On 30 June, HSJ columnist Noel Plumridge suggested primary care should carry its share of the £20bn Nicholson challenge, alluding to the Nuffield Trust’s March recommendation that primary care “should become a key focus of the quality, innovation, productivity and prevention agenda”. Noel’s article led to this correspondence with Pat Stevenson, a GP practice manager in the North East.

Dear Noel:

My name is Pat Stevenson and I’ve been working in and around the NHS for 24 years: in a competitive commercial organisation as an NHS IT systems provider; in an NHS trust as an assistant director and for the last 14 years in primary care as a practice manager. I have seen and experienced the numerous cyclical changes, reorganisations and efficiency drives at first hand.

In your column you identified that around 7 per cent of the NHS budget is spent on GP work, but not the proportion of NHS activity that this funds. The Department of Health itself recognises that 90-95 per cent of NHS activity is carried out in primary care. This gives a much higher productivity ratio to primary care work than secondary care.

Dear Pat:

Yes, most people’s main interaction with the NHS is through primary care. Channelling patients via GP practices is a very practical way of working. Yet I would be cautious about the word “productivity”. Do we really have a way of measuring what GPs “produce”? The quality and outcomes framework is a brave attempt, but cannot tell the whole story.

For years we collected “contacts” as a measure of district nursing activity. Utterly meaningless, and yet some even used it as a basis for funding. With primary care being pressed to demonstrate its efficiency, let’s not over-simplify.

It has been really difficult for PCT commissioners to challenge the efficiency of independent primary care businesses; far safer to agree the problem is acute hospitals. There is little in the current reforms suggesting this might change.

Dear Noel:

You’re right about the QOF – but it was never intended to measure productivity – it’s called the quality and outcomes framework for a reason.

I don’t think productivity measurement anywhere in the NHS has been cracked. District general hospitals, mental health trusts and primary care have all been slated by the Audit Commission and Parliament for reduced productivity despite increased investment under the last government – yet do we have a reliable and credible formula for measuring productivity anywhere in the healthcare system? Where are the health economists in all of this?

You also wrote that “the gloom of an annual 4 per cent annual cash saving does not appear to preoccupy practice managers”. Based on my own practice’s experience over the last five years, I’d say that this would be a welcome lessening of the pace of financial tightening. 2006-07 was a 7 per cent cash saving (government figures), 2007-08 was 3.5 per cent and 2008-09 was 14 per cent – a local personal medical services review stripped out 10 per cent in cash and staff and inflation did the rest.

Dear Pat:

How would your partners react to reduced income of perhaps 25-30 per cent over the next four years? Monitor’s guidance to would-be foundation trusts implies this is the outlook for hospitals.

I also wonder how they would fancy being manoeuvred into mergers with other practices, or “vertically integrated” with hospitals. This won’t happen: they’re independent practitioners, running a private business. But if they were supermarket suppliers, say, they would adapt. The inescapable logic of savings on this scale is fewer staff and fewer buildings, even in primary care.

The acute sector going rate for cost improvements seems to be more like 7 per cent, by the way.

Dear Noel:

The economic environment is just as challenging, or arguably even more so, for us as for foundation trusts. The QOF is continually changing so that the same work brings less income – this year nearly 10 per cent has been stripped out and re-badged. This means we do the same work for 10 per cent less – within one year I would add – and need to do new and additional work if we are to replace the lost income. Much of this is the work that is being shipped out of hospitals because it can be done more cheaply in primary care.

Mergers are also increasing. We merged with another practice four years ago. We are now looking at partnership working with a range of providers. We are very much aware of private competition and our need to match or surpass their offering and price.

Dear Pat:

Many a hospital would love to find new work to replace their lost income. Finding cash savings to live within a lower income budget is another matter altogether.

Dear Noel:

Of course it is, and it’s a very difficult task, requiring some challenging rethinking about the purpose and shape of hospitals, but the fundamental difference between primary and secondary care funding is also often either overlooked, or not understood. Most GP practice income is fixed, and variations and increases in activity must be managed within a pre-defined cash limit. But secondary care, since payment by results, is paid for the activity it undertakes, much more akin to a commercial business model.

A swine flu epidemic may bring a 50 per cent increase in GP consultations in a single week, with no increase in income. Accident and emergency attendances in that week may increase by 10 per cent, but every one of these is paid for. All resulting emergency admissions are also funded.

The GP funding mechanism means patient A, who telephones every day and attends the practice weekly, attracts exactly the same income as patient B, who attends twice a year, and patient C, who attends every five years. Referral avoidance activity such as intra-practice referrals to GP colleagues with specialist skills is similarly unrecognised.

Consequently, practices with patients in poor health, with high deprivation, or with many elderly patients have to do more work for the same money than those with younger, less deprived and more healthy patients. The Carr-Hill formula is designed to even out these differences, but its accuracy and political bias continues to be argued. It certainly cannot measure cultural norms and behaviour. These have a huge impact on frequency of attendance.

Dear Pat:

You’re absolutely right about primary care funding. Actually the same is true of community care – including nursing and the therapies – and a surprising amount of hospital care. But don’t believe all you hear about payment by results. It has become riddled with smallprint, all designed to deny the hospital the extra money for its extra work.

Dear Noel:

You suggested that skill-mix review is alien to GP practices. From my own experience, the skill-mix review is in fact the norm. Every vacancy is reviewed in the context of team workload and work practices. Activities are often stopped or transferred to other disciplines, or completely new roles are defined.

Dear Pat:

I think of skill-mix review less as a reaction to someone leaving, more as a proactive approach to budget planning. Naturally it works better on a large scale. Need fewer senior nurses? Change the grade mix, recruit accordingly, and reduce the number of agency nurses.

But what if you conclude you need fewer doctors at £100,000 a year, and more specialist nurses or physiotherapists at rather less than that? Cue sick laughter. However, if Tesco or McDonald’s ever get into the primary care market, that may prove to be their business model.

Dear Noel:

Yes, of course, you also need proactive skill-mix. We started to move work from practice nurses at the end of the 1990s to other roles and more recently to technology. We now have to manage with fewer GPs, not just because they are expensive, but also because we cannot recruit them.

So, that means more senior nurses and extending the nursing role. However, we are handicapped by the fact that patients can actively reject new models of working. We have developed specialist nurses for minor illness. Patients, when offered an appointment with them, may refuse to see a nurse and demand to see the doctor instead. Our contractual requirement to provide care to patients who believe themselves to be ill mean that we must make a GP available to see them.

It will be interesting to see if commercial providers are given the same contractual obligations.

The patient has less power in secondary care – one referred for an elective procedure may see a nurse specialist for a pre-op assessment. That patient cannot then make a further appointment to see a medic (whether F1, registrar or consultant) for the same activity. Nor can they refuse to see a nurse and insist on seeing a doctor.

Finally, in respect of the ongoing “fatcat lazy GP” campaign waged by the popular press, such GPs are, in my experience, definitely in the minority. My own GPs work 11-16 hour days, week in, week out. When I leave my office, usually around 8pm, seven times out of 10 there will be a GP or two still working. And we are not unique.

Dear Pat:

I’ve never met a lazy GP. Stressed sometimes, frustrating occasionally, but lazy? No. That’s the stuff of myth, like the jibe that hospital consultants spend half their life on the golf course. They don’t.

But being busy isn’t enough. Nowadays we’re all used to measuring and demonstrating our efficiency, not least for fear that some potential competitor is already sizing us up for takeover. Saving 4 per cent each year is tough, but these are difficult times. GP practices should be subject to the same discipline as the rest of the NHS.

Dear Noel,

I agree Noel, no sector can be immune. I just think that we’ve been making these kinds of savings for longer than most, so we’re already carrying at least our fair share of the QIPP burden.