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Don't give up: Alternatives to practice closure

Closing a practice can be costly and there may be other alternatives. Bob Senior considers the steps to take before making a decision

A Pulse survey in November found that one in 20 GPs is considering closing their practice by the spring. But shutting up shop must be a last resort.

The costs of closure may be high in terms of redundancies and premises. Leaseholders may need to pay rent until the end of the lease term, and might have to pay to put the building in good order. Partners who own premises may owe redemption penalties if they close the practice, even if they pay their mortgage back immediately, and the sale may leave partners in negative equity.

These costs may be steep for a sole GP but dividing the costs of closure is harder still for a partnership. Therefore, GP partners planning to sell up should hold an urgent meeting with the practice solicitor so all partners know where they stand.

Significant savings

Once the partners have quantified the financial implications of closure they may be persuaded to stay open.

Partners need to consider whether they could postpone closure for two to five years, which will depend on the factors behind the decision to close. If significant savings can be made then freezing the list, shrinking practice boundaries and cutting clinics might make the workload more manageable for a year or two. However, these measures won’t eliminate problems of financial viability unless they are accompanied by reductions in staff costs.

Where the decision is mainly down to workload and GP recruitment (but practice profits are okay) perhaps continue the search for a new partner, with greater flexibility about job-shares or part-time posts. Merging with another practice is another way to avoid the costs of closure, particularly those associated with redundancy of staff.

Agree whether any GPs in your practice wish to remain in the merged business.

Another factor to consider is the 2015/16 contract, which may bring financial benefits to practices with poor incomes. New enhanced services and Better Care Fund schemes to integrate care may introduce ‘new’ income (although it may be ‘recycled’ from elsewhere in general practice) and changes to the GMS contract (such as investing MPIG funding in the global sum) will help many.

Bob Senior is chair of the Association of Independent Specialist Medical Accountants and head of medical services at Baker Tilly

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Readers' comments (4)

  • easiest way is to run practice down slowly. All patient nos to drift until a natural level is found. Only problem is most neighbouring practices cannot cope either. But some practices still think patient numbers matter!

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  • if things are that bad that GPs are considering list closure, then JUST CLOSE.

    SAVE YOUR SANITY.

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  • At Our peak we had 6600 patients between the 2 of us ,we lost a few Ghost patients but the workload escalated out of control and income fell so much we had to let our 4 session a week locum go .We cut our salaries pulled out if the NHS pension scheme but income continued to plummet .we were both heading for burnout and decided to close. That was 6 months ago .when the patients got the letter from NHSE telling them we were shutting we lost about 2000 patients , the remainder stayed until the end . Oddly as the list dropped the workload became manageable and less stressed ! The High attending patients left first meaning the job became easier . Looking at t now I could have carried on , but obviously our income dropped more and more as patients leftn. It has cost £333000 to shut down the practice , with £100000 in redundancies and £233000 in mortgage/redemption fees .£10000 accountancy fees and £6000 estate agent fees .add to that Tax and removal fees and there is not a lot to show for 30 years of work . I look at it by thinking the building has allowed me to have a place of work , but not the assett I was assured it would be on going into partnership all those years ago.Today the computers are being taken away , phone system stripped out and the new owner gets the keys on monday. I start a job as Prison Doctor/locum in May after some time off to "reflect" i have enjoyed being a GP , well I did , the last 2 years have been hell. I never thought this would happen , but we really had no choice .So yes think hard before closing , but don't just keep going because you can see no other way .I will miss my Patients , but no one else really cares that we are gone .Being found dead at my desk from an MI was not on my wish list ..I wish those of you in a similar position to myself the best of luck .Hardest decision we have made . The only real one we could make however .

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  • hi, if you are thinking of closing your practice, please contact me at balrajsidhu@aol.com, I have turned around 2 practices in the last 5 years, and am happy to help. If you are thinking of retiring I may be able to take over the practice for you, thanks.

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