It is currently intended that the Provider Selection Regime (PSR) will come into force on 1 January 2024. 

The PSR Regulations are a new set of rules relating to the arrangement and procurement of healthcare services by the relevant authorities in England. 

• Healthcare means all forms of healthcare provided for individuals, whether relating to physical or mental health, which fall within one or more of the CPV codes specified in Schedule 1 of the Regulations.
• The authorities include NHS England, NHS Trusts and NHS Foundation Trusts, Integrated Care Boards and Local Authorities and Combined Authorities.

The PSR will not apply to the procurement of goods or non-health care services (unless they are a part of a mixed procurement), irrespective of whether these are procured by the relevant authorities.

The purpose of the PSR Regulations is to:

• introduce a flexible and proportionate process for deciding who should provide healthcare services;
• provide a framework that allows collaboration to flourish across systems; and
• ensure that all decisions are made in the best interest of patients and service users.

The PSR is set out in Health Care Services (Provider Selection Regime) Regulations 2023, which were introduced into Parliament on 19 October 2023 and once in force will replace the current framework for the procurement of healthcare services – The Public Contracts Regulations 2015, and The Procurement Patient Choice and Competition Regulations 2013. Until the PSR is in force, relevant authorities should continue to follow the current rules. NHS England has published its draft statutory guidance to support the implementation of the regulations and set out what the relevant authorities must do to comply with them. The draft guidance can be found here. 

Selection Process

When the PSR comes into force, it will introduce three processes that authorities can follow to award contracts:

1. Direct award processes (A, B and C). These involve awarding contracts to providers when there is limited or no reason to seek to change from the existing provider; or to assess providers against one another, because:
   1. the existing provider is the only provider that can deliver the health care services (direct award process A).
      1. Requirements: Authority to publish a notice to award, within 30 days, including contract value and details of the award decision-maker. The content for such notice can be found at Schedule 2 of the Regulations.
   2. patients have a choice of providers and the number of providers is not restricted by the relevant authority (direct award process B). The relevant authority will offer contracts to all providers to whom an award can be made because they meet all requirements in relation to the provision of healthcare services to patients. 
      1. Requirements: Authority to publish a notice to award, within 30 days, including contract value and details of the award decision-maker. The content for such notice can be found at Schedule 2 of the Regulations.
   3. the existing provider is satisfying its existing contract, will likely satisfy the new contract to a sufficient standard, and the proposed contracting arrangements are not changing considerably (direct award process C).
      1. Requirements: Authority applies key criteria (Quality and Innovation, Value, Integration, Collaboration and Service Sustainability, Improving Access, Reducing Health Inequalities and Facility Choice and Social Value) and basic selection criteria when making the decision to extend the contract. The basic selection criteria are set out in Regulation 19 and in Schedule 16. The exclusions are set out in Regulation 20. The regulations state that the basic selection criteria is to be decided by the authority but may relate to the following:
         1. Suitability to pursue a particular activity;
         2. Economic and financial standing; and 
         3. Technical and professional ability.
      2. Authority publishes an ‘intention to award notice’ triggering a standstill period lasting for a maximum of 30 days (unless extended by mutual agreement). The content for such notice can be found at Schedule 3 of the Regulations.
      3. Authority publishes a notice to award if no representations are received during the standstill. The content for such notice can be found at Schedule 4 of the Regulations.
2. Most suitable provider process. This involves awarding a contract to providers without running a competitive process, because the relevant authority can identify the most suitable provider.
   1. Requirements: Authority publishes intention to follow the Most Suitable Provider Process.
   2. Authority identifies potential providers with reference to key criteria and basic selection criteria, both as described above in 1.c.i.
   3. Authority publishes an 'intention to award' notice triggering standstill period lasting for a maximum of 30 days (unless extended by mutual agreement. The content for such notice can be found at Schedule 5 of the Regulations.
   4. Authority publishes a notice to award if no representations are received during standstill. The content for such notice can be found at Schedule 7 of the Regulations.
3. Competitive process. This involves running a competitive process to award a contract.
   1. Requirements: Authority determines award criteria (taking into account the key criteria and basic selection criteria, both as described above in 1.c.i).
   2. Authority publishes contract notice. The content for such notice can be found at Schedule 8 of the Regulations.
   3. Authority assesses offers in accordance with the criteria.
   4. Authority publishes an 'intention to award' notice triggering standstill period lasting for a maximum of 30 days (unless extended by mutual agreement. The content for such notice can be found at Schedule 10 of the Regulations.
   5. Authority publishes a notice to award if no representations are received during standstill. The content for such notice can be found at Schedule 11 of the Regulations.

NHS England have also published a list of FAQs which can be found here. 

Further Government guidance can also be found here.