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A company part-run by an NHS trust has launched a legal challenge against a neighbouring integrated care system over a £500m pathology contract.

The rollout of a new integrated pathology service across Hertfordshire and West Essex ICS has been delayed as a result of legal action raised by a trust in a neighbouring system.

A contract notice was first issued in 2019 for a 10-year outsourced pathology service to cover the acute trusts in Hertfordshire and West Essex. In October 2022, the commissioners selected Health Services Laboratories, a joint venture involving two large London trusts, and the contract was expected to be formally awarded in August this year.

However, papers now filed in the High Court reveal how a separate joint venture between Mid and South Essex Foundation Trust and diagnostics provider Synlab has claimed the ICS broke procurement regulations. They claim the commissioners had previously issued a “best and final offer document” to the different bidders, with a requirement that suppliers accepted the draft agreement without any amendment.

Pathology First then withdrew from the process in February 2022, as they felt they could not agree to the terms without amendment, but says it then discovered the terms and conditions of the awarded contract differed from those in the draft agreement.

The ICS had planned to roll out the new integrated pathology service from summer next year. A spokeswoman said: “We are currently having constructive discussions with Pathology First. We are hopeful that we will shortly be clear about how we are going to proceed.”

They said the service continued to be delivered by pathology teams at West Hertfordshire Teaching Hospitals, Princess Alexandra Hospital Trust and East and North Hertfordshire Hospitals in the meantime. An NHS Improvement review in 2019 placed the trusts in a collaboration group involving providers in north west London, suggesting this could lead to annual savings of £8m. Local sources suggested a larger scale provider would offer more staffing resilience, better access to more specialised tests, and economies of scale. Pathology First said in a statement: “We are in constructive discussions with HWE and expect an imminent resolution.” MSEFT did not comment separately.

HSL is a joint venture between The Doctors Laboratory, Royal Free London and University College London Hospitals.

Source: HSJ

Date: 19 December

Posted in News on Dec 19, 2023

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