London Borough of Camden enquiry report seeks to blame closure of independent sector provider GP practice in Camden on NHS reforms – we comment on the likely true causes of the closure.

A local authority enquiry into the closure of a GP surgery in north London that was run by a private company has criticised the national provider contract, suggesting that it includes “a serious loophole” that allows NHS primary care services providers to trade contracts for the provision of primary care like a “a commodity traded in the private market”.

The London Borough of Camden’s report of the “Health Scrutiny Panel of Enquiry into the closure of the Camden Road Surgery” was provided with a copy of the contract in question which apparently permitted the provider, UnitedHealth to “engage another suitable provider to lead on the delivery of services” and prevented the commissioning PCT from objecting “provided that the proposed new provider was a suitable provider of primary medical services”. UnitedHealth were not apparently required to consult the PCT on this change in provision.

In April 2011 UnitedHealth had arranged for the services to be provided by The Practice PLC, another independent sector provider. The usual legal basis for such an arrangement would be an assignment or a sub-contract. Under a sub-contracting arrangement the main contractor, in this case UnitedHealth, continues to be fully responsible to the PCT, for the provision of the services and the performance of its sub-contractor, in this case The Practice PLC. We wonder therefore what national provider contract the PCT was using when it contracted with UnitedHealth in 2008?

An example contract was provided by the Department of Health and NHS PASA (that was) in 2005 and this was commonly used by PCTs from that date as a basis for commissioning Alternative Provider Medical Services (APMS) agreements. New EAPMC contracts for GP practices were published in January 2009. Both these national contracts include wording that: forbids the provider from assigning or sub-contracting the services without prior written authorisation of the PCT; enables the PCT to impose such conditions on its authorisation as it thinks fit; and forbids any sub-contractor from itself passing the services down to a sub-contractor.

If the enquiry’s reading of the Camden PCT/UnitedHealth contract is correct, the PCT was clearly not using the national provider contract current at that time.

In our view the true reason for the closure of the GP practice has nothing to do with the sub-contract to The Practice PLC, nor does it have much to do with the NHS reforms.

The true reason appears to have been the expiry of the lease for the surgery premises in 2012 and the failure by either the PCT or the provider to find suitable alternative premises. The practice premises were owned by the GP who had run the practice from those premises until the contract was awarded to UnitedHealth in 2008, following a competitive tendering exercise. For reasons unexplained in the report, the five-year lease granted to Camden PCT by the former GP was backdated to 2007 and so was not coterminous with the primary medical services contract awarded to UnitedHealth, but expired in 2012, a year before the expiry of the primary medical services contract. As is common with primary medical services contracts, the PCT held the lease and paid the rent for the premises.

The expiry of the lease a year early and the failure of negotiations with the former GP landlord to secure an extension to the lease (sour grapes?), or find alternative premises locally left UnitedHealth/The Practice PLC with no premises from which to operate a GP practice.

The report also suggested that the reason for the sub-contract to The Practice PLC was UnitedHealth’s “desire to concentrate on providing services to the GP Commissioner consortia being set up under the National Health and Social Care Act 2012.” This shows a fundamental lack of understanding of the NHS reforms that will transfer the responsibility for commissioning NHS services from PCTs to “providers of primary medical services”, previously known as GP consortia, but now formally named Clinical Commissioning Groups (CCG). Mind you, they can be forgiven for not yet having a firm grasp of the new arrangements – many others are also struggling to keep up.

Under the National Health Service Act 2006 “providers of primary medical services” are defined as those who provide “essential medical services to registered patients during core hours”. This must include all those providing GP services, whether they be partnerships of GPs or independent sector providers (the only providers likely to be excluded from this definition are those providing “out of hours” services or walk-in centre services, where none of the patients are registered at the centre). Under the amendments to the 2006 Act made by the National Health and Social Care Act 2012 all “providers of primary medical services” are required by law to be members of a CCG.

So UnitedHealth and the other so-called “independent sector’ “providers of primary medical services” will have a statutory duty from 2013 to be members of a local CCG alongside their GP partnership colleagues. So LB Camden’s suggestion that UnitedHealth wants to be a provider rather than a commissioner of NHS services is mistaken – they will have no choice but to be both and will be competing with their fellow CCG members, the GP partnerships, to win contracts for services commissioned by the CCGs.

As a national healthcare legal practice we are expecting a deluge of enquiries on how to manage the conflicts of interest that these arrangements will inevitably throw up. We’ll be ready!