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Understanding the Provider Selection Regime: Key Decision-Making Criteria

By |2023-10-17T10:04:54+00:00September 11th, 2023|Articles|

In this blog, we will explore the Provider Selection Regime’s (PSR)  ‘Key Decision- Making Criteria’ which may be considered during Decision Making Circumstances. This blog will also provide a context around ear criterion with examples of what may be expected as part of decision making.


Once passed by Parliament, The Provider Selection Regime will introduce Key Changes to how commissioners can select and assess providers of healthcare services.  Application of Decision-making circumstances is intended to include the application of The Key Decision-Making Criteria below:

Key Decision-Making Criteria

Quality and innovation

This criterion will ensure that decision-making bodies consider the fundamental utility and performance of a service and the quality of the provider generally, and seek to maximise these. Ensuring that they will seek to innovate and improve services, and proactively develop services that are fit for the future.

Decision making bodies should establish the desired outcomes for Quality, Safety, and health outcomes. They should then ensure that the arrangements made with providers are capable of maximising these.

Consideration should be given to all available local and national data and information to inform decisions. When considering available data, decision-making bodies should consider, upward and downward trends, any criteria that may affect trends and how trends may be expected to change over time. This should be considered to establish how performance may vary over the lift of the proposed arrangement and what risks/ mitigations should be agreed

Information could include (but is not limited to):

  • CQC rating and action plan
  • Provider experience, evidenced by relevant Key performance indicators and/ or relevant references
  • Patient experience and feedback, including complaints
  • Patient and staff survey results
  • Patient safety incidents and learning from incidents
  • Quality outcomes evidenced by clinical audit and patient outcome measures
  • Documented Quality improvement plans

Decision making bodies should consider the unique and innovative strategies proposed by service providers, as they can significantly enhance the delivery of superior outcomes. They should avoid assuming that existing provisions will adequately meet both present and future requirements. Instead, this criterion should explore avenues for fostering innovation within service arrangements. This could involve exploring the possibility of longer contract durations, where explicit expectations regarding innovation and service evolution are incorporated into the contract terms. Alternatively, pilot testing novel and potentially higher risk services should be considered, with the intent to award a full contract if the pilot phase proves successful.


The Value Criteria will ensure that decision-making bodies seek to maximise the value provided by a service, refraining from solely equating value with the lowest cost. Instead, providers selection should be made based upon a balance between costs and the benefits it brings to both individual outcomes and improved health and wellbeing for the general population. This is intended to ensure value for taxpayers by reducing the burden of ill health over the lifetime of the arrangement and as such reducing the cost.

As with the Quality criterion above, decision-making bodies should determine ‘value’ objectives in line with the need of their local population and national wellbeing initiatives.

When evaluating value, decision-making bodies should consider various elements, including but not limited to:

  • efficiency of the service and associated cost benefits
  • length of contract
  • historic market valuation of certain services
  • benchmarking against other similar services
  • broader local/national financial goals
  • long-term benefits to the service/related services.

When assessing the value of a provider arrangement, decision-making bodies should consider the financial value of the contract throughout its entire duration, especially since some contracts span several years. They should recognise the potential impact of external trends and how the service’s value may evolve over the contract’s duration for example population increases.

Decision-making bodies should also account for any transactional costs associated with changing existing arrangements or establishing new ones. This includes considering the anticipated costs of procurement and the contract itself when evaluating value. For instance, arranging a service with a new provider may save money across a longer-term contract, but if the cost of transitioning, including start-up funding, outweighs the anticipated savings, then decision-makers must reconsider whether this arrangement remains in the taxpayers’ best interest.

Under this framework, decision-making bodies retain the option to test service provision through tendering exercises. In certain situations, this approach can be a useful method to determine the value offered by available providers.

Integration, collaboration, and service sustainability

Ensures that decision-making bodies seek to maximise the integration of services for patients to improve outcomes. Due consideration should be given to how decisions may affect the stability and sustainability of services over time across providers, and that decisions align with local and national strategies for care integration and service coordination.

Integration should be considered from a patient perspective, as to whether the patient’s themselves feel that services are delivered seamlessly, irrespective of whether they are administered by different professionals within one organisation or by separate providers.

Decision-making bodies should assess the degree to which the considered service can integrate with other related service. Selections should avoid unnecessary fragmentation of services and consider how altering a specific arrangement might affect the quality and completeness of the broader patient journey. Providers should be assessed on their willingness and capability of participating in local integration plans when determining whether contracting with it is in the best interests of patients, taxpayers, and the population. For instance, if a provider can clearly demonstrate that its services will integrate effectively into the existing infrastructure and patient pathways, even if the cost is slightly higher than other options, there may be a compelling argument for pursuing this service due to its overarching benefits.

Decision-making bodies should evaluate whether individual services would benefit from a more integrated approach alongside other services.

The following considerations should be considered when evaluating this criterion:

  • The extent to which collaboration and coordination would enhance the provided service
  • The relationships between current provider(s) and connected organisations in the area
  • Relevant geographical factors like the proximity of related services
  • The flow of patient information
  • Whether the working practices, culture, infrastructure, and systems of the involved providers support or hinder integration

Consideration must also be given to the newly planned Triple Aim Duty of

  • Achieving better health and well-being for all
  • Improved care for patients, and
  • Sustainable utilisation of NHS resources

Access, inequalities, and disparities, and choice

This Criterion ensures that decision-making bodies seek to maximise the choices available to patients, and that services and treatments are offered and accessible to all individuals who need them, with a particular focus on tackling health inequalities and disparities.

Decision-making bodies should continue to consider the commitments and rights outlined in the NHS Constitution, particularly those concerning patient and public right to:

  • Access NHS services and not being refused access on unreasonable grounds
  • Expect the NHS to assess the health requirements of the local community and to arrange and put in place the services to meet those needs as considered necessary, and in the case of public health services arranged by local authorities to take steps to improve the health of the local community
  • Not be unlawfully discriminated against in the provision of NHS services, including on rounds of sex, race, disability, age, sexual orientation, religion or belief, gender reassignment, pregnancy and maternity or marriage or civil partnership.

In cases where the decisions might potentially restrict patient choice, careful consideration should be given to whether the broader advantages of the proposal adequately offset this limitation. Additionally, decision-making bodies should explore the inclusion of alternative forms of choice within the arrangement, such as the option of selecting different treatments. Engagement with current and prospective providers may help to:

  • Understand the scope of services they can offer and how choice can be integrated
  • Share information regarding patient preferences and priorities
  • Explore innovation regarding patient choice
  • Incorporate choice into contracting strategies

Decision-making bodies should assess whether services could be enhanced by offering patients the choice of provider or by fostering competition among providers to deliver services. Factors to consider may include:

  • Feasibility of implementing choice (minimum number of patients required to ensure patient safety?)
  • Mechanisms for presenting and providing choices to patients
  • The potential for choice to enhance service quality
  • The possibility that diverse delivery models could expand service accessibility

Decision-making bodies should consider the impact that arrangement will have on:

  • Driving personalised care
  • Supporting population health needs
  • Ensuring access for minority, excluded and vulnerable groups
  • Health inequalities
  • The specific needs of local populations, including geographical and social constraints

Social value and sustainability

This purpose of this criterion is to ensures that decision-making bodies maximise the value created by the arrangements, including recognising the role that healthcare providers play in achieving a net zero carbon footprint. The criteria and metrics for social value will align with guidance on social value published by Cabinet Office and by NHS England.

Due considerations should be given to how decisions affect current and wider sustainability of NHS services over time and/ or in the wider locality. Considerations may include:

  • The financial stability of local services
  • How continuity of other related services will be affected
  • The potential impact on quality, safety and effectiveness of other related and/or dependent services (including those arranged by other bodies)
  • The stability and sustainability of other providers in the short, medium and long term
  • The impact on the ability of the wider market to provide required services in future

Decision-making bodies should consider the impact of their decisions on the local healthcare workforce. This evaluation could include but not be limited to:

  • Retention of a Skilled Local Workforce: Decision-makers should contemplate how their choices may influence the ability to retain a proficient local workforce
  • Availability of Training Opportunities: considerations should include the continued accessibility of pertinent training opportunities for the local workforce, such as apprenticeships, training structures, and clinical placements
  • Impact on Well-Established Teams: Decision-makers must consider the potential impact on well-established healthcare teams directly or indirectly affected by the service
  • Alignment with NHS Workforce Policies: Assessments should assess whether the employment models employed by service providers support workforce policy priorities within the wider NHS

If it becomes evident that the proposed decisions might have adverse effects on the stability, sustainability, or quality of other services, either immediately or in the long term, decision-making bodies should rigorously assess whether these repercussions can be justified by the broader benefits of the proposed changes.

Decision-making bodies should actively strive to ensure that their decisions are aimed at maximising ‘social value.’ This includes making contributions to enhancing social, economic, and environmental conditions within the local area. To achieve this, decision-makers may consider the following:

  • Environmental Sustainability including commitments to waste reduction, water conservation, carbon footprint reduction, and air pollution mitigation as outlined in the NHS Long Term Plan
  • Local Employment: The decisions should consider potential effects on local job opportunities
  • Local Economic Growth: Considerations should be made on how the choices could stimulate local economic development
  • Community Cohesion: The decisions should be assessed for their potential impact on fostering community unity
  • Social Determinants of Health: Decision-makers should consider how their determinations may affect the underlying social factors influencing health outcomes.
  • Population Health and Wellbeing: The broader implications for the health and wellbeing of the local population should also be evaluated

Decision-making bodies should investigate the extent to which service providers have actively enhanced social value within their own activities and how enhancements in social value can lead to improvements in health outcomes.

Social value should not be viewed as a one-time consideration but rather as an ongoing and interconnected aspect of the decision-making process. It should not exist in isolation from the other criteria within this framework. For instance:

  • Integrated Services and Environmental Gains: A more integrated service that reduces patient journeys may also yield environmental benefits
  • Improved Air Quality and Health Outcomes: A service that enhances air quality can contribute to better health outcomes over time, resulting in anticipated cost savings.

The arrangements that decision-making bodies establish for specific services should not hinder the potential for the development and adoption of sustainability measures within those services. They should not create a local provider market that cannot support the growth of new or sustainable services for patients in the future.


Understanding the intricacies of the Provider Selection Regime’s (PSR) Key Decision-Making Criteria will be pivotal in shaping the future of healthcare provision. In this blog, we have explored the Quality and innovation, value, integration, access, social value and sustainability considerations that will underpin the selection and assessment of healthcare service providers and it is clear that under this regime, there is opportunity for transformative change which could positively impact generations to come.

Contact us if you would like to discuss how to prepare ahead of PSRs implementation, including evidence that could demonstrate the criteria discussed in this article, please reach out to our Service Development team via email at anna.bernard@nhs.net or Kieran.mchugh6@nhs.net