On the current timetable, Monitor will become the economic regulator for health and social care in 2012. Monitor’s duty will be to protect and promote the interests of patients by promoting competition “where appropriate” and through regulation “where necessary”. There are also a number of other forces at work. Monitor must “have regard in particular to the likely future demand for health care services”. This is interesting as “have regard to” is the same sort of wording used to describe how NHS decision-making should be influenced by the NHS Constitution. Monitor must also promote the economic, efficient and effective provision of health care services for the purposes of the NHS and exercise its functions in a manner consistent with the Secretary of State’s obligation to promote a comprehensive health service.

  1. Licensing providers

As regulator, Monitor will be responsible for setting the licence conditions that apply to all providers of NHS services. Monitor will be consulting on the rules, but we would expect that at least some of the conditions will look very similar to Monitor’s current standard Foundation Trust (FT) terms of authorisation. Indeed for those FTs lucky enough to be “designated” under clause 101 of the Bill, there will be a period during which things might feel very familiar – right down to Monitor’s power to intervene and remove the FT’s governors and directors.

In addition, the Bill contemplates that some services might be too important to fail. Clause 69 of the Bill says that commissioners of NHS services can apply to Monitor to have services “designated” on the grounds that if the service ceased it would have a significant adverse impact on users’ health or on the prevention or amelioration of their condition. It will be possible for providers to appeal against the classification to a tribunal. The classification is important because it will restrict what providers can do with their services.

  1. Price setting

Monitor takes on responsibility for setting the national tariff. This section of the Bill expressly acknowledges that tariff could be a maximum price. You will have read enough about competition on price and why some say it is bad for quality. In setting tariff, Monitor must work with the NHS Commissioning Board. If Monitor and the Board cannot agree on tariff, then the decision goes to arbitration.

  1. Promoting competition

As will be seen from the summary above, Monitor’s principal duty is not to promote competition, but to protect and promote the interests of patients. That being said, Monitor is not the only competition regulator in this space. Monitor has to work with the Office of Fair Trading, the Competition Commission and many of the powers are concurrent (which means that either of the regulators could exercise them, a bit like the dual controls of a driving instructor). The Competition Commission will also be reporting to the Secretary of State on the development of competition in the provision of NHS services and how well Monitor is doing its job as competition regulator.