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CCGs failing to monitor and enforce contracts for outsourced services

CCGs are struggling to monitor and enforce the services they have outsourced to private providers, according to a new report.

FOI requests sent to the 211 CCGs from the Centre for Health and the Public Interest (CHPI) have revealed that 60% of the 181 who responded did not record how many site inspections they undertook of outsourced services, or were unable to say how many they had done. Of even greater concern, 12% said they did not carry out any inspections at all.

CCGs now spend 16% of their care budget in the private sector and manage, monitor and enforce some 15,000 contracts with private providers.

The report also revealed a growing number of the contracts are with large multinationals and companies backed by private equity, of which only seven have been terminated due to failings.

The CHPI said there is also a reluctance among CCGs to enforce their contracts with the private sector, their investigations uncovered just 16 CCGs had imposed any financial sanctions due to poor performance.

Monitor came to the same conclusion in 2013 when a study of CCGs and found that they were reluctant to enforce the terms of contracts for fear of exacerbating the financial situation of providers.

The report claims that the reason many CCGs are unable to answer questions about their outsourcing contracts and how they are inspected and enforced is due to the complex arrangements surrounding them.

CCGs remain the contracting bodies, with statutory responsibilities, but most of them have contracted out their contract monitoring function to CSUs (commissioning support units). CSUs, which between them employ some 8,500 staff, are at present technically part of NHS England, although the government intends them to become private companies by April 2016.

The CHPI suggest that NHS England should reconsider its plans to privatise the contract monitoring of NHS contracts. It points out that CCGs are the statutory bodies responsible for enforcing contracts between the NHS and the private sector, not CSUs, which remain unaccountable if anything goes wrong – and this problem will become exacerbated if CSUs become private companies.

The report also recommends an NHS England commissioned audit of CCGs’ capacity to monitor and manage contracts with non-NHS providers.

Colin Leys, the report’s co-author, said: “The picture that is emerging is of an NHS poorly equipped to ensure that healthcare services outsourced to for-profit providers will provide safe, high-quality care and good value for money.”

Responding to a written parliamentary question on the use of private providers within the NHS Jeremy Hunt said: “Under this Government, competition between providers of NHS services has been pursued on the basis of competition for quality through a system of fixed national tariffs.

“Our neutral position on who should provide services is taken to ensure patients receive the best possible services and outcomes. These decisions are taken by the local clinicians, who are best placed to act for the benefit of their patients.”

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Cllr Martin Klute   03/05/2015 at 19:11

Having been involved in Health Scrutiny since before the implementation of the Health and Social Care Act, I have been deeply concerned about the fragmentation of commissioning brought in by the Act. We established that the commissioning functions of the combined North Central London CCG were reallocated to 16 different organisations on April 1st 2013. We also learned that NCL CCGs were delegating their commissioning to the North and North East London CSU. The fragmentation of services has been damaging enough, already making scrutiny very difficult, but if the government forces the CSUs to go private, we will loose any scope at all to scrutinise them. There is absolutely no justification for privatising CSUs, and good reason for not doing so,

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