ICBs looking into potential contract breach by large private GP provider

Three ICBs are ‘considering next steps’ after a potential contract breach by a large private GP provider.

On Monday, North West London, North East London, and North Central London ICBs announced that the successor to Operose Health had actioned an unauthorised ‘change of control’.

Last year, the HCRG Care Group – formerly known as Virgin Care – agreed to buy Operose Health, which ran nearly 60 GP practices across the UK via ownership of AT Medics.

According to the London ICBs, the companies requested ‘authorisation’ for a change of control at the end of November, at which point a ‘due diligence exercise’ began to assess the new owner.

However, before this authorisation was granted, the companies went ahead with the ‘change of control’ on 28 December and failed to inform NHS commissioners. 

The three ICBs have sought to reassure patients that this action ‘does not impact’ access across current GP services, but they will continue with their due diligence process to ‘ensure the NHS has all the information needed’ regarding the companies. 

North East London Save our NHS, a campaigning group, has said this is a ‘serious contract breach’ and that HCRG Care Group has been operating GP practices ‘without permission’.

The group also argued that commissioners ‘must serve notice terminating the contracts’ based on the unauthorised change of ownership.

In an update on Monday, the ICBs said: ‘On 30 November 2023 the NHS was asked for authorisation for a change of control and commenced a due diligence exercise to assess the standing of the new owner and understand any implications of the change of control, including making formal enquiries to Operose Health Ltd.’

The change of control was for ownership of Operose Health to be transferred from the Centene Corporation to T20 Osprey Midico Ltd, which is part of the HCRG Care Group. 

The ICBs continued: ‘We have been informed that a “change of control” took place on 28 December 2023. The NHS was not informed of this at the time. We were written to on 15 March 2024 to inform us.

‘Under the terms of the APMS contracts, providers may not undergo a change of control without the NHS’s prior authorisation.

‘In light of this new information the NHS is now considering its next steps.’

Despite this potential breach of contract, the ICBs highlighted that a change in ownership does not actually result in a change to the legal entity holding the APMS contracts – AT Medics – or the GP services provided under the contract.

‘AT Medics Ltd has previously informed the NHS that there are no intentions to change service delivery or the personnel involved in providing care. This remains the case and has been re-asserted at meetings between AT Medics and the NHS since 15 March 2024,’ the ICBs added. 

According to NEL ICB, a decision will be made about next steps at the upcoming primary care contracts committee on 21 May. 

At NWL ICB’s board meeting yesterday, senior leaders faced questions from the public on the potential contract breach. 

One resident asked: ‘Why has this cynical move on their part not resulted in the immediate cancellation of the contract and control of the affected GP practices reverting to the commissioners?’

NHS England’s standard APMS contract states that contractors must not ‘undergo’ a change of control process ‘without the prior authorisation’ of the ICB. 

It also allows ICBs to serve notice of termination to the contractor if a change of control takes place ‘of which the Commissioner, acting reasonably, does not approve’. 

Spokespersons for Operose Health and HCRG Care Group said: ‘There has been no change to the companies or people that hold our contracts and run our GP services – these are still run by Operose Health Limited and AT Medics and by the same practice leadership and clinical staff.

‘There has been a change of ownership at the ultimate parent company, as the previous owners required completion of the transaction.

They added: ‘Patients will continue to be seen by the same practice teams and access care in the same way. Our main priority has, and will always be, providing our patients with high quality primary care.

‘The new parent company is an experienced provider in the Health and Care Sector, including GP practices, Walk in Centres and Urgent Care. They are registered and accredited to provide APMS contracts and 97% of their services are rated Good or Outstanding by CQC.’

Pulse has approached the parent companies, HCRG Care Group and Centene Corporation, for comment.

Earlier this month, a community health trust in North East London won four APMS contracts, two of which were previously run by Operose Health. 

This brought the total number of GP contracts under the trust’s control to ten. 

In Lancashire, a popular GP and her patients have been campaigning for her to be allowed to re-contract her APMS contract without a competitive tender process. 

But the ICB recently confirmed it will go ahead with re-tendering the contract.