Health and Social Care Bill

My Lords, there are some extremely helpful amendments in this group. Indeed, there has been a great deal of valuable debate both inside and outside the Chamber on the roles of competition and integration in the health service. I am grateful for much of what the noble Lord, Lord Warner, said in his introductory speech. The Government have been clear that both competition and integration can be important tools for commissioners to drive up the quality of services for patients. We have also been clear that it will be for commissioners to decide where and how these tools should be used—not Monitor. There will be ““no one size fits all”” or a model prescribed by government. To help ensure that both competition and integration are effective, Part 3 of the Bill seeks to establish appropriate powers for Monitor. Where there is competition, Monitor will have powers to ensure that it operates effectively in the interests of patients and to safeguard against anti-competitive conduct that can work against those interests. The Future Forum concluded that Monitor, as a sector-specific regulator with knowledge and expertise in health services, would be best placed to achieve this. Let me remind the Committee that this is if there is competition. In some circumstances, I freely concede that commissioners may decide that the best way to achieve high-quality services for patients is not to have competition. On Amendment 265C, I hope that noble Lords will agree that it is the right approach to require Monitor’s focus to be on considering the interests of patients. That will allow Monitor the scope to take account of a broad range of factors. This approach also provides continuity with the requirements of the existing system rules, the Principles and Rules for Co-operation and Competition, which we have committed to retaining and giving a firmer statutory underpinning through Monitor’s sectoral powers. Those powers are the setting and enforcement of licence conditions for providers and the overseeing of commissioning regulations set by the Secretary of State. Along with the concurrent powers to apply the Competition Act with the Office of Fair Trading, they will provide necessary safeguards to ensure that the interests of patients are protected. To pick up on the sorts of circumstances cited by the noble Lord, Lord Whitty, that would include, for example, safeguarding against providers exchanging information to agree lower levels of service quality than they would otherwise supply if they were in competition; or a commissioner removing a well-performing provider from the choices available to patients, or seeking to direct patient referrals to one provider and not another on non-clinical grounds. However, it is not the case that every arrangement in the provision of healthcare that had the effect of restricting competition would necessarily be anti-competitive. I made that point in one of our earlier debates. I look particularly in the direction of the noble Lord, Lord Whitty, in saying that Monitor’s core duty means that patients’ interests will always come first. For example, in some cases limiting competition by concentrating specialist services in regional centres or in providing services through a clinical network may deliver overriding benefits to patients and would not, therefore, be anti-competitive. Similarly, where an integrated service raises competition concerns, and equally where services offering more choice and control raise concerns over integration, Monitor will always come back to its core duty—to ask itself the question, ““What is it that benefits patients the most?””. The Government appreciate the clear consensus for further integration and more joined-up services. Integrated care pathways can enable increased collaboration between hospitals and clinicians, between public and independent sector services and between health and social care providers. The Bill seeks to encourage and enable that. In addition to powers relating to competition, Monitor has an overarching duty to enable integration where this would improve services or reduce inequalities for patients. Monitor will have a range of functions at its disposal to achieve this—for example, supporting the NHS Commissioning Board in identifying and spreading good practice in the development of reimbursement systems. Here I am particularly addressing Amendments 286A, 287 and 287B. Monitor would also be able to use its licensing conditions to enable integration, subject to the making of regulations provided for in Clause 95(2)(h)—for example, to reflect principle 4 of the existing Principles and Rules for Co-operation and Competition and require providers to exchange information with commissioners and other providers to ensure that the patient experience is of a seamless health service, regardless of organisational boundaries. I am also sympathetic to the intention of Amendment 274B as I agree that it is important that Monitor is transparent in managing conflicts effectively, including where there may be decisions to take on matters of integration. However, I believe that the requirements already set out in the Bill are comprehensive. This is because resolving a conflict that has a significant impact on the integration of services would also have a significant impact on patients or persons who provide healthcare services. I turn to the specific issues on the reviews that the Bill proposes are undertaken by the Competition Commission of competition in the provision of NHS services and the exercise of Monitor’s functions. I have listened carefully to the various arguments and concerns that have been put forward about this proposal and, as I have intimated previously, I will reflect further on the points that have been made on these reviews, with a view to bringing forward proposals on Report. I turn to Amendment 266, which is where we began. I do not take exception to the idea put forward by the noble Lord, Lord Warner, at least in principle, but Monitor would have the power to carry out the kind of review that the noble Lord suggests that it should. I am not sure that it would be helpful to compel it to use its resources in exactly the way that he proposes. The particular issue here is the timing. It might be helpful for any such review to be later, once the reformed system is more established. Amendment 267ZDA provides a definition of integration, referring to services being independent of organisational barriers. I am sympathetic to what it is trying to achieve but I am not sure that the proposed definition, which focuses largely on structures and processes, fully captures integration seen from the point of view of the patients. We see integration as a means of improving patient outcomes rather than—to return to an earlier theme—an end in itself. We do not want to be prescriptive about how commissioners decide to integrate services. Amendment 269, which the noble Lord also proposed, would remove the provision that Monitor should exercise its functions with a view to preventing anticompetitive behaviour in the provision of NHS services. It is important that Monitor plays this role to protect patients’ interests against collusion and so on. However, if these amendments were accepted, Monitor would still have its concurrent powers with the OFT but would not be required to use its other functions, such as licensing, to tackle abuses or distortions, and that would be retrograde. The noble Baroness, Lady Finlay, in her Amendment 268B also brought us to the subject of integration. Monitor will enable integration, as I have already said. It will be for commissioners to drive that. Monitor would have to publish an annual report on how it had discharged its functions and Schedule 8 gives the Secretary of State the power to ask Monitor for specific reports. This could include how Monitor was discharging its duty to enable integration. Amendment 267ZDA again is one that I am sympathetic to but I come back to the criticism that I made earlier that it is rather structure and process orientated. While I am with the noble Lord in spirit perhaps he would like to think again about how that amendment might be worded. He asked me about confidentiality and business interests in the government amendments—these would indeed apply to all providers whatever their sector and whether an individual or an organisation. The noble Lord, Lord Whitty, asked whether an aggrieved provider could appeal beyond Monitor. The answer is no. What the noble Lord has described would be an issue of procurement and not competition law. Commissioners, as long as they work within guidance and regulations, can decide when, how and if to use competition, including whether to restrict the number of providers to maintain service quality and sustainability. Finally, I turn to the amendments that it falls to me to speak to in this group. Both of them are minor and technical; their purpose is to tidy up the Bill and I hope that they will be agreed when moved.