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Wednesday 28 September 2016
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The bottom line on 2010 funding changes

Legal & Finance

DEBORAH WOOD
BSc(Hons) FCA

Specialist Healthcare Partner
Moore and Smalley

Deborah is Specialist Healthcare Partner at Moore and Smalley and an Executive Member of the Association of Independent Specialist Medical Accountants (aisma). She is invited to speak at seminars across the country, to both doctors and practice managers, on a wide variety of financial management topics, and also contributes articles and comments to the medical press on a regular basis. In June 2008, Deborah received the Health Investor Accountant of the Year Award on behalf of the Moore and Smalley medical team

Understanding last year's results and considering which figures are likely to change during 2009/10 requires an understanding of the changes to the underlying General Medical Services (GMS) contract. For 2008/09, the changes to the Statement of Fees and Entitlements affecting gross income included a number of factors.

With effect from 1 October 2008, an uplift of 2.7% in the gross global sum came into effect, following a recommendation by the Doctors' and Dentists' Review Body (DDRB). While this introduced an additional £5m into the system, the DDRB recommendation also included a provision for zero uplift in the minimum practice income guarantee (MPIG).

Since only 7% of practices at that time were not reliant on the MPIG, most practices will have therefore seen an uplift in global sum but an equivalent reduction in their correction-factor payment.

Practices should double-check primary care trust (PCT) calculations for the reallocation between global sum and correction-factor elements to ensure they are correct. These are based on a practice's weighted list size at 1 April 2008. Temporary patient adjustments are made based on the actual number of such patients in 2007/08.

The global sum baseline payment increased to £56.20 in 2008/09, with no change to the London adjustment. Remember that there is a 6% deduction for opting out of out-of-hours based on the global sum figure, so that will have increased.

For the 7% of practices with no correction factor, the increase in global sum backdated to 1 April 2008 should have been calculated and paid as a lump sum. Other factors affecting gross income included:

  • Minor changes to the statistics used in calculating childhood immunisation payments.
  • From 1 October 2008, an uplift in Quality and Outcomes Framework (QOF) aspiration payments to 70% from 60% (backdated to 1 April 2008).
  • A new Annex D with a reallocation of points relating to PE7 (48-hour access) and PE8 (advance booking).

The GP Patient Survey
The payment for final QOF achievement was put back to June after the year-end to allow for collation of the GP Patient Survey results. With points for PE7 and PE8 dependent on the results, the survey has had a significant impact on many practices. Thresholds for both these indicators increased, from 50% to 70% for PE7 and from 40% to 60% for PE8.

Many GP practices appear to have lost out on significant amounts of income. Nationally, a 38% response rate was achieved but for some practices it was less than 1% and hardly representative. The survey sought patient views on making an appointment, satisfaction with opening hours, and quality of care from GPs and nurses, but there appears to be no correlation between practice list size and the number of patients in the practice who received a survey.

The analysis of the results will be used to reward a high standard of access, to assist patient choice when registering with a practice and to measure practice achievement against standards set. Yet many practices with greatly improved access systems and that offer extended hours services have done badly under the survey while others, who have not updated their procedures, have done well.

The 2007/08 improved access directed enhanced service (DES) ceased on 31 March 2008, and from 1 October 2008 an extended hours DES was introduced, This is paid quarterly in arrears at £2.95 per registered patient. Additional routine appointments with GPs have to be provided outside the surgery core hours. The amount of time to be provided depends on the list size.

A local enhanced service (LES) can be agreed instead, and in some cases these were effective from 1 April 2008. Half of all practices per PCT should have been signed up by December 2008 to either the DES or LES. For many practices the opportunity for half or three quarters of a year's access income has been lost (see Table 1).

[[DW_Tab1]]

  • Five new DES were also introduced on 1 October 2008:
  • Alcohol-related risk reduction scheme.
  • Ethnicity and first language recording scheme.
  • Learning disabilities health-check scheme.
  • Osteoporosis diagnosis and prevention scheme.
  • Heart-failure scheme.

The IM&T scheme has rolled forward to enable payments to be made in 2008/09.

Anticipating 2009/10 results
A disappointing top-line increase is likely to impact on results for 2009/10. The DDRB recommendation of a gross 2.29% uplift was applied with effect from 1 April 2009. However, the uplift was applied differentially to four income streams (see Table 2) with the aim of increasing net income by only 1.5%. Savings in correction-factor payments are recycled into the global sum through the calculation process.

[[DW_Tab2]]

Some practices should be in a stronger position than before, however. Stuart Cowen, a member of the Association of Independent Specialist Medical Accountants (aisma) and partner at Plymouth accountancy firm Francis Clark, says: "The distribution of the 2009/10 pay rise for GPs has given some welcome relief to lower-earning GMS practices that were stuck with a historically small correction factor.

"While those practices with a large correction factor will have seen a fairly minimal increase in their baseline income, those with low correction factors have this amount eliminated, with a tangible increase in their baseline income for the first time since the new contract began."

The square-rooting formula for prevalence was removed with effect from 1 April 2009. Generally this is believed to redistribute available funding but there could be some significant losers. If a loss affects service provision, practices are advised to discuss with their local medical committee and PCT ways in which to commission services to address local health needs and potentially enable the practice to access the lost income.

Mr Cowen says: "Worryingly, some practices appear to be unaware of the impact that changes to the prevalence calculations will have on their QOF income. A large number of practices seem to assume they will not see a huge fall in income, but few seem to have actually quantified the figures with the PCT."

He adds: "The impact of these changes in funding will not be felt by practices until June 2010, and it is important that practices take action sooner rather than later to quantify the effect, and start negotiations with the PCT if possible, to try and minimise any potential shortfall."

QOF changes
In 2009/10, the value of a QOF point increases from £124.60 to £126.77. The QOF has again been adjusted, with 55 points reallocated from the existing local survey, two points from the existing contraception indicator and 15 points from other clinical indicators to a new list of indicators covering:

  • Prevention of cardiovascular disease development in patients with hypertension.
  • Improved advice and choice on contraception.
  • Depression indicator to reduce early cessation treatment.
  • Improved chronic kidney disease indicators.
  • Improved diabetes indicators.
  • Improved chronic lung disease indicators.
  • Beta-blockers for heart failure (previously a DES).

From 6 April 2009, the GP Patient Survey will be issued quarterly, with a view to 1.4 million patients taking part. The survey has been expanded to assess patients' experiences of local delivery of NHS services; fast, convenient access and the all-round quality of the patient experience.

The extended hours DES continues until 31 March 2010, and practices have until 31 December 2009 to apply for it. The rate increases to £3.00 per patient.

In all the above areas, the Department of Health recommends an equitable approach for personal medical services (PMS) practices.

Resource
Department of Health – Primary care contracting