making of written representations to the relevant authority by providers aggrieved by the decision made in step 1.

(7) Step 4 is that the relevant authority—

(a) carries out the requirements specified in regulation 12(4) where written representations are made in accordance with regulation 12(3), and

(b) communicates the further decision made under regulation 12(4)(d) and any subsequent further decisions made under regulation 12(7), in accordance with regulation 12(6) and (8).

(8) Where no written representations are made in accordance with regulation 12(3), the relevant authority moves to step 5 without taking any action under step 4.

(9) Step 5 is that the relevant authority enters into the contract after the standstill period has ended in accordance with regulation 12(9) or (10).

(10) Step 6 is that the relevant authority submits for publication on the UK e-notification service a notice of the award of the contract.

(11) The notice referred to in paragraph (10) must—

(a) include the information set out in Schedule 4, and

(b) be submitted for publication within 30 days of the contract being awarded.

The Most Suitable Provider Process

10.—(1) Where the relevant authority follows the Most Suitable Provider Process, the process is that the relevant authority—

(a) follows the steps set out in this regulation, and

(b) awards any contract without a competition.

(2) Step 1 is that the relevant authority submits for publication on the UK e-notification service a notice of intention to follow the Most Suitable Provider Process.

(3) The notice referred to in paragraph (2) must include the information set out in Schedule 5.

(4) Step 2 is that the relevant authority identifies potential providers who may be the most suitable provider, with reference to the key criteria and the basic selection criteria.

(5) The relevant authority must not complete step 2 before the day which is 14 days after the day on which the notice of intention to follow the Most Suitable Provider Process is submitted for publication in accordance with step 1.

(6) Step 3 is that the relevant authority assesses the potential providers identified in step 2 and chooses, taking into account the key criteria and applying the basic selection criteria, the most suitable provider to whom to make an award.

(7) Step 4 is that the relevant authority submits for publication on the UK e-notification service a notice of intention to make an award to the chosen provider.

(8) The notice referred to in paragraph (7) must include the information set out in Schedule 6.

(9) Step 5 is that the standstill period begins the day after the day the notice referred to in paragraph (7) is published.

(10) Regulation 12 makes further provision relating to the standstill period, including the making of written representations to the relevant authority by providers aggrieved by the decision made in step 3.

(11) Step 6 is that the relevant authority—

(a) carries out the requirements specified in regulation 12(4) where written representations are made in accordance with regulation 12(3), and

(b) communicates the further decision made under regulation 12(4)(d) and any subsequent further decisions made under regulation 12(7), in accordance with regulation 12(6) and (8).

(12) Where no written representations are made in accordance with regulation 12(3), the relevant authority moves to step 7 without taking any action under step 6.

(13) Step 7 is that the relevant authority enters into the contract after the standstill period has ended in accordance with regulation 12(9) or (10).

(14) Step 8 is that the relevant authority submits for publication on the UK e-notification service a notice of the award of the contract.

(15) The notice referred to in paragraph (14) must—

(a) include the information set out in Schedule 7, and

(b) be submitted for publication within 30 days of the contract being awarded.

The Competitive Process

11.—(1) Where the relevant authority follows the Competitive Process, the process is that the relevant authority follows the steps set out in this regulation.

(2) Step 1 is that the relevant authority determines the contract or framework award criteria, taking into account the key criteria and applying the basic selection criteria.

(3) Step 2 is that the relevant authority submits a notice for publication on the UK e-notification service inviting offers to provide the relevant health care services in relation to which the contract is to be awarded or framework agreement is to be concluded.

(4) The notice referred to in paragraph (3) must include the information set out in Schedule 8.

(5) Step 3 is that the relevant authority assesses any offers received in accordance with the contract or framework award criteria.

(6) A relevant authority may carry out step 3 in stages.

(7) Step 4 is that the relevant authority makes a decision as to the successful provider.

(8) Step 5 is that the relevant authority promptly informs, in writing—

(a) the successful provider that their offer has been successful and the relevant authority intends to make an award or conclude the framework agreement;

(b) each unsuccessful provider that their offer has been unsuccessful, such communications to include the information set out in Schedule 9.

(9) Step 6 is that the relevant authority submits for publication on the UK e-notification service a notice of intention to make an award to the chosen provider or conclude a framework agreement.

(10) The notice referred to in paragraph (9) must include the information set out in Schedule 10.

(11) Step 7 is that the standstill period begins the day after the day the notice referred to in paragraph (9) is published.

(12) Regulation 12 makes further provision relating to the standstill period, including the making of written representations to the relevant authority by providers aggrieved by the decision made in step 4.

(13) Step 8 is that the relevant authority—

(a) carries out the requirements specified in regulation 12(4) where written representations are made in accordance with regulation 12(3), and

(b) communicates the further decision made under regulation 12(4)(d) and any subsequent further decisions made under regulation 12(7), in accordance with regulation 12(6) and (8).

(14) Where no written representations are made in accordance with regulation 12(3), the relevant authority moves to step 9 without taking any action under step 8.

(15) Step 9 is that the relevant authority enters into the contract or concludes the framework agreement after the standstill period has ended in accordance with regulation 12(9) or (10).

(16) Step 10 is that the relevant authority submits for publication on the UK e-notification service a notice of the award of the contract or conclusion of the framework agreement.

(17) The notice referred to in paragraph (16) must—

(a) include the information set out in Schedule 11, and

(b) be submitted for publication within 30 days of the contract being awarded or framework agreement being concluded.

The standstill period

12.—(1) Where the relevant authority follows Direct Award Process C, the Most Suitable Provider Process or the Competitive Process, the relevant authority must not enter into the contract or conclude the framework agreement before the end of a standstill period.

(2) The standstill period begins on the day after the day a notice of intention to award or conclude is published on the UK e-notification service in accordance with regulation 9(3) (Direct Award Process C), 10(7) (the Most Suitable Provider Process) or 11(9) (the Competitive Process).

(3) Any provider of the services to which the contract or framework agreement relates who—

(a) is aggrieved by the decision, and

(b) believes that there has been a failure to comply with these Regulations,

may make written representations to the relevant authority before midnight at the end of the 8th working day after the day the standstill period begins.

(4) Where the relevant authority receives representations in accordance with paragraph (3), it must—

(a) ensure each provider who made representations is afforded such further opportunity to explain or clarify the representations made as the relevant authority considers appropriate,

(b) provide promptly any information requested by an aggrieved provider where the relevant authority has a duty to record that information under regulation 24 (information requirements),

(c) review the decision to award the contract or conclude the framework agreement, taking into account the representations made, and

(d) make a further decision whether to—

(i) enter into the contract or conclude the framework agreement as intended after the standstill period has ended,

(ii) go back to an earlier step in the selection process and repeat that step and subsequent steps in accordance with the relevant procedure, or

(iii) abandon the procurement in accordance with regulation 15.

(5) Paragraph (4)(b) does not require the provision of information where provision—

(a) would prejudice the legitimate commercial interests of any person, including those of the relevant authority,

(b) might prejudice fair competition between providers, or

(c) would otherwise be contrary to the public interest.

(6) The further decision in paragraph (4)(d) must be communicated promptly, in writing, with reasons to—

(a) each provider from which the relevant authority received representations in accordance with paragraph (3), and

(b) each provider to whom the relevant authority intended at the beginning of the standstill period to award the contract or with whom the relevant authority intended at the beginning of the standstill period to conclude the framework agreement, as the case may be.

(7) Following a further decision under paragraph (4)(d), the relevant authority may make any number of subsequent further decisions, each replacing the previous decision, to—

(a) enter into the contract or conclude the framework agreement as intended after the standstill period has ended,

(b) go back to an earlier step in the selection process and repeat that step and subsequent steps in accordance with the relevant procedure, or

(c) abandon the procurement in accordance with regulation 15.

(8) Each subsequent further decision under paragraph (7) must be communicated promptly in writing, with reasons to—

(a) each provider from which the relevant authority received representations in accordance with paragraph (3), and

(b) each provider to whom the relevant authority intended at the beginning of the standstill period to award the contract or with whom the relevant authority intended at the beginning of the standstill period to conclude the framework agreement, as the case may be.

(9) Where no written representations are received in accordance with paragraph (3), the standstill period ends at midnight at the end of the 8th working day after the day the standstill period began.

(10) Where written representations are received in accordance with paragraph (3), the standstill period ends—

(a) on such day as—

(i) the relevant authority has decided that it is ready to enter into the contract or conclude the framework agreement,

(ii) the relevant authority has carried out the requirements set out in paragraph (4),

(iii) the relevant authority has informed providers of its further decision in accordance with paragraph (6) and any subsequent further decisions in accordance with paragraph (8),

(iv) the relevant authority does not intend to make any, or any more, subsequent further decisions in accordance with paragraph (7), and

(v) there have been no fewer than 5 working days since the relevant authority informed providers of its last further decision in accordance with paragraph (6) or (8), or

(b) on such day as—

(i) the relevant authority has decided to abandon the procurement in accordance with regulation 15 or to go back to an earlier step in the selection process and repeat that step and subsequent steps in accordance with the relevant procedure,

(ii) the relevant authority has carried out the requirements set out in paragraph (4),

(iii) the relevant authority has informed providers of its further decision in accordance with paragraph (6) and any subsequent further decisions in accordance with paragraph (8),

(iv) the relevant authority does not intend to make any, or any more, subsequent further decisions in accordance with paragraph (7), and

(v) there have been no fewer than 5 working days since the relevant authority informed providers of its last further decision in accordance with paragraph (6) or (8).

(11) In paragraphs (4)(d)(ii), (7)(b) and (10)(b)(i), a reference to a step in the selection process is to a step referred to in regulation 9 (Direct Award Process C), 10 (the Most Suitable Provider Process) or 11 (the Competitive Process) as the case may be.

(12) In this regulation—

“public holiday” means Christmas Day, Good Friday, the first Monday in May or a bank holiday in England under the Banking and Financial Dealings Act 1971(1);

“working day” means any day which is not Saturday, Sunday or a public holiday.

Modification of contracts and framework agreements during their term

13.—(1) Subject to paragraph (3), a contract or framework agreement for relevant health care services may be modified during its term without following a new procurement process under these Regulations only where—

(a) the modification is clearly and unambiguously provided for in the contract or framework agreement documents,

(b) the modification is solely a change in the identity of the provider due to succession into the position of provider following corporate changes including takeover, merger, acquisition or insolvency and the relevant authority is satisfied that the provider meets the basic selection criteria,

(c) the modification is made in response to external factors beyond the control of the relevant authority and the provider including, but not limited to—

(i) changes in patient or service user volume, or

(ii) changes in prices in accordance with a formula provided for in the contract documents,

and the modification does not render the contract or framework agreement materially different in character, or

(d) the modification is attributable to a decision of the relevant authority and both of the criteria in paragraph (2) are met.

(2) The criteria are—

(a) the modification does not render the contract or framework agreement materially different in character, and

(b) the cumulative change in the lifetime value of the contract or framework agreement since it was entered into or concluded is—

(i) below £500,000; or

(ii) less than 25% of the lifetime value of the original contract or framework agreement when it was entered into or concluded.

(3) Where Direct Award Process A or Direct Award Process B was followed for the original award of a contract, the contract may be modified during its term without following a new procurement process under these Regulations where the modification does not render the contract materially different in character.

(4) Where—

(a) a modification is made to a contract or framework agreement without following a new procurement process, in accordance with paragraph (1) or (3),

(b) the modification is attributable to a decision of the relevant authority, and

(c) the cumulative change in the lifetime value of the contract since it was entered into, or framework agreement since it was concluded, is £500,000 or more,

the relevant authority must submit a notice of the modification for publication on the UK e-notification service.

(5) The notice in paragraph (4) must—

(a) be submitted for publication within 30 days of the modification of the contract or framework agreement, and

(b) include the information set out in Schedule 12.

Urgent award or modification

14.—(1) Regulations 6 to 13 are subject to this regulation.

(2) Where a relevant authority considers that—

(a) an award or modification must be made urgently,

(b) the reason for the urgency was not foreseeable by and not attributable to the relevant authority, and

(c) delaying the award of the contract or modification to satisfy the requirements of regulations 6 to 13 would be likely to pose a risk to patient or public safety,

the relevant authority may award or modify a contract without satisfying the requirements in regulations 6 to 13.

(3) Where—

(a) a standstill period has begun in accordance with regulation 12(2),

(b) the relevant authority has sought independent expert advice in accordance with regulation 23 in the standstill period,

(c) there is an existing contract for the relevant health care services to which the proposed contracting arrangement relates and the relevant authority considers that the term of that contract is likely to expire before the end of the standstill period,

(d) the relevant authority considers it necessary or expedient to modify the existing contract prior to the new contract taking effect in order to ensure continuity between the existing contract and proposed award of a new contract, and

(e) the relevant authority considers that it is not possible to satisfy the requirements of regulations 6 to 13 before the term of the existing contract expires,

the relevant authority may modify the existing contract without satisfying the requirements in regulations 6 to 13.

(4) Where paragraph (2) applies, the relevant authority must submit a notice for publication on the UK e-notification service.

(5) The notice in paragraph (4) must—

(a) be submitted for publication within 30 days of the award or modification of the contract;

(b) in the case of an urgent award, include the information set out in Schedule 13;

(c) in the case of an urgent modification, include the information set out in Schedule 14.

Abandonment of, or repetition of steps in, a procurement

15.—(1) Subject to paragraphs (2) and (3), a relevant authority may—

(a) abandon a procurement of relevant health care services under these Regulations and not award a contract, or not conclude a framework agreement, or

(b) go back to an earlier step in the selection process and repeat that step and subsequent steps,

at any time before an award is made or a framework agreement concluded.

(2) In a standstill period, a relevant authority may only make a decision to—

(a) abandon a procurement, or

(b) go back to an earlier step in a selection process and repeat that step and subsequent steps,

where that decision is in accordance with the procedure and requirements in regulation 12.

(3) Where a relevant authority makes a decision referred to in paragraph (2), the relevant authority may only abandon the procurement or repeat those steps after the standstill period has ended.

(4) Where, having started a process to procure relevant health care services under these Regulations, a relevant authority decides to abandon a procurement, the relevant authority must submit for publication on the UK e-notification service a notice of that decision.

(5) The notice in paragraph (4) must be submitted for publication—

(a) where the decision is made in a standstill period—

(i) after the standstill period has ended, and

(ii) within 30 days of the end of that standstill period;

(b) in any other case, within 30 days of the decision to abandon the procurement.

(6) Where, having started a process to procure relevant health care services under these Regulations, a relevant authority decides to repeat a step or steps, the relevant authority must inform relevant providers of that decision in writing.

(7) Paragraph (6) is satisfied where a decision to repeat a step or steps has been communicated to a provider in accordance with regulation 12(6) or (8).

(8) In this regulation—

(a) a reference to a step in the selection process is to a step referred to in regulation 9 (Direct Award Process C), 10 (the Most Suitable Provider Process) or 11 (the Competitive Process) as the case may be;

(b) “relevant providers” in paragraph (6) means any provider who has been made aware in the selection process that they are being considered for the award of a contract or to be a party to a framework agreement.

(1)

1971 c. 80.