§ Mr. MorganTo ask the Secretary of State for Wales what source of information is available to Welsh health authorities as purchasers on comparative prices for standard orthopaedic operations; what guidelines are given to health authorities in relation to baseload and marginal prices in quotation and final accounting procedures both between health authorities and within health authorities; and if he will make a statement.
§ Mr. Gwilym JonesProviders routinely inform their purchasers of proposed prices to inform contract negotiations. On request, they also make in-year information on prices available to purchasers. Where the service is provided, tariffs include separately identified prices for orthopaedic procedures.
Guidance on setting prices was issued to health authorities in October 1990. This emphasised that providers must price their services on the basis of full costs. Marginal costs should be used only when providers are able to offer additional services, in-year, making use of unplanned spare capacity. Activity purchased in this way should be reflected in a future year's contract on a full and not marginal cost basis.
The detailed accounting requirements which health authorities should follow in completing their annual accounts and financial returns are given in the "Health Authority Manual for Accounts".