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How to...set up a community interest provider company

Dr Gurdip Singh Hear describes how 50 GPs organised themselves into a community interest company that ploughs 90% of profits back into patient care

Dr Gurdip Singh Hear describes how 50 GPs organised themselves into a community interest company that ploughs 90% of profits back into patient care

The basic concept of GPs bidding to take on services from a PCT is nothing new. Small groups of enterprising GPs have been extending the services they offer their patients in this way, and making additional money out of it, for years.
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However, what makes Slough Health Community Interest Company (CIC) different is that every one of the 50 GPs in Slough is involved and the aim is definitely not to make money.

Although the company belongs to the same 17 practices that constitute Slough PBC group, the majority of profits made will not be paid to the GP practice owners but reinvested in improving services for patients instead.

Quite a number of GPs in the area were against the idea of forming an organisation that was profit-making, but because this was not the primary aim I have been able to bring them on board.

Essentially, our model is a hybrid of a profit-making and not-for-profit organisation that operates for the benefit of the community. The profit element is extremely limited and it takes 10 years for the GPs' investments to be returned to them. A practice investing £3,000 would make £300 over 10 years if CIC made a profit during that time (see box below left).

Practices pay the company £1 for every patient on their list. Of each pound, 90p is a loan and the practices will get that back if the company makes a profit. The remaining 10p buys an actual stake in the company and practices will not recover that for at least 10 years, because practices can only be paid a maximum of 10% of their investment in profits per year – that is, a maximum of 1p for every 10p or patient.

Finding a better way

Like all PCTs, ours has had to separate its commissioning and provider functions and many PCTs are hiving off their provider arms completely. I went to talk to the chief executive of our PCT (Berkshire East) about how GPs in Slough could be involved.

A profit-making provider unit had recently been set up in an area of nearby Bracknell but was not proving a success, so the aim was to try to find a better way for Slough.

Our chief executive, Lise Llewellyn, was very supportive and offered to fund consultant Mo Girach to explore the various options. Mo is a business strategist and special adviser on social enterprise to the NHS Alliance and associate consultant in leadership development (social enterprise) at The King's Fund.

We decided we didn't want to go down the fully fledged profit-making route because we didn't want to be seen as money-grabbing GPs. We wanted to improve services for patients and reinvest any profit back into doing more for our patients. We also hoped the not-for-profit aspects of the model would appeal more to the PCT.


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If the PCT can see any profit made will be reinvested to further improve patient care, it makes it easier for a contract to be made available. It's similar to how hospitals work – they get their money but if there is a surplus at the end of the day, it is carried over to next year to provide other services. We will do things in a similar way and have the added advantage of understanding our patients' needs better than anyone else.

GP investment

Although the potential profit is incredibly small, I wanted to introduce something into the company for the GPs who were interested in the profit-making element, but it is extremely limited.

If the company doesn't work out, they stand to lose the whole pound. But they are quite okay with it because every practice stands to lose. Because we are all in it together, we are willing to take that risk – and the feeling is that if you don't take risks you never get anywhere.

Like the financial commitment, the number of shares allocated to practices reflects the number of patients on their lists. Practices' rights and powers are in direct proportion to the number of patients they have, which has gone down well with all the GPs.

There are 130,000 patients in the area so the company has initial funding of £130,000. This money will be used to pay for solicitors and accountancy costs, support staff, other organisational costs and preparing for pitches. The company's seven GP directors will also be paid for their time.

So far, the company has spent about £4,000, mostly on solicitors' costs. It is anticipated that annual running costs will amount to £100,000.

The seven directors come from practices covering two-thirds of the patient population. However, I have told the practices that don't have a director that if they really wanted one they could get their shares together and easily oust one of the current directors.

As I am chair of the board and chief executive, the registered address for the company is my surgery – Crosby House Surgery – but I hope that with the help of Berkshire East PCT we will be able to secure a base at Upton Hospital in Slough.

The company also has an admin secretary. The next appointment will be someone who can take care of the day-to-day management of the company and we will recruit the necessary clinical staff as we win contracts.

The ultimate commissioning decision is held by the PCT – as it should be – but Slough PBC group can make suggestions and recommendations based on the fact that we know our patients' needs better than anyone else. Slough Health CIC would like to provide the services commissioned, but would be happy for them to be provided by other companies if that was better for our patients and more cost-effective.

Anticipated turnover

The long-term aim is for the company to turn over about £1m a year. However, realistically we expect the company to turn over a more modest £250,000 this year and perhaps £500,000 a year within two or three years.

We have secured our first contract with Berkshire East PCT to reduce accident and emergency attendance at Wexham Park Hospital in Slough.

We are proposing to do this by providing a nurse and an administrative person to phone patients who regularly attend A&E to get information about why they do so. The nurse would then attempt to educate patients about the most appropriate service to use, probably redirecting them back to practices. In the future we would certainly be interested in providing an urgent care service at the hospital or at another site.

We have also bid for about £300,000 from the Department of Health's social enterprise fund to improve diabetes and alcohol services in Slough, and are awaiting the outcome.

Better patient care

We know that health inequalities, particularly in relation to diabetes, alcohol and drugs, are real problems in Slough, which is the poor cousin to other areas in Berkshire East PCT. Windsor, Ascot, Maidenhead and Bracknell are all fairly well-off areas, where large numbers of patients have private healthcare and not as many health needs. In Slough there aren't many patients with private insurance but there are plenty with high health needs, particularly diabetes. We have a lot of patients from ethnic minorities and a lot coming from Poland and other countries.

Diabetes

At my surgery, diabetes patients are looked after from diagnosis to insulin initiation and do not attend hospital unless it is an emergency. We want all the patients in Slough to have access to this level of service and are looking to set up a diabetes clinic in central Slough so patients would not have

to travel to the King Edward VII Hospital in Windsor. Slough has many Asian patients with diabetes, so we are also proposing having a nurse who can provide health education in the patients' first language and do home visits to teach insulin titration.

Tackling alcohol problems

There are also huge numbers of patients in Slough with alcohol problems. Although the PCT currently spends £150,000 on drug and alcohol services, at the moment this goes exclusively on treating drug addiction. As a result, patients with alcohol problems are not getting the care they need. There is a national DES for alcohol for new patients, but there is no provision for patients already on our books, which is the majority.

We are proposing a pilot in around 300 patients of brief interventions delivered by GPSIs in their surgeries. If this is successful we would perhaps move on to detox therapy and maintenance of abstinence.

An umbrella provider

GP practices in the area already provide some additional services to the PCT and ideally we would like these to become part of the company's portfolio.

In my previous role as PBC lead for the PCT, I helped set up pathways for ENT and ophthalmology provision, and another is now being developed for urology.

Lots of providers in Slough have little bits of the share of ENT and ophthalmology, so what I want to do is to try and bring all the services into Slough Health CIC. I am already talking to the local ophthalmology consultant about getting all ophthalmology provision under the umbrella of one provider.

I believe Slough GPs as a whole should be sending their patients to one provider that the GP commissioners choose. Slough Health CIC would like to be the preferred provider but obviously other providers can come in as well.

Conflicts of interest

I am keenly aware that just as there are conflicts of interest for PCTs as providers and commissioners of services, the same can be argued for GPs, especially those such as myself who are involved with PBC and provider companies such as Slough Health CIC. Now that I am chief executive of Slough Health CIC, I am no longer involved with PBC.

I keep myself separate from the commissioning, so the commissioners make the decisions about what services are needed in Slough. I also always declare my chief executive role when doing any work for the PCT.

Strength in numbers

GPs in neighbouring Windsor, Ascot and Maidenhead are already exploring setting up a company based on the Slough Health CIC model and this hybrid of a not-for-profit and profit-making organisation is a model.

I would recommend to other GPs. It provides a sound footing and the infrastructure for practices to compete on a level playing field for PCT contracts.

Working together collectively with other GPs is important, particularly now with private providers coming in. Tendering for this kind of work in a credible way is extremely complex – you need a lot of time and support. It costs a huge amount of money if you want to put in for a proper tender – £10,000-20,000 – and as an individual practice you can't go throwing that kind of money around.

Dr Gurdip Singh Hear is a GP in Slough, Berkshire, and chief executive of Slough Health CIC

How the GP investment model works 60-second summary Dr Gurdip Singh Hear: chief executive of of Slough Health CIC Dr Gurdip Singh Hear: chief executive of of Slough Health CIC

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