Recent activity of Monitor's Cooperation and Competition Directorate

Monitor's Cooperation and Competition Directorate has now been up and running for a year having taken over from the NHS Cooperation and Competition Panel in April 2013.  We take a look back at some of the Directorate's activity over the past year.

Commissioning of Radiosurgery services

On 5 June 2013, Monitor opened an investigation into matters raised in a complaint by the Thornbury Radiosurgery Centre Limited (Thornbury).  The complaint related to the conduct of NHS England (and its predecessor body, the North of England Specialised Commissioning Group in the Yorkshire and Humber area) in relation to Gamma Knife radiosurgery services.  Thornbury alleged that decisions of NHS England resulted in Thornbury not being able to accept direct referrals of NHS patients and raised concerns about a contract awarded to a competitor.  Whilst Thornbury's complaint related to matters arising as long ago as 2008, Monitor decided to focus its investigation on the actions of NHS England post 1 April 2013.  On 26 February 2014, Monitor closed its investigation following confirmation from NHS England that it has now entered into a contract with Thornbury. 

Monitor published guidance on the issues raised on 4 April 2014. The guidance focusses on the importance of objective justification in relation to commissioning decisions (including whether or not to tender), objective evaluation of evidence to support decisions, publishing reasons for decisions, keeping records and publishing details of contracts awarded. 

Walk-in Centre Review

On 19 February 2014, Monitor published its final report following its review of the provision of walk-in centre services in England.  This was prompted by a number of walk-in centre closures.  Monitor's review focused on why walk-in centres are closing, the potential impact of closures on patients, whether commissioning arrangements and practices related to walk-in centres are working in patients' interests and whether payment mechanisms for walk-in centres and GP services are generating benefits for patients. The review led to the following findings:

• In some cases, walk-in centre closures may adversely affect patients' access to primary care
• The division of commissioning responsibilities for walk-in centres is causing confusion and could lead to decisions that do not take a system-wide view of the potential impact of changes to walk-in centre provision
• Walk-in centres would work better for patients if payment mechanisms were reformed.

The report sets out a number of factors for commissioners to consider when deciding whether to continue to procure walk-in centre services and made recommendations for commissioners to address some of the specific findings of the review.

Merger of parts of University Hospitals Bristol NHS Foundation Trust and North Bristol NHS Trust

On 20 September 2013 Monitor published the outcome of its review into the merger of parts of University Hospitals Bristol NHS Foundation Trust and North Bristol NHS Trust.  It found that the merger would be likely to reduce patient choice and competition for certain services.  Monitor concluded that in the particular circumstances of the case, the merger was likely to give rise to relevant benefits to patients, however it weighed those benefits against the impact of the reduction in patient choice and competition and concluded that the benefits did not outweigh the costs that had been identified.  Therefore the merger was found to be inconsistent with principle 10 of the Principles and Rules for cooperation and competition (which applied to the merger at the time).

Complaint into the commissioning of cancer surgery services in Greater Manchester

On 31 January 2014, Monitor announced its decision to close its investigation into the commissioning of specialist cancer surgery services in Greater Manchester and Cheshire.  The investigation had been opened after two hospitals raised concerns about the way these services were being commissioned.  Monitor was concerned that the process being followed by the commissioner to take decisions about future provision would not lead to the best hospitals being selected to deliver care to patients.  The decision to close the investigation was made following NHS England's confirmation that the commissioning process under investigation had been discontinued and that it was developing a new service specification and process which would be fully compliant with the NHS (Procurement, Patient Choice and Competition) Regulations. 

Investigation into the commissioning of elective services in Blackpool

In October 2013 Monitor announced that it had decided to initiate an investigation into the commissioning of elective services in Blackpool and the surrounding area by Blackpool CCG and Fylde and Wyre CCG.  This followed a complaint by Spire Healthcare Limited that the CCGs are breaching their regulatory obligations in relation to the commissioning of elective care, in particular, that the CCGs have sought to direct patients requiring elective care away from a Spire Hospital and towards Blackpool Victoria Hospital.  The Monitor timetable indicates that the final report is expected to be published in Spring 2014.

Pathology merger - Brighton and Sussex University Hospitals NHS Trust and Surrey and Sussex Healthcare NHS Trust

Monitor has advised the NHS Trust Development Authority that the proposed pathology merger between the two Sussex Trusts was not likely to result in a material adverse effect on patients and tax payers as a result of a loss of choice or competition. In its report on the merger, published on 12 March 2014, Monitor also advised that the merger was not likely to reduce the incentives for the merger parties to continue improving their elective and non-elective healthcare services and for pathology providers to compete. The Sussex Trusts plan to merge and consolidate their pathology services by forming a joint venture called Brighton, Surrey and Sussex Pathology.

Commentary

It is noteworthy that of the cases referred to above, only a handful relate to the operation of the NHS (Procurement, Patient Choice and Competition) Regulations 2013 which came into force on 1 April 2013.  A recent article in the Health Service Journal reported that according to a spokesperson for Monitor, Monitor had received 166 enquiries about those Regulations from a wide range of different organisations since last April and that the vast majority of these are handled without launching a formal investigation or using Monitor's enforcement powers.  In our experience, both commissioners and providers are aware of the Regulations and are taking them into account both in making commissioning decisions and in seeking to challenge those decisions. 

A number of Monitor's decisions relate to mergers within the NHS. There is considerable debate about how the merger regime does and should apply to the NHS and in particular how patient benefits should be assessed.  Over the past year, Monitor has sought to emphasise its role both in advising NHS organisations contemplating a merger over the potential impact on competition but also to help them identify what patient benefits are relevant and the type of evidence that Monitor will need to see before making its recommendations to the CMA.