Huge variation in GP practice pay regardless of size of list

The cause of the inequity is the minimum practice income guarantee, which was introduced as a last-minute concession to GP negotiators when the new GP contract was implemented in 2004. The guarantee was devised to ensure no practice experienced a drop in income when the new needs-based allocation formula was introduced.

But four years later, figures released to HSJ under the Freedom of Information Act indicate the guarantee is perpetuating inequalities by inflating the basic income hundreds of practices receive under the funding formula by more than 40 per cent.

PCT Network director David Stout said the income guarantee “institutionalises unfair variation as a matter of course”.

HSJ obtained the details of payments made by 16 primary care trusts to 675 GP practices operating under the general medical services contract. The PCTs were randomly selected and the sample represents 13 per cent of the total 5,162 GMS practices.

The 675 practices were paid an extra£42m under the guarantee - 19 per cent above the amount they were due under the allocation formula. Of these, 73 had their income boosted by 40 per cent or more. Ten practices had their core income boosted by more than 70 per cent. Two Westminster practices more than doubled their income. A spokeswoman for the PCT told HSJ that one of these was the practice for Buckingham Palace staff.

Under the allocation formula, the Buckingham Palace practice was due to get just£14,657 this year. But the guarantee added another£16,505. That left the practice with payments of£113 for each of its 276 needs-weighted patients, compared with the sample average of£63.

Four other Westminster practices also received boosts to their income of over 70 per cent. Practices contracted by East and North Hertfordshire and West Hertfordshire PCTs also received supplements equivalent to over 70 per cent of their core income, leaving them with per-patient payments up to 50 per cent larger than their colleagues’ elsewhere in the PCT area.

Mr Stout said the guarantee “undermined” the attempt to make services responsive to patient choice. “If you lose people from your list, it doesn’t make any difference to the income guarantee,” he said.

Around£330m extra will be paid in the guarantee this year. Mr Stout said that money would be better spent attracting practices to deprived areas to reduce inequalities.

The figures given to HSJ suggest the guarantee has the opposite effect, as there is a tendency for practices in richer areas to receive a higher boost than those in poor areas.

A spokeswoman for NHS Employers commented: “The guarantee perpetuates historic levels of funding, which means that some practices in deprived areas lose out when compared with the distribution of resources based on need.” She added that although the employers’ position was that the guarantee should be removed, it did not feature in the current set of negotiations with the British Medical Association around the GP contract for 2008-09.

A Department of Health spokesman said: “The future of the guarantee is currently under discussion as part of [Lord Darzi’s] next stage review.”

In numbers

• 19% Average amount income guarantee adds on top of basic payment

• 52% Guarantee increase paid to the County Durham GP with the lowest levels of deprivation in the PCT

• 18% Increase paid to County Durham GP with highest deprivation in the PCT

• 40-93 Range in payments per weighted patient to GMS practices in Mid Essex PCT

• 63 Average basic payment plus guarantee per weighted patient paid to practices

For more analysis, see this week’s leader.