The internal market--exposing clinical services to competitive tendering

There exists in the National Health Service a history of compulsory competitive tendering for equipment and services (e.g. medical equipment, building construction). However, introduction of the internal market has galvanized some purchasers and providers to market test clinical services. Perceived shortcomings in the urology service in Walsall led to the Health Authority undertaking such an exercise.

A formal tendering process was undertaken by the Health Authority in the winter of 1993-1994 for the provision of the urology service.

Three provider units tendered for the provision of the urology service, with the contract being awarded to the local provider, who submitted a bid for an enhanced level of service in terms of quantitative and qualitative measures.

Market testing is a complex and lengthy process but can produce improvements in the quality of services. It is unlikely that many Health Authorities are fully aware of the issues involved in undertaking such an exercise. Major consideration needs to be given to the definition of the service required and objective measurements of service quality. Few such measures are as yet routinely available.