Writing the Business Case for a New Independent Clinical Site That Sells Capacity to the NHS
Writing the Business Case for a New Independent Clinical Site That Sells Capacity to the NHS
The commissioner's question is whether your site adds reliable capacity at acceptable quality and price, not whether the building is impressive. Your business case must demonstrate clinical safety, pathway fit, workforce resilience and price certainty before anyone looks at bricks and mortar.
Independent sector providers selling capacity to the NHS face a different scrutiny than private-pay operators. Integrated care boards and NHS trusts care about waiting-list clearance, contract exit risk, and whether your unit can be staffed without poaching from the local acute trust. The business case you write for investors or lenders will not convince a commissioner.
What commissioners actually score
Most capacity procurement now happens under the Provider Selection Regime, particularly the most suitable provider process when the ICB has already decided to commission independent capacity. Your submission is scored against weighted criteria, typically clinical quality and safety around 40 to 50 per cent, workforce and operational continuity 20 to 30 per cent, and price 20 to 30 per cent. The commissioner is not buying a facility. They are buying guaranteed theatre slots, diagnostic sessions or bed-days that do not fail halfway through a contract because you cannot recruit scrub nurses.
Quality scoring focuses on CQC readiness, clinical governance structures, incident reporting routes and whether your medical advisory committee includes anyone the ICB already works with. The evaluator wants evidence you understand NHS pathways, not private pathways with NHS patients bolted on. If your orthopaedic service assumes patients self-fund physiotherapy afterwards, the pathway does not work. If your endoscopy suite requires GPs to arrange follow-up without a clear referral protocol, you have introduced a gap.
Workforce scoring penalises reliance on the same staff pool the NHS trust is trying to retain. If your rota depends on consultants who already have local NHS sessions, or your nursing model requires agency staff from the same suppliers the trust uses, the commissioner sees displacement, not additionality. A convincing plan names retired consultants returning part-time, shows training partnerships with universities outside the immediate area, or provides letters of intent from clinicians relocating. One provider won a Somerset ophthalmology contract in part because the workforce plan included recruitment from Ireland and a shared training programme that increased overall local capacity rather than competing for it.
Price is often a simple cost-per-case comparison, but commissioners also score risk of variation. A fixed-price tariff for 12 months with named exclusions scores better than a headline discount that turns into supplements for complex cases. Financial resilience matters because the ICB does not want to re-procure in 18 months when your cashflow fails. Expect requests for parent company guarantees, evidence of working capital, and a transparent explanation of how you remain solvent if NHS referral volumes undershoot your model by 20 per cent.
Demand and referral evidence that holds weight
Your case must prove demand exists and that referrals will flow. Waiting-list data from the local trust is public through the provider's own reporting, but the ICB will want evidence you have spoken to surgical leads, diagnostics managers and GP federation chairs. A table showing 800 patients waiting more than 40 weeks for hip replacement is context. A letter from the orthopaedic clinical director confirming referral pathways and thresholds is evidence.
Many independent providers overestimate referral conversion. Patients on a waiting list for the NHS trust may not accept an independent sector offer if travel is harder, or if they mistrust a provider they have not heard of. Commissioners know this. Your demand case should reference realistic conversion rates, supported by patient-choice data from similar contracts elsewhere. If you assume 90 per cent acceptance and the local norm is 65 per cent, your capacity model collapses.
Pre-notice engagement is not optional. Before the ICB publishes a tender or direct award notice, they will have discussed need, specification and market capacity with potential providers. If you appear only when the notice is live, you are too late to shape the requirement. ICBs often hold market engagement events six to nine months before formal procurement. Attending those, and following up with written submissions on what capacity you can offer and at what lead time, builds your credibility and often influences lot structure or contract length.
Illustrative structure of a commissioner-facing business case
A worked example for a proposed 30-bed short-stay surgical unit offering orthopaedics and general surgery to an ICB covering 600,000 population might look like this.
Executive summary in two pages: headline capacity offer (1,200 orthopaedic procedures and 800 general surgery procedures per year), price per case (for illustration, comparable to national tariff or a stated discount), CQC registration timeline, workforce model, and financial backing. Commissioners read this first and decide whether to continue.
Section one covers demand evidence. Waiting-list data by specialty, ICB elective recovery targets, referral pathway agreements with named clinician leads, and patient travel analysis. Include a demand scenario: if current trust capacity is 2,000 hip and knee cases per year and the waiting list stands at 1,400, your 600-case contribution over 18 months is material. If the trust is already recovering and the waiting list is falling, your case weakens unless you can show seasonal or long-term structural need.
Section two covers clinical quality and safety. CQC registration plan with milestones, clinical governance framework, infection control protocols, safeguarding leads, medical advisory committee membership, and how incidents are reported to the ICB and the trust. Provide organograms, draft policies, and evidence of clinical leadership. If your medical director is a retired NHS consultant with 25 years in the local trust, say so.
Section three covers workforce. Name your clinical leads, show recruitment evidence (contracts, letters of intent, or recruitment agency agreements specifying geography), explain nurse staffing ratios, and prove you are not competing directly with the trust for the same people. Include a risk register: what happens if a key consultant leaves, and how you mitigate.
Section four covers operational delivery. Theatre session plans, equipment lists, pharmacy and pathology arrangements, patient transport solutions if needed, and IT integration with NHS systems for referrals, results and discharge summaries. Commissioners want to see you have thought about the boring detail that makes a pathway work.
Section five covers finance and contract risk. Price schedule, exclusions, variation clauses, parent company guarantee if applicable, and a sensitivity model showing you remain viable if referral volumes are 20 per cent below plan. Include your break-even point and evidence of working capital or a credit facility.
Section six covers timeline. CQC registration, building fit-out if not complete, equipment commissioning, staff onboarding, and a realistic go-live date. Optimism here damages credibility. If you say three months and the evaluator knows CQC registration alone takes four, your whole case is discounted.
Pathway fit and the integration question
Commissioners increasingly care about how your service fits the broader pathway, particularly under integrated care system thinking. A standalone surgical unit that does pre-assessment, surgery and discharge but has no link to community rehabilitation or virtual wards creates a gap. Your business case should explain how patients move into your service (referral protocol, choice process, pre-assessment pathway) and how they move out (discharge summaries, therapy handover, follow-up arrangements).
If your model includes elements that improve overall system flow, such as seven-day working, early-morning lists that free up trust capacity, or a step-down facility that releases acute beds, those are worth highlighting. One provider in the Midlands secured a contract in part by offering weekend diagnostic slots that allowed the trust to reduce backlogs without weekend premiums for its own staff.
Do not assume the ICB wants to outsource entire pathways. They may want to buy specific capacity pinch-points: MRI slots, endoscopy lists, or straightforward day-case surgery. Your business case should be modular enough to offer different configurations rather than an all-or-nothing model.
The Provider Selection Regime and framework routes
As of 2026-11-03, most new independent sector capacity is procured either through a most suitable provider process under the Provider Selection Regime or through national frameworks such as NHS P23 for specific procedure types. If the ICB has already decided to commission independent capacity and your site is the only or clearly most suitable option, the direct award route is faster than competitive tender. Your business case then supports the ICB's own internal decision and the published decision notice, rather than a scored bid.
If multiple providers are credible, the ICB will run a competitive process. Your business case becomes a tender response, and everything in it will be scored. Understanding what the evaluators actually prioritise, what evidence they trust, and what risks they fear is the difference between a case that wins and one that looks plausible but finishes second.
Frameworks such as RM6291 NHS P23 allow trusts and ICBs to call off capacity without full OJEU procurement, but you must already be on the framework and within the relevant lot. If you are not, the time to apply is during the framework's supplier refresh windows, not when a specific contract appears. Framework applications themselves require business-case evidence: financial standing, clinical quality history, workforce resilience, and contract performance data. The work is similar but the audience is the framework authority, not the end commissioner.
Frequently asked questions
Do I need CQC registration before submitting a business case or tender response?
You do not need full registration, but you must demonstrate a credible timeline and show you understand what CQC will assess. Most commissioners will accept a business case from a provider in pre-registration dialogue with CQC, particularly if you can evidence similar services already rated good or outstanding elsewhere in your group. If you have never been through CQC registration and have no track record, your case will struggle unless you bring in experienced clinical leaders who do. Submitting a case with no CQC engagement at all is usually fatal.
Can I reference letters of support from local GPs or consultants, and do they carry weight?
Yes, and they carry significant weight if they are specific. A letter from a GP federation chair saying the practice would refer suitable patients through NHS e-Referral, explaining criteria and expected volume, is strong evidence. A generic letter saying the area needs more capacity is weak. Similarly, a letter from a consultant confirming they will work in your facility, stating sessions per week and start date, is evidence. A letter saying they support the idea in principle is not. Commissioners are experienced at distinguishing between real commitment and polite encouragement.
How should I handle price in a business case if I am not yet in a formal procurement?
Provide a clear, realistic price structure even in early-stage business cases. Commissioners use pre-procurement cases to test affordability and compare options, so a vague statement that price will be competitive is not enough. Quote a cost per procedure or per bed-day, specify what is included and excluded, and explain assumptions such as contract length or minimum volume. You are not legally bound by a price in a business case, but if your later tender price is materially different without explanation, you lose credibility. Transparency on price early also helps the ICB decide whether the business case is worth pursuing or whether affordability kills it before procurement starts.
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