GP contracts would make it “difficult, if not impossible” to introduce a cost saving Spanish integrated care model in the UK, a new report by the NHS Confederation has concluded.

The Alzira model, named after the town in Valencia where it originated more than a decade ago, sees a private contractor paid a per capita sum for the local population by the local authority for primary and secondary care.

It was one of a number of integrated care models explored by the board at Weston Area Health Trust which is in the process of agreeing a plan for an integrated health and social care organisation in North Somerset.

The annual fee per inhabitant, which was about 607 euros in 2010, has been on average 26 per cent cheaper than other parts of the Valencia region over the past five years.

Key to the system is technology that allows all parts of the system to have access to patient records. Up to 20 per cent of hospital doctors salaries and up to 10 per cent of GPs are for on call payments and meeting agreed performance targets. Despite this salaries are higher than average.

In conclusion to the report former NHS Confederation policy director Nigel Edwards described the lower cost of the operation as “striking”.

He added: “It seems reasonable to suppose that some of this comes from integration and the emphasis that capitation puts on cost-effective management and early intervention for some conditions, and more conservative treatment for others.”

However, Mr Edwards, who took part in a study visit to Alzira in March 2011, warned the fact that Spanish GPs were employees made it easier to integrate them in the system. In the UK, because some services are “embedded” in the quality and outcomes framework it would mean either “a difficult, if not impossible, negotiation or effectively paying twice for this type of care”.

Other potential barriers highlighted by the report include UK public private partnership contract law which tends to require variation for even the smallest changes. The report said Spanish law appeared less rigid.

Patients covered by the per capita payment are free to choose services other than those provided by the contractor. If they do the contractor must pay 80 per cent of the cost, incentivising the contractor to ensure patients choose its services.

However, the report also warned in an NHS setting the model would probably “squeeze out” other providers and suggested in an NHS setting there would need to be a range of suppliers for areas where choice is important.