07 January 2016

High Court rules that NHS England did not breach new commissioning regulations

On 21 December 2015, the High Court handed down judgment in R (QSRC Limited) v National Health Service Commissioning Board (NHS England) and another [2015] EWHC 3752 (Admin), the first case to consider the government’s new commissioning regulations, the National Health Service (Procurement, Patient Choice and Competition) (No.2) Regulations 2013 (the Regulations). The applicant, QSRC, is a provider of healthcare services which had in the past provided gamma knife surgery services (GKSS) to UCLH NHS Trust (UCLH) at the National Hospital for Neurology and Neurosurgery (NHNN). The High Court dismissed QSRC's application for judicial review of the NHS’ decision not to award an interim contract for the provision of medical services.

From April 2013, responsibility for commissioning transferred from primary care trusts, such as UCLH, to NHS England. QSRC was informed that it would not be awarded a contract for GKSS pending the regulatory changes affecting NHS commissioning. However, two other providers, at Cromwell Hospital and St Bartholomew's Hospital, were approved to provide those services in the interim period because they were considered to be existing providers who had held NHS standard contracts in the previous commissioning year. QSRC applied for judicial review alleging that NHS England had treated some providers of GKSS more favourably than others in breach of Regulation 3(2) of the Regulations requiring NHS England to act in a transparent and proportionate way. In particular, QSRC alleged, NHS England had ignored Monitor's guidance under the Regulations (the Guidance):

“[I]f the commissioner's decision had the effect of excluding some existing providers from being able to provide a service (because they had provided direct services to NHS patients under other arrangements than an NHS standard contract), commissioners would need an objective justification for this. The objective justification would need to be well reasoned and based on evidence. If commissioners did not have a well reasoned objective justification based on evidence, we would normally expect them to also procure services from the other existing providers (those that had provided services under other arrangements than an NHS standard contract), under their interim commissioning position.”

The two questions at issue were whether QSRC was an “existing provider” for the purposes of the Guidance and, if so, whether NHS England had provided an “objective justification” for excluding QSRC. The High Court held that, despite the fact that there was no pattern of consistent behaviour in the commissioning of services in the period leading up to April 2013, QSRC was an existing provider for the purposes of the Guidance. However, NHS England had provided an objective justification to QSRC for not commissioning its services: to do so, NHS England explained, would have been to give preferential treatment to QSRC over at least nine other healthcare providers. NHS England had, therefore, acted in accordance with the Guidance and was not in breach of its duties under the Regulations.  The application was dismissed.

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