Standardising practices’ “core” income would mean a shift in funding worth about a quarter of a billion pounds, HSJ has estimated.

The Department of Health last week announced it wanted to move all practices to a standard rate of “core” income, adjusted for population characteristics. This core income would include basic contract payment and sums currently paid to compensate small practices, called the minimum practice income guarantee.

The change, if implemented, would be phased in over seven years. Its effect on individual practices’ income would depend on decisions yet to be made by the DH about how it calculates fair funding and how the changes are introduced.

However, HSJ has analysed practice income figures to estimate the variation in their current “core” income. It appears to range from around £35-£200 per head of weighted population. Much of the variation is among personal medical services and alternative personal medical services practices, whose “core” payments can include additional services negotiated locally.

HSJ extrapolated the variation across all English GP practices and calculated the change in funding if all practices receiving above the average rate were moved to the average immediately. It suggests there would be a cut of about £256m spread over about 4,150 practices - giving an average fall of around £64,000. The change would not be spread evenly but would mean a significant change in income for many practices, in comparison to it increasing at a standard rate.

Under DH proposals, any saving would go to the rest of practices, which are currently underpaid.

The analysis suggests around 35 per cent of practices still receive the minimum practice income guarantee - which the DH plans to phase out. For those practices it represents an average of 6 per cent of their income. It suggests that, for around 500 practices nationally, the income guarantee represents 10 per cent or more of their income. However, HSJ’s analysis shows that even if core income is standardised, there would be significant variation outside these sums.

The British Medical Association GPs committee discussed and in principle agreed a phased standardisation of core income with NHS Employers over the summer. However committee chair Laurence Buckman told HSJ discussions had focused on drawing up a “fully developed scheme” with general practice. He said: “We said the changes had to be acceptable to the profession. [But] the government has now just said: ‘We’ll get on with it.’ That is not a way to engage people whose cooperation will be required.”

The BMA is opposing other proposed changes to the contract, which include significant changes to the quality and outcomes framework, making it more difficult to earn income.

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