Contracting Jennifer Finch Commissioning Manager Commissioning Centre of

Contracting Jennifer Finch Commissioning Manager Commissioning Centre of Excellence Birmingham City Council

Contents • • • Purpose of the contract Developing contracts Different types of contracts NHS and LA Contracting Procurement thresholds Managing Contracts

Commissioning Cycle

Benefits of a Contract DISCUSSION IN GROUPS Name one benefit of signing a contract Discuss one contract you are signed up to (non household)

Main Aspects of a Contract Terms and Conditions • Payment Terms • Termination • Transfer of Undertakings (Protection of Employment) - TUPE • Confidentiality • Safeguarding / Child Sexual Exploitation

Main Aspects of a Contract Main Schedules • Service Spec • Finance Schedule • KPIs / Reporting Requirements • Data Sharing / Processing agreements

Main Aspects of a Contract • • • Quality NHS – Friends and Family test Compliments / Complaints Serious Untoward Incidents (SUI’s) Service User Surveys Mystery customer shoppers Audits

Main Aspects of a Contract Signing of the contract • Delegated authority • Signature / Sealing

ORAL CONTRACTS SUPPLIER CONTRACTS Types of Contracts (Goods and Services) STANDARD CONTRACTS MODEL CONTRACTS

Oral Contracts Can be binding if the essential elements of a contract are present Risks: • Lack of understanding • Mistakes • Disadvantageous Terms

Supply Contracts • • One off Purchases Standing Orders Blanket Ordering Framework Agreements

Model Contracts Published by 3 rd party experts incorporating standard practice for specific industries ensure fair and balance of contractual rights between buyer and supplier. E. g. Engineering contracts (NEC 3) CIPS contracts

Standard Contracts Contract template based on generally accepted practice in industry or supply market or based on past negotiated agreements E. g. NHS Standard Contract (Unilateral and Multi-Lateral), Non- Mandated Public Health Contract

ADVANTAGES DISADVANTAGES Helps reduce time Major changes will still need legal advice Unfair terms can be negotiated Cost to train employees on those contracts Saves costs - legal fees Not reinventing the wheel Fair to both parties Widely accepted in the industry

Public Procurement Regulations • Regulates the purchasing by public sector bodies for goods, works or services. • Purpose: open up the EU's public procurement market to competition • Part A services must advertise in EU, light touch process for Part B Services

Public Procurement Thresholds • Supplies & Services (except subsidised services contracts) Schedule 1 bodies -£ 106, 047 Others £ 164, 176 • Subsidised services contracts All bodies -£ 164, 176 • Works All bodies -£ 4, 104, 394 • Light Touch Regime for Services All bodies £ 589, 148 • Small lots Supplies and services -£ 62, 842 Works £ 785, 530

NHS Contracting Process • Process set out by Department of Health • Timelines – October to March each year • All major contracts must be negotiated and signed by 8 th April • Dispute resolution

QIPP • Quality, Innovation, Productivity and Prevention • National, regional and local level programme designed to support clinical teams and NHS organisations to improve the quality of care they deliver while making efficiency savings that can be reinvested into the NHS.

Contracting Arrangements PAYMENT BY OUTCOMES BLOCK CONTRACT ACTIVITY CONTRACT CQUIN PAYMENTS

Block Contract vs Activity Contract

CQUIN Payments • Commissioning for quality and innovation • Introduced in 2009 • A proportion of the providers income is conditional on demonstrating improvements in quality and innovation specific areas (does NOT apply in local authorities)

NHS Payment by Results • National Tariff System in place e. g. cancer services • Tariffs are reviewed every year • Cost per activity / service • Agreement of tariff from Commissioners and Providers • Local variations can be implemented

DISCUSSION IN GROUPS • Difference • Advantages • Disadvantages OUTPUTS OUTCOMES

Payment by Outcomes - Example

Relationship Management Relationship management is dependant upon: – Contract value – Type of service – Importance – Length of contract

Performance Management • Contract Review Meetings • Performance Monitoring • Remedial Action Plan

Future of Contracting • More emphasis on Corporate Social Responsibility (CSR) • More partnership working between Health and Social Care

Commissioning Cycle

Quick Quiz 1. What are the four main stages of the commissioning cycle? 2. What is the purpose of the Friends and Family test within an NHS Contract? 3. When does the NHS Contracting cycle start and finish? 4. Name one advantage of model / standard contract? 5. What is a remedial action plan?

Any Questions