Finance

GP practices are funded almost exclusively from their contract with NHS England, whether it is a GMS, PMS or APMS Contract. There are a significant number of income streams associated with this contract and it is often difficult to keep a track on the various income streams. There have been too many instances where practices have received payments without any covering information on what it is for.

As independent contractors GPs are responsible for their own finances. This is an area which often causes difficulties and requires sound financial systems within the practice. There is a concerted attack on practice finances in the light of the current economic climate resulting in falling incomes and profitability.
This is coming from a number of quarters and includes:

  • Removal of historic funding streams whist expecting practices to continue doing the work
  • Offering back these funding streams but for extra work
  • Delays in receiving payments arising from the reorganisation and fragmentation of the NHS such that practices now have several paymasters
  • Services previously centrally funded being unilaterally withdrawn leaving practices / individual GPs to pay for the service if they want it.
  • Increased workloads and transfers from secondary care without any commensurate resources
  • The equalisation agenda to remove MPIG from GMS practices and review core funding for PMS practices

In the light of the contract changes imposed in March 2013 the BMA have published a “Survival Guide” giving an analysis of the factors practices need to take into consideration whether to undertake a particular enhanced service or QOF domain. Locally we have drawn this together from the BMA website into one ready reference document.

It has been a temptation in the past to do everything that was on offer without giving consideration to the costs involved. Practices now need to decide whether the income on offer actually covers the cost of providing the service; otherwise the practice ends up giving the extra service but at a financial loss.

In these times of financial stringency coupled with unprecedented workload demands practices need to consider whether they have the right staffing levels and skill mix to carry out the tasks they require to do. Many external organisations have already suggested that partners may wish to review and reduce their drawings.

Practices should have sound policies around financial management and banking issues to avoid losses. Preparing and monitoring against a cash flow forecast can often help identify, at an early stage, if things are going wrong.

The LMC is happy to help practices with practical issues, which are often inextricably linked with business planning, changes in the practice skill mix and premises issues. When we feel you need expert help we will advise you to utilise the services of a specialist medical accountant who has access to industry standards. LMC will happily supply a list upon request.

If you think you need any help, please contact us!