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What do GP practice finances hold for 2022/2023?
Read time: 4 mins Added: 23/02/2023
NHS England has rolled out its new contract for GPs, saying “the needs of our populations and patients necessitates the primary focus of general practice returns to addressing non‑Covid needs”. We asked Jane Jordan at specialist healthcare accountants Lentells to take a look at the changes and explain what they would mean financially for GP practices in England – different rules apply to Scotland, Wales and Northern Ireland.
The key changes to the GP contract from 1 April 2022
Here’s a quick summary of the key changes compared with the previous year.
|
|
2022/23 |
2021/22 |
Increase |
|---|---|---|---|
|
Global Sum payment per weighted patient |
2022/23 £99.70 |
2021/22 £96.78 |
Increase £2.92 per patient = 3% |
|
Out of hours deduction |
2022/23 4.75% or £4.73 per patient |
2021/22 4.75% or £4.59 per patient |
Increase £0.14 per patient = 3% |
|
QOF point |
2022/23 £207.56 |
2021/22 £201.16 |
Increase £6.40 per point = 3.18% |
|
QOF national average practice population |
2022/23 9, 374 |
2021/22 9, 085 |
Increase 289 = 3.18% |
|
QOF points |
2022/23 635 |
2021/22 635 |
Increase No change |
Looking at the voluntary annual reward and incentive programme for GP practices, the Quality and Outcomes Framework (QOF), there is little change. While the value of a QOF point has increased, the average population has increased by the same percentage, which means there is overall no additional funding being made available.
This has followed the trend in recent years (although there have been increases in the maximum points available previously). In addition, the Covid protection to some parts of QOF ceased on 31 March 2022, meaning that practices will be paid according to actual performance going forwards.
If we consider the global sum and Out of Hours (OOH) figures according to the average Lentells’ client, looking after 11,300 weighted patients, the position is as follows:
|
|
2022/23 |
2021/22 |
|---|---|---|
|
Global Sum |
2022/23 £1,126,610 |
2021/22 £1,093,614 |
|
OOH opt out |
2022/23 £(53,514) |
2021/22 £(51,947) |
|
Core income |
2022/23 £1,073,096 |
2021/22 £1,041,667 |
This results in an increase in income of £31,429 for a typical client practice.
Staffing and pay
The increase in core contract income has apparently been calculated to accommodate a pay rise of 2.1% for staff and GPs (excluding salaried GPs). The recommended pay increase for salaried GPs has not yet been published, but is expected to be in the region of 2%.
Given the 6.6% increase in the main national minimum wage rate in April 2022, from £8.91 to £9.50, the cost of living crisis and the new health and social care levy, which will add 1.25% to employer National Insurance (NI) contributions, a contract increase of 3% is likely to fall someway short of the amount practices need to cover increased staff costs.
The chancellor made some attempt in the spring budget to reduce the impact of the rise in NI costs by increasing the NI threshold for employees from July 2022, which will help to alleviate some of the impact on net pay for staff, however there is no similar increase applied to the employer threshold. In addition, the small employer allowance, which enables some businesses to reduce NI costs, was increased by £1,000, but this does not apply to GP practices, and so they lose out on any additional government assistance through this.
This does then mean that practices are going to need to carefully consider staffing and pay levels going forwards in order to keep a lid on growing staff costs.
Vaccinations
There are minimal changes to vaccinations in 2022/23, with funding remaining at £10.06 per item of service (IOS), which has not increased since April 2018. The HPV vaccination programme will reduce to a two-dose schedule for most patients, compared with three previously. The 10 and 11-year-old MMR catch up is ending as is the MenACWY freshers programme.
Subject access requests
Additional funding of £20m will remain in place for dealing with subject access requests. This was expected to be withdrawn on 31 March 2022, but will continue for a further year.
Extended hours
One of the more controversial changes planned for 2022/23 applies to extended hours. Currently, most practices take part in extended hours and receive £1.44 per patient directly, but then also have the opportunity to share in additional funding allocated to the CCG of £6 per patient. With effect from October 2022, all of this income will be payable to the Primary Care Network (PCN), and arrangements on how this is shared with practices will vary.
In order to qualify for this income, PCNs are required to offer patients appointments between 6.30pm–8pm weekdays and 9am–5pm on Saturdays. This will become known as the network standard hours and will need to include a range of general practice services, in line with patient preferences and needs. Each PCN will need to offer 60 minutes of appointments per 1,000 patients within the extended time slots.
Funding through PCNs
The above follows the trend for more and more funding to be fed through PCNs. In 2022/23 there will be an increase in overall Additional Roles Reimbursement Scheme (ARRS) funding of £280m, a rise in Investment and Impact Fund (IIF) funding of £110m and an increase in clinical director funding of £43m.
As a result of the planned changes to extended hours, many practices have considered withdrawing from PCN membership. Any such action needs to be considered carefully, as not only will there be a loss to the practice of PCN participation income of £1.76 per patient, the practice will also lose out on access to increasing streams of income going forwards.
Increasing cost pressures
There is no doubt that difficult times are ahead financially for practices. The main pressure is likely to come from rising staff costs and a drop off in Covid vaccination income, which has given many practices a significant welcome boost in profits over the past couple of years.
Jane Jordan is a director of the specialist healthcare team at Lentells accountants, specialising in advising GP practices. To find out more about the services offered visit the Lentells website.