Homecare providers challenge HSE over tenders for contracts

Forty-two companies involved in providing private homecare services have brought a legal challenge to the HSE’s handling of three home care contracts valued at €148 million. A key part of the claim is the provision of grants for care service providers amounts to unlawful State aid in breach of EU law.

The companies claim the HSE breached EU public procurement law in deciding two of the contracts – the Home Help Services (HHS) contract and the Under-65 contracts – should not be put out to public tender while the third – the Home Care Provision (HCP) Contract – should be.

Mr Justice Peter Kelly yesterday accepted arguments on behalf of the HSE that delay in bringing the case disentitled the companies to have the hearing fast-tracked in the Commercial Court, meaning the case will now proceed via normal High Court procedures.

In an affidavit on behalf of the companies, Michael Harty, Home Care Plus Ltd chief executive, said there should have been a HSE public tender process concerning the HHS and Under-65 contracts instead of entering into arrangements with “assisted operators” who were paid inter alia through grant funding under the Health Act.

It was their case that the subsidisation of the assisted operators amounted to unlawful State aid, created a structural bias in the market and distorted the procurement process.

The companies were also challenging the tender process adopted by the HSE for the award of the HCP Contract. That was a procurement process in relation to differently defined homecare services which, Mr Harty argued, were in substance identical to those provided under the HHS and Under-65 Contracts.

All 42 companies are members of Home and Community Care Ireland Ltd, established to represent the interests of private homecare providers here. Mr Harty is president of that organisation. Before the disputed decisions made by the HSE on the contracts, he said he had raised various concerns, including that private providers were not eligible for section 39 funding.

It was only when the invitation to tender documents was published last April the companies that they were in a position to identify the frailties of the tender process, he said. The procedure put in place by the HSE was, he said, designed to neutralise the advantage assisted operators had when tendering due to their being subsidised via grants from the HSE.

Because of that subsidisation, the prices put forward by assisted operators were not in fact the prices ultimately charged. There was therefore no equality between assisted and non-assisted operators regarding price evaluation in circumstances, where price was the whole award criteria. Mr Harty said the HSE had been asked to suspend the tender process pending a decision on the companies’ complaints but had refused to do so.