Consultant partnerships (LLPs) working in an NHS Trust – is this insourcing or outsourcing?
Insourcing
The term “insourcing” has become a common term within the NHS recently. Typically it is used to describe an arrangement where a Trust contracts with an external clinical provider of services, but where the provider delivers their clinical services using Trust premises and equipment.
This scenario is the one that would best describe the arrangement between an NHS Trust and a consultant partnership (LLP). The LLP provides a package of clinical services outside of standard working hours, using vacant Trust facilities.
Outsourcing
A typical “outsourced” service would be, say, an NHS Trust outsourcing patients to the local private hospital where the services are fully delivered within the private hospital facilities.
However…
confusion can arise because a contract with a consultant LLP where the work takes place within the NHS facilities, whilst being described as an insourced contract, is actually an outsourced contract for services in contractual terms and as far as HMRC is concerned. The LLP is a business within its own right, with its own costs, liabilities and more often than not a payroll.
But why does the terminology of insourcing or outsourcing matter?
Both terms are used in procurement conversations, however without a detailed understanding of what they mean, it can make a huge different to how a Trust perceives the LLP model, how the contract is structured and whether the arrangement falls inside or outside of IR35 legislation.
It is therefore essential that NHS Trust management obtain specialist advice when considering whether and, importantly, how to contract with an LLP.
Where do they find this? I would either recommend approaching a specialist LLP business management company such as Trust Health for advice or obtaining it from a legal firm who specialises in healthcare contracting and IR35.
If you would like further information regarding insourcing or outsourcing please contact [email protected]
