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Why we won't have a wild west of AQP providers

Until now, AQP has made only small waves in the NHS pond. It has been used to mainly procure relatively small contracts, such as musculoskeletal services or talking therapies.

Procuring larger services under AQP will create bigger waves, significantly altering the local healthcare infrastructure. This can be both a good and a bad thing. If as a commissioner you truly require change then this may be one way to achieve it.

Having a number of small AQP contracts can mean a lot of hard work from a commissioner’s point of view if you have a number of providers to monitor.

GPs won’t tolerate a poor service under AQP and will soon turn the CCG governance spotlight on those providers. Similarly patients won’t tolerate a poor service and word will soon get round not to choose that particular provider.

The other downside of small AQP contracts though is that small providers might struggle with the AQP application process and developing their service and be put off AQP.

They might benefit from the support of larger experienced providers who can either facilitate or ‘buddy’ with them. From a larger provider point of view though, small low value AQP contracts may not be attractive. This is because tariffs (often set locally) may be too low, contracts are for a short duration and there is uncertainty over volumes. For these reasons the ‘wild west’ of hundreds of providers which some fear is unlikely.

Larger AQP contracts are more attractive to larger providers. The contracts are likely to be linked to national tariffs and even with competition should allow sufficient volumes to provide a profit. Even so, there is likely to be a limit to the number of providers.

Firstly, there is a lack of available clinical staff. Consultants in particular are not that easy to recruit. Many Foundation Trusts (FTs), as the consultants’ main employers will not take kindly to one of their employees working for a competitor. Similarly complex services often require pathology and other diagnostic services or to be part of their multi-disciplinary teams. It is quite easy for local FTs to create sufficient blocks for new providers to struggle. Significant numbers of competing providers for one speciality are therefore unlikely. Two or three are more likely and this should create sufficient competition to improve services to patients.

For individual clinicians who have a ‘provider vision’ these too might find the AQP process and mobilisation of a service difficult.  Again, there is no reason why working in partnership with an experienced provider organisation would not be fruitful either as an ‘enabler’ to get the service started or as full partner.

Commissioners are already speaking to providers and need to do this more frequently to allow new and innovative ways of delivering services to develop. Allowing new providers to enter the system should provide patients with better services. There is huge potential if commissioners are both brave and visionary. In some places this is already beginning to happen. Not all ideas will work and some services will fail but managed risk is essential to create real change.

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