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Financial implications of the GMS contract 2014/15

With the 2014/15 GMS contract details announced last Friday, specialist medical accountant Laurence Slavin outlines key changes.

It is not yet known how core funding will be distributed (image: iStock)
It is not yet known how core funding will be distributed (image: iStock)

As always, the devil will be in the detail but a review of the GMS contract 2014/15 details, announced on November 15, suggests the following financial effect.

These projections and calculations are based on an average practice with a list size of 6,487 patients. Download the attached spreadsheet for gains and losses (right).

QOF

The changes (download attachment, right) move 238 points into the core budget. Note carefully that any funds moved into the core budget will  not suffer a loss of 6% if the practice has chosen to opt out of out-of-hours work.

Three points are moved to the learning disabilities DES and 100 points to the new unplanned admissions DES.

Overall, the 341 points will reduce the average practice’s income by £53,509.

Seniority pay

Seniority payments will go by 2020. It is stated that the present scheme will continue until then, with annual increments available as before, but there is a commitment that the annual spend from the seniority pool will reduce by 15% per annum.

The monies saved will be put into core funding.  If the average practice has (say) £10,000 of income from seniority it should expect to lose £1,500

Unplanned admissions DES

Overall funding for the unplanned admissions DES will be £160m. A total of 100 QOF points will be moved to this, representing £118m of this funding and £42m from the Risk Profiling DES.

Since 100 QOF points for the average practice are worth £15,692, the total income for this is likely to be £21,280 for the average practice. The requirements are acknowledged to generate a significant amount of work and practices will need to assess the costs of undertaking this.

Other enhanced services

From a financial perspective the dementia, alcohol and extended hours DES will continue with some practical changes.

Learning disabilities will gain another three points – adding £470 for the average practice.

Patient participation DES funding will reduce by two-thirds to around 36.5p per patient, reducing the income for the average practice from £7,135 to £2,616. The loss of £4,519 will be reinvested in the core budget.

The remote care monitoring and patient online DES will come to an end on 31 March 2014. The sums involved will be transferred to core funding.

Overall financial effects

For the average practice, taking on all the changes offered there appears to be an increase in funding of £6,999 but, clearly, while there is an intended saving in time from some of the bureaucratic obligations, it remains to be seen how much time (and resources) will be needed to take on the unplanned admissions DES.

The open question remains as to how core funding will be distributed. If the planned reductions in MPIG go ahead in April 2014, core funding is going to have to be distributed in such a way as helps those practices where the MPIG has proven to be necessary, so it cannot be assumed that the reinvested funds will be spread evenly over the profession.

Other matters

The IT changes may well have a cost implication for GPs. It is probably too early to predict this.

There is a commitment for GPs to publish their earnings from 2015/16. The key phrase here is that the earnings will be GP NHS net earnings relating to the contract only.  So private fees, surpluses on notional rent, income from the PPA, teaching and so on will all have to be excluded. A working group will be established to agree this.

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