NHS Provider Selection Regime: what you need to know

Overview

Procurement of goods, social care services, some pharmacy services, and non-healthcare services or healthcare services that do not provide healthcare to individuals (eg public health campaigns) are not covered by the PSR. However, they can be covered if part of a mixed procurement  ¹ but only when the majority of the contract is in-scope health services and the out-of-scope goods or services could not be covered in a separate contract. 

The PSR replaces all other methods for healthcare service procurement by relevant authorities, such as mandatory competitive tendering. 

Processes for selecting providers

The PSR introduced three provider selection processes that relevant authorities must follow. All processes require relevant authorities to keep records of their decisions and publish notices confirming the outcome. 

Relevant authorities can also establish framework agreements ² with providers to set out the terms and conditions of the contract ahead of time, and then award a contract to those providers within the agreement.

Requirements

If relevant authorities meet the criteria for direct award processes A or B, they must follow these processes. Otherwise they can opt to follow either direct award process C, the most suitable provider process or the competitive process, which have additional requirements all relevant authorities must follow:

• Assess providers using the basic selection criteria and five key criteria (additional local criteria can also be used).
• Maintain a record of decisions and assessment processes.
• Observe a standstill period (see below).  

Standstill period, representations and appeals

The standstill period gives time for providers that were not awarded a contract to make representations and for relevant authorities to consider and respond to them. If there are no representations, the period must last for a minimum of eight working days; if representations are received, it will remain open until further decisions are made and communicated.

If a provider is not satisfied with this decision, they can seek an independent review by appealing to the Independent Patient Choice and Procurement Panel. ³ The standstill period must remain open until the relevant authority has considered the advice from this panel and made a further decision.

Conflict of interest

Legal conflicts of interest rules are maintained, ie provider members of an ICS using a competitive process would be required to recuse themselves from decision-making. 

Otherwise conflicts of interest are expected to be managed on a case-by-case basis, with appropriate declaration, recording, mitigation and management of personal and professional interests.  

Patient choice

Where relevant authorities are required to offer a choice or provider to patients (through legal right to choice), direct award process B must be followed – but contracts can only be awarded to providers that meet the qualification criteria.

Next steps

As of 1 January 2024, relevant authorities must follow the PSR rules when procuring new healthcare services. Full statutory guidance should be used to support these processes.