This site is intended for health professionals only

PMS practices face £260m losses as NHS England announces two-year review of all contracts

Exclusive PMS practices face £260m of their funding being ‘redeployed’ over the next two years, after a major review of contracts by NHS England found the money was not linked with providing any additional services to patients above GMS.

Pulse has learnt that NHS England has written to all area teams to ask them to review all PMS contracts locally from April and aim to ‘secure best value’ from PMS funding that is not tied to defined additional services or performance indicators.

NHS England’s review found that overall, PMS practices are paid a ‘premium’ above equivalent GMS practices of £325m for England as a whole, equating to £13.52 above spending per patients registered with GMS practices.

Out of this, it could link £67m to defined enhanced services or key performance indicators (KPIs) but the remaining £258m had no formal link. It also found no link with the additional funding and the level of deprivation.

NHS England said that the £258m would be reduced to £235m over the next seven years with the redistribution of MPIG, but urged area team managers to review all PMS contracts over the next two years to ensure they were value for money.

The reviews will be conducted according to a number of criteria, including that it should reflect strategic plans set out by the area team or the CCG, help reduce health inequalities or support fairer funding distribution locally.

Writing in the letter, NHS England’s director of commissioning policy and primary care Ben Dyson and the director of commissioning (corporate) Ann Sutton said: ‘Area teams should begin a programme from April 2014 to review all local PMS contracts… and complete this review process by March 2016 at the latest.

‘[They should] seek to secure best value from future investment of the “premium” element of PMS funding by ensuring available resources for investment are deployed in line with the criteria set out in the annex to this letter.’

NHS England ruled out moving the funding released from PMS contract reviews into core general practice funding, as suggested by the GPC, as it would leave area teams with a lack of funds to address local ‘transformation of primary care’.

The letter added: ‘This would significantly reduce the ability of area teams to support the transformation of primary care locally, in line with the original objectives of PMS contracts.’

‘It is essential, however, that we apply the principles of equitable funding by moving towards a position where we can demonstrate that all practices (whether GMS, PMS or APMS) receive the same core funding for providing the core services expected of all GP practices.’

Deputy GPC chair Dr Richard Vautrey said: ‘NHS England had a golden opportunity with this review to invest in core general practice in order that practices could plan for the future with confidence and invest in GPs and other staff to meet the core needs of their patients, not least in offering enough appointments. 

‘Instead, they are taking a massive amount of funding away that will cause huge concern to PMS practices, with the expectation that they can only earn some of it back if they do even more work.  At a time when practices are being crushed by massive workload, and GP recruitment and retention is reaching a crisis point, this is the last thing they wanted to hear.’

NAPC chair Dr Charles Alessi said he was ‘very disappointed’ by the approach NHS England was taking.

He said: ‘It is really disruptive. We would be the first to say that it is inappropriate that one practice gets more for providing the same service as another practice, but this process is too indiscriminate.’

Commenting on the news, Mr Dyson added: ‘NHS England is committed to supporting innovation and quality improvement in primary care and reducing health inequalities. We want to continue to use PMS arrangements to achieve these objectives. At the same time, we need to ensure that there is an equitable approach to funding.’

‘Where GP practices are receiving extra funding per patient, this has to be fairly and transparently linked to the quality of care they provide for patients or the particular needs of the local population that they serve.’

‘The purpose of this review has been to put in place a much clearer framework that will enable our area teams to ensure that extra investment in PMS meets these criteria. In reviewing local arrangements, our area teams will work closely with local communities to ensure that these resources are used to help provide more joined-up services for patients.’