Home > News > Appeal launched in challenge to NHS Accountable Care Organisation Contract

Permission is being sought by the campaign group, 999 Call for the NHS, to appeal to the Court of Appeal against the decision of Kerr J dismissing the first challenge to the Accountable Care Organisation (ACO) Contract.

NHS England publishes a ‘Standard NHS acute Services Contract’ which is adopted by Clinical Commissioning Groups (CCGs) when commissioning services. Payment for services under the Standard Contract is “per treatment” so that when a provider treats more individuals, it is paid more. In this respect, it ensures providers have sufficient money to provide services. The prices are set by Monitor in the National Tariff.

In August 2017, NHS England published an alternative contract, the ACO Contract, which proposed to fund providers on a “per population” basis. It was envisioned a CCG would contract with a provider who would agree to provide numerous types of treatments to a population over a period of several years at a pre-agreed price.

999 Call for the NHS challenged the legality of this funding model on the basis it breached the funding structure mandated by the Health and Social Care Act 2012. It was argued that, in accordance with assurances given by ministers to Parliament when the 2012 Act was passed, the 2012 Act mandated “per treatment” funding. If the “per population” funding was adopted, it would place the commercial risk on providers, so that if more patients than expected required treatment then service standards would be at risk.

Kerr J accepted that ministers did indeed assure Parliament that the 2012 Act would permit competition on quality but not price. However he found, on the basis of statutory construction, the principle of the ACO Contract was lawful.  However, potentially contradicting this finding, he also found that the ACO Contract could not be used as it was drafted but it would need amending to ensure its legality.

Permission to appeal the judgment has been sought on seven grounds. Amongst those grounds, it is argued the judge has misinterpreted the different roles of NHS England and Monitor under the 2012 Act, and that the relevant provisions of the 2012 Act have been misconstrued.

Meanwhile, in January 2018, NHS England announced a consultation on the terms of the ACO Contract, although the details of that consultation are not yet known. Another challenge to the ACO Contract, brought by a group of academics and professionals including the late Professor Stephen Hawking, has recently been heard by Green J and judgment is awaited.

The judgment in the 999 Call for the NHS challenge is available here; and coverage in the Guardian is available here.

David Lock QC and Leon Glenister are acting for 999 Call For the NHS, instructed by Leigh Day.

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