Accountants: PCNs will strip £400m from practice funding

Primary care networks (PCNs) will strip £400m from practice funding by 2023/24 to pay for additional staff but will fail to reduce GP workload, accountants have warned

Responding to the NHS England consultation on draft specifications for the network DES, the Association of Specialist Medical Accountants (Aisma) warns that the current plans increase practice workload rather than reducing it.

As a result, it says, the 30% contribution practices are expected to pay towards the cost of hiring the bulk of 20,000 new staff set to be recruited through PCNs – equivalent to around £400m by 2023/24 – cannot be justified.

The Aisma response says: ‘Practices will only accept paying the 30% element if it is having a positive impact on the workload involved in doing the core work and if they can fund it, for example by reducing locum costs.

GP funding

‘This specification doesn’t do this at all. It increases workload by bringing in work not currently done. And practices must fund 30% of the cost.’

Warnings from accountants over PCN recruitment costs for GP practices follow analysis from a leading LMC that practices in England could lose more than £100,000 a year on average because of the workload implications of draft network DES specifications.

The Aisma analysis adds that for practices that had already employed staff such as clinical pharmacists – which are among the additional roles funded through PCNs – the additional roles reimbursement scheme creates a serious dilemma.

If these practices do not need to expand their workforce further, ‘quickly finding 30% means either cutting existing staff or cutting existing profits, or not employing PCN staff’, Aisma says. It adds: ‘The obvious route is the latter.’

GMS contract

Aisma questions whether a DES is the right vehicle for the formation of PCNs – warning that networks have ‘struggled with organisational structure partly because the DES doesn’t fit well with VAT and PAYE tax rules’.

The association adds that as a ‘practice-specific contract’, the DES is ill-suited to provision of services across multiple organisations – and calls for urgent talks between the BMA, NHS England and HMRC to find ‘a pragmatic solution to avoid creating tax and NHS pension issues which are not in the public interest.’

The response adds: ‘Should this really be a DES? For PCNs to make a real difference to community health they will have to bring in services outside the NHS, for example working with the charitable sector. Should that really be a bolt-on to the GP contract?’

Aisma warns that because the terms of a DES are set nationally although ‘the problems of rural practices are completely different from the problems of inner-city practices’, national terms and conditions ‘and removing local knowledge and choice is a backward step in terms of healthcare delivery’.

Financial risk

Meanwhile accountants raise concerns that where practices are already delivering services that overlap with work set out in the network DES, funding could be withdrawn. Aisma warns that this funding must be ‘ring-fenced for primary care’. The response also highlights the need to protect PCNs and their member practices from financial risk at the end of the five-year contract period – warning that ‘if the funding stops then the redundancy costs and risk remain with the practices’.

The Aisma response came as consultation on draft network DES plans closed on 15 January. NHS England has suggested it is open to a rethink on the controversial proposals, which have drawn sharp and widespread criticism across general practice.

NHS England director of primary care and system transformation Matt Neligan wrote on Twitter this week that there had been ‘lots of feedback to date that tells us we need to make changes’, adding that NHS England was ‘committed to doing just that’.

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