This site is intended for health professionals only

CCG may struggle to ‘pay its bills’ due to financial pressure of Babylon GP at Hand

The CCG hosting Babylon GP at Hand might not be able to ‘pay its bills’, due to finanicial pressures caused by tens of thousands of patients signing up to the digital-first NHS GP service.

NHS Hammersmith and Fulham CCG reported a £2.5m cash deficit, citing Babylon GP at Hand as the ‘key driver’ of cashflow issues, and said the situation is ‘expected to worsen in the near future’.

Currently, Babylon GP at Hand has around 34,000 patients, according to the CCG papers.

Pulse previously revealed NHS Hammersmith and Fulham CCG needed an extra £18m in funding from NHS England to cope with the influx of patients caused by the service. This led to neighbouring CCGs bailing out Hammersmith and Fulham CCG, with over £1m in funding.

At the same time, NHS England’s London regional team agreed to re-allocate funds from other London CCGs. However, some CCGs, including Tower Hamlets, Lambeth and Southark, have objected to covering the costs of patients residing within the CCG but signed up with GP at Hand.

The papers noted that Babylon is currently carrying out an ‘active advertising campaign across London’, on top of potential plans to expand to other cities across the UK.

The CCG said if the campaign results in an increase in the number of patients registering with the service, at a rate similar to that seen in 2017/18 – which was around 8,000 patients per month – costs ‘will likely be higher than estimated’.

The board papers, published last week, said: ‘Cash utilisation is above plan by £2.5m and presents a possible risk to the ability of the CCG to pay its bills later in the year. 

‘A detailed review and forecast has been completed and confirmed that GP at Hand is the key driver and that provided those costs are mitigated in a timely fashion the CCG will not need to implement change in this area, albeit this will continue to be kept under scrutiny.’ 

‘Given the settlement of a number of large quarterly invoices in month nine (January) this position is expected to worsen in the near future subject to the timing of GP at Hand mitigation being received,’ it continued.

A Babylon spokesperson said: ‘The needs of patients have to be put first. Regardless of which NHS practice they register with, they should never be denied local NHS care.

‘People who choose Babylon GP at Hand as their NHS GP must be able to access the full range of NHS services local to them, just like any other NHS patient can, and this care should be fully funded. CCGs should be paid appropriately and Babylon are pleased to hear that the Hammersmith and Fulham CCG board are reporting that “provided those costs are mitigated in a timely fashion the CCG will not need to implement change”.’

Earlier this year, health secretary Matt Hanock told Pulse there needs to be a ‘genuine level playing field’ for GP practices competing with Babylon GP at Hand, and said rules had to change to ensure that they ‘work fairly for everyone’.

This came after he was criticised by GPs for appearing to promote the private company, even appearing in a Babylon-sponsored interview with the Evening Standard praising the provider.

The rise of Babylon GP at Hand

Babylon started offering online GP services as a replacement to regular GP practices across London in November 2017.

GP leaders expressed concerns about the impact of Babylon’s entry to London, after it rapidly signed up tens of thousands of patients to it’s GP at Hand app via the out-of-area registration scheme.

The service has also been criticised for ‘cherry picking’ patients, as it advised certain patients – including pregnant women and patients with learning difficulties – to ‘discuss’ whether it may be ‘appropriate’ to register with ‘a practice closer to home’. Although these restrictions have now been lifted.

Despite concerns, health secretary Matt Hancock said he is a patient of Babylon, and that the company is ‘taking the pressure off the NHS’.

An independent evaulation of the service is currently being conducted by Ipsos Mori, while the CQC is assessing whether the app has destabilised other GP practices, and its impact on the overall quality of care.

Meanwhile, GPs called on the BMA to abolish the out-of-area registration clause in the GMS contract – which allows patients to register with practices outside of the traditional GP boundaries – at the England LMC conference last month.