‘Clunky’ GP contracts raise questions on quality

If you have ever attended a conference on making NHS commissioning “world class” the dominant theme will have been primary care trusts getting to grips with their hospitals. You hear less, if anything, about what PCTs are doing to improve the value for money of their primary care contracts with GPs.

Commissioning in primary care has been a rather passive reimbursement exercise rather than an active one. It’s not just GP services but also pharmacies and dental [which have] been poorly commissioned

NHS Alliance chief executive Mike Sobanja

Helen Northall, director of NHS advisory body Primary Care Commissioning, says the skewed emphasis is misguided. Although primary care services make up just £7bn of PCT direct spending, general practices are “gatekeepers” to the rest of the NHS and £80bn or so of further spending on drug prescribing and acute care.

Ms Northall says the absence of a value for money focus in primary care is evident in the results of Primary Care Commissioning’s latest benchmarking survey, which found huge and persistent variations in what PCTs pay for ostensibly the same thing.

The anonymised results from the 91 participating PCTs were shared with HSJ. They show a 21-fold variation in what PCTs paid per needs-adjusted registered patient for out of hours GP services in 2007-08. Lowest cost per patient was 78p, the highest £16.49 and the average £3.75.

It is worth noting that these variations are those found at the PCT level, rather than individual services and contracts. They are the average rate paid across entire PCT areas and will therefore be masking even starker variations at the individual contract level.

But perhaps more worrying than the spending variation is the apparent lack of correlation between cost and outcome. The PCTs spending the most and least on out of hours services had similar high rates of complaints about primary care - 18 and 19 per 10,000 population respectively, compared with a national average of six.

Contract frustrations

Accident and emergency attendance rates - not so much a gateway but a gaping hole leading to further acute care costs - also show no relationship between PCT spending on out of hours services.

The survey also revealed a two-and-a-half-fold difference per patient between PCT spending on core general medical services and personal medical services contracts - from £51 per head to £141 and £61 to £150 per head respectively. Again, there is no detectable trend to suggest higher spending brings higher quality, better acute demand management or increased patient satisfaction.

NHS Alliance chief executive Mike Sobanja is not surprised.

“People have been preoccupied with commissioning acute care and not primary care,” he says.

He believes the significant variations in cost across PCTs are “accidents of history that PCTs have not yet addressed”, rather than signs some PCTs have better quality than others.

“Commissioning in primary care has been a rather passive reimbursement exercise rather than an active one. It’s not just GP services but also pharmacies and dental [which have] been poorly commissioned.”

The precedent of that “passive reimbursement exercise” is the old pre-2004 GP contract, which Mr Sobanja characterises as a “John Wayne contract: a GP’s gotta do what a GP’s gotta do”.

It listed a menu of services GPs could choose to provide. If they did, the health authority reimbursed them accordingly. It was down to the GP to decide “what they wanted to do” rather than the health authority to actively commission services on the basis of local needs analysis.

Mr Sobanja says that historical precedent is also the likely cause of the 61-fold variation in PCT spending per head on locally enhanced services and why some PCTs pay extra for services other PCTs get for “free” or as part of the core GP contract.

But PCT representatives have told HSJ it is precisely the new GMS contract that frustrates attempts to improve quality and value in primary care.

Primary Care Network director David Stout says the contract is so “weak and clunky” there are serious cost-benefit questions about the time, effort and overheads PCTs have to invest in leveraging any change.

Limited leverage

A crucial issue is the inability of PCTs to terminate a GP practice contract. Mr Stout says anecdotal reports that GPs “basically have to kill someone” before their contracts can be terminated are only a “slight exaggeration”.

Ninety per cent of respondents to the benchmarking survey said they had no dedicated team for monitoring the primary care performance against contracts and only 15 per cent could identify specific spending on contract management.

Although that might suggest substantial room for PCTs to toughen up their management of primary care contracts, Mr Stout may well have a point: although the data is sparse, it suggests there is no relationship between inputs into contract monitoring - measured by spending and visits to practices - and outcomes for patients.

The PMS contract was introduced in 2004 to give PCTs more flexibility over GP services. Nationally, 43 per cent of GP contracts were under PMS by 2007-08, with GMS making up 55 per cent.

As the British Medical Association has long suspected, at an average per patient payment of £86, core PMS contracts command a hefty 27 per cent premium over GMS contracts, which came in at £68 per patient in 2007-08.

NHS Sheffield chief executive Jan Sobieraj says across his PCT that premium adds up to £2.3m.

He says: “We are aware of what we get and don’t get from that. As a PCT we are very clear that QIPP [the quality innovation, productivity and prevention drive] must apply to all of our spend, not just acute.”

BMA GPs committee deputy chair Richard Vautrey says Mr Sobieraj is right to be concerned about the value he gets from his PMS contracts and the high premium brings little more than contractual insecurity.

He says: “When the Department of Heath developed the PMS contract it gave a large amount of money to PCTs to entice practices from the national contract, so they could terminate contracts with greater ease. They felt the prices they were offering were good value for money, but they should be doing more if they are being paid more.”

PCT chiefs have told HSJ they are now tackling this variation in cost and performance by selecting common performance indicators and benchmarking each of their practices against each other.

NHS Devon interim director of contracting Philip Grant, who was previously economic adviser to NHS Employers, specialising in the GP contract, now runs his own NHS management consultancy Xponential Management Solutions, which is helping a number of PCTs review the value they get from their GP contracts.

He is sceptical about PCT claims that they can “do nothing” in the face of an overly restrictive national contract.

He says PCTs should get practices engaged in understanding what the data and indicators mean, so they can agree on what problematic performance and cost look like and consider “corrective action”.

But Mr Grant advises against PCTs rushing in with accusations of bad clinical practice.

Rather, poor value for money is more likely to be about bad business practices, he says.

As in all walks of life, he says, there will be GPs who are good at business and GPs who are not: “This type of analysis, review and contract management process is a chance for those [who are poor at business] to get support and advice on how to run a more successful and therefore profitable business.”