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Will private work add to income or swallow up valuable practice time?

Dr John Couch shows how to evaluate your practice's private workload to ensure it really is cost-effective

The potential of the new contract has quite rightly focused GPs' minds and actions. It is vital that all practices work hard to maximise the benefits in both patient care and financial reward. The problem is that nobody can be sure of the final outcome. Historically around 10 per cent of the average practice's income comes from private sources. There is a danger that with eyes fixed firmly on new GMS these areas could suffer and opportunities be missed.

Check current work first

Once a year we should all check our systems for private fee earning. This should start with the fees actually charged. When were they last increased? Do they reflect a fair return for the work? We can no longer rely on BMA guidance for all fees. Fees for official government bodies are usually fixed; however, most other fees should be regarded as negotiable. For instance most GPs now request and obtain far higher insurance report fees than the £40 suggested. The increased size of patient MREs make this perfectly justifiable.

Check your system for claiming and checking payments. Do you chase late invoices? Do all staff follow procedures when taking cash and cheques directly from patients? Is the cash box checked and emptied regularly? Is the cash book completed?

It is worth exploring whether you can make any efficiency gains. For instance, if you are fully computerised can you extract and print insurance report data? Some insurance companies will now accept computer reports. I find an average report 'by hand' takes me around 30 minutes to complete. A computer could do this in a few seconds.

Increasing private income

It is important to decide if your practice has the capacity to increase private income without affecting the practice's ability to maximise rewards from new GMS. It is useful to quantify that capacity in terms of partner hours. Potential new work can be assessed in terms of time. Private work should earn more than £70 per GP hour gross.

If it is felt that there is no spare time, consider using locums or salaried GPs to replace extra time lost by partners taking on more private work. In this case you must look at the net profit. If your locum costs £60 per hour but the private work brings in £100 per hour this may be considered cost-effective. Once again, ensure your new contract work does not suffer as a result of increasing locum use.

Consider increasing existing work such as insurance and employer medicals. By offering a quick, easily accessible and efficient service you may persuade insurance and local companies to send more patients. Your practice manager will need to market your services aggressively.

With employment law becoming ever tighter, opportunities in occupational medicine are increasing. Larger practices can consider at least one partner obtaining an occupational health qualification.

Experienced GPs may find legal expert work interesting. The increase in 'no win no fee' legal firms has increased demand in this area. Care is needed as this work can involve time away from the practice at short notice. It can be disruptive.

Some GPs work for medical defence bodies as advisers to members with queries. Most of this work is via telephone. Sadly, increasing litigation means this work is also increasing.

It is still possible to participate in pharmaceutical trials. Although this work has been through the doldrums in recent years it is quite possible to make reasonable profits. It is vital to look carefully at the time input now required as this can be surprisingly high.

Some income generation need not involve partner time. For example, if you own your premises, ask yourself whether you are using the space to maximum potential. Renting space to other professionals such as physiotherapists, dentists or opticians can provide extra income with little practice input. But take care not to lose NHS rent reimbursement.

Generally speaking it is better to ensure space is still used by the practice for some of the time to sustain 'duality of use'. If you are lucky enough to be able to attract a pharmacy, the potential for profit is even greater.

Private companies

in primary care

Historically, GPs usually find that what initially seems a threat can often be an opportunity. Therefore the threat posed by private companies entering primary care may also carry openings.

In many areas enhanced services are not being fully taken up. Could your practice take on one or more of these if other practices are not willing or able to? If so there may be advantages doing this by setting up a private company of your own. Discuss this with your accountant. There will undoubtedly be other opportunities for similar work in the coming years.

Make sure any private work you do is cost-effective and doesn't prejudice your core activities.

Opportunities for private

income may exist in the

following areas:

•Insurance and employment medicals

•Occupational medicine

•vLegal work

•Work for medical defence bodies

•Pharmaceutical trials

•Renting out space in your premises (if you own them)

•Offering enhanced services

John Couch is a GP in Ashford, Middlesex

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