Funding for new staff could be removed to ‘offset’ practice costs in case of inflation

Primary care networks might not be able to recruit additional staff if inflation rises significantly as that money would be used to cover practices’ increased core costs, the BMA has said.
 
As part of the five-year GP contract, NHS England and the BMA will introduce a new ‘balancing mechanism’ to protect practices and taxpayers against ’unexpectedly large increases in inflation or partner drawings’.
 
This mechanism will mean that if inflation is much higher than expected, funding set aside for new primary care network staff could be used to ‘offset’ the rising costs incurred as a result of the inflation, the BMA has told our sister publication Pulse, where this article first appeared.
 
Conversly, in the unliklier event of deflation occuring, funding will be removed from the global sum to prevent practices from receiving funding uplifts way above inflation. This money will then be added to the network staff funding pot.
 
GPs argue that this ‘balancing mechanism’ could leave practices and networks out of pocket.
 
The new GP contract promised to fund 22,000 additional practice staff – including pharmacists, physiotherapists, paramedics, physician associates and social prescribing workers – by 2023/24.
 
Under the contract, networks – which practices will be paid to join – will receive 70% recurrent funding for physiotherapists, physician associates, clinical pharmacists and community paramedics and 100% funding for social prescribers.
 
The contract also introduced a new ‘balancing mechanism’, set to be designed this year and introduced from 2020/21.
 
Its purpose is to – if required – ‘adjust between the practice level global sum and the network level Additional Roles Reimbursement Sum depending on levels of real terms partner NHS earnings’ in the case of high inflation or deflation.
 
This ‘will enable global sum adjustment equally in either direction’ and should ‘provide confidence to the profession and taxpayers alike’, according to the contract.
 
Speaking to Pulse, BMA GP Committee chair Dr Richard Vautrey said: ‘If there was a big rise in inflation – well above the predicted levels of inflation – then we may need to use some of the funding that is currently within the workforce envelope for the extension of teams of the primary care networks, to offset some of the new costs within practices so that practice staff are not at risk.
 
‘If there was a big change to the wider economy we can’t have practices vulnerable as a result of that. In this situation, we would not be able to recruit as many new members of staff as currently planned.’
 
‘We have committed to ensuring practices have sufficient funding in the next five years to provide their staff with pay uplifts that at least match inflation. Future practice workforce recruitment depends on being able to treat our staff fairly in comparison with peers elsewhere in the NHS,’ Dr Vautrey explained.
 
Addressing the reference to partner drawings, Dr Vautrey said the mechanism will be similar to what happens with the Review Body on Doctors’ and Dentists’ Remuneration (DDRB).
 
He said: ‘What’s happened in the past is we would take into account expenses and then make the case to the DDRB based on what we know at the time. This is quite similar to that, but it’s just anticipating any significant change.
 
‘If we look back in recent years, the level of inflation has always been fairly stable, but there is no guarantee that will be the case going forward.
 
‘This is to give confidence to all parties in signing up to a five-year deal. We have used the best available information we’ve got at the moment but if the situation changes then we need to be adaptable to that situation,’ he added.
 
But County Durham and Darlington LMC vice-chair Dr Kamal Sidhu argued moving some of the funding for new staff to absorb rising practice costs will impact the ability of networks to take pressure off practices.
 
He said: ‘Either way, the pressure will be on practices be it in form of funding or workload. It shall be a challenge to offset the expectations from primary care networks, which seems to be quite a big unknown to me.
 
‘There should really be a clause that the Government shall pick up some of the cost at least and it not be left to the practices who have been starved of funding for a decade now.’
 
Dr Vautrey said the BMA will be holding discussions with NHS England on the sof the balancing mechanism in the ‘coming months’.
 
This story was first published on our sister publication Pulse.