PART 3Regulation of health and adult social care services
CHAPTER 1Monitor
F2961Monitor
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F2962General duties
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F2963Secretary of State's guidance on duty under section 62(9)
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F2964General duties: supplementary
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F2965Power to give Monitor functions relating to adult social care services
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F2966Matters to have regard to in exercise of functions
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F2967Conflicts between functions
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F2968Duty to review regulatory burdens
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F2969Duty to carry out impact assessments
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F2970Information
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F2971Failure to perform functions
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CHAPTER 2Competition
F6372Functions under the Competition Act 1998
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F6273Functions under Part 4 of the Enterprise Act 2002
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74Competition functions: supplementary
F641
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F642
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F643
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F644
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F645
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F646
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I577
In section 168 of that Act (regulated markets)—
a
in subsection (3) (meaning of “relevant action”), after paragraph (o) insert—
p
modifying the conditions of a licence issued under section 87 of the Health and Social Care Act 2012.
b
in subsection (4) (meaning of “relevant statutory functions”), after paragraph (q) insert—
r
in relation to any licence issued under section 87 of the Health and Social Care Act 2012, the duties of Monitor under sections 62 and 66 of that Act.
c
in subsection (5) (meaning of “sectoral regulator”), after paragraph (i) insert—
ia
Monitor;
I58C475I1Requirements as to procurement, patient choice and competition
1
Regulations may impose requirements on the National Health Service Commissioning Board and clinical commissioning groups for the purpose of securing that, in commissioning health care services for the purposes of the NHS, they—
a
adhere to good practice in relation to procurement;
b
protect and promote the right of patients to make choices with respect to treatment or other health care services provided for the purposes of the NHS;
c
do not engage in anti-competitive behaviour which is against the interests of people who use such services.
2
Requirements imposed by regulations under this section apply to an arrangement for the provision of goods and services only if the value of the consideration attributable to the services is greater than that attributable to the goods.
3
Regulations under this section may, in particular, impose requirements relating to—
a
competitive tendering for the provision of services;
b
the management of conflicts between the interests involved in commissioning services and the interests involved in providing them.
4
The regulations may provide for the requirements imposed, or such of them as are prescribed, not to apply in relation to arrangements of a prescribed description.
I59C476I2Requirements under section 75: investigations, declarations and directions
1
Regulations under section 75 may confer on Monitor—
a
a power to investigate a complaint that the National Health Service Commissioning Board or a clinical commissioning group has failed to comply with a requirement imposed by the regulations;
b
a power to investigate on its own initiative whether the Board or a clinical commissioning group has failed to comply with a requirement imposed by virtue of section 75(1)(c);
c
a power to require the Board or a clinical commissioning group to provide it with such information as Monitor may specify for the purposes of an investigation it carries out by virtue of paragraph (a) or (b);
d
a power to require the Board or a clinical commissioning group to provide an explanation of such information as it provides by virtue of paragraph (c).
2
A power conferred by virtue of subsection (1)(a) is exercisable only where Monitor considers that the person making the complaint has sufficient interest in the arrangement to which the complaint relates.
3
Regulations under section 75 may confer on Monitor a power to declare that an arrangement for the provision of health care services for the purposes of the NHS is ineffective.
4
A power conferred by virtue of subsection (3) is exercisable only in prescribed circumstances and subject to prescribed restrictions and only where Monitor is satisfied that—
a
the National Health Service Commissioning Board or a clinical commissioning group has failed to comply with a requirement of regulations under section 75, and
b
the failure is sufficiently serious.
5
On a declaration being made by virtue of subsection (3), the arrangement is void; but that does not affect—
a
the validity of anything done pursuant to the arrangement,
b
any right acquired or liability incurred under the arrangement, or
c
any proceedings or remedy in respect of such a right or liability.
6
Regulations under section 75 may confer on Monitor a power to direct the National Health Service Commissioning Board or a clinical commissioning group—
a
to put in place measures for the purpose of preventing failures to comply with requirements imposed by the regulations or mitigating the effect of such failures;
b
to remedy a failure to comply with such a requirement;
c
not to exercise in a prescribed manner prescribed functions in relation to arrangements for the provision of health care services;
d
to vary or withdraw an invitation to tender for the provision of health care services;
e
to vary an arrangement for the provision of health care services made in consequence of putting the provision of the services out to tender.
C1C27
A failure to comply with a requirement imposed by regulations under section 75 which causes loss or damage is actionable, except in so far as the regulations restrict the right to bring such an action.
8
Regulations under section 75 may—
a
provide for a specified defence to such an action;
b
prevent a person who has brought such an action under F24the Public Contracts Regulations 2015 (S.I. 2015/102)F25or the Concession Contracts Regulations 2016 (S.I. 2016/273) from bringing such an action under the regulations under section 75 in respect of the whole or part of the same loss or damage.
I60C477I3Requirements under section 75: undertakings
1
Regulations under section 75 may confer on Monitor a power to accept an undertaking (referred to in this Chapter as a “section 77 undertaking”) from the National Health Service Commissioning Board or a clinical commissioning group to take such action of a kind mentioned in subsection (2) as is specified in the undertaking within such period as is so specified.
2
The specified action must be—
a
action of a description given in paragraphs (a) to (e) of section 76(6), or
b
action of such a description as may be prescribed.
3
Where Monitor accepts a section 77 undertaking then, unless the Board, or (as the case may be) the clinical commissioning group from whom the undertaking is accepted, has failed to comply with the undertaking or any part of it, Monitor may not—
a
continue to carry out the investigation in question,
b
make a declaration by virtue of subsection (3) of section 76 in relation to the arrangement in question, or
c
give a direction by virtue of subsection (6) of that section in relation to the failure in question.
4
Where the Board, or (as the case may be) the clinical commissioning group from whom Monitor has accepted a section 77 undertaking, has failed to comply fully with the undertaking but has complied with part of it, Monitor must take the partial compliance into account in deciding whether to do something mentioned in paragraphs (a) to (c) of subsection (3).
5
Schedule 9 (which makes further provision about section 77 undertakings) has effect.
I51C478Guidance
1
Monitor must publish guidance about—
a
compliance with requirements imposed by regulations under section 75;
b
how it intends to exercise powers conferred on it by regulations under that section.
2
Before publishing guidance under subsection (1)(a) or (b), Monitor must consult—
a
the National Health Service Commissioning Board, and
b
such other persons as Monitor considers appropriate.
3
Before publishing guidance under subsection (1)(a) or (b), Monitor must obtain the approval of the Secretary of State.
4
Monitor may revise guidance under this section and, if it does so, must publish the guidance as revised.
5
Before publishing guidance revised under subsection (4), Monitor must consult the persons mentioned in subsection (2).
F6579Mergers involving NHS foundation trusts
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F6680Co-operation with the F4CMA
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CHAPTER 3Licensing
Licensing requirement
I61I11381I4Requirement for health service providers to be licensed
1
Any person who provides a health care service for the purposes of the NHS must hold a licence under this Chapter.
2
Regulations may make provision for the purposes of this Chapter for determining, in relation to a service provided by two or more persons acting in different capacities, which of those persons is to be regarded as the person who provides the service.
I6282Deemed breach of requirement to be licensed
1
This section applies where a licence holder—
a
in providing a health care service for the purposes of the NHS, carries on a regulated activity (within the meaning of Part 1 of the Health and Social Care Act 2008), but
b
is not registered under Chapter 2 of Part 1 of that Act in respect of the carrying on of that activity.
2
The licence holder is to be regarded as providing the service in breach of the requirement under section 81 to hold a licence.
I11483I5Exemption regulations
1
Regulations (referred to in this section and section 84 as “exemption regulations”) may provide for the grant of exemptions from the requirement under section 81 in respect of—
a
a prescribed person or persons of a prescribed description;
b
the provision of a prescribed health care service or a health care service of a prescribed description.
2
Exemption regulations may grant an exemption—
a
either generally or to the extent prescribed;
b
either unconditionally or subject to prescribed conditions;
c
indefinitely, for a prescribed period or for a period determined by or under the exemption.
3
Conditions subject to which an exemption may be granted include, in particular, conditions requiring any person providing a service pursuant to the exemption—
a
to comply with any direction given by F68NHS England about such matters as are specified in the exemption or are of a description so specified,
b
except to the extent that F69NHS England otherwise approves, to do, or not to do, such things as are specified in the exemption or are of a description so specified (or to do, or not to do, such things in a specified manner), and
c
to refer for determination by F70NHS England such questions arising under the exemption as are specified in the exemption or are of a description so specified.
4
Before making exemption regulations the Secretary of State must give notice to—
F71a
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b
F67NHS England, and
c
the Care Quality Commission and its Healthwatch England committee.
5
The Secretary of State must also publish a notice under subsection (4).
6
A notice under subsection (4) must—
a
state that the Secretary of State proposes to make exemption regulations and set out their proposed effect,
b
set out the Secretary of State's reasons for the proposal, and
c
specify the period (“the notice period”) within which representations with respect to the proposal may be made.
7
The notice period must be not less than 28 days beginning with the day after that on which the notice is published under subsection (5).
8
Where an exemption is granted the Secretary of State—
a
if the exemption is granted to a prescribed person, must give notice of it to that person, and
b
must publish the exemption.
I11584I6Exemption regulations: supplementary
1
Regulations may revoke exemption regulations by which an exemption was granted to a person, or amend such regulations by which more than one exemption was so granted so as to withdraw any of the exemptions—
a
at the person's request,
b
in accordance with any provision of the exemption regulations by which the exemption was granted, or
c
if the Secretary of State considers it to be inappropriate for the exemption to continue to have effect.
2
Regulations may revoke exemption regulations by which an exemption was granted to persons of a prescribed description, or amend such regulations by which more than one exemption was so granted so as to withdraw any of the exemptions—
a
in accordance with any provision of the exemption regulations by which the exemption was granted, or
b
if the Secretary of State considers it to be inappropriate for the exemption to continue to have effect.
3
The Secretary of State may by direction withdraw an exemption granted to persons of a description prescribed in exemption regulations for any person of that description—
a
at the person's request,
b
in accordance with any provision of the exemption regulations by which the exemption was granted, or
c
if the Secretary of State considers it to be inappropriate for the exemption to continue to have effect in the case of the person.
4
Subsection (5) applies where the Secretary of State proposes to—
a
make regulations under subsection (1)(b) or (c) or (2), or
b
give a direction under subsection (3)(b) or (c).
5
The Secretary of State must—
a
consult the following about the proposal—
F73i
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ii
F72NHS England;
iii
the Care Quality Commission and its Healthwatch England committee;
b
where the Secretary of State is proposing to make regulations under subsection (1)(b) or (c), give notice of the proposal to the person to whom the exemption was granted;
c
where the Secretary of State is proposing to make regulations under subsection (2), publish the notice;
d
where the Secretary of State is proposing to give a direction under subsection (3)(b) or (c), give notice of the proposal to the person from whom the Secretary of State proposes to withdraw the exemption.
6
The notice must—
a
state that the Secretary of State proposes to make the regulations or give the direction (as the case may be),
b
set out the Secretary of State's reasons for the proposal, and
c
specify the period within which representations with respect to the proposal may be made.
7
The period so specified must be not less than 28 days beginning with the day after that on which the notice is received or (as the case may be) published.
Licensing procedure
I63I10785Application for licence
1
A person seeking to hold a licence under this Chapter must make an application to F74NHS England.
2
The application must be made in such form, and contain or be accompanied by such information, as F75NHS England requires.
I64I10886Licensing criteria
1
F87NHS England must set and publish the criteria which must be met by a person in order for that person to be granted a licence under this Chapter.
2
F87NHS England may revise the criteria and, if it does so, must publish them as revised.
3
F87NHS England may not set or revise the criteria unless the Secretary of State has by order approved the criteria or (as the case may be) revised criteria.
I65I11687Grant or refusal of licence
1
This section applies where an application for a licence has been made under section 85.
2
If F88NHS England is satisfied that the applicant meets the criteria for holding a licence for the time being published under section 86 it must as soon as reasonably practicable grant the application; otherwise it must refuse it.
3
On granting the application, F89NHS England must issue a licence to the applicant.
4
A licence issued under this section is subject to—
a
such of the standard conditions (see section 94) as are applicable to the licence, F1and
b
such other conditions included in the licence by virtue of section 95 (referred to in this Chapter as “the special conditions”), F226and
c
F226any conditions included in the licence by virtue of section 111 (imposition of licence conditions on NHS foundation trusts during transitional period).
I6688Application and grant: NHS foundation trusts
F901
This section applies where—
a
an NHS trust becomes an NHS foundation trust in pursuance of section 36 of the National Health Service Act 2006 (effect of authorisation of NHS foundation trust), or
b
an NHS foundation trust is established under sections 56 or 56B of that Act (mergers and separations).
2
The NHS foundation trust is to be treated by F91NHS England as having—
a
duly made an application for a licence under section 85, and
b
met the criteria for holding a licence for the time being published under section 86.
3
An NHS foundation trust in existence on the day on which this section comes into force is to be treated for the purposes of this section as having become an NHS foundation trust pursuant to section 36 of the National Health Service Act 2006 on that day.
I6789Revocation of licence
F92NHS England may at any time revoke a licence under this Chapter—
a
on the application of the licence holder, or
b
if F92NHS England is satisfied that the licence holder has failed to comply with a condition of the licence.
90Right to make representations
1
F76NHS England must give notice—
I117a
to an applicant for a licence under this Chapter of a proposal to refuse the application;
I68b
to the licence holder of a proposal to revoke a licence under section 89(b).
I682
A notice under this section must—
a
set out F77NHS England’s reasons for its proposal;
b
specify the period within which representations with respect to the proposal may be made to F78NHS England.
I683
The period so specified must be not less than 28 days beginning with the day after that on which the notice is received.
91Notice of decisions
1
This section applies if F79NHS England decides to—
I118a
refuse an application for a licence under section 87, or
I53b
revoke a licence under section 89(b).
I532
F80NHS England must give notice of its decision to the applicant or the licence holder (as the case may be).
I533
A notice under this section must explain the right of appeal conferred by section 92.
I534
A decision of F81NHS England to revoke a licence under section 89(b) takes effect on such day as may be specified by F81NHS England, being a day no earlier than—
a
if an appeal is brought under section 92, the day on which the decision on appeal is confirmed or the appeal is abandoned,
b
c
the day after that period.
92Appeals to the Tribunal
1
An appeal lies to the First-tier Tribunal against a decision of F82NHS England to—
I119a
refuse an application for a licence under section 87, or
I69b
revoke a licence under section 89(b).
I692
The grounds for an appeal under this section are that the decision was—
a
based on an error of fact,
b
wrong in law, or
c
unreasonable.
I693
On an appeal under this section, the First-tier Tribunal may—
a
confirm F83NHS England’s decision,
b
direct that the decision is not to have effect, or
c
remit the decision to F84NHS England.
I7093I7Register of licence holders
1
F86NHS England must maintain and publish a register of licence holders.
2
The register may contain such information as F86NHS England considers appropriate for the purpose of keeping members of the public informed about licence holders including, in particular, information about the revocation of any licence under this Chapter.
3
F86NHS England must secure that copies of the register are available at its offices for inspection at all reasonable times by any person.
4
Any person who asks F86NHS England for a copy of, or an extract from, the register is entitled to have one.
5
Regulations may provide that subsections (3) and (4) do not apply—
a
in such circumstances as may be prescribed, or
b
to such parts of the register as may be prescribed.
6
A fee determined by F85NHS England is payable for the copy or extract except—
a
in such circumstances as may be prescribed, or
b
in any case where F85NHS England considers it appropriate to provide the copy or extract free of charge.
Licence conditions
I7194I8Standard conditions
I361
F93NHS England must determine and publish the conditions to be included in each licence under this Chapter (referred to in this Chapter as “the standard conditions”).
I362
Different standard conditions may be determined for different descriptions of licences.
I363
For the purposes of subsection (2) a description of licences may, in particular, be framed wholly or partly by reference to—
a
the nature of the licence holder,
b
the services provided under the licence, or
c
the areas in which those services are provided.
I364
But different standard conditions must not be determined for different descriptions of licences to the extent that the description is framed by reference to the nature of the licence holder unless F94NHS England considers that at least one of requirements 1 and 2 is met.
I365
Requirement 1 is that—
a
the standard conditions in question relate to the governance of licence holders, and
b
it is necessary to determine different standard conditions in order to take account of differences in the status of different licence holders.
I366
Requirement 2 is that it is necessary to determine different standard conditions for the purpose of ensuring that the burdens to which different licence holders are subject as a result of holding a licence are broadly consistent.
F95I377
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F95I378
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F95I379
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F95I3710
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F9511
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I4095Special conditions
1
F33NHS England may—
I542
Before including a special condition or making such modifications F34NHS England must give notice to—
a
the applicant or the licence holder (as the case may be),
b
the Secretary of State,
F37c
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
d
such F36integrated care boards as are likely to be affected by the proposed inclusion or modifications, and
e
the Care Quality Commission and its Healthwatch England committee.
I543
F38NHS England must also publish the notice under subsection (2).
I544
The notice under subsection (2) must—
a
state that F39NHS England proposes to include the special condition or make the modifications and set out its or their proposed effect,
b
set out F40NHS England’s reasons for the proposal, and
c
specify the period (“the notice period”) within which representations with respect to the proposal may be made to F41NHS England.
I545
The notice period must be not less than 28 days beginning with the day after that on which the notice is published under subsection (3).
I936
In this section, a reference to modifying a condition includes a reference to amending, omitting or adding a condition.
I4196I9Limits on F30NHS England’s functions to set or modify licence conditions
1
This section applies to the following functions of F44NHS England —
I112a
the duty to determine the standard conditions to be included in each licence under this Chapter or in licences of a particular description (see section 94);
I112b
the powers to include a special condition in a licence and to modify such a condition (see section 95);
I94c
the power to modify the standard conditions applicable to all licences, or to licences of a particular description (see section 100).
I1122
F45NHS England may only exercise a function to which this section applies—
a
for the purpose of regulating the price payable for the provision of health care services for the purposes of the NHS;
b
for the purpose of preventing anti-competitive behaviour in the provision of health care services for those purposes which is against the interests of people who use such services;
c
for the purpose of protecting and promoting the right of patients to make choices with respect to treatment or other health care services provided for the purposes of the NHS;
d
for the purpose of ensuring the continued provision of health care services for the purposes of the NHS;
F43da
for the purpose of ensuring that decisions relating to the provision of health care services for the purposes of the NHS are made with regard to all their likely effects in relation to the matters referred to in subsection (2A);
e
for the purpose of enabling health care services provided for the purposes of the NHS to be provided in an integrated way where F48NHS England considers that this would achieve one or more of the objectives referred to in subsection (3);
f
for the purpose of enabling the provision of health care services provided for the purposes of the NHS to be integrated with the provision of health-related services or social care services where F49NHS England considers that this would achieve one or more of the objectives referred to in subsection (3);
F46g
for the purpose of enabling, promoting or securing co-operation between providers of health care services for the purposes of the NHS, or between such providers and—
i
NHS bodies, within the meaning of section 72 of the National Health Service Act 2006, or
ii
local authorities in England (and for this purpose “local authority” has the meaning given by section 275(1) of the National Health Service Act 2006);
h
for purposes connected with the governance of persons providing health care services for the purposes of the NHS;
i
for purposes connected with F50NHS England’s functions in relation to the register of NHS foundation trusts required to be maintained under section 39 of the National Health Service Act 2006;
j
for purposes connected with the operation of the licensing regime established by this Chapter;
F51k
for such other purposes as may be prescribed.
F422A
The matters referred to in subsection (2)(da) are—
a
the health and well-being of the people of England;
b
the quality of services provided to individuals—
i
by relevant bodies, or
ii
in pursuance of arrangements made by relevant bodies,
for or in connection with the prevention, diagnosis or treatment of illness, as part of the health service in England;
c
efficiency and sustainability in relation to the use of resources by relevant bodies for the purposes of the health service in England.
2B
For the purposes of subsection (2)(da) (as read with subsection (2A))—
a
a reference to the effects of decisions in relation to the health and well-being of the people of England includes a reference to the effects of the decisions in relation to inequalities between the people of England with respect to their health and well-being;
b
a reference to effects of decisions in relation to the quality of services provided to individuals includes a reference to the effects of the decisions in relation to inequalities between individuals with respect to the benefits that they can obtain from those services.
2C
In subsection (2A) “relevant bodies” means—
a
NHS England,
b
integrated care boards,
c
NHS trusts established under section 25, and
d
NHS foundation trusts.
I1123
The objectives referred to in subsection (2)(e), F47and (f) are—
a
improving the quality of health care services provided for the purposes of the NHS (including the outcomes that are achieved from their provision) or the efficiency of their provision,
b
reducing inequalities between persons with respect to their ability to access those services, and
c
reducing inequalities between persons with respect to the outcomes achieved for them by the provision of those services.
I1124
F52NHS England must not exercise a function to which this section applies in a way which it considers would result in a particular licence holder or holders of licences of a particular description being put at an unfair advantage or disadvantage in competing with others in the provision of health care services for the purposes of the NHS as a result of—
a
being in the public or (as the case may be) private sector, or
b
some other aspect of its or their status.
I1125
In subsection (2)(f), “health-related services” and “social care services” each have the meaning given in section 62(11).
I42I7297I10Conditions: supplementary
1
The standard or special conditions of a licence under this Chapter may, in particular, include conditions—
a
b
requiring the licence holder to comply with any requirement imposed on it by F54NHS England under Chapter 6 (financial assistance in special administration cases),
c
requiring the licence holder to do, or not to do, specified things or things of a specified description (or to do, or not to do, any such things in a specified manner) within such period as may be specified in order to prevent anti-competitive behaviour in the provision of health care services for the purposes of the NHS which is against the interests of people who use such services,
d
requiring the licence holder to give notice to the F5CMA before entering into an arrangement under which, or a transaction in consequence of which, the licence holder's activities, and the activities of one or more other businesses, cease to be distinct activities,
e
f
requiring the licence holder to publish such information as may be specified or as F56NHS England may direct,
g
h
requiring the licence holder to comply with other rules published by F57NHS England about the charging for the provision of health care services for the purposes of the NHS,
i
requiring the licence holder—
i
to do, or not to do, specified things or things of a specified description (or to do, or not to do, any such things in a specified manner) within such period as may be specified in order to ensure the continued provision of one or more of the health care services that the licence holder provides for the purposes of the NHS,
ii
to give F58NHS England notice (of such period as may be determined by or under the licence) of the licence holder's intention to cease providing a health care service for the purposes of the NHS, and
j
about the use or disposal by the licence holder of assets used in the provision of health care services for the purposes of the NHS in order to ensure the continued provision of one or more of the health care services that the licence holder provides for those purposes, and
k
about the making by the licence holder of investment in relation to the provision of health care services for the purposes of the NHS in order to ensure the continued provision of one or more of the health care services that the licence holder provides for those purposes.
2
In subsection (1) “specified” means specified in a condition.
3
F60NHS England must not include a condition under subsection (1)(c) that requires the licence holder (A) to provide another licence holder with access to facilities of A.
4
A condition under subsection (1)(d)—
a
may be included only in the licence of an NHS foundation trust or a body which (or part of which) used to be an NHS trust established under section 25 of the National Health Service Act 2006, and
b
ceases to have effect at the end of the period of five years beginning with the day on which it is included in the licence.
5
The references in subsection (1)(d) to the activities of a licence holder or other business include a reference to part of the activities concerned.
6
The references in subsections (1)(d) and (5) to the activities of a business include a reference to the activities of an NHS foundation trust in so far as its activities would not otherwise be the activities of a business.
7
A condition of a licence under this Chapter may provide that it is to have effect, or cease to have effect, at such times and in such circumstances as may be determined by or under the conditions.
I7398I11Conditions relating to the continuation of the provision of services etc.
I431
The things which a licence holder may be required to do by a condition under section 97(1)(i)(i) include, in particular—
a
providing information to the commissioners of services to which the condition applies and to such other persons as F99NHS England may direct,
b
allowing F100NHS England to enter premises owned or controlled by the licence holder and to inspect the premises and anything on them, and
c
co-operating with such persons as F101NHS England may appoint to assist in the management of the licence holder's affairs, business and property.
I432
A commissioner of services to which a condition under section 97(1)(i), (j) or (k) applies must co-operate with persons appointed under subsection (1)(c) in their provision of the assistance that they have been appointed to provide.
3
Where a licence includes a condition under section 97(1)(i), (j) or (k), F102NHS England must carry out an ongoing assessment of the risks to the continued provision of services to which the condition applies.
I444
F97NHS England must publish guidance—
a
for commissioners of a service to which a condition under section 97(1)(i), (j) or (k) applies about the exercise of their functions in connection with the licence holders who provide the service, and
b
for such licence holders about the conduct of their affairs, business and property at a time at which such a condition applies.
5
A commissioner of services to which a condition under section 97(1)(i), (j), or (k) applies must have regard to guidance under subsection (4)(a).
F965A
In subsections (4)(a) and (5) “commissioner” does not include NHS England.
6
F103NHS England may revise guidance under subsection (4) and, if it does so, must publish the guidance as revised.
I447
Before publishing guidance under subsection (4) or (6), F98NHS England must obtain the approval of—
a
the Secretary of State, F104...
F104b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I7499Notification of commissioners where continuation of services at risk
1
This section applies where F107NHS England—
a
takes action in the case of a licence holder in reliance on a condition in the licence under section 97(1)(i), (j) or (k), and
b
does so because it is satisfied that the continued provision for the purposes of the NHS of health care services to which that condition applies is being put at significant risk by the configuration of certain health care services provided for those purposes.
2
In subsection (1), a reference to the provision of services is a reference to their provision by the licence holder or any other provider.
F1083
NHS England must as soon as reasonably practicable notify such integrated care boards as NHS England considers appropriate—
a
of the action it has taken, and
b
of its reasons for being satisfied as mentioned in subsection (1)(b).
4
5
I95100I12Modification of standard conditions
1
F127NHS England may, subject to the requirements of this section, modify the standard conditions applicable to all licences under this Chapter or to licences of a particular description.
F1191A
Before making modifications under subsection (1) that NHS England consider to be a major change, NHS England must—
a
carry out an assessment of the likely impact of the modifications, or
b
publish a statement setting out its reasons for concluding that such assessment is not needed.
2
a
each relevant licence holder,
b
the Secretary of State,
F126c
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
d
every F125integrated care board, and
e
the Care Quality Commission and its Healthwatch England committee.
3
F122NHS England must also publish the notice under subsection (2).
4
The notice under subsection (2) must—
a
state that F128NHS England proposes to make the modifications,
b
set out the proposed effect of the modifications,
c
set out F129NHS England’s reasons for the proposal, and
d
specify the period (“the notice period”) within which representations with respect to the proposal may be made to F130NHS England.
5
The notice period must be not less than 28 days beginning with the day after that on which the notice is published under subsection (3).
F1326
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F1327
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F1328
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F1329
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
Where F131NHS England modifies the standard conditions applicable to all licences or (as the case may be) to licences of a particular description under this section, F131NHS England—
a
may also make such incidental or consequential modifications as it considers necessary or expedient of any other conditions of a licence which is affected by the modifications,
b
must make (as nearly as may be) the same modifications of those conditions for the purposes of their inclusion in all licences or (as the case may be) licences of that description granted after that time, and
c
must publish the modifications.
11
In this sectionF124..., “relevant licence holder”—
a
in relation to proposed modifications of the standard conditions applicable to all licences, means any licence holder, and
b
in relation to proposed modifications of the standard conditions applicable to licences of a particular description, means a holder of a licence of that description.
12
In this section, a reference to modifying a condition includes a reference to amending, omitting or adding a condition.
F111101Modification references to the F3CMA
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I75102I13Modification of conditions by order under other enactments
1
This section applies where the F6CMA or Secretary of State (the “relevant authority”) makes a relevant order.
2
A relevant order may modify—
a
the conditions of a particular licence, or
b
the standard conditions applicable to all licences under this Chapter or to licences of a particular description.
3
The modifications which may be made by a relevant order are those which the relevant authority considers necessary or expedient for the purpose of giving effect to, or taking account of, any provision made by the order.
4
In this section “relevant order” means—
a
an order under section 75, 83 or 84 of, or paragraph 5, 10 or 11 of Schedule 7 to, the Enterprise Act 2002 where one or more of the enterprises which have, or may have, ceased to be distinct enterprises were engaged in the provision of health care services for the purposes of the NHS;
b
an order under any of those provisions of that Act where one or more of the enterprises which will or may cease to be distinct enterprises is engaged in the provision of health care services for the purposes of the NHS;
c
an order under section 160 or 161 of that Act where the feature, or combination of features, of the market F7or markets in the United Kingdom for goods or services which prevents, restricts or distorts competition relates to—
i
ii
the provision of those services.
5
The modification under subsection (2)(a) of part of a standard condition of a licence does not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Chapter.
6
Where the relevant authority modifies the standard conditions applicable to all licences or (as the case may be) to licences of a particular description under this section, the relevant authority—
a
may, after consultation with F114NHS England, make such incidental or consequential modifications as the relevant authority considers necessary or expedient of any other conditions of any licence which is affected by the modifications,
b
must also make (as nearly as may be) the same modifications of those conditions for the purposes of their inclusion in all licences or (as the case may be) licences of that description granted after that time, and
c
must publish any modifications it makes under paragraph (b).
7
Expressions used in subsection (4) and in Part 3 or (as the case may be) Part 4 of the Enterprise Act 2002 have the same meaning in that subsection as in that Part.
8
In this section, a reference to modifying a condition includes a reference to amending, omitting or adding a condition.
I76I96103Standard condition as to transparency of certain criteria
I451
The standard conditions applicable to any licence under this Chapter must include a condition requiring the licence holder to—
a
set transparent eligibility and selection criteria, and
b
apply those criteria in a transparent way to persons who, having a choice of persons from whom to receive health care services for the purposes of the NHS, choose to receive them from the licence holder.
I452
“Eligibility and selection criteria”, in relation to a licence holder, means criteria for determining—
a
whether a person is eligible, or is to be selected, to receive health care services provided by the licence holder for the purposes of the NHS, and
b
if the person is selected, the manner in which the services are provided to the person.
3
The following powers must not be exercised so as to omit the condition mentioned in subsection (1) from any licence under this Chapter—
a
F134the power conferred on NHS England by section 100 to modify the standard conditions applicable to all licences, or to licences of a particular description,
F133b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and
c
the powers conferred by section 102 on the F8CMA and Secretary of State to modify those conditions or the conditions of a particular licence.
Enforcement
104Power to require documents and information
I461
F115NHS England may require a person mentioned in subsection (2) to provide it with any information, documents, records or other items which it considers it necessary or expedient to have for the purposes of any of its regulatory functions.
2
The persons are—
I46a
an applicant for a licence under this Chapter,
I77b
a licence holder,
I120c
a person who has provided, or is providing, a health care service for the purposes of the NHS in accordance with an exemption by virtue of section 83 from the requirement to hold a licence under this Chapter,
I120d
a person who has provided, or is providing, a health care service for the purposes of the NHS in breach of that requirement,
I463
The power in subsection (1) includes, in relation to information, documents or records kept by means of a computer, power to require the provision of the information, documents or records in legible form.
F1174
105I14Discretionary requirements
1
F135NHS England may impose one or more discretionary requirements on a person if F135NHS England is satisfied that the person—
I121a
has provided, or is providing, a health care service for the purposes of the NHS in breach of the requirement to hold a licence under this Chapter (see section 81),
I79b
is a licence holder who has provided, or is providing, a health care service for the purposes of the NHS in breach of a condition of the licence, or
2
In this Chapter, “discretionary requirement” means—
I97a
I79b
a requirement to take such steps within such period as F136NHS England may specify, to secure that the breach in question does not continue or recur (referred to in this Chapter as a “compliance requirement”), or
I79c
a requirement to take such steps within such period as F137NHS England may specify, to secure that the position is, so far as possible, restored to what it would have been if the breach in question was not occurring or had not occurred (referred to in this Chapter as a “restoration requirement”).
I793
F138NHS England must not impose discretionary requirements on a person on more than one occasion in relation to the same breach.
I974
A variable monetary penalty must not exceed 10% of the turnover in England of the person on whom it is imposed, such amount to be calculated in the prescribed manner.
I975
If the whole or any part of a variable monetary penalty is not paid by the time it is required to be paid, the unpaid balance from time to time carries interest at the rate for the time being specified in section 17 of the Judgments Act 1838; but the total interest must not exceed the amount of the penalty.
106I15Enforcement undertakings
1
F140NHS England may accept an enforcement undertaking from a person if F140NHS England has reasonable grounds to suspect that the person—
I122a
has provided, or is providing, a health care service for the purposes of the NHS in breach of the requirement to hold a licence under this Chapter,
I55b
is a licence holder who has provided, or is providing, a health care service for the purposes of the NHS in breach of a condition of the licence, or
I552
In this Chapter, “enforcement undertaking” means an undertaking from a person to take such action of a kind mentioned in subsection (3) as may be specified in the undertaking within such period as may be so specified.
I553
The specified action must be—
a
action to secure that the breach in question does not continue or recur,
b
action to secure that the position is, so far as possible, restored to what it would have been if the breach in question was not occurring or had not occurred,
c
action (including the payment of a sum of money) to benefit—
i
any other licence holder affected by the breach, or
ii
any commissioner of health care services for the purposes of the NHS which is affected by the breach, or
d
action of such a description as may be prescribed.
I554
Where F142NHS England accepts an enforcement undertaking then, unless the person from whom the undertaking is accepted has failed to comply with the undertaking or any part of it—
a
F142NHS England may not impose on that person any discretionary requirement which it would otherwise have power to impose by virtue of section 105 in respect of the breach to which the undertaking relates, and
b
if the breach to which the undertaking relates falls within subsection (1)(b), F142NHS England may not revoke that person's licence under section 89(b).
I555
Where a person from whom F141NHS England has accepted an enforcement undertaking has failed to comply fully with the undertaking but has complied with part of it, F141NHS England must take the partial compliance into account in deciding whether—
a
to impose a discretionary requirement on the person in respect of the breach to which the undertaking relates, or
b
if the breach to which the undertaking relates falls within subsection (1)(b), to revoke the person's licence under section 89(b).
I98I99107Further provision about enforcement powers
Schedule 11 (Part 1 of which makes further provision about discretionary requirements and Part 2 of which makes further provision about enforcement undertakings) has effect.
108Guidance as to use of enforcement powers
I38I521
F147NHS England must publish guidance about how it intends to exercise its functions under sections 105 and 106 and Schedule 11.
I38I522
F147NHS England may revise the guidance and, if it does so, must publish the guidance as revised.
I38I523
F147NHS England must consult such persons as it considers appropriate before publishing or revising the guidance.
I38I524
Guidance relating to F143NHS England’s functions under section 105 must include information about—
a
the circumstances in which F144NHS England is likely to impose a discretionary requirement,
b
the circumstances in which F145NHS England may not impose a discretionary requirement,
c
the matters likely to be taken into account by F146NHS England in determining the amount of any variable monetary penalty to be imposed (including, where relevant, any discounts for voluntary reporting of breaches in respect of which a penalty may be imposed), and
d
rights to make representations and rights of appeal.
I805
F148NHS England must have regard to the guidance or (as the case may be) revised guidance in exercising its functions under sections 105 and 106 and Schedule 11.
I81109Publication of enforcement action
1
F169NHS England must include information about the following in its annual report—
a
the cases in which a discretionary requirement has been imposed during the financial year to which the report relates, and
b
the cases in which an enforcement undertaking has been accepted during that financial year.
2
But F170NHS England must not include information which it is satisfied is—
a
commercial information the disclosure of which would, or might, significantly harm the legitimate business interests of the person to whom it relates;
b
information relating to the private affairs of an individual the disclosure of which would, or might, significantly harm that person's interests.
3
The reference in subsection (1)(a) to cases in which a discretionary requirement has been imposed does not include a reference to a case where a discretionary requirement has been imposed but overturned on appeal.
I82110Notification of enforcement action
1
As soon as reasonably practicable after imposing a discretionary requirement or accepting an enforcement undertaking F151NHS England must notify the following of that fact—
F150a
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b
such F149integrated care boards as are likely to be affected by the imposition of the requirement or the acceptance of the undertaking, and
c
any person exercising regulatory functions in relation to the person on whom the discretionary requirement was imposed or from whom the enforcement undertaking was accepted.
2
In subsection (1) “regulatory functions” has the same meaning as in the Legislative and Regulatory Reform Act 2006 (see section 32 of that Act).
Transitional provision
I83111F217Imposition of licence conditions on NHS foundation trusts
1
Where F218NHS England is satisfied that the governance of an NHS foundation trust is such that the trust will fail to comply with the conditions of its licence, F218NHS England may include in the licence such conditions relating to governance as it considers appropriate for the purpose of reducing that risk.
2
The circumstances in which F218NHS England may be satisfied as mentioned in subsection (1) include circumstances where it is satisfied that the council of governors, the board of directors or the council of governors and board of directors taken together are failing—
a
to secure compliance with conditions in the trust’s licence, or
b
to take steps to reduce the risk of a breach of a condition in the trust’s licence.
F2142A
Where a warning notice under section 29A of the Health and Social Care Act 2008 is given to an NHS foundation trust, F218NHS England may include in the trust's licence such conditions as it considers appropriate in connection with the matters to which the notice relates.
3
A condition included under subsection (1) F215or (2A) has effect until this section ceases, by virtue of section 112, to have effect in relation to the trust.
4
5
Where F219NHS England is satisfied that the trust has breached or is breaching a condition included under subsection (1) F215or (2A), F219NHS England may by notice require the trust to—
a
remove one or more of the directors or members of the council of governors and appoint interim directors or members of the council;
b
suspend one or more of the directors or members of the council from office as a director or member for a specified period;
c
disqualify one or more of the directors or members of the council from holding office as a director or member for a specified period.
6
7
Subsection (5) does not prevent F219NHS England from exercising in relation to a condition included in a licence under subsection (1) F216or (2A) the powers conferred by sections 105 and 106 (breach of licence condition etc: enforcement powers which apply during and after period in which this section and sections 112 to 114 have effect).
8
9
10
In this section, a reference to failing to discharge functions includes a reference to failing to discharge those functions properly.
11
Omit section 52 of the National Health Service Act 2006 (failing NHS foundation trusts); and in consequence of that, omit—
a
section 39(2)(f) of that Act (copy of notice under section 52 of that Act to be on register), and
b
paragraph 22(1)(f) of Schedule 7 to that Act (copy of that notice to be available for public inspection).
I84112I16F220Duration of transitional period
1
Section 111 ceases to have effect in relation to an NHS foundation trust on such day as the Secretary of State may by order specify.
2
Different days may be appointed in relation to different NHS foundation trusts.
3
A day specified under subsection (1) must not—
a
in the case of an NHS foundation trust authorised on or before 1 April 2014, be before 1 April 2016;
b
in the case of an NHS foundation trust authorised after 1 April 2014, be before the end of the period of two years beginning with the day on which the trust was authorised.
4
In this section, a reference to being authorised is a reference to being given an authorisation under section 35 of the National Health Service Act 2006.
5
Section 111 is repealed as soon as there are—
a
no NHS foundation trusts in relation to which it has effect, and
b
no NHS trusts in existence F221....
I85113F222Orders under section 112: criteria for deciding applicable trusts
1
Where the Secretary of State proposes to make an order under section 112, the Secretary of State must notify F223NHS England.
2
F223NHS England, having received a notification under subsection (1), must set the criteria that are to be applied for the purpose of determining to which NHS foundation trusts the order should apply.
3
Before setting criteria under subsection (2), F223NHS England must—
a
consult the Care Quality Commission and such other persons as F223NHS England considers appropriate, and
b
obtain the approval of the Secretary of State.
4
If the Secretary of State approves the proposed criteria, F223NHS England must—
a
publish the criteria,
b
determine, by applying the criteria, to which trusts the order should apply,
c
notify the Secretary of State of its determination, and
d
publish a list of the trusts concerned.
5
If the Secretary of State does not approve the proposed criteria, F223NHS England must propose revised criteria; and subsections (3)(b) and (4) apply in relation to the proposed revised criteria as they apply in relation to the criteria previously proposed.
6
The Secretary of State, having received a notification under subsection (4)(c), must review F224NHS England’s determination under subsection (4)(b).
I86114F225Repeal of sections 112 and 113
1
Sections 112 and 113 are repealed immediately after section 111 is repealed; and in consequence of that—
a
in section 67(2)(a), omit “or under sections 111 and 113 of this Act (imposition of licence conditions on NHS foundation trusts during transitional period)”,
b
omit section 67(3),
c
in section 87(4), after paragraph (a) insert “and”, and
d
in section 87(4), omit paragraph (c) and the preceding “and”.
2
This section is repealed immediately after sections 112 and 113 are repealed.
CHAPTER 4F31PricingF31The NHS payment scheme
114AF31The NHS payment scheme
1
NHS England must publish a document, to be known as “the NHS payment scheme”, containing rules for determining the price that is to be payable by a commissioner—
a
for the provision of health care services for the purposes of the NHS;
b
for the provision of services in pursuance of arrangements made by NHS England or an integrated care board in the exercise of any public health functions of the Secretary of State, within the meaning of the National Health Service Act 2006, by virtue of any provision of that Act.
2
The commissioner and the provider of services mentioned in subsection (1) must comply with rules under that subsection.
3
Rules under subsection (1) may, in particular—
a
specify prices;
b
specify amounts, formulae or other matters on the basis of which prices are to be determined;
c
provide for prices to be determined for, or by reference to, components of services or groups of services;
d
make different provision for different services or provision for some services but not others;
e
make different provision for the same service by reference to different circumstances or areas, different descriptions of provider, or other factors relevant to the provision of the service or the arrangements for its provision;
f
confer a discretion on the commissioner of a service or on NHS England.
4
Rules under subsection (1) may allow or require a price to be agreed between the commissioner and the provider of a service.
5
Rules made by virtue of subsection (4) may—
a
make provision about how the price is to be agreed;
b
allow the agreement to make any provision that could be made by rules by virtue of subsection (3);
c
provide for the publication by the commissioner, the provider or NHS England of information relevant to the agreement.
6
For the purpose of securing that the prices payable for the provision of services mentioned in subsection (1)(a) or (b) result in a fair level of pay for providers of those services, NHS England must, in exercising functions under subsection (1), have regard to—
a
differences in the costs incurred in providing those services to persons of different descriptions, and
b
differences between providers with respect to the range of those services that they provide.
7
The NHS payment scheme may contain rules relating to the making of payments to the provider of a service for the provision of that service.
8
The NHS payment scheme may contain guidance as to the application of rules under subsection (1).
9
A commissioner of a service mentioned in subsection (1) must have regard to any such guidance.
10
The NHS payment scheme has effect for the period specified in the NHS payment scheme or, where a new edition of the NHS payment scheme takes effect before the end of that period, until that new edition takes effect.
114BThe NHS payment scheme: enforcement
Where the commissioner of a service fails to comply with rules contained in the NHS payment scheme, NHS England may direct the commissioner to take steps specified in the direction, within a period specified in the direction—
a
to secure that the failure does not continue or recur, or
b
to secure that the position is (so far as practicable) restored to what it would have been if the failure was not occurring or had not occurred.
114CThe NHS payment scheme: impact assessment and consultation
1
Before publishing the NHS payment scheme, NHS England must—
a
carry out an assessment of the likely impact of the proposed scheme, or
b
publish a statement setting out its reasons for concluding that such assessment is not needed.
2
Before publishing the NHS payment scheme, NHS England must consult the following—
a
each integrated care board;
b
each relevant provider;
c
such other persons as NHS England considers appropriate.
3
NHS England must give those persons a notice—
a
describing the proposed NHS payment scheme,
b
setting out any impact assessment carried out under subsection (1)(a), and
c
specifying when the period within which representations may be made about the proposed NHS payment scheme (“the consultation period”) will come to an end.
4
The consultation period is the period of 28 days beginning with the day after that on which the notice is published.
5
NHS England must publish the notice given under subsection (2).
6
If, having consulted under this section—
a
NHS England decides to make amendments of the proposed NHS payment scheme that are, in its opinion, significant, and
b
it would, in NHS England’s opinion, be unfair to make the amendments without further consultation,
NHS England must consult again under this section.
7
8
In this section “relevant provider” means—
a
a licence holder, or
b
another person, of a prescribed description, that provides—
i
health care services for the purposes of the NHS, or
ii
services in pursuance of arrangements made by NHS England or an integrated care board by virtue of section 7A or 7B of the National Health Service Act 2006 (Secretary of State’s public health functions).
114DObjections to proposed NHS payment scheme
1
This section applies where—
a
within the consultation period under section 114C, NHS England receives objections to the proposed NHS payment scheme from one or more integrated care boards or relevant providers, and
b
either or both of the following apply—
i
the objection percentage for integrated care boards exceeds the prescribed percentage;
ii
the objection percentage for relevant providers exceeds the prescribed percentage.
2
In subsection (1)(b) the “objection percentage” is the proportion (expressed as a percentage) of integrated care boards or (as the case may be) relevant providers that objected.
3
NHS England must consult such persons as appear to NHS England to be representative of the integrated care boards or relevant providers from whom objections were received.
4
If, having complied with subsection (3)—
a
NHS England decides to make amendments of the proposed NHS payment scheme that are, in its opinion, significant, and
b
it would, in NHS England’s opinion, be unfair to make the amendments without further consultation,
NHS England must consult again under section 114C.
5
If, having complied with subsection (3), NHS England decides not to amend the proposed NHS payment scheme, it may publish the scheme but, before doing so, must—
a
publish a notice stating that decision and setting out the reasons for it, and
b
send a copy of the notice to—
i
the persons consulted under subsection (3), and
ii
the integrated care boards or relevant providers from whom objections were received.
114EAmendments of the NHS payment scheme
1
NHS England may amend the NHS payment scheme during the period for which it has effect, provided that, in the opinion of NHS England, the amendments are not so significant as to require publication of a new edition of the NHS payment scheme.
2
In deciding whether the amendments are so significant as to require the publication of a new edition of the NHS payment scheme, NHS England must have regard to—
a
the proportion of integrated care boards that would be affected by the proposed amendments;
b
the proportion of relevant providers that would be affected by the proposed amendments;
c
the impact that the proposed amendments would have on integrated care boards and relevant providers that would be affected by them;
d
whether any integrated care boards or relevant providers would be disproportionately affected by the proposed amendments;
e
the amount of any increase or decrease in prices that would result from the proposed amendments.
3
If NHS England amends the NHS payment scheme, it must publish the NHS payment scheme as amended.
4
Before amending the NHS payment scheme, NHS England must, in accordance with subsections (5) to (7), consult the following about the proposed amendments—
a
any integrated care boards that would be affected by the proposed amendments;
b
any relevant providers that would be affected by the proposed amendments;
c
such other persons as NHS England considers appropriate.
5
NHS England must publish a notice specifying—
a
the proposed amendments, and
b
when the period within which representations may be made about the proposed amendments (“the consultation period”) will come to an end.
6
The consultation period is the period of 28 days beginning with the day after that on which the notice is published.
7
NHS England must send a copy of the notice to each of the persons to be consulted under subsection (4).
114FInterpretation
I123115F31Price payable by commissioners for NHS services
1
If a health care service is specified in the national tariff (as to which, see section 116), the price payable for the provision of that service for the purposes of the NHS is (subject to sections 124 and 125) such price as is determined in accordance with the national tariff on the basis of the price (referred to in this Chapter as “the national price”) specified in the national tariff for that service.
2
If a health care service is not specified in the national tariff, the price payable for the provision of that service for the purposes of the NHS is such price as is determined in accordance with the rules provided for in the national tariff for that purpose.
I87I105C3116The national tariff
1
Monitor must publish a document, to be known as “the national tariff”, which specifies—
a
certain health care services which are or may be provided for the purposes of the NHS,
b
the method used for determining the national prices of those services,
c
the national price of each of those services, and
d
the method used for deciding whether to approve an agreement under section 124 and for determining an application under section 125 (local modifications of prices).
2
The national tariff may provide for rules under which the commissioner of a health care service specified in the national tariff and the providers of that service may agree to vary—
a
the specification of the service under subsection (1)(a), or
b
the national price of the service.
3
Where a variation is agreed in accordance with rules provided for under subsection (2), the commissioner of the service in question must maintain and publish a written statement of—
a
the variation, and
b
such other variations as have already been agreed in accordance with rules provided for under that subsection in the case of that service.
4
The national tariff may also—
a
specify variations to the national price for a service by reference to circumstances in which the service is provided or other factors relevant to the provision of the service,
b
provide for rules for determining the price payable for the provision for the purposes of the NHS of health care services which are not specified under subsection (1)(a), and
c
provide for rules relating to the making of payments to the provider of a health care service for the provision of that service.
5
Rules provided for under subsection (4)(b) may specify health care services which are not specified under subsection (1)(a).
6
The national tariff may also provide for rules for determining, where a health care service is specified in more than one way under subsection (1)(a) or in more than one way in rules provided for under subsection (4)(b), which specification of the service is to apply in any particular case or cases of any particular description.
7
The national tariff may include guidance as to—
a
the application of the method specified under subsection (1)(d),
b
the application of rules provided for under subsection (2), (4)(b) or (6),
c
the discharge of the duty imposed by subsection (3), or
d
the application of variations specified under subsection (4)(a),
and a commissioner of a health care service for the purposes of the NHS must have regard to guidance under this subsection.
8
Different methods may be specified under subsection (1)(b) for different descriptions of health care service.
9
The national tariff may, in the case of a specified health care service or health care services of a specified description, specify different national prices or different variations under subsection (4)(a) in relation to different descriptions of provider.
10
A description for the purposes of subsection (9) may not be framed by reference to—
a
whether the provider is in the public or (as the case may be) private sector, or
b
some other aspect of the status of the provider.
11
The national tariff may not specify a national price for a health care service provided pursuant to the public health functions of the Secretary of State, or of a local authority, under the National Health Service Act 2006.
12
The national tariff has effect for such period as is specified in the national tariff (or, where a new edition of the national tariff takes effect before the end of that period, until that new edition takes effect).
13
In exercising its functions under this Chapter, Monitor must (in addition to the matters specified in section 66) have regard to the objectives and requirements for the time being specified in the mandate published under section 13A of the National Health Service Act 2006.
C3117I17The national tariff: further provision
I56I1041
The ways in which a health care service may be specified in the national tariff under section 116(1)(a), or in rules provided for in the national tariff under section 116(4)(b), include in particular—
a
specifying it by reference to its components,
b
specifying it as a service (a “bundle”) that comprises two or more health care services which together constitute a form of treatment,
c
specifying it as a service in a group of standardised services.
I56I1042
In the case of a service specified in the national tariff under section 116(1)(a), the national tariff must—
a
if the service is specified in accordance with subsection (1)(a), specify a national price for each component of the service;
b
if it is specified in accordance with subsection (1)(b), specify a national price for the bundle;
c
if it is specified in accordance with subsection (1)(c), specify a single price as the national price for each service in the group.
I56I1043
In the case of a service specified in rules provided for in the national tariff under section 116(4)(b), the rules may—
a
if the service is specified in accordance with subsection (1)(a), make provision for determining the price payable for each component of the service;
b
if it is specified in accordance with subsection (1)(b), make provision for determining the price payable for the bundle;
c
if it is specified in accordance with subsection (1)(c), make provision for determining the price payable for each service in the group.
I1244
Where the commissioner of a health care service for the purposes of the NHS agrees to pay a price for the provision of the service other than the price that is payable by virtue of this Chapter, Monitor may direct the commissioner to take such steps within such period as Monitor may specify to secure that the position is, so far as practicable, restored to what it would have been if the commissioner had agreed to pay the price payable by virtue of this Chapter.
I1245
Where the commissioner of a health care service fails to comply with rules provided for under section 116(2), (4) or (6), Monitor may direct the commissioner to take such steps within such period as Monitor may specify—
a
to secure that the failure does not continue or recur;
b
to secure that the position is, so far as practicable, restored to what it would have been if the failure was not occurring or had not occurred.
I88I125C3118I18Consultation on proposals for the national tariff
1
Before publishing the national tariff, Monitor must send a notice to—
a
each clinical commissioning group,
b
each relevant provider, and
c
such other persons as it considers appropriate.
2
Monitor must also publish the notice.
3
The notice must specify—
a
the health care services which Monitor proposes to specify in the national tariff,
b
the method or methods it proposes to use for determining the national prices of those services,
c
the prices, determined in each case by using the applicable method specified under paragraph (b), that Monitor proposes as the national prices of those services, and
d
the method it proposes to use for deciding whether to approve an agreement under section 124 and for determining an application under section 125 (local modifications of national prices).
4
The notice may specify such rules as Monitor proposes to provide for in the national tariff under which the commissioner of a health care service and a provider of the service would be entitled to vary—
a
the specification of the service in the national tariff, or
b
the national price of the service.
5
The notice may also specify—
a
such variations (by reference to circumstances in which a service is provided or other factors relevant to its provision) as Monitor proposes to specify to the prices that it proposes as the national prices,
b
such rules as Monitor proposes to provide for in the national tariff for determining the price payable for the provision for the purposes of the NHS of health care services not specified for the purposes of subsection (3)(a), and
c
such rules as Monitor proposes to provide for in the national tariff for determining, where a health care service is specified in more than one way for the purposes of subsection (3)(a) or in more than one way in rules specified for the purposes of paragraph (b), which specification of the service is to apply in any particular case or cases of any particular description.
6
The notice may include such guidance as Monitor proposes to provide for in the national tariff as to—
a
the application of the method specified for the purposes of subsection (3)(d);
b
the application of rules specified for the purposes of subsection (4) or (5)(b) or (c);
c
the application of variations specified for the purposes of subsection (5)(a).
7
The health care services specified for the purposes of subsection (3)(a) are only such services as the National Health Service Commissioning Board considers should be so specified and—
a
as the Board and Monitor agree will be so specified, or
b
in default of agreement, as are determined by arbitration as being services that will be so specified.
8
A method specified for the purposes of subsection (3)(b) or (d) is only such method, and such guidance on the application of the method specified for the purposes of subsection (3)(d) as is included for the purposes of subsection (6) is only such guidance, as Monitor considers should be so specified and included and—
a
as Monitor and the Board agree will be so specified and included, or
b
in default of agreement, as is determined by arbitration as being the method that will be so specified and the guidance that will be so included.
9
The prices specified for the purposes of subsection (3)(c) are only such prices as Monitor considers should be so specified and—
a
as Monitor and the Board agree will be so specified, or
b
in default of agreement, as are determined by arbitration as being the prices that will be so specified.
10
Such variations as are specified for the purposes of subsection (5)(a), and such guidance on the application of those variations as is included for the purposes of subsection (6), are only such variations and such guidance as Monitor considers should be so specified and included and—
a
as Monitor and the Board agree will be so specified and included, or
b
in default of agreement, as are determined by arbitration as being the variations that will be so specified and the guidance that will be so included.
11
Such rules as are specified for the purposes of subsection (4) or (5)(c), and such guidance on those rules as is included for the purposes of subsection (6), are only such rules and such guidance as the National Health Service Commissioning Board considers should be so specified and included and—
a
as the Board and Monitor agree will be so specified and included, or
b
in default of agreement, as are determined by arbitration as being the rules that will be so specified and the guidance that will be so included.
12
Such rules as are specified for the purposes of subsection (5)(b), and such guidance on those rules as is included for the purposes of subsection (6), are only such rules and such guidance as Monitor considers should be so specified and included and—
a
as Monitor and the Board agree will be so specified and included, or
b
in default of agreement, as are determined by arbitration as being the rules that will be so specified and the guidance that will be so included.
13
A notice under this section must specify when the consultation period in relation to the proposals ends; and for that purpose, the consultation period is the period of 28 days beginning with the day after that on which the notice is published under subsection (2).
14
In this section, a “relevant provider” is—
a
a licence holder, or
b
such other person, of such description as may be prescribed, as provides health care services for the purposes of the NHS.
I89I126C3119Consultation: further provision
1
For the purpose of securing that the prices payable for the provision of health care services for the purposes of the NHS are such as to result in a fair level of pay for providers of the services, the National Health Service Commissioning Board and Monitor must, in exercising functions under section 118, have regard to—
a
differences in the costs incurred in providing health care services for the purposes of the NHS to persons of different descriptions, and
b
differences between providers with respect to the range of health care services that they provide for those purposes.
2
In exercising functions under section 118(7), the Board and Monitor must act with a view to securing the standardisation throughout England of the specification of health care services in the national tariff under section 116(1)(a).
3
In exercising functions under section 118(12), Monitor and the Board must act with a view to securing the standardisation throughout England of the specification of health care services in rules provided for in the national tariff under section 116(4)(b).
4
In carrying out the duty under subsection (2) or (3), the Board and Monitor must have regard to whether, or to what extent, standardisation is likely to have a significant adverse impact on the provision of health care services for the purposes of the NHS.
I100I127C3120I19Responses to consultation
1
If Monitor receives objections from one or more clinical commissioning groups or relevant providers to a method it proposes under section 118(3)(b), Monitor may not publish the national tariff unless—
a
the conditions in subsection (2) are met, or
b
where those conditions are not met, Monitor has made a reference to the F9CMA.
2
The conditions referred to in subsection (1)(a) are that—
a
the objection percentage for clinical commissioning groups is less than the prescribed percentage,
b
the objection percentage for relevant providers is less than the prescribed percentage, and
c
the share of supply percentage is less than such percentage as may be prescribed.
3
In subsection (2)—
a
the “objection percentage” is the proportion (expressed as a percentage) of clinical commissioning groups or (as the case may be) relevant providers who objected to the proposed method, and
b
the “share of supply percentage” is the proportion (expressed as a percentage) of relevant providers who objected to the proposed method, weighted according to their share of the supply in England of such services as may be prescribed.
4
A reference under subsection (1)(b) must require the F9CMA to determine whether the method proposed under section 118(3)(b) is appropriate.
5
F10...Schedule 12 to this Act (procedure on a reference under this section) has effect.
F115A
Except where specified otherwise in Schedule 12, the functions of the CMA with respect to a reference under this section (including functions relating to the making of changes following a determination on a reference) are to be carried out on behalf of the CMA by a group constituted for the purpose by the chair of the CMA under Schedule 4 to the Enterprise and Regulatory Reform Act 2013.
6
Regulations prescribing a percentage for the purposes of subsection (2)(c) may include provision prescribing the method used for determining a relevant provider's share of the supply in England of the services concerned.
7
In this section and section 121 and Schedule 12, “relevant provider” has the meaning given in section 118(14).
I101I128C3121I20Determination on reference under section 120
1
In carrying out a determination on a reference under section 120, the F12CMA must have regard, to the same extent as is required of Monitor, to the matters to which Monitor must have regard in carrying out the functions of its to which the determination relates.
2
In carrying out the determination, the F12CMA must also have regard to such representations as are made to it by clinical commissioning groups or relevant providers who made objections to Monitor in accordance with paragraph 2 of Schedule 12 about the method proposed under section 118(3)(b).
3
In carrying out the determination, the F12CMA—
a
may also have regard to matters to which Monitor was not able to have regard in the case to which the determination relates, but
b
must not, in the exercise of the power under paragraph (a), have regard to a matter to which Monitor would not have been entitled to have regard in that case had it had the opportunity to do so.
4
The F13CMA may determine that the method proposed under section 118(3)(b) is not appropriate only if it is satisfied that Monitor's decision to propose the method was wrong on one or more of the following grounds—
a
that Monitor failed to have regard to the matters referred to in subsection (1),
b
that the decision was based, wholly or partly, on an error of fact,
c
that the decision was wrong in law.
5
Where the F13CMA determines that the method proposed under section 118(3)(b) is appropriate, Monitor may use that method for the purposes of the national tariff accordingly.
6
7
A direction under subsection (6) may, in particular, require Monitor to make such changes to the method in question as are specified in the direction.
8
A determination on a reference under section 120—
a
must be contained in an order made by the F14CMA,
b
must set out the reasons for the determination, and
c
takes effect at the time specified in the order or determined in accordance with provision made in the order.
9
The F14CMA must give notice of a determination on a reference under section 120 to—
a
Monitor,
b
the National Health Service Commissioning Board, and
c
such clinical commissioning groups or relevant providers as made representations in accordance with paragraph 2 of Schedule 12.
10
The F14CMA must also publish the determination; but it must exclude from what it publishes information which it is satisfied is—
a
commercial information the disclosure of which would, or might, significantly harm the legitimate business interests of an undertaking to which it relates;
b
information relating to the private affairs of an individual the disclosure of which would, or might, significantly harm that person's interests.
I102I129C3122Changes following determination on reference under section 120
1
Where the F15CMA remits a matter to Monitor under subsection (6) of section 121, Monitor must make such changes to the method to which the matter relates as it considers necessary, having regard to the reasons specified for the purposes of subsection (8)(b) of that section.
2
Monitor must give the F15CMA and the National Health Service Commissioning Board a notice specifying—
a
the changes it proposes to make, and
b
its reasons for proposing to make them.
3
Monitor must make the changes specified in the notice unless it is given a direction under section 123 before the end of the period of 28 days beginning with the day after that on which it gave the notice.
4
If Monitor is given a direction under that section before the end of that period, it must make such of the changes as are not specified in the direction.
I103I130C3123I21Power to veto changes proposed under section 122
1
The F16CMA may, within the period of 28 days beginning with the day after that on which it is given a notice under section 122, direct Monitor—
a
not to make the changes specified in the notice, or
b
not to make such of those changes as may be specified in the direction.
2
Monitor must comply with a direction under this section.
3
The Secretary of State may, within that period and on the application of the F17CMA, direct that the period for giving a direction under this section (and, accordingly, the period referred to in section 122(3)) is to be extended by 14 days.
4
The F18CMA may give a direction under this section only in respect of such of the changes specified in the notice under section 122 as it considers are not necessary in consequence of its determination on the reference.
5
If the F19CMA gives a direction under this section, it—
a
must give notice specifying the changes proposed by Monitor, the terms of the direction and the reasons for giving it, and
b
must itself make such changes to the method to which the reference relates as it considers necessary in consequence of its determination on the reference.
6
In exercising its function under subsection (5)(b), the F19CMA must have regard to the matters to which Monitor must have regard when determining the method to which the reference relates.
7
Before making changes under subsection (5)(b), the F19CMA must give notice to Monitor and the National Health Service Commissioning Board specifying—
a
the changes it proposes to make,
b
its reasons for proposing to make them, and
c
the period within which representations on the proposed changes may be made.
8
The period specified for the purposes of subsection (7)(c) must not be less than 28 days beginning with the day on which the notice is given.
I109C3124I22Local modifications of prices: agreements
1
The commissioner and the provider of a health care service may agree that the price payable to the provider for the provision of the service for the purposes of the NHS in such circumstances or areas as may be determined in accordance with the agreement is the price determined in accordance with the national tariff for that service as modified in accordance with the agreement.
2
An agreement under this section must specify the date on which the modification is to take effect; and a date specified for that purpose may be earlier than the date of the agreement (but not earlier than the date on which the national tariff took effect).
3
An agreement under this section has effect only if it is approved by Monitor.
4
An agreement submitted for approval under subsection (3) must be supported by such evidence as Monitor may require.
5
Monitor may approve an agreement under this section only if, having applied the method specified under section 116(1)(d), it is satisfied that, without a modification to the price determined in accordance with the national tariff for that service, it would be uneconomic for the provider to provide the service for the purposes of the NHS.
6
Where an agreement is approved under subsection (3), Monitor must send a notice to the Secretary of State and such clinical commissioning groups, providers and other persons as it considers appropriate.
7
Monitor must also publish the notice.
8
The notice must specify—
a
the modification, and
b
the date on which it takes effect.
F269
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I110C3125I23Local modifications of prices: applications
1
Monitor may, on an application by a provider of a health care service who has failed to reach an agreement under section 124 with the commissioner, decide that the price payable to the provider for the provision of the service for the purposes of the NHS in such circumstances or areas as Monitor may determine is to be the price determined in accordance with the national tariff for that service as modified in such way as Monitor may determine.
2
An application under this section must be supported by such evidence as Monitor may require.
3
Monitor may grant an application under this section only if, having applied the method under section 116(1)(d), it is satisfied that, without a modification to the price determined in accordance with the national tariff for that service, it would be uneconomic for the provider to provide the service for the purposes of the NHS.
4
Subsections (5) to (8) apply where Monitor grants an application under this section.
5
The decision by Monitor on the application takes effect on such date as Monitor may determine; and a date determined for that purpose may be earlier than the date of the decision (but not earlier than the date on which the national tariff took effect).
6
Monitor must send a notice of the decision to the Secretary of State and such clinical commissioning groups, providers and other persons as it considers appropriate.
7
Monitor must also publish the notice.
8
The notice must specify—
a
the modification, and
b
the date on which it takes effect.
F279
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I111C3126Applications under section 125: notification of commissioners
1
This section applies where Monitor—
a
receives an application under section 125, and
b
is satisfied that the continued provision for the purposes of the NHS of health care services to which a condition in the applicant's licence under section 97(1)(i), (j) or (k) applies is being put at significant risk by the configuration of certain health care services provided for those purposes.
2
In subsection (1), a reference to the provision of services is a reference to their provision by the applicant or any other provider.
3
Monitor must as soon as reasonably practicable notify the National Health Service Commissioning Board and such clinical commissioning groups as Monitor considers appropriate—
a
of its receipt of the application, and
b
of its reasons for being satisfied as mentioned in subsection (1)(b).
4
Monitor must publish for each financial year a list of the notifications under this section that it has given during that year; and the list must include for each notification a summary of Monitor's reasons for being satisfied as mentioned in subsection (1)(b).
5
The Board and clinical commissioning groups, having received a notification under this section, must have regard to it in arranging for the provision of health care services for the purposes of the NHS.
I106C3127Correction of mistakes
1
This section applies where the national tariff contains information that does not accord with—
a
what Monitor and the National Health Service Commissioning Board agreed on the matter concerned, or
b
where the matter was determined by arbitration, what was determined.
2
Monitor must send a notice to—
a
each clinical commissioning group,
b
each relevant provider, and
c
such other persons as Monitor considers appropriate.
3
Monitor must also publish the notice.
4
The notice must specify—
a
the information that does not accord with what was agreed or determined,
b
the correction required to make the information so accord, and
c
the date on which the correction is to take effect.
5
A date specified for the purposes of subsection (4)(c) may be earlier than the date of the notice.
6
In this section, “relevant provider” has the meaning given in section 118(14).
CHAPTER 5Health special administration
128Health special administration orders
1
In this Chapter “health special administration order” means an order which—
a
is made by the court in relation to a relevant provider, and
b
directs that the affairs, business and property of the provider are to be managed by one or more persons appointed by the court.
2
An application to the court for a health special administration order may be made only by F152NHS England.
3
A person appointed as mentioned in subsection (1)(b) is referred to in this Chapter as a “health special administrator”.
4
A health special administrator of a company—
a
is an officer of the court, and
b
in exercising functions in relation to the company, is the company's agent.
5
A person is not to be the health special administrator of a company unless the person is qualified to act as an insolvency practitioner in relation to the company.
6
A health special administrator of a relevant provider must manage its affairs, business and property, and exercise the health special administrator's functions, so as to—
a
achieve the objective set out in section 129 as quickly and as efficiently as is reasonably practicable,
b
in seeking to achieve that objective, ensure that any regulated activity carried on in providing the services provided by the provider is carried on in accordance with any requirements or conditions imposed in respect of that activity by virtue of Chapter 2 of Part 1 of the Health and Social Care Act 2008,
c
so far as is consistent with the objective set out in section 129, protect the interests of the creditors of the provider as a whole, and
d
so far as is consistent with that objective and subject to those interests, protect the interests of the members of the provider as a whole.
7
In relation to a health special administration order applying to a non-GB company, references in this Chapter to the affairs, business and property of the company are references only to its affairs and business so far as carried on in Great Britain and to its property in Great Britain.
8
In this section—
a
a reference to a person qualified to act as an insolvency practitioner in relation to a company is to be construed in accordance with Part 13 of the Insolvency Act 1986 (insolvency practitioners and their qualifications);
b
“regulated activity” has the same meaning as in Part 1 of the Health and Social Care Act 2008 (see section 8 of that Act).
9
In this Chapter—
“business” and “property” each have the same meaning as in the Insolvency Act 1986 (see section 436 of that Act);
“company” includes a company not registered under the Companies Act 2006;
“court”, in relation to a company, means the court—
- a
having jurisdiction to wind up the company, or
- b
that would have such jurisdiction apart from section 221(2) or 441(2) of the Insolvency Act 1986 (exclusion of winding up jurisdiction in case of companies incorporated in, or having principal place of business in, Northern Ireland);
- a
“member” is to be read in accordance with section 250 of the Insolvency Act 1986;
“non-GB company” means a company incorporated outside Great Britain;
“relevant provider” means a company which is providing services to which a condition included in the company's licence under section 97(1)(i), (j) or (k) applies;
“wholly-owned subsidiary” has the meaning given by section 1159 of the Companies Act 2006.
129Objective of a health special administration
1
The objective of a health special administration is to secure—
a
the continued provision of such of the health care services provided for the purposes of the NHS by the company subject to the health special administration order, at such level, as the commissioners of those services determine by applying criteria specified in health special administration regulations (see section 130), and
b
that it becomes unnecessary, by one or both of the means set out in subsection (2), for the health special administration order to remain in force for that purpose.
2
Those means are—
a
the rescue as a going concern of the company subject to the health special administration order, and
b
one or more transfers falling within subsection (3).
3
A transfer falls within this subsection if it is a transfer as a going concern—
a
to another person, or
b
as respects different parts of the undertaking of the company subject to the health special administration order, to two or more other persons,
of so much of that undertaking as it is appropriate to transfer for the purpose of achieving the objective of the health special administration.
4
The means by which a transfer falling within subsection (3) may be effected include in particular—
a
a transfer of the undertaking of the company subject to the health special administration order, or of part of its undertaking, to a wholly-owned subsidiary of that company, and
b
a transfer to a company of securities of a wholly-owned subsidiary to which there has been a transfer falling within paragraph (a).
5
The objective of a health special administration may be achieved by transfers to the extent only that—
a
the rescue as a going concern of the company subject to the health special administration order is not reasonably practicable or is not reasonably practicable without such transfers,
b
the rescue of the company as a going concern will not achieve that objective or will not do so without such transfers,
c
such transfers would produce a result for the company's creditors as a whole that is better than the result that would be produced without them, or
d
such transfers would, without prejudicing the interests of its creditors as a whole, produce a result for the company's members as a whole that is better than the result that would be produced without them.
130I24Health special administration regulations
1
Regulations (referred to in this Chapter as “health special administration regulations”) must make further provision about health special administration orders.
2
Health special administration regulations may apply with or without modifications—
a
any provision of Part 2 of the Insolvency Act 1986 (administration) or any related provision of that Act, and
b
any other enactment which relates to insolvency or administration or makes provision by reference to anything that is or may be done under that Act.
3
Health special administration regulations may, in particular, provide that the court may make a health special administration order in relation to a relevant provider if it is satisfied, on a petition by the Secretary of State under section 124A of the Insolvency Act 1986 (petition for winding up on grounds of public interest), that it would be just and equitable (disregarding the objective of the health special administration) to wind up the provider in the public interest.
4
Health special administration regulations may make provision about—
a
the application of procedures under the Insolvency Act 1986 in relation to relevant providers, and
b
the enforcement of security over property of relevant providers.
5
Health special administration regulations may, in particular, make provision about the publication and maintenance by F153NHS England of a list of relevant providers.
6
Health special administration regulations may in particular—
a
require F154NHS England to publish guidance for commissioners about the application of the criteria referred to in section 129(1)(a);
b
confer power on F155NHS England to revise guidance published by virtue of paragraph (a) and require it to publish guidance so revised;
c
d
require commissioners, when applying the criteria referred to in section 129(1)(a), to have regard to such matters as F158NHS England may specify in guidance published by virtue of paragraph (a) or (b);
e
require F160NHS England to make arrangements for facilitating agreement between commissioners in their exercise of their function under section 129(1)(a);
f
confer power on F160NHS England, where commissioners fail to reach agreement in pursuance of arrangements made by virtue of paragraph (e), to exercise their function under section 129(1)(a);
g
provide that, in consequence of the exercise of the power conferred by virtue of paragraph (f), the function under section 129(1)(a), so far as applying to the commissioners concerned, is to be regarded as discharged;
h
require a health special administrator to carry out in accordance with the regulations consultation on the action which the administrator recommends should be taken in relation to the provider concerned.
7
Health special administration regulations may modify this Chapter or any enactment mentioned in subsection (8) in relation to any provision made by virtue of this Chapter.
8
The enactments are—
a
the Insolvency Act 1986, and
b
any other enactment which relates to insolvency or administration or makes provision by reference to anything that is or may be done under that Act.
9
The power to make rules under section 411 of the Insolvency Act 1986 (company insolvency rules) applies for the purpose of giving effect to provision made by virtue of this Chapter as it applies for the purpose of giving effect to Parts 1 to 7 of that Act.
10
For that purpose—
a
the power to make rules in relation to England and Wales is exercisable by the Lord Chancellor with the concurrence of the Secretary of State and, in the case of rules that affect court procedure, with the concurrence of the Lord Chief Justice;
b
the power to make rules in relation to Scotland is exercisable by the Secretary of State;
c
references in section 411 of that Act to those Parts are to be read as including a reference to this Chapter.
11
Before making health special administration regulations the Secretary of State must consult F159such persons as the Secretary of State considers appropriate.
131I25Transfer schemes
1
Health special administration regulations may make provision about transfer schemes to achieve the objective of a health special administration (see section 129).
2
Health special administration regulations may, in particular, include provision—
a
for the making of a transfer scheme to be subject to the consent of F161NHS England and the person to whom the transfer is being made,
b
for F162NHS England to have power to modify a transfer scheme with the consent of parties to the transfers effected by the scheme, and
c
for modifications made to a transfer scheme by virtue of paragraph (b) to have effect from such time as F163NHS England may specify (which may be a time before the modifications were made).
3
Health special administration regulations may, in particular, provide that a transfer scheme may include provision—
a
for the transfer of rights and liabilities under or in connection with a contract of employment from a company subject to a health special administration order to another person,
b
for the transfer of property, or rights and liabilities other than those mentioned in paragraph (a), from a company subject to a health special administration order to another person,
c
for the transfer of property, rights and liabilities which would not otherwise be capable of being transferred or assigned,
d
for the transfer of property acquired, and rights and liabilities arising, after the making of the scheme,
e
for the creation of interests or rights, or the imposition of liabilities, and
f
for the transfer, or concurrent exercise, of functions under enactments.
132I26Indemnities
Health special administration regulations may make provision about the giving by F171NHS England of indemnities in respect of—
a
liabilities incurred in connection with the discharge by health special administrators of their functions, and
b
loss or damage sustained in that connection.
133I27Modification of this Chapter under Enterprise Act 2002
1
The power to modify or apply enactments conferred on the Secretary of State by each of the sections of the Enterprise Act 2002 mentioned in subsection (2) includes power to make such consequential modifications of provision made by virtue of this Chapter as the Secretary of State considers appropriate in connection with any other provision made under that section.
2
Those sections are—
a
sections 248 and 277 (amendments consequential on that Act), and
b
section 254 (power to apply insolvency law to foreign companies).
CHAPTER 6Financial assistance in special administration cases
Establishment of mechanisms
134I28Duty to establish mechanisms for providing financial assistance
1
F172NHS England must establish, and secure the effective operation of, one or more mechanisms for providing financial assistance in cases where a provider of health care services for the purposes of the NHS (referred to in this Chapter as a “provider”) is subject to—
a
a health special administration order (within the meaning of Chapter 5), or
b
an order under section 65D(2) of the National Health Service Act 2006 (trust special administration for NHS foundation trusts).
2
Mechanisms that F172NHS England may establish under this section include, in particular—
a
mechanisms for raising money to make grants or loans or to make payments in consequence of indemnities given by F172NHS England by virtue of section 132 or under section 65D(12) of the National Health Service Act 2006;
b
mechanisms for securing that providers arrange, or are provided with, insurance facilities.
3
F172NHS England may secure that a mechanism established under this section operates so as to enable it to recover the costs it incurs in establishing and operating the mechanism.
4
F172NHS England may establish different mechanisms for different providers or providers of different descriptions.
5
F172NHS England does not require permission under any provision of the Financial Services and Markets Act 2000 as respects activities carried out under this Chapter.
6
An order under section 306 providing for the commencement of this Chapter may require F172NHS England to comply with the duty to establish under subsection (1) before such date as the order specifies.
135Power to establish fund
1
F164NHS England may, for the purposes of section 134, establish and maintain a fund.
2
3
F167NHS England must appoint at least two managers for a fund it establishes under this section.
4
A manager of a fund may be an individual, a firm or a body corporate.
5
F168NHS England must not appoint an individual as manager of a fund unless it is satisfied that the individual has the appropriate knowledge and experience for managing investments.
6
F168NHS England must not appoint a firm or body corporate as manager of a fund unless it is satisfied that arrangements are in place to secure that any individual who will exercise functions of the firm or body corporate as manager will, at the time of doing so, have the appropriate knowledge and experience for managing investments.
7
F168NHS England must not appoint an individual, firm or body corporate as manager of a fund unless the individual, firm or body is an authorised or exempt person within the meaning of the Financial Services and Markets Act 2000.
8
F168NHS England must secure the prudent management of any fund it establishes under this section.
Applications for financial assistance
136Applications
1
F173NHS England may, on an application by a special administrator, provide financial assistance to the special administrator by using a mechanism established under section 134.
2
An application under this section must be in such form, and must be supported by such evidence or other information, as F173NHS England may require (and a requirement under this subsection may be imposed after the receipt, but before the determination, of the application).
3
If F173NHS England grants an application under this section, it must notify the applicant of—
a
the purpose for which the financial assistance is being provided, and
b
the other conditions to which its provision is subject.
4
The special administrator must secure that the financial assistance is used only—
a
for the purpose notified under subsection (3)(a), and
b
in accordance with the conditions notified under subsection (3)(b).
5
Financial assistance under this section may be provided only in the period during which the provider in question is in special administration.
6
If F174NHS England refuses an application under this section, it must notify the applicant of the reasons for the refusal.
7
F174NHS England must, on a request by an applicant whose application under this section has been refused, reconsider the application; but no individual involved in the decision to refuse the application may be involved in the decision on the reconsideration of the application.
8
For the purposes of reconsidering an application, F174NHS England may request information from the applicant.
9
F174NHS England must notify the applicant of its decision on reconsidering the application; and—
a
if F174NHS England grants the application, it must notify the applicant of the matters specified in subsection (3), and
b
if F174NHS England refuses the application, it must notify the applicant of the reasons for the refusal.
10
In this Chapter—
a
“special administrator” means—
i
a person appointed as a health special administrator under Chapter 5, or
ii
a person appointed as a trust special administrator under section 65D(2) of the National Health Service Act 2006, and
b
references to being in special administration are to be construed accordingly.
137Grants and loans
1
F175NHS England may not provide financial assistance under section 136 in the form of a grant or loan unless it is satisfied that—
a
it is necessary for the provider—
i
to be able to continue to provide one or more of the health care services that it provides for the purposes of the NHS, or
ii
to be able to secure a viable business in the long term, and
b
no other source of funding which would enable it do so and on which it would be reasonable for it to rely is likely to become available to it.
2
The terms of a grant or loan must include a term that the whole or a specified part of the grant or loan becomes repayable in the event of a breach by the provider or special administrator of the terms of the grant or loan.
3
Subject to that, where F176NHS England makes a grant or loan under section 136, it may do so in such manner and on such terms as it may determine.
4
F176NHS England may take such steps as it considers appropriate (including steps to adjust the amount of future payments towards the mechanism established under section 134 to raise funds for grants or loans under section 136) to recover overpayments in the provision of a grant or loan under that section.
5
The power to recover an overpayment under subsection (4) includes a power to recover interest, at such rate as F176NHS England may determine, on the amount of the overpayment for the period beginning with the making of the overpayment and ending with its recovery.
Charges on commissioners
138I29Power to impose charges on commissioners
F1771
The Secretary of State may by regulations confer power on NHS England to require integrated care boards to pay charges relating to such of NHS England’s regulatory functions as relate to securing the continued provision of health care services for the purposes of the NHS.
1A
2
The regulations must provide that the amount of a charge imposed by virtue of this section is to be such amount—
a
as may be prescribed, or
b
as is determined by reference to such criteria, and by using such method, as may be prescribed.
3
The regulations must—
a
prescribe to whom the charge is to be paid;
b
prescribe when the charge becomes payable;
c
where the amount of the charge is to be determined in accordance with subsection (2)(b), require F178NHS England to carry out consultation in accordance with the regulations before imposing the charge;
d
provide for any amount that is not paid by the time prescribed for the purposes of paragraph (b) to carry interest at the rate for the time being specified in section 18 of the Judgments Act 1838;
e
provide for any unpaid balance and accrued interest to be recoverable summarily as a civil debt (but for this not to affect any other method of recovery).
4
F1805
Before making regulations under this section, the Secretary of State must consult NHS England.
6
Regulations under this section may apply with modifications provision made by sections 141 to 143 in relation to charges imposed by virtue of this section.
Levy on providers
139Imposition of levy
1
The power under section 135(2) includes, in particular, power to impose a levy on providers for each financial year.
2
Before deciding whether to impose a levy under this section for the coming financial year, F181NHS England must estimate—
a
the amount that will be required for the purpose of providing financial assistance in accordance with this Chapter,
b
the amount that will be collected from F182integrated care boards by way of charges imposed by virtue of section 138 during that year, and
c
the amount that will be standing to the credit of the fund at the end of the current financial year.
3
Before the start of a financial year in which F183NHS England proposes to impose a levy under this section, it must determine—
a
the factors by reference to which the rate of the levy is to be assessed,
b
the time or times by reference to which those factors are to be assessed, and
c
the time or times during the year when the levy, or an instalment of it, becomes payable.
4
Where the determinations under subsection (3) reflect changes made to the factors by reference to which the rate of the levy is to be assessed, the notice under section 143(1)(b) must include an explanation of those changes.
5
A levy under this section may be imposed at different rates for different providers.
140I30Power of Secretary of State to set limit on levy and charges
1
Before the beginning of each financial year, the Secretary of State may, with the approval of the Treasury, specify by order—
a
the maximum amount that F184NHS England may raise from levies it imposes under section 139 for that year, and
b
the maximum amount that it may raise from charges it imposes by virtue of section 138 for that year.
2
141Consultation
1
This section applies where F191NHS England is proposing to impose a levy under section 139 for the coming financial year and—
a
has not imposed a levy under that section for the current financial year or any previous year,
b
has been imposing the levy for the current financial year but proposes to make relevant changes to it for the coming financial year, or
c
has been imposing the levy for the current financial year and the financial year preceding it, but has not been required to serve a notice under this section in respect of the levy for either of those years.
2
A change to a levy is relevant for the purposes of subsection (1)(b) if it is a change to the factors by reference to which the rate of the levy is to be assessed.
3
Before making the determinations under section 139(3) in respect of the levy, F189NHS England must send a notice to—
a
the Secretary of State,
F190b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F188c
each integrated care board,
d
each potentially liable provider, and
e
such other persons as it considers appropriate.
4
F192NHS England must publish a notice that it sends under subsection (3).
5
In a case within subsection (1)(a) or (c), the notice must state—
a
the factors by reference to which F193NHS England proposes to assess the rate of the levy,
b
the time or times by reference to which it proposes to assess those factors, and
c
the time or times during the coming financial year when it proposes that the levy, or an instalment of it, will become payable.
6
In a case within subsection (1)(b), the notice must specify the relevant changes F194NHS England proposes to make.
7
A notice under this section must specify when the consultation period in relation to the proposals ends; and for that purpose, the consultation period is the period of 28 days beginning with the day on which the notice is published under subsection (4).
8
F195142Responses to consultation
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
143Amount payable
1
F202NHS England must—
a
calculate the amount which each provider who is to be subject to a levy under section 139 for a financial year is to be liable to pay in respect of that year, and
b
notify the provider of that amount and the date or dates on which it, or instalments of it, will become payable.
2
If the provider is to be subject to the levy for only part of the financial year, it is to be liable to pay only the amount which bears to the amount payable for the whole financial year the same proportion as the part of the financial year for which the provider is to be subject to the levy bears to the whole financial year.
3
The amount which a provider is liable to pay may be zero.
4
Subsection (5) applies if, during a financial year in which F204NHS England is imposing a levy under section 139, it becomes satisfied that the risk of a provider who is subject to the levy going into special administration has changed by reference to what it was—
a
at the start of the year, or
b
if F204NHS England has already exercised the power under subsection (5) in relation to the levy in the case of that provider, at the time it did so.
5
6
Following the expiry of the period of 28 days beginning with the day after that on which F204NHS England sends the notice, it may make the adjustment.
7
In a case within subsection (2), subsection (4) has effect as if references to the financial year were references to the part of the financial year for which the provider is to be subject to the levy.
8
Where a provider who reasonably believes that F203NHS England has miscalculated the amount notified to the provider under subsection (1) or (5) requests F203NHS England to recalculate the amount, F203NHS England must—
a
comply with the request, and
b
send the provider written notice of its recalculation.
9
Subsection (8) does not apply to a request to recalculate an amount in respect of a financial year preceding the one in which the request is made.
10
If the whole or part of the amount which a person is liable to pay is not paid by the date by which it is required to be paid, the unpaid balance carries interest at the rate for the time being specified in section 17 of the Judgments Act 1838; and the unpaid balance and accrued interest are recoverable summarily as a civil debt (but this does not affect any other method of recovery).
Supplementary
144Investment principles and reviews
1
F198NHS England must prepare and publish a statement of the principles that govern its decisions, or decisions made on its behalf, about making investments for the purposes of this Chapter.
2
F198NHS England must—
a
in each financial year, review the statement,
b
if it considers necessary in light of the review, revise the statement, and
c
if it revises the statement, publish the revised statement.
3
As soon as reasonably practicable after the end of each financial year, F198NHS England must undertake and publish a review of the operation during that year of—
a
the procedure for health special administration under Chapter 5,
I47b
the procedure for trust special administration for NHS foundation trusts under Chapter 5A of Part 2 of the National Health Service Act 2006, and
c
such mechanisms as have been established under section 134.
4
The purposes of the review under subsection (3)(c) are—
a
to assess the operation of the mechanisms concerned,
b
to assess the accuracy of the estimates given by F197NHS England in relation to the operation of the mechanisms,
c
to assess what improvements can be made to the process for making estimates in relation to the operation of the mechanisms, and
d
to review the extent of the protection which the mechanisms are required to provide.
5
Where a fund established under section 135 has been in operation for the whole or part of the year concerned, the review published under this section must specify—
a
the income of the fund during that year, and
b
the expenditure from the fund during that year.
I476
F196NHS England must exclude from a review published under this section information which it is satisfied is—
a
commercial information the disclosure of which would, or might, significantly harm the legitimate business interests of an undertaking to which it relates;
b
information relating to the private affairs of an individual the disclosure of which would, or might, significantly harm that person's interests.
145I31Borrowing
1
F199NHS England may—
a
borrow from a deposit-taker such sums as it may from time to time require for exercising its functions under this Chapter;
b
give security for sums that it borrows.
2
But F200NHS England may not borrow if the effect would be—
a
to take the aggregate amount outstanding in respect of the principal of sums borrowed by it over such limit as the Secretary of State may by order specify, or
b
to increase the amount by which the aggregate amount so outstanding exceeds that limit.
3
In this section, “deposit-taker” means—
F28b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
The definition of “deposit-taker” in subsection (3) must be read with—
a
section 22 of the Financial Services and Markets Act 2000,
b
any relevant order under that section, and
c
Schedule 2 to that Act.
146I32Shortfall or excess of available funds, etc.
1
The Secretary of State may provide financial assistance to F201NHS England if the Secretary of State is satisfied that—
a
there are insufficient funds available from a mechanism established under section 134, or
b
the mechanism is otherwise unable to operate effectively.
2
If the Secretary of State is satisfied that the level of funds available from a mechanism established under section 134 exceeds the level that is necessary, the Secretary of State may direct F201NHS England to transfer the excess to the Secretary of State.
3
If the Secretary of State is satisfied that a mechanism established under section 134 has become dormant, or if a mechanism so established is being wound up, the Secretary of State may direct F201NHS England to transfer to the Secretary of State such funds as are available from the mechanism.
CHAPTER 7Miscellaneous and general
I35I90147Secretary of State's duty as respects variation in provision of health services
After section 12D of the National Health Service Act 2006 insert—
Miscellaneous
12ESecretary of State's duty as respects variation in provision of health services
1
The Secretary of State must not exercise the functions mentioned in subsection (2) for the purpose of causing a variation in the proportion of services provided as part of the health service that is provided by persons of a particular description if that description is by reference to—
a
whether the persons in question are in the public or (as the case may be) private sector, or
b
some other aspect of their status.
2
The functions mentioned in this subsection are the functions of the Secretary of State under—
a
sections 6E and 13A, and
b
section 75 of the Health and Social Care Act 2012 (requirements as to procurement, patient choice and competition).
148Service of documents
I391
A notice required under this Part to be given or sent to or served on a person (“R”) may be given or sent to or served on R—
a
by being delivered personally to R,
b
by being sent to R—
i
by a registered post service, as defined by section 125(1) of the Postal Services Act 2000, or
ii
by a postal service which provides for the delivery of the document to be recorded, or
c
subject to section 149, by being sent to R by an electronic communication.
I392
Where a notice is sent as mentioned in subsection (1)(b), it is, unless the contrary is proved, to be taken to have been received on the third day after the day on which it is sent.
I393
Where a notice is sent as mentioned in subsection (1)(c) in accordance with section 149, it is, unless the contrary is proved, to be taken to have been received on the next working day after the day on which it is transmitted.
I394
In subsection (3) “working day” means a day other than—
a
a Saturday or a Sunday;
b
Christmas Day or Good Friday; or
c
a day which is a bank holiday in England under the Banking and Financial Dealings Act 1971.
I395
A notice required under this Part to be given or sent to or served on a body corporate or a firm is duly given, sent or served if it is given or sent to or served on the secretary or clerk of that body or a partner of that firm.
6
For the purposes of section 7 of the Interpretation Act 1978 in its application to this section, the proper address of a person is—
I91a
in the case of a person who holds a licence under Chapter 3 who has notified F211NHS England of an address for service, that address, and
I39b
in any other case, the address determined in accordance with subsection (7).
I397
That address is—
a
in the case of a secretary or clerk of a body corporate, the address of the registered or principal office of the body,
b
in the case of a partner of a firm, the address of the principal office of the firm, and
c
in any other case, the last known address of the person.
I398
In this section and in section 149—
“electronic communication” has the same meaning as in the Electronic Communications Act 2000;
“notice” includes any other document.
F212I399
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I48149Electronic communications
1
If a notice required or authorised by this Part to be given or sent by or to a person or to be served on a person is sent by an electronic communication, it is to be treated as given, sent or served only if the requirements of subsection (2) or (3) are met.
2
If the person required or authorised to give, send or serve the notice is F213NHS England or the F20CMA—
a
b
the notice must be sent to or given or served at the address so provided.
3
4
5
F213NHS England must publish such requirements as it imposes under subsection (3).
150I33Interpretation, transitional provision and consequential amendments
I491
In this Part—
F206“anti-competitive behaviour” means behaviour which would (or would be likely to) prevent, restrict or distort competition and a reference to preventing anti-competitive behaviour includes a reference to eliminating or reducing the effects (or potential effects) of the behaviour;
F23“the CMA” means the Competition and Markets Authority;
“commissioner”, in relation to a health care service, means the person who arranges for the provision of the service (and “commission” is to be construed accordingly);
“enactment” includes an enactment contained in subordinate legislation (within the meaning of the Interpretation Act 1978);
“facilities” has the same meaning as in the National Health Service Act 2006 (see section 275 of that Act);
“financial year” means a period of 12 months ending with 31 March;
F207“health care” means all forms of health care provided for individuals, whether relating to physical or mental health, with a reference in this Part to “health care services” being read accordingly; and for the purposes of this Part it does not matter if a health care service is also an adult social care service;
F208“the NHS” means the comprehensive health service continued under section 1(1) of the National Health Service Act 2006, except the part of it that is provided in pursuance of the public health functions (within the meaning of that Act) of the Secretary of State or local authorities;
“prescribed” means prescribed in regulations;
“service” includes facility.
F2051A
A reference in this Part to the provision of health care services for the purposes of the NHS is a reference to their provision for those purposes in accordance with the National Health Service Act 2006.
F2102
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F209I493
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
Until section 181 comes into force, the following provisions in this Part are to be read as if the words “and its Healthwatch England committee” were omitted—
a
section 83(4)(c);
b
section 84(5)(a)(iii);
c
section 95(2)(e);
d
section 100(2)(e).
I34I50I925
Schedule 13 (which contains minor and consequential amendments) has effect.
Pt. 3 Ch. 4 substituted (1.7.2022 but only for the insertion of ss. 114C, 114D for specified purposes, 1.4.2023 in so far as not already in force) by Health and Care Act 2022 (c. 31), s. 186(6), Sch. 10 para. 3; S.I. 2022/734, reg. 2(b) (with regs. 13, 29, 30); S.I. 2023/371, reg. 2(d)