A guide to financial planning for primary care network leaders

If you want to reduce your chances of conflict, the importance of planning well and dedicating time to discuss, agree and document your financial plan cannot be understated – Tara Humphrey discusses.

CREDIT: This is an edited version of an article that originally appeared on The Primary Care Network Specialists

There are many benefits to having a solid financial plan. They aid decision making, reduce conflict, and promote trust and transparency.

When putting together your financial plan, there are eight things to consider:

Start with last year’s accounts

Spend some time looking over last year’s accounts and using this as the basis for creating a new financial plan which pulls recurring costs to give you an idea of this year’s expenditure.

Compromise is key

A meeting of such magnitude, involving different parties, with differing views, wants and issues, is likely to be subject to debate and disagreement. The only way through will be for everyone to accept that they may not get everything they want, and that compromise will be required on all sides.

Consider your overarching strategy

Will your finances be managed centrally, or will you divert or devolve some of your budgets to individual practices or services?

What investment is required and when? Do we have the opportunity to flex our approach if required further down the line?

Identify your funding streams and how to best utilise each

At the time of publication, there are nine funding streams currently available to primary care networks.

These include:
Clinical Director Payment

• This is directly allocated to your Clinical Directors.

PCN Core Funding

• This can be used to cover your infrastructure costs; so any subscriptions and/or hardware. The funding can also be used to top up any gaps in salary costs above and beyond the ARRS pot.

PCN Leadership and Management Payment

• This supports the payment of your PCN’s operational management team (and administrators) but can also be used to top up the Clinical Director support payment.

Impact and Investment Funding (IIF)

• Ensure that there is a meeting at board level to review last year’s allocation and agree on how and where the funding will be reinvested.

Keep collaboration and at-scale working front of mind

If your intention is to simply divvy up funding payments between practices, keep in mind that the establishment of shared principles, mutual understanding, and collaboration is key when it comes to working at scale.

Allocation of regular payments should be agreed upon from the outset.

Interlink your financial plan and your workforce plan

Particularly where the Additional Roles Reimbursement Scheme (ARRS) is concerned, consider the needs of the network and where extra costs, such as costs for training and equipment, may lie when it comes to recruiting to these roles.

Support will need to be balanced and equitable across the financial year. Keep in mind also that the ARRS pot may not adequately everything, so extra monies will be needed.

Be honest about how well your finances are being managed right now

Can you easily answer:

• How much money is in the bank account today?
• Are there any payments owing, and if so, to whom (network to practice or vice-versa)?
• Should we (or do we) use a spreadsheet or a dedicated electronic accountancy system?
• What’s our governance framework for the management of our finances?
• Is there anything that we can improve on?

Lean on your accountant

Where possible, commission an experienced accountant who specialises in providing financial services within Primary Care. The value of this cannot be underestimated as a specialist accountant can offer advice about how others manage their finances and what tools or applications could support you.