Health and Social Care Bill

Session 2010 - 12
Internet Publications
Other Bills before Parliament

Health and Social Care Bill

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 4 — Pricing
132

(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
5
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
10
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
15
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.
20
(9)
If the Secretary of State considers that the modification gives or may give rise
(or, where it has yet to take effect, would or might give rise) to liability for
breach of an EU obligation, the Secretary of State may give a direction to that
effect; and the modification is (or is to be) of no effect in so far as it is subject to
the direction.
25
126
Applications 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
30
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.
35
(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).
40
(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).

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 5 — Health special administration
133

(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.
127
Correction of mistakes
(1)
This section applies where the national tariff contains information that does
5
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—
10
(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—
15
(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
20
date of the notice.
(6)
In this section, “relevant provider” has the meaning given in section 118(14).
Chapter 5
Health special administration
128
Health special administration orders
25
(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
30
made only by Monitor.
(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
35
(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.
40

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 5 — Health special administration
134

(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,
5
(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,
10
(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
15
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
20
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).
25
(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;
30
“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
35
principal place of business in, Northern Ireland);
“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
40
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.
129
Objective of a health special administration
45
(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

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 5 — Health special administration
135

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
5
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).
10
(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
15
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-
20
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—
25
(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,
30
(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
35
is better than the result that would be produced without them.
130
Health special administration regulations
(1)
Regulations (referred to in this Chapter as “health special administration
regulations”) must make further provision about health special administration
orders.
40
(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
45
makes provision by reference to anything that is or may be done under
that Act.

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 5 — Health special administration
136

(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
5
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.
10
(5)
Health special administration regulations may, in particular, make provision
about the publication and maintenance by Monitor of a list of relevant
providers.
(6)
Health special administration regulations may in particular—
(a)
require Monitor to publish guidance for commissioners about the
15
application of the criteria referred to in section 129(1)(a);
(b)
confer power on Monitor to revise guidance published by virtue of
paragraph (a) and require it to publish guidance so revised;
(c)
require Monitor, before publishing guidance by virtue of paragraph (a)
or (b), to obtain the approval of the Secretary of State and the National
20
Health Service Commissioning Board;
(d)
require commissioners, when applying the criteria referred to in section
129(1)(a), to have regard to such matters as Monitor may specify in
guidance published by virtue of paragraph (a) or (b);
(e)
require the National Health Service Commissioning Board to make
25
arrangements for facilitating agreement between commissioners in
their exercise of their function under section 129(1)(a);
(f)
confer power on the Board, 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);
30
(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
35
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.
40
(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.
45
(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.

Health and Social Care Bill
Part 3 — Regulation of health and adult social care services
Chapter 5 — Health special administration
137

(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;
5
(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
10
must consult—
(a)
Monitor, and
(b)
such other persons as the Secretary of State considers appropriate.
131
Transfer schemes
(1)
Health special administration regulations may make provision about transfer
15
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
20
Monitor and the person to whom the transfer is being made,
(b)
for Monitor 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 Monitor may specify (which may be a
25
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
30
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
35
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.
40
132
Indemnities
Health special administration regulations may make provision about the
giving by Monitor of indemnities in respect of—
(a)
liabilities incurred in connection with the discharge by health special
administrators of their functions, and
45
(b)
loss or damage sustained in that connection.