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At the heart of general practice since 1960

PMS practices ‘overfunded’, report concludes

By Lilian Anekwe

PMS practices have been ‘over-compensated' for the extra services they provide, according to a report by an influential group of Government researchers.

The report, which has been submitted to the Department of Health, re-ignites controversy over whether PMS contracts are cost-effective, and may embolden PCTs to claw back cash.

It claims the incentives offered to GPs to switch to PMS contracts since their introduction in 1998 have not improved provision in under-served areas. Instead, PMS GPs are far better off than their GMS colleagues.

‘A GP working in a PMS practice with identical characteristics to a GP in a GMS practice would have earned considerably higher wages than the GMS GP,' the report concludes.

The study of data from GP tax returns in 2002/3 found that in PMS practices, increases in gross income far outstripped rises in expenses – taken as a proxy for extra services. The gross income of PMS practices rose by £41,237 in a year, while expenses rose by only £28,737.

After allowing for expenses and administration, GPs working under PMS contracts earned greater net income and wages than their GMS counterparts.

Working in a PMS practice was by far the strongest determinant of pay, increasing PMS GPs' net income by £12,500, or 17%, per annum. ‘Thus PMS GPs seem to have been overcompensated for the additional costs they incur,' the report says.

It adds: ‘PMS contracts were meant to increase the supply of services to under-served groups. Financial incentives for switching to PMS may not have been aligned with policy objectives.'

Professor Matthew Sutton, a professor of health economics at the University of Manchester and one of the authors of the report, told Pulse: ‘At the time, PMS GPs were working for the same number of hours but getting more money. I'm not aware the trend has changed.'

Dr Hank Beerstecher, a GP in Sittingbourne, Kent, who has

researched the differences between GMS and PMS pay, said his own study had also found PMS practices ‘did not justify' their extra income.

But GPC negotiator Dr Chaand Nagpaul said the gap had narrowed: ‘Over the past two years PMS GPs have taken quite a hit.'

Pressure grows on PMS GPs

Mar 06 Department of Health orders PMS GPs to agree pay cuts to bring their income into line with their GMS counterparts or face being stripped of their contracts.

Sep 06 Pulse reports that PMS GPs are being told to take on extra work with no additional funding.

May 07 Figures from the Information Centre show that PMS GPs are losing their pay advantage over GMS GPs.

Aug 07 GPC describes the situation in Suffolk – where all PMS practices were given six months' notice of the termination of their contracts and told to agree modified terms – as a testbed for the rest of country.

Mar 08 PMS GPs in Northumberland are latest to agree new terms after receiving similar threats of termination of their contracts.

Are PMS GPs paid too much?

YES
Dr Andrew Mimnagh, chair of Sefton LMC:
‘I think there has been an excessive remuneration of PMS GPs. The PMS contracts to incentivise people to move paid a generally higher baseline income. I suspect PMS practices will be picked off one by one to create a more uniform level of pay.'

NO
Dr Baljit Kuar Bhullar, a PMS GP in Bedfont, Middlesex:
‘We need something extra because we are PMS. But the money goes straight away. The £60,000 I have been given is like chicken feed; out of that I have to pay for two salaried doctors at £78,000 a year. So where is the "extra" money'?

PMS pay: mounting pressure for clawbacks PMS pay: mounting pressure for clawbacks

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