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More GPs, fewer partnerships

Stagnating profits, lifestyle choices and APMS providers are driving the GP recruitment market, reports Carole Slingsby.

Most practices advertising GP posts now are only looking for salaried doctors. As more new GPs take on employee roles and retiring partners are not replaced, it is clear that general practice is evolving fast.

The time is approaching when large practices owned by perhaps, one, two or three profit-earning GPs employing several salaried doctors could predominate.

There is much in favour of being salaried. Working set hours is just one advantage, though not having business responsibilities means lower earnings.

Economic grounds
Companies winning alternative provider medical service (APMS) contracts are also increasing the demand for salaried GPs. In addition, the current uncertainty over practice profits after two years of no uplift in the global sum and quality framework is deterring further recruitment of partners.

On economic grounds taking on a salaried doctor often seems prudent and, by doing so, a large drop in partner drawings is avoided.

Richard Banyard, a senior consultant at health and social care consultancy Acton Shapiro, describes the GP recruitment market as 'mutually reinforcing dynamics'.

'The rapid growth in APMS contracts provides a governance base for recruiting salaried GPs rather than GP partners,' he says. 'The financial logic now seems to be for a practice seeking a replacement to look for a salaried doctor rather than a partner.'

He points out that, since the new GMS contract in 2004, gone are the basic practice and other allowances that effectively provided a payment to practices for taking on a partner.

'The practice can be better off by having a salaried doctor,' Mr Banyard says.

Pay differential
North London medical specialist accountant Laurence Slavin, from Ramsay Brown and Partners, puts figures down to cost saving, reporting that in London and the South East, the average partner currently earns £16,250 a year per session including employer's NHS superannuation.

'A good salaried GP would expect to be paid £10,000 a session. With employer's superannuation this costs £11,400. Swapping a retiring partner with a salaried GP leaves the continuing partners with a bonus of £4,850 per session a year,' he explains.

On the other hand, Mr Slavin says that if, as he predicts, practices' NHS earnings fall, practices will have to continue paying their salaried GPs while the partners' profit shares drop. But if these salaried doctors were partners, they might be motivated to find other ways to generate income.

However, Mr Banyard says that 'arguably a salaried doctor carries less risk'. This is because it is easier to make changes to the practice involving doctors not party to a partnership agreement in response to the changing market.

When practices do advertise partner jobs, competition can be intense. Mr Banyard says that practice managers he recently questioned reported that 10 to 20 applicants is about average. This is higher than the number typically applying several years ago when more partner posts were advertised. Mr Banyard adds: 'The numbers of applicants vary depending on geographical area and the terms offered.'

Longer to parity
Some partner posts attract many applicants. 'I know of two partnerships where one had more than 100 applicants and the other more than 250,' Mr Slavin says.

Offering a longer period to parity (equal profits share) than up to one year is making a comeback, Mr Banyard says.

Mr Slavin said a side-effect of the surplus of young GPs working as locums is driving down the pay of salaried GPs.

'GPs at a practice in the Home Counties told me they had heard of salaried GPs accepting posts at £6,000 per session, a significant disparity,' he says.

'On the other hand, salaried GPs will do less than partners, as they aren't as motivated.'

The prohibition on selling the goodwill in practices is to some extent protecting partnerships. Mr Slavin says: 'If the rules on goodwill are relaxed, I would expect the average value for the goodwill of a GP to be around £100,000.'

He explains that while this may prevent some currently salaried GPs from applying for partnerships, it will probably not deter the private sector from paying GP principals these sort of sums, acquiring the practice's NHS contracts and employing salaried GPs.

'This will be a major issue and it is probably a good idea for partnerships to decide at this stage what they will do about goodwill and how it affects an incoming and an outgoing partner,' said Mr Slavin.

Mr Banyard confirms that new GPs often spurn partnership. 'Young GPs do not relish taking on further loans as they graduate with student loans averaging £25,000.' Combined with fewer practices offering partner posts, this is fuelling change in general practice.

Partner versus salaried GP earnings
One 3.5 hour session £16,250 £11,400 £4,850
Nine sessions per week £146,250 £102,600 £43,650
*In London and South East including employer's superannuation.
Source: Ramsay Brown and Partners

Rapid increase in salaried GPs


salaried (or assistant) GPs in England in 2006 compared to 3,398 in 2005, an increase of 58.9 per cent.

5.6 %

fall in GP partner numbers in England fell by 5.6 per cent between 2005 and 2006.
Source: The Information Centre



Would you offer a salaried post or partnership if recruiting?

"I'd offer a salaried post. I'm unwilling to share dispensing profits and I'm looking forward to a time when practice lists are worth money for goodwill." Hertfordshire GP

"Partnership would offer more incentive with the quality framework and would also share increasing financial risk." Belfast GP Dr James Rowney

If you were job hunting, would you prefer to be salaried or a partner (or single-handed)?

"If I was looking for work now, I might well consider salaried work. General practice has changed beyond all recognition." Reading GP Dr Niall Riddell

What effect is the growth of salaried posts having?

"We are moving towards - or may be have already arrived at - a two-tier system for GPs." Brighton GP Dr Christine Habgood

"With three quarters of GPs under 30 now both male and female GPs increasingly make life-style choices about the hours they work. The rise in part-time work and salaried posts is inevitable.
"Government policy and these demographics both conspire in the demise of self-employed general practice." Leicestershire GP Dr Bill Spiegler

Do you have recent experience of recruiting?

"We have recruited a salaried GP without difficulty." Lincolnshire GP

"We had about 50 applicants for one salaried and one profit share position and interviewed 10." Berkshire GP Dr George Kassianos.

For your free copy of GP's 'Best Practice Guide to Recruitment', call Kelly Morris on (020) 8267 4741

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