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Cloud telephony to cost practices up to £10K extra annually, GPs warn

by Anna Colivicchi
1 February 2024

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Cloud-based telephony will cost ‘cash-strapped’ GP practices up to £10,000 extra per year, GP leaders have warned.

This year’s GP contract imposition stipulated that GP practices must procure cloud-based telephony once their current contracts expire, and £240m of funding was announced as part of the recovery plan, with a focus on replacing old analogue phone systems.

But Lancashire and Cumbria LMC said that the new systems incur yearly fees that are ‘approximately double or triple current the annual costs’ and warned that this will result in an extra expense of between £3,000 to £10,000 depending on the practice size.

The LMC published a report assessing the state of finances among GP practices in the area following a survey.

It found that, of the 191 practices who responded to the survey, 111 reported ‘financial stress’ either in terms of reduced income or rising costs and the inability to afford to recruit staff, with further 10 placing themselves ‘at immediate risk of closure’.

LMC chief executive officer Dr Adam Janjua told our sister publication Pulse that having to pay more towards cloud-based telephony will have a ‘huge’ impact on practice finances.

He said: ‘My practice has just been going through this process, we are a 6,000-patient practice and we paid almost £1,500 a year for our telephony.

‘For us to use one of the digital services which we have had to sign up to we’ll need to pay £6,000 a year. So there’s a huge discrepancy even for the smaller practices.

‘It’s not adding anything for patients aside for the call wait and the call back. There’s still going to be the same number of receptionists that are going to be available to take the calls.

‘For a 12,000-patient practice they are paying almost £10,000 to £15,000 a year for this telephony – and we still haven’t heard anything from NHS England about getting any subsidisation for the price that we are paying compared with the price that we used to pay. I think it’s pretty much all on practices to pay for the new systems.’

In other areas including Preston, Chorley, South Ribble, and West Lancashire, practices have been ‘driven to shift early’ to cloud based telephony and the LMC said this was ‘due to operational difficulties’ with existing systems and that it led to practices ‘footing the entirety of costs’ to be contractually compliant themselves prior to any financial support through national programmes.

Similarly in Greater Manchester, practices are reporting extra costs due to issues with the new systems.

Dr Bob Wood, a GP in Heywood, said that about 20 practices in Heywood, Middleton and Rochdale were already on a cloud-based telephony system provided by NHS Greater Manchester, but were then told that it ‘did not meet the Governments service specifications’.

He said: ‘The system is going to be pulled from use in mid-March of this year and we have to procure and install a new system.

‘We’ve only managed to meet with one supplier, so we basically have to go with that supplier. The ongoing costs will be £54 plus VAT more than we currently pay, so we are going to have to find this extra monies from our drawings.

‘Our entire system is going to cost about £20,000, so we’re going to have to find £20,000, and then wait to be reimbursed. So we’re essentially going be out of pocket.

‘Whilst the goal of having improved telephone systems is admirable the implementation on our patch is grossly unfair to practices and also the wider NHS.’

Lancashire and Cumbria LMC’s report also highlighted that NHS England has set aside funding for the set-up costs of the new systems, but ‘numerous local practices’ have missed out on the funding by making the move ‘prematurely’.

It added: ‘Set-up costs for cloud-based telephony can range from between £15,000 to £30,000 depending on practice size. Other practices have been told that they must pay the installation costs upfront and then apply for the amounts to be reimbursed later.

‘This is causing major cashflow problems within already cash-strapped practices.’

For practices in Fylde and Wyre and in Blackpool, the initiative is ‘causing widespread financial challenge’ according to the LMC.

‘Several practices have paid out large sums of money to avoid contract beaches, only to find that these new systems are not on the Better Purchasing Framework.

‘The issue has been poorly communicated and these practices have purchased telephony systems in good faith, fully expecting funding provision from NHSE. This lack of reimbursement will worsen the financial strain on practices.’

NHS England for comment has been approached for comment.

Earlier this month, NHS England said more than eight in 10 GP practices now ‘have digital telephony in place.’

A version of this story was first published on our sister title Pulse