GP funding and contracts explained (2024)

What are general practices?

General practices are the small to medium-sized businesses whose services are contracted by NHS commissioners to provide generalist medical services in a geographical or population area. While some general practices are operated by an individual GP, most general practices in England are run by a GP partnership. This involves two or more GPs, sometimes with nurses, practice managers and others (as long as at least one partner is a GP), working together as business partners, pooling resources, such as buildings and staff, and together owning a stake in the practice business. GP partners are jointly responsible for meeting the requirements set out in the contract for their practice and share the income it provides.

Some GPs work as salaried employees of a practice without owning a share in the overall business (so they are not GP partners). The British Medical Association (BMA) has a model salaried employment contract for these staff and practices with a General Medical Services (GMS) contract are required to offer this contract or an equal alternative to salaried GPs.

Who commissions general practice?

Responsibility for commissioning primary care services, including general practice, sits formally with NHS England. However, over time clinical commissioning groups (CCGs) have increasingly taken on full or partial delegation of these commissioning powers for primary care. This now means most CCGs have at least some responsibility for commissioning general practice in their local area, while keeping to national guidelines to ensure consistency.

What types of GP contracts are there?

Every individual or partnership of GPs must hold an NHS GP contract to run an NHS-commissioned general practice. These set out mandatory requirements and services for all general practices, as well making provisions for several types of other services that practices may also provide, if they so choose.

There are three1 different types of GP contract arrangements used by NHS commissioners in England – General Medical Services (GMS), Personal Medical Services (PMS) and Alternative Provider Medical Services (APMS).

The GMS contractis the national standard GP contract. In 2018/19,around 70 per centof GP practices operated under it2. This contract is negotiated nationally every year between NHS England and the General Practice Committee of the BMA, the trade union representative of GPs in England. It is then used by either NHS England and/or CCGs (depending on delegated powers) to contract local general practices in an area.

The PMS contractis another form of core contract but unlike the GMS contract, is negotiated and agreed locally by CCGs or NHS England with a general practice or practices. This contract offers commissioners an alternative route with more flexibility to tailor requirements to local need while also keeping within national guidelines and legislation. The PMS contract is being phased out, but in 2018/19, 26 per cent of practices held one.

The APMS contractoffers greater flexibility than the other two contract types. The APMS framework allows contracts with organisations (such as private companies or third sector providers) other than general practitioners/partnerships of GPs to provide primary care services. APMS contracts can also be used to commission other types of primary care service, beyond that of ‘core’ general practice. For example, a social enterprise could be contracted to provide primary health care to people who are homeless or asylum seekers. In 2018/19, 2 per cent of practices held this type of contract.

All types of contract are managed by the NHS commissioner (either NHS England or CCGs). Where contracts are negotiated locally, Local Medical Committees representing GPs may advise or participate in discussions alongside regional BMA representation.

  • 2. Figures do not add up to 100 per cent because in 2018/19 101 practices were listed with an unknown contract type.

What’s in a GP contract?

The core parts of a general practice contract:

  • agree the geographical or population area the practice will cover
  • require the practice to maintain a list of patients for the area and sets out who this list covers and under what circumstances a patient might be removed from it
  • establish the essential medical services a general practice must provide to its patients
  • set standards for premises and workforce and requirements for inspection and oversight
  • set out expectations for public and patient involvement
  • outline key policies including indemnity, complaints, liability, insurance, clinical governance and termination of the contract.

In addition to these core arrangements, a general practice contract also contains a number of optional agreements for services that a practice might enter into, usually in return for additional payment. These include the nationally negotiated Directed Enhanced Services (DES) that all commissioners of general practice must offer to their practices in their contract and the locally negotiated and set Local Enhanced Services (LES) that vary by area.

What services can practices be contracted to provide?

General practices are contracted to perform broadly five types of service for the NHS, although some are optional.

  1. Essential services are mandatory for a practice to deliver to registered patients and temporary residents in its practice area. They include the identification and management of illnesses, providing health advice and referral to other services. GPs are required to provide their essential services during core hours, which are 8.00am–6.30pm Monday to Friday, excluding bank holidays.
  2. Out-of-hours services are those provided outside core working hours. A practice is assumed to provide these by default but can opt out. Where a practice opts out, as most practices do, commissioners have the responsibility for contracting a replacement service to cover the general practice area population.
  3. Additional services include specific other clinical services that a practice is assumed to provide but can opt out of, for example,minor surgery.
  4. Enhanced services are nationally agreed services that holders of almost all GP contracts (GMS/PMS/APMS) can also provide if they choose to opt in. Services specified for 2020/21 include some vaccination programmes and a health check scheme for people with learning disabilities. Primary care networks (PCNs) (see box below) have also been established via an enhanced service agreement.
  5. Locally commissioned services are locally set services that practices can also opt in to. Unlike other GP services, these might also be commissioned by non-NHS organisations such as local authority public health departments. Examples include services for people who are sleeping rough or mental health support programmes.

Almost all general practices in England are part of a PCN, a small group of practices usually within the same geographical area that work together under the PCN DES contract to gain some of the benefits of working at scale and access to additional funding.

How does the money flow?

The funding a general practice receives depends on a complex mix of different income streams. Much of a practice’s income comes from its core contract agreements – meeting mandatory requirements, running essential services and operating additional and out-of-hours services where they have been agreed. This is known as the global sum payment. However, a sizeable amount of a typical practice’s income comes from other NHS sources such as the Quality and Outcomes Framework scheme (see below) or payments for providing enhanced services. Practices may also top up their NHS funding with fees for limited private services, such as sick certifications and travel prescribing. Most practice income is paid to the general practice rather than individual GPs.

Global sum payments

About half the money a practice receives is from the global sum payment – money for delivering the core parts of its contract. This includes payment for out-of-hours and additional services; if a practice opts out of these, percentage deductions are applied to the global sum payment to account for this. Global sum payments are based on an estimate of a practice’s patient workload and certain unavoidable costs (eg, the additional costs of serving a rural or remote area or the effect of geography on staff markets and pay), not on the actual recorded delivery of services. The global sum payment for each practice is based on a weighted sum for every patient on the practice list. The Carr-Hill formula is used to apply these weightings, which account for factors such as age and gender. The global sum amount is reviewed quarterly to account for changes to the practice’s patient population.

Figure 1 summarises how the global sum payment to a practice is calculated.

Figure 1 Calculating a practice’s global sum payment

GP funding and contracts explained (1)

Quality and Outcomes Framework payments

The Quality and Outcomes Framework accounts for around 10 per cent of a practice’s income. The Quality and Outcomes Framework is a voluntary programme that practices can opt in to in order to receive payments based on good performance against a number of indicators. In 2018/19 more than 95 per cent of practices took part. The framework covers a range of clinical areas, for example, management of hypertension or asthma; prescribing safety; or ill health prevention activity. Each area has a range of indicators that equate to a number of Quality and Outcomes Framework points.

Example indicator from The Quality and Outcomes Framework 2019/20

RA002 – The percentage of patients with rheumatoid arthritis, on the register, who have had a face-to-face review in the preceding 12 months. Achievement threshold 40–90 per cent. Points: 5

If 40 per cent of patients with rheumatoid arthritis have had a face-to-face review with a health professional, the practice will receive 1 point. If 90 per cent of these patients have had a face-to-face review, the practice receives 5 points. Points are awarded proportionately for percentages between these boundaries.

At the end of the financial year, the practice receives an amount of money, based on points achieved in the Quality and Outcomes Framework.

Premises payment

If a practice is leasing its premises, rent is generally reimbursed in full in arrears. If a partnership owns its premises, it is mortgage payments that are reimbursed, although most practice premises are leased. Some practices sub-let rooms to other providers (for example community health services providers) but there are rules on what a practice can use its building for, which affect reimbursement.

Primary care organisation (PCO)-administered payments

PCO-administered payments refers to payments by the local ‘primary care organisation’, ie, the CCG or NHS England depending on delegation of powers. Payments in this category include, for example, locum allowances and appraisal costs.

What do GPs spend their money on?

Figure 2 Practice income, outgoings and partner share

GP funding and contracts explained (2)

Source: GP income streams based on NHS payments recorded in NHS payments to general practice – England, 2018/19

Paying its workforce – including salaried GPs, nurses, health care assistants and administrative staff – accounts for the majority of a practice’s costs. These staff are usually employed directly by the GP practice and not by the NHS and so are not subject to Agenda for Change arrangements.

Partners pay themselves from the money that remains after other expenditure has been accounted for. Part of this personal income is used to pay their pension contributions, tax, indemnity, General Medical Council and other subscriptions. Partners may also decide to reinvest some of the remaining income into the practice. It is important to note that partners in GP practices are also personally liable for any losses made by the practice.

What does it all mean?

GP partners are not just clinicians but also small business owners and employers. This comes with a number of challenges, for example, the need to manage and optimise complicated income streams and personal liability for financial risks. It also means partners have a strong vested interest in maintaining and developing their practice.

Historically, the major levers for setting national or local priorities and implementing service improvements across general practice have been contractual, for example, the Quality and Outcomes Framework, rather than based on national guidance. This is still the case, although rapid transformation in the services GPs are providing in response to Covid-19 is challenging this assumption.

If local health systems are to achieve their full potential, a shared understanding of the differences between funding and contracting models for the different parts of that system will be important if partners are going to work effectively together.

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GP funding and contracts explained (2024)

FAQs

What is the GP contract? ›

About the GP Contract

The new contract was designed to bring about a range of improvements in primary care in providing demonstrable benefits to general practitioners, to other healthcare professionals, to the health service in general and most importantly to patients.

What is the difference between GMS and PMS contracts? ›

The PMS contract is another form of core contract but unlike the GMS contract, is negotiated and agreed locally by CCGs or NHS England with a general practice or practices.

How are GPs funded in the UK? ›

GP practices are paid on the basis of the number of patients on their list. This is obtained from the registered patient list held by NHS Digital on behalf of NHS England. In addition to this GPs are paid for their performance under the Quality and Outcomes Framework (QOF).

How do GPs get paid? ›

GPs do not receive a simple pay cheque. Instead, they earn their money through a complex system of fees and allowances. The fee scale is calculated to pay intended average pay plus an amount to cover indirect expenses.

What is changing in the GP contract for 2022 23? ›

Other 2022-23 changes

The GP registration service (in development via a pilot) will be made available to adopt on a voluntary basis. Alternative locally developed online solutions may be put in place. Online appointment booking will see the removal of the 25% minimum.

How much does a GP earn per patient? ›

The typical pay rate for a day is around $1000 to $1,600. This amount can vary due to a number of factors: The number of patients a practitioner sees in a day. Most GPs book 4 to 6 consultations an hour.

Who can hold a GMS contract? ›

GMS contracts may be held by partnerships as long as at least one partner (who must not be a limited partner) is a general medical practitioner and any other medical practitioner is a qualifying general medical practitioner or employed by a PCT, a Local Health Board, an NHS Trust, an NHS foundation trust, a Health ...

Do GPs get paid per prescription UK? ›

The NHS pays pharmacists and dispensing GPs a flat rate for each drug, meaning they make money if they can buy it more cheaply from wholesalers.

How much do GP partners earn UK? ›

The yearly publication for 2019/20 said the average GP partner earned £121,800 before tax – a 'statistically significant' 3.8% increase from 2018/19 – while the average income for salaried GPs rose by 4.9%, from £60,600 to £63,600. The data also showed that GP partners' expenses rose by 6.5%, to £280,800.

Are GPs private contractors? ›

Yes GPs are private business, but … A GP working in private practice sees private (non NHS) patients. That is people who prefer to have a different service (longer appointments, unusual hours) or do not qualify for NHS care, eg. diplomatic staff, etc.

Are GPs independent contractors? ›

The independent contractor status of GPs has been an article of faith since the NHS was established in 1948. A salaried service was devised for hospital consultants but essentially, GPs have been self-employed ever since.

How do GP partnerships work? ›

You share the profits of the practice with the other partners. If profits go up, so does your share. Partners working in a successful practice can therefore hope to gain a substantial income. You have stability of employment.

Is owning a GP practice profitable? ›

Gross profit margin for the surveyed practices averaged 35.9%, according to the Prosperity Health survey. In absolute dollar terms, gross profit per GP (taking into account owners, contractors and contributing GPs) averaged around $166,000, with higher-performing practices averaging more than $250,000 per GP.

Where do GPs get paid the most? ›

1: Luxembourg. A surprise winner – Luxembourg tops the list! A small nation with just above six-hundred-thousand, Luxembourg offers a cultural mix between its neighbours Germany and France. This is reflected in the three official languages; German, French and the national language of Luxembourgish.

Why are GPs paid so much? ›

but speciality training takes longer than GP training yet GPs earn more at a younger age (finish training earlier) is it all about supply and demand? GPs are paid differently because they are technically self-employed. It relies on your management skills whether you do earn a lot or not (as a partner).

How much is an IIF point worth 2022 23? ›

2.13 The IIF is a points-based scheme. For 2022/23, each PCN can earn a maximum of 1153 IIF points and the value of a point will be £200.00 (adjusted for list size and prevalence – see paragraphs 2.18-2.19).

How much is each QOF point worth? ›

The new value of a QOF point will be £194.83. More roles added to the additional roles. Reimbursement scheme. Between 2020 and 2024, the scheme will expand to 26,000 additional roles.

How are QOF payments made? ›

The agreed Aspiration Points Total is divided by three, multiplied by the value for a QOF point and then by the contractor's CPI, to produce the annual amount of the contractor's Aspiration Payment. Again, these will be paid in twelve month instalments over the year.

How many patients does a GP take a day? ›

Within these limits, adequate rest breaks must be taken. Extending sessions beyond this time risks harm to patient and clinician. The European Union of General Practitioners and BMA have recommended a safe level of patient contacts per day in order for a GP to deliver safe care at not more than 25 contacts per day.

How many sessions is full-time GP? ›

Life as a GP

A full-time working week usually comprises of eight sessions, which equates to four days. A typical day in the practice normally starts at around 8am when you'll check paperwork before seeing patients.

How much do rural GPs earn? ›

Once a GP, you can make around $300,000 a year without sacrificing your lifestyle, working 9 to 5, five days a week. As a rural GP you can earn even more, with government incentive schemes for GP Registrars training in rural and remote areas and financial incentives for new GPs practising in these areas.

How can I increase my GP practice income? ›

The top 12 ideas to increase GP practice profits
  1. Offer virtual appointments. ...
  2. Get on board with wearable technology. ...
  3. Keep your website updated. ...
  4. Encourage patient engagement online. ...
  5. Expand your services. ...
  6. Offer paid-for services to local businesses. ...
  7. Offer health education classes. ...
  8. Take action to reduce wait times.
Jul 17, 2017

Can a nurse hold a GMS contract? ›

Nurse partners can fit into any one of the three current contractual arrangements in general practice. Since 2004, the General Medical Services (GMS) contract states at least one partner in a practice must be a doctor with an active registration but it is possible to form partnerships with practice managers and nurses.

Can a GP practice be a limited company? ›

“Can I put my medical practice into a limited company?” I have been asked this on numerous occasions over the last 18 months - and have also been asked to act for 'Ltds' that have already made the change. The simple answer is yes.

Do GPs get money for prescribing statins? ›

The new QOF incentives will be offered to GP surgeries for: Prescribing statins to patients with type 1 diabetes that are over 40 years of age or have had diabetes for over 10 years. The QOF rewards are in line with the controversial NICE guidelines on lipid modification.

How many patients can a GP have in the UK? ›

There are now just 0.45 fully qualified GPs per 1,000 patients in England – down from 0.52 in 2015. For the GPs that remain, this means increasing numbers of patients to take care of. The average number of patients each GP is responsible for has increased by around 300 – or 16% - since 2015.

Do doctors make money off prescribing drugs? ›

Pharmaceutical companies have paid doctors billions of dollars for consulting, promotional talks, meals and more. A new ProPublica analysis finds doctors who received payments linked to specific drugs prescribed more of those drugs.

Do GPs earn more than consultants? ›

Due to their training, consultants often make more than GPs. Starting pay for consultants in their first year is around $100,000. Each year, consultants receive a pay raise.

How much does a GP earn per hour UK? ›

Find out what the average Gp salary is

How much does a Gp make in United Kingdom? The average gp salary in the United Kingdom is £71,879 per year or £36.86 per hour. Entry level positions start at £35,364 per year while most experienced workers make up to £95,592 per year.

How are GP partners taxed? ›

GP partners are taxed on their overall income – not, as many tend to believe, on how much they choose to draw from the practice. Drawings are payments made to each partner, usually on a regular monthly basis, on account of their final share of the net income – or profit – of the practice.

Can you sell a GP practice? ›

The sale of goodwill by GP practices has been prohibited since the government, in effect, 'bought it' in 1948 when the NHS was created. The ban was restated in 2004 for practices with a patient list in the Primary Medical Services (Sale of Goodwill and Restrictions on Subcontracting) Regulations 2004.

How are GP practices owned? ›

It's true that general practices are run as businesses. This is because, at the founding of the NHS, most GPs worked as individuals from their own homes, and it would have been very difficult to nationalise them. We still run as small businesses, but we have only one contract and that is with the NHS.

Why are GPs independent contractors? ›

History of GPs

Since the inception of the NHS in 1948 GPs were independent practitioners providing services to the NHS, rather than being NHS employees. This was partly because most GPs did not want to become state employees and partly because most practised from their own homes, which could not be nationalised.

Are GP partners self-employed? ›

Note that partners are self-employed and responsible for their own tax liabilities – tax is not deducted at source as it is for employees i.e. there is no Pay As You Earn (“PAYE”) as you will be used to as a GP trainee.

Can NHS GPs work privately? ›

Wholly private GPs cannot issue NHS prescriptions but can only provide private prescriptions. NHS GPs on the other hand, cannot charge NHS patients for prescriptions but can charge private patients who are not on their NHS list for prescriptions. Additionally, NHS GPs cannot issue NHS prescriptions to private patients.

Who owns my GP surgery UK? ›

US health insurance giant, Centene, through its UK subsidiary, Operose Health, has been taking over GP surgeries and practices in London and across the country for many years.

Do GP partners get NHS pension? ›

GPs have been afforded access to the NHS Pension Scheme since 6 July 1948. To qualify for Scheme membership a GP must be a party to, or working under, a GMS (General Medical Services) contract, a PMS (Personal Medical Services) agreement, or an APMS (Alternative Provider of Medical Services) contract.

What to ask before becoming a GP partner? ›

Ask your trainer, if you are a registrar, and your spouse, if you have one.
...
Here are some possible headings and some lines of questioning.
  • Partnership and team—do you share their ethos? ...
  • Work—how are clinical and managerial responsibility divided? ...
  • IT and premises—is the practice paperless, or on the way?
Apr 29, 2006

Do GP partners pay national insurance? ›

National Insurance as a GP

Both these sources of income are liable to national insurance contributions (NICs). A GP will pay NICs on any salary as well as on their practice income. There is, however, a maximum amount of National Insurance Contributions which any individual tax payer has to pay in any year.

Is it worth becoming a GP? ›

It's a very good career but it's very hard. A lot of doctors think GPs don't really do very much but it's literally non-stop because even when you're not at the practice you have to constantly read up on new treatments and guidelines at home.

What is a good profit margin in healthcare? ›

Even though hospitals in the U.S. are paid an average of less than 30% of what they bill, their profits margins have averaged around 8% in recent years. 5. Over 80% of hospitals in the U.S. are non-profit. 6.

How many patients can a GP see per day Australia? ›

With the competition in the inner city suburbs being so fierce, GPs will typically see around 20 – 30 patients per day, depending on the model of the practice. The exception is for larger bulk billing clinics.

Do GPs get paid for prescribing? ›

GPs may write private prescriptions for patients for drugs not available through the drug tariff. However, GPs normally do not charge their registered patients for providing such a prescription, although a dispensing doctor may charge for dispensing the prescription.

How much do GP partners earn UK? ›

The yearly publication for 2019/20 said the average GP partner earned £121,800 before tax – a 'statistically significant' 3.8% increase from 2018/19 – while the average income for salaried GPs rose by 4.9%, from £60,600 to £63,600. The data also showed that GP partners' expenses rose by 6.5%, to £280,800.

How do GP partnerships work? ›

You share the profits of the practice with the other partners. If profits go up, so does your share. Partners working in a successful practice can therefore hope to gain a substantial income. You have stability of employment.

Who owns GP surgeries UK? ›

US health insurance giant, Centene, through its UK subsidiary, Operose Health, has been taking over GP surgeries and practices in London and across the country for many years.

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