Health and Social Care Bill proposes wide-ranging reforms to the regulation of healthcare in England & Wales

On 19 January 2011, the Health and Social Care Bill (the “Bill”) received its first reading in the House of Commons. The Bill introduces some of the most sweeping changes to the regulation of healthcare in England & Wales since the introduction of the National Health Service (“NHS”) some 60 years ago.

Key reforms

The Bill proposes the following key reforms:

  • Monitor appointed as the “economic regulator” of NHS services in England & Wales to set prices for services, promote competition and ensure continuity of services.
  • Monitor will license providers of NHS services (similar to functions performed by other sectoral regulators such as Ofgem, Ofwat and Ofcom). The licensing framework mirrors the model in other regulated sectors: standard conditions and special conditions can be imposed, and mechanisms are provided for referral to the Competition Commission.
  • Mergers involving NHS Foundation Trusts will be subject to merger control review by the Office of Fair Trading (“OFT”) and Competition Commission (“CC”). The Secretary of State has the power to intervene on public interest grounds to impose conditions or modify conditions in a provider’s licence following a merger.
  • Monitor is empowered to enforce competition laws under the Competition Act 1998 concurrently with the OFT.
  • Monitor is empowered to undertake market studies under the Enterprise Act 2002 (similar to OFT market studies) and to refer markets or barriers to competition to the CC for further investigation. 

Given the similarities between this new framework and the regulatory frameworks in other regulated sectors, Monitor’s role is likely to imitate that played by other sectoral regulators such as Ofcom and Ofgem. The proposed reforms to the public healthcare sector, however, take place against the backdrop of fundamental reviews of the structure of a number of other competition regulators in the UK (including the OFT, CC, Ofgem and Ofwat)."

Timing

The White Paper signalled an intention for Monitor to assume responsibility for regulating all providers of NHS care from April 2013.  Obviously much depends on the passage of the Bill through Parliament and the nature of any amendments sought.  

Please click here for a more detailed review of the proposed reforms.

Please contact Nicole Kar or Felicity Deane for further information.

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