These notes refer to the Health Bill [HL] as brought from the House of Lords on 13 May 2009 [Bill 97]
HEALTH BILL [HL]
1. These explanatory notes relate to the Health Bill [HL] as brought from the House of Lords on 13 May 2009. They have been prepared by the Department of Health in order to assist the reader of the Bill and to help inform debate on it. They do not form part of the Bill and have not been endorsed by Parliament.
2. The notes need to be read in conjunction with the Bill. They are not, and are not meant to be, a comprehensive description of the Bill. So where a clause or part of a clause does not seem to require any explanation or comment, none is given.
3. A glossary of terms and abbreviations used in these explanatory notes is provided at the end of these notes.
OVERVIEW OF THE STRUCTURE
4. The Bill contains provisions on a range of policies. Part 1 contains provisions arising directly from the NHS Next Stage Review regarding quality and delivery of NHS services.
5. Part 1 establishes a framework for the NHS Constitution, requires NHS providers to publish Quality Accounts, enables direct payments for health care to be made to patients (initially as part of a pilot scheme) and enables payments as prizes to be made to promote innovation in the provision of health services in England.
6. Part 2 contains powers in relation to health bodies that arise out of a Government review of the NHS performance regime. The provisions enable the appointment of trust special administrators and relate to suspension of Ministerial appointees to NHS and other health bodies.
7. Part 3 contains miscellaneous provisions relating to advertising and display of tobacco products and the sale of such products from vending machines, pharmaceutical services, a complaints procedure for privately arranged or funded adult social care, power to make regulations exempting NHS foundation trusts from
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restrictions on earning income derived from private charges and the disclosure of information relating to general medical practitioners (GPs) or dental practitioners by Her Majestys Revenue and Customs (HMRC).
BACKGROUND AND SUMMARY
General Background: NHS Next Stage Review
8. In a statement to the House of Commons on 4 July 2007 1, the Secretary of State for Health, Rt Hon. Alan Johnson, announced a review of the National Health Service (NHS). The NHS Next Stage Review, which was led by Lord Darzi of Denham, sought to develop a plan for the NHS over the next decade by engaging with patients, staff and the public.
9. On 4 October 2007 the Interim Report, Our NHS, Our Future, 2 was published. The Interim Report set out a 10 year plan for the NHS and considered how the NHS could become fairer and more personalised, effective and safe. It set out immediate and longer term priorities in these areas.
10. The NHS Next Stage Review Final Report, High Quality Care for All, 3 was published on 30 June 2008. The Final Report responds to the 10 Strategic Health Authority strategic plans and sets out a strategy for an NHS with a focus on quality.
11. This Bill implements those parts of the NHS Next Stage Review that require primary legislation. These include provisions concerning the NHS Constitution, Quality Accounts and direct payments for NHS healthcare services.
Chapter 1 - NHS Constitution
12. The Interim Report published in October 2007 set out the case for an NHS Constitution. This was said to be?
to enshrine the values of the NHS and increase local accountability to patients and public.
13. On 30 June 2008, the Department of Health published A Consultation on the NHS Constitution 4.
14. The clauses on the NHS Constitution set out the proposed duties on specified bodies involved in the provision, commissioning or regulation of NHS care and on other persons providing NHS services under contracts or arrangements. The clauses provide that those bodies are to have regard to the NHS Constitution, and for the Secretary of State to review the NHS Constitution at least every ten years, after consultation with patients and bodies representing patients, the public, staff and bodies representing staff, carers and local authorities. They also provide that the Secretary of State must revise the accompanying Handbook to the NHS Constitution at least every three years. The Secretary of State must also report on the effect of the NHS Constitution on patients, the public, staff and carers every three years.
Chapter 2 - Quality Accounts
15. High Quality Care for All said that from April 2010 all healthcare providers working for or on behalf of the NHS would be placed under a legal requirement to publish an annual Quality Account. Clauses 8 and 9 of the Bill therefore propose placing a duty on those providers although clause 8 also gives the Secretary of State a regulation-making power enabling him to exempt prescribed persons, or the providers of prescribed services, from this requirement.
16. The duty is to publish prescribed information about quality of services for the period 1 April to 31 March each year. Clause 8 gives the Secretary of State a further regulation-making power, including the power to determine the form, content and timetable for publication of a Quality Account.
Chapter 3 - Direct payments
17. The Government made a commitment in High Quality Care for All to pilot personal health budgets, including piloting direct payments for health care where this makes most sense for particular patients in certain circumstances. Direct payments are monetary payments to patients with which they can procure health care services.
18. The Department published Personal Health Budgets: First Steps in January 2009, setting out its intentions for personal health budgets, including direct payments. 5
3 Department of Health (2007), Personal Health Budgets: First Steps, Department of Health, London. Available at: http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_093842
19. Direct payments have been used in lieu of social care services for some time. These are payments for individuals to purchase services from various providers directly, to meet their social care needs. This Bill allows for a similar model of direct payments to be used for health care.
20. Clause 11 in Chapter 3 of Part 1 of the Bill allows the Secretary of State to make monetary payments to patients in lieu of providing them with health care services. In practice, this power will be delegated to local NHS organisations, generally Primary Care Trusts (PCTs), though some Strategic Health Authorities or Special Health Authorities may also wish to use direct payments. Initially, this power will be available in pilot schemes only.
21. Direct payments for health care will allow patients to purchase health care services directly from a variety of providers, including private organisations and the voluntary sector.
22. The Bill provides powers to allow the Secretary of State to make regulations to govern the operation of direct payments and direct payment pilot schemes. The regulations will set out the persons who might receive direct payments, potentially appropriate health conditions and the services in respect of which payments could be made. The regulations might also set out specific categories of patients who would not be able to access direct payments for health care, or services that could not be purchased. The regulations will also make provision for the necessary monitoring in order to ensure accountability and that direct payments are effective in meeting the health outcomes agreed between the patient and the NHS. Provision could also be made for money to be recouped in the event of a large surplus or misuse of direct payments.
23. The Government intends that every pilot scheme will be reviewed. The Government intends that the pilot programme as a whole should be reviewed by an independent person, the review should be published, and it should examine a range of issues. These include the administration of direct payments, the effect of direct payments on cost or quality of care, and the effect of direct payments on the behaviour of patients, carers or people providing services.
24. Following a review there is a power, subject to approval by each House of Parliament under the affirmative resolution procedure, to remove the requirement that payments be made through a pilot scheme so that direct payments could become more generally available while still following rules in the framework established by regulations.
Chapter 4 - Innovation prizes
25. High Quality Care for All stated the Governments intention to create prizes for innovations that directly benefit patients and the public. Clause 14 will enable the Secretary of State to make payments to promote greater innovation in the provision of health services.
Chapter 1 - Trust special administrators
26. Developing an NHS Performance Regime 6, published in June 2008, announced the Governments intention to
establish a failure regime for state-owned providers that reflects the Government's obligations to ensure service continuity and protect public assets.
27. It detailed the steps that would be taken if an NHS organisation failed, either for clinical or organisational reasons.
28. In September 2008, the Government published the Consultation on a regime for unsustainable NHS providers 7, which set out Government proposals and sought views on such a regime. The consultation response document 8 was published in January 2009, alongside the Bill.
29. Further detail on how the wider performance framework will work for NHS trusts was published in April 2009 and is included in The NHS Performance Framework: Implementation Guide 9.
5 Department of Health (2009), NHS Performance Framework: Implementation Guidance, Department of Health, London. Available at: www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_098525
30. Chapter 1 of Part 2 of the Bill amends the National Health Service Act 2006 (NHS Act) to make provision for the appointment of trust special administrators (TSAs) for NHS trusts, NHS foundation trusts and PCTs in England. These NHS bodies are all established under the provisions of the NHS Act. The provisions of the Bill are intended to form part of a wider process for dealing with the poor performance and failure of such NHS bodies. The appointment of a TSA will be the final stage in this process, where earlier attempts to improve performance using existing powers have failed and the continuation of the body in its present situation is not considered to be in the interests of the health service.
31. Under the existing provisions of the NHS Act, there are various means to address poor performance of NHS trusts and PCTs. Strategic Health Authorities are responsible for the performance management of PCTs and NHS trusts; and the arrangements between NHS trusts and PCTs may include provisions relating to performance. The Secretary of State has power to give directions to NHS trusts and PCTs about their exercise of functions (section 7 of the NHS Act) and has powers to remove the chairs and non-executive directors (regulations made under Schedules 3 and 4 to the NHS Act). If the Secretary of State considers that a trust is not performing its functions adequately or at all, or that there are significant failings in the way the body is being run, and he considers it appropriate to intervene he may make an intervention order under sections 66 and 67. Finally, the Secretary of State may dissolve a PCT or an NHS trust (section 18(2) of, and paragraph 28 of Schedule 4 to, the NHS Act).
32. NHS foundation trusts are regulated by the Independent Regulator of NHS foundation trusts (Monitor). NHS foundation trusts must comply with the terms of the authorisation given by Monitor under the NHS Act. Under the NHS Act, Monitor has powers to require a failing trust to do specified things or to remove its directors (section 52), and to require it to enter a voluntary arrangements with creditors (section 53). If a trust fails to comply and Monitor considers that the further exercise of its powers would not be likely to secure the provision of the goods or services which the authorisation required the trust to provide, the Secretary of State may make an order to dissolve the trust, transfer property or liabilities to other NHS bodies and apply the provisions of insolvency legislation relating to the winding up of companies to the trust, in order to deal with outstanding liabilities, etc (and see below) (section 54).
33. Historically, failing NHS trusts have been dealt with in a relatively ad hoc way. The policy intention is to provide for a regime in legislation which will ensure clarity and transparency and ensure that key processes of the regime are applied systematically. For NHS foundation trusts, the provisions of the Health and Social Care (Community Health and Standards) Act 2003, now consolidated in the NHS Act, provide for a regime in which a dissolving trust could be subject to insolvency procedures similar to the statutory provisions for the winding up of companies (Part 4 of the Insolvency Act 1986), but there has been continuing discussion about how such procedures would be modified and applied. The Department has now concluded that it is not appropriate to apply insolvency procedures to NHS foundation trusts. Consultation on a regime for unsustainable providers, September 2008 and The Regime for Unsustainable NHS Providers: response to consultation, January 2009 provide further background and set out more detail on the policy.
34. The clauses in Chapter 1 of Part 2 of the Bill enable the Secretary of State to appoint, or in the case of a PCT, require a body to appoint, a TSA to take control of the body for a temporary period, during which the TSA would be responsible for ensuring that the body continued to exercise its functions (for example, in the case of an NHS trust, that it continued to provide services in accordance with its NHS contracts). During the period of appointment, the TSA must produce a report stating the action which the TSA recommends the Secretary of State should take in relation to the trust. The TSA will be obliged to consult various persons before finalising the report. The Secretary of State will be obliged to make a decision as to what action to take in the light of the final report, within 20 working days of receiving the report. In the case of NHS foundation trusts, it will be for Monitor to initiate the regime, by giving a notice to the Secretary of State in accordance with the draft provisions. On receiving such a notice, the Secretary of State will be obliged to make an order providing that the trust shall cease to be a foundation trust and instead become an NHS trust, and appointing a TSA (described as de-authorisation). A de-authorised NHS foundation trust will become an NHS trust and be subject to the other provisions of the Chapter relating to such trusts.
Chapter 2 - NHS and other health appointments: suspension
35. The Healthcare Commission report in October 2007 on outbreaks of Clostridium difficile at Maidstone and Tunbridge Wells NHS Trust 10 highlighted the need for swift action, in extreme cases, to suspend chairs and members of NHS boards. A Review of NHS public appointments processes carried out with the NHS and published in January 2008, recommended that the Secretary of State should have powers to suspend those he appoints and that powers to suspend should, as with powers to appoint, be delegated to the Appointments Commission.
36. The Government consulted on proposals to introduce new powers of suspension for chairs and other non-executives of PCTs and NHS trusts between January and March 2008 11. The Government stated during the consultation that the Governments intention was to introduce the same powers for chairs and non-executives of Strategic Health Authorities and national bodies established by the Department of Health in a second phase of legislation to follow later in 2008/09. The proposals for local trusts and PCTs received full support from the NHS and, following amendments to regulations, 12 the Appointments Commission was provided with the new powers on 16 June 2008.
6 Department of Health (2008). Removing or suspending chairs & non-executives from PCTs and NHS Trusts: Consultation on introducing powers of suspension. Department of Health, London.
7 The Primary Care Trusts and National Health Service Trusts (Membership and Procedure) Amendment Regulations 2008 (SI 2008/1269)
37. A Government consultation document, 13 published in July 2008, considered proposals to introduce powers of suspension and a single approach to the removal of chairs and non-executives of this second group of bodies - Strategic Health Authorities, national health sector bodies and arms length bodies. The consultation concluded on 9 October and, as with the previous local consultation, it was supportive of introducing the new suspension proposals.
38. Chapter 2 of Part 2 of the Bill introduces a Schedule providing for new powers of suspension of chairs and other members of NHS and other health bodies. The provisions in the Schedule amend the relevant legislation dealing with appointments to Strategic Health Authorities, Special Health Authorities, Monitor, standing advisory committees (which advise the Secretary of State pursuant to section 250 of the NHS Act such as the Joint Committee on Vaccination and Immunisation), community health councils in Wales, the Human Tissue Authority, the Health Protection Agency, the Human Fertilisation and Embryology Authority, bodies established under the Medicines Act 1968, the Alcohol Education and Research Council and the Appointments Commission itself. The provisions will also ensure that appropriate procedures are or could be put in place for notification of suspension, review on request after a given period of time and provision for temporary replacement of a suspended chair.
39. The Department of Healths Consultation on the Future of Tobacco Control, 14 published on 31 May 2008, sought views from stakeholders and the public on further action to combat smoking and the negative effects it has on public health. The consultation was expressed as the first step in developing a new national tobacco control strategy and focused on four main areas: reducing smoking rates and health inequalities caused by smoking; protecting children and young people from smoking; supporting smokers to quit; and, helping those who cannot quit.
40. The consultation ran for three months and sought views on possible measures to reduce young peoples access to tobacco and on reducing exposure to tobacco promotion. The consultation received over 96,000 responses, details of which can be found in the consultation report published on 8 December 2008 15.
41. The Bill includes a series of amendments to the Tobacco Advertising and Promotion Act 2002 (the 2002 Act), the Children and Young Persons (Protection from Tobacco) Act 1991 (the 1991 Act) and the Children and Young Persons (Protection from Tobacco) (Northern Ireland) Order 1991 (the 1991 (NI) Order) to adopt some of these measures for protecting public health. The amendments make further provision in relation to the display of tobacco products and the sale of such products from vending machines.
42. The new provisions to be inserted into the 2002 Act subject to exclusions, prohibit the display of tobacco products in the course of a business. Powers are also given to the Secretary of State, the Welsh Ministers and the Department of Health, Social Services and Public Safety in Northern Ireland (DHSSPSNI) to regulate (but not prohibit) the display of prices of tobacco products and (Secretary of State only) the display of tobacco products and their prices in the course of a business on a website where such products are offered for sale. The 1991 Act and the 1991 (NI) Order are also amended to give power to the Secretary of State, the Welsh Ministers, and DHSSPSNI to prohibit, or otherwise impose requirements in relation to, the sale of tobacco from vending machines.
43. The Department of Health published a pharmacy White Paper, Pharmacy in England: Building on strengths - delivering the future 16 on 3 April 2008. The White Paper set out the Governments programme for a reformed pharmaceutical service. A series of consultation events were held in May to consider the proposals in more detail 17. The White Paper also provided the Governments response to the Review of NHS pharmaceutical contractual arrangements 18 commissioned in 2007 and conducted by Anne Galbraith. In addition, the White Paper took account of recommendations of the All Party Pharmacy Groups report, The Future of Pharmacy 19 published in June 2007.
9 Department of Health (2008). Pharmacy in England: Building on strengths - delivering the future, Cm 734. Department of Health, London.
Available at: http://www.dh.gov.uk/en/publicationsandstatistics/publications/publicationspolicyandguidance/dh_083815
10 A summary report of those is now available at http://www.dh.gov.uk/en/Publicationsandstatistics/index.htm
11 Anne Galbraith (2007). Review of NHS pharmaceutical contractual arrangements - Report by Anne Galbraith
44. The White Paper was developed to align closely with the NHS Next Stage Review and the development of a new primary and community care strategy, Our Vision for primary and community care, 20 which was published on 3 July 2008.
45. The White Paper promised consultation on a number of proposals for structural change, including any necessary revisions to primary legislation. That consultation, Pharmacy in England: Building on strengths - delivering the future - proposals for legislative change, 21 began on 27 August 2008 and ended on 20 November 2008. A series of national listening events were held in October 2008 in support and a report of these events, together with the Departments report of the consultation concerning the primary legislation proposals contained within this Bill, was published on 16 January 2009.
46. The purpose of the pharmacy provisions contained in the Bill is threefold. First, the provisions concerning market entry replace the current control of entry test which is applicable to all pharmaceutical contractors seeking to enter onto a pharmaceutical list. The new test requires PCTs first to develop and to publish statements of pharmaceutical needs and then to use these to determine applications. This would replace the current test which refers to the adequacy of the pharmaceutical services in the neighbourhood in which the premises are to be located.
47. Second, the market exit provisions enable PCTs to be given new powers to take action where there are concerns about the quality or performance of services provided by pharmacy contractors.
48. Third, the pharmacy provisions enable PCTs themselves to provide local pharmaceutical services (LPS) in certain circumstances.