The development of new models of care requires traditional boundaries between health services to be removed in favour of a more integrated provider landscape. With no new legislative framework to bridge those boundaries, the contractual arrangements required to do so may be novel and complex. NHS England ("NHSE") and NHS Improvement ("NHSI") have recognised this and following initial guidance on the Integrated Support and Assurance Process ("ISAP") published in November 2016, final guidance has now been published: Integrated Support and Assurance Process (NHS England).
ISAP at a glance
The ISAP has been developed to mitigate the inevitable risks involved with the development of complex contracts so far as reasonably possible. Although risks will not be eliminated, a rating system will aim to ensure that the proposals presented represent a solution which is in the interests of patients.
Given the ISAP's focus on appraisal of risk, it is made clear that the process will examine the extent to which the governing body of the commissioner (and potentially the boards of other organisations involved) have examined the proposals at key stages.
The ISAP will apply in circumstances where a commissioner is proposing to procure new arrangements for existing services or the re-procurement of a complex contract. Additionally, the ISAP will also apply to providers who gain preferred bidder status, where it will act as a safeguard to examine the bidder's ability to assume the risks associated with the contract.
The ISAP will draw on the existing processes of NHSE including the CCG Improvement and Assessment Framework as well as NHSI's methods of risk evaluation. If a transaction review is required for an NHS Trust or NHS Foundation Trust it will form part of the ISAP process in accordance with the Single Oversight Framework.
The definition of a complex contract, and therefore when the ISAP may apply, is subject to the discretion of NHSE and NHSI, so as explained below, commissioners should engage with NHSE and NHSI at an early stage in order to determine whether the ISAP will apply in any particular case.
It is expected that new models of care involving cross-service integration along a care pathway, multispecialty community providers, primary and acute care systems and accountable care organisations will be subject to the ISAP due to the need for risk sharing arrangements. Services which involve complex delivery and/or payment mechanisms may also be subject to the ISAP.
If a contract is considered complex, whether or not the ISAP will apply is determined based on four factors: relative contract value (not applicable for specialised services), contract duration, commissioner quality and degree of performance-based income.
The ISAP process
The ISAP process consists of four stages, as outlined below, with the minimum expected procurement timeline to be 15 – 18 months. This staged process involves significant engagement including "Key Lines of Enquiry" ("KLOE") designed to establish a risk profile and numerous checks and balances. The KLOEs are defined in detail in the ISAP. There are a number of KLOEs that require specific legal input to evidence compliance:
- Legal risk identification and mitigation: compliance of strategy/ contractual documents/ notices with all applicable laws/regulations, managing conflicts, potential risk of the new entity’s novel structure, risks associated with variations to contractual documents, developing robust contingency plans, engaging with regulators and advice regarding licences and registrations with regulatory bodies; and
- Governance and Management: capacity and capability to deliver the procurement, engagement with key stakeholders, engaging the governing body and obtaining relevant approvals and transparency and accountability in governance arrangements.
Each checkpoint requires a summary of key legal issues and risks to be provided as part of the evidence gathering process. Confirmation is also required as to whether or not a commissioner has followed advice, and if not, how the risks will be managed.
|Early Engagement||Prior to formal market engagement.||A meeting between NHSE, NHSI and the commissioner who is developing a strategy that involves the commissioning of a complex contract. This stage will determine if the ISAP applies.|
|Checkpoint 1||Prior to formal competitive procurement or other selection process.||Establishes whether the proposal is a good solution for the local economy concerned and whether all necessary preparatory work has been completed.|
|Checkpoint 2||When a preferred bidder has been selected.||The aim of this checkpoint is to ensure that the final contractual terms meet the strategic objectives. This checkpoint also serves as a mechanism to determine whether the commissioner has followed the established process and whether the commissioner and the preferred bidder have the capacity to deliver. Where the preferred bidder is a trust the NHSI's transaction review process will be explained.|
|Checkpoint 3||Prior to the commencement of the service.||Enquiries are made to establish whether there have been any changes to the contract, to confirm that mobilisation plans are being implemented and to ensure that all parties are prepared for service delivery.|
During the review process a series of ISAP ratings (red, amber and green) will be used to determine whether or not expectations have been met.
Ultimately, the aim of the ISAP is to enable a joined up approach between NHSE and NHSI in scrutinising the risks of a project involving novel and/or complex contracts.
What should we be doing?
- Commissioners that are considering procuring a novel or complex contractual arrangement should engage at an early stage with NHSE to establish whether it will fall within the remit of the ISAP.
- Providers considering bidding for a novel or complex contract (either on their own or as part of a consortium) should consider the implications of the ISAP and how best to demonstrate compliance.
- When developing novel or complex contractual arrangements, review your engagement arrangements with professional advisers to ensure that there are clear, auditable divisions of responsibilities and lines of accountability.