Sarah Cousins is an independent management consultant with over 25 years’ experience in primary care, both as a provider and commissioner, supporting practice development and resilience
Practice finances are being squeezed. Hard. And whilst the GP Forward View is on target to meet its pledge of a funding uplift of £12 billion into primary care by 2020/21 through the core contract, it’s disappointing that so far little, or discernable progress has been made over the last year in leveraging additional investment from the rest of the system into primary care. Add to this that any investment or uplift generally comes with a multitude of strings attached, targets to meet, and general extra work, bureaucracy and complexity, rather than addressing long term under funding, GPs are generally wary of announcements of extra cash.
Furthermore, in the budget at the end of October there was no specific ring-fencing of funding for General Practice in the same way as there was for mental health. In fact, general practice investment is increasing at a slower rate compared to last year, and the proportion of the NHS budget going into General Practice, excluding reimbursement of drugs, has fallen from 9.6% in 2005/06 to 7.9% In 2016/17. This means that an extra £2 billion could have gone into General Practice if funding met the levels of 2005/06. Add to this that current investment falls some £3.7 billion short of the BMA’s target of 11% of the NHS budget being spent in primary care.
It’s against this backdrop that, in August 2016 there was a joint statement from NHS England and the BMA, where it was announced that detailed negotiations were starting on a new funding formula for general practice. The target date for that new funding formula was set for April 2018 – and not a moment too soon. It should perhaps come as no surprise that we’re now almost at the end of November and there’s still no sign of a new funding formula, and no indication of when we might see it.
At this point it’s probably worth a reminder that current core funding for general practice is based on the Global Sum allocation formula, which was developed by Professor Carr-Hill as part of the introduction of the 2004 version of the GMS contract. The formula is weighted for factors that influence relative patient needs and cost, and was developed to take into consideration the following factors:
- Patient age and gender
- Additional needs
- The number of newly registered patients in a year
- The cost of living in some geographical areas
- Patient age and gender
However, at the outset the formula was found to be flawed, with many practices finding that they would be worse off under Global Sum payments than they would be under the existing “Red Book” funding of the 1990 contract.
Rather than go back to the drawing board, the Minimum Practice Income Guarantee (MPIG) was introduced at the beginning of the 2004 contract, to ensure that no practice would be worse off under the new contract than they were under the 1990 contract. The MPIG was only meant to be a temporary arrangement, with practices only remaining on this payment until their Global Sum allocation caught up as it was increased each year. Unfortunately, as the country ran into times of austerity, and funding into general practice effectively stalled and then reduced, many practices continued to rely on the MPIG, as it remained higher than their Global Sum allocation.
It, therefore, came as a bit of a blow to many practices when it was announced that the MPIG would be phased out over a 7-year period, starting April 2014. Add to this that all practices working under PMS contracts would have those contracts reviewed in order to bring weighted patient income in line with GMS practices, and many practices established that they would be worse off. In some cases, this was significantly worse off. As an example, one practice I’ve worked with, with a patient population of 4,000, will see its core contract income reduced by £175,000 by 2020/21 under these arrangements.
So, has the delay in this announcement had any effect on General Practice?
The answer is probably not. For those of us working at the coal face day in day out, it’s a case of same old, same old; promises and assurances being made, but no delivery – not at this point, anyway. If there’s frustration, it’s not so much at the fact that yet another announcement on a potential increase in funding has been delayed, but the fact that whatever that announcement is, it would need to herald a huge shift in the allocation of resources to primary care. And as we know from the budget announcement, there was no specific ring-fencing of funding into primary care, so realistically any change in the funding formula is likely to be tinkering at the edges – and who knows, some practices could, again, find themselves worse off.
Put it another way, if General Practice had the 11% of the NHS budget that it used to have, this would mean additional investment of £14.5 billion a year into primary care. Unfortunately, any change in the allocation formula realistically is not going to bring funding back to those levels; not at this point, anyway.
In fairness, even if that kind of investment was made, whilst I’ve no doubt that it would solve some of the problems, it wouldn’t solve all of them. Money won’t have GPs feeling less demoralised or less under pressure. To do that means taking a step back and looking at how best to utilise the income practices have and make the working day a better one than it is currently. That means making tough decisions on what work do to do (I advocate only work that’s properly commissioned and funded) and what work to stop doing – in other words, work that isn’t properly commissioned or is either underfunded or not funded at all.
In doing that, general practice will lift a lot of the workload burden it has and start to focus commissioner minds on properly commissioning services that are deemed to be “good for the patient”. What is clear is that if general practice continues to see its core income drop and it doesn’t react and cut its cloth to match the budget, we are likely to see many more practice closures, which definitely is not “good for the patient”.
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