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Locums forced to slash fees by 8% due to pensions changes

Exclusive GP locums have cut their fees by an average of 8% since April, or halted their pension payments altogether, as a result of the Government’s changes to employer superannuation contributions.

Figures from Rlocums, a website that matches 1,300 locums to practices, show that locums are being forced to share the burden with practices of paying the extra employer contributions that the Government imposed on practices in April.

GP leaders have backed the figures, saying there has been anecdotal evidence that smaller practices in particular have been heavily hit by the reforms and have taken to paying locums less or stopping their use altogether.

A Pulse survey of 435 GPs reflects the analysis, showing that more than four out of ten GPs say they have made changes to the way they employ locums.

In April, the burden of paying locums’ 14% pension contributions was transferred from the now defunct PCTs to GP surgeries. Practices do receive an allocation of money with their global sum, which the DH says is equivalent overall to the money spent by PCTs on locum superannuation.

But this is distributed evenly across GP practices according to their size, which means that those who do not use locums regularly are actually better off, while those who do – which tend to be smaller practices who cannot cover absences internally - are worse off.

The BMA sent a letter to health secretary Jeremy Hunt in April warning that it had seen ‘dozens of cases’ in which locums were being forced to cut their fees, but the Rlocum figures are the first concrete indication that this is happening in practice.

Dr Steve Leung, the medical director for Rlocums and a GP in Leicester, said the changes are adversely affecting both locums and practices.

He said: ‘Locums are losing out because of the changes. Locums think it’s unfair and so do the practices. Practices are being reimbursed for using locums, but it’s not enough. We need to go back to a system like the one we had before where surgeries get money according to the number of locums they use.’

Locums who still pension their income typically reduced their hourly rates from £82.92 to £76.29 during May – the first month after the policy change – representing a fall of about 8%, said Dr Leung.

Around 45.6% of locums were pensioning their work in March, but the figures had fallen to 41.6% by the start of May - which relates to a reduction of almost 9%. This trend is likely to continue, said Dr Leung.

The Pulse survey found that 58.4% of GPs said the practices had absorbed the extra costs of pensions’ superannuation. A further 10% said they had negotiated a reduction in fees, while 7% said they were employing more retired GPs. One in four GPs said they had taken other action, which normally involved reducing the number of locums they use.

Dr Peter Swinyard, a GP in Swindon and chair of the Family Doctor Association, said the reforms were disproportionately affecting smaller practices because they often rely heavily on locums to cover absences, whereas larger practices can provide cover through their own substantive doctors, added Dr Swinyard. ‘Large practices that have no need for locums have had a windfall from the new payments system,’ said Dr Swinyard.

He added: ‘Some practices have told me that they have a certain budget, and they are sticking to it. It means now that they are using fewer locums or paying them less. I’ve have heard of both situations.’

Dr Sajid Mehmood, a GP in Luton, said that the changes had been affecting his small practice. He said: ‘To try to cover the extra costs of paying locums’ superannuation contribution we decided we would absorb half of the extra and ask locums to absorb the other half. It meant that locums charging £80 an hour would have their payment reduced to about £74 or £75.

‘We had to do this because we work in a small practice with only 1.5 full-time GPs and so we have to use locums when one of us wants a holiday or goes to a conference or a course. We’ve been struggling year-on-year financially, and we’ve been losing quite a lot. It’s been really hard.’

However, Dr Richard Fieldhouse, chief executive of the National Association of Sessional GPs, criticised GP partners who have tried to drive down locum rates as ‘small-minded’. He said: ‘The increase in costs for most practices has been tiny because it is spread throughout their overall costs.’

He added the data highlighted that it would be advantageous for ‘independent, vulnerable’ locums to join ‘chambers’ – collections of locums who work together to provide freelance GP services and have greater bargaining power as a result.

Dr Fieldhouse said: ‘Isolated, independent locums have become vulnerable following the changes. They tend to be female and are often from overseas, and they are not represented nationally.’

Survey results

Have you taken any action to mitigate the cost of providing employers 14% superannuation for the locums working at your practice?

No, we have absorbed any extra costs - 254 (58.4%)

Yes, we have negotiated a reduction in locum rates - 44 (10.1%)

Yes, we now employ retired GPs - 30 (6.9%)

Other action - 107 (24.6%)