GPs set to lose income guarantee

The minimum income guarantee for family doctors is set to be scrapped, in a move that could open up health services to more competition.

A recommendation to scrap the guarantee is to be made by Lord Darzi’s “next steps” review of the NHS.

The move has been widely expected, as primary care trusts complain that the guarantee can double their costs when they introduce new primary care providers – but then have to continue to pay existing GPs a minimum income, even if large numbers of patients leave an existing practice.

“We would definitely like to see it go, and we have said as much to Lord Darzi’s review,” said David Stout, director of the NHS Confederation’s primary care trust network.

Lord Darzi’s report, expected in June, is still at early drafting stages. But one health minister said: “I would be very surprised if this does not happen.”

The Minimum Practice Income Guarantee, which costs about £300m ($592m) a year, was the result of a last-minute change to the GP contract in 2003 which pushed more money into payments for achieving quality targets, but paid GPs less per patient they took on.

As a result, some practices faced big potential drops in income. To get the contract through, ministers promised that no practice would face a lower income from the new deal than under the old one.

However, the effect of the guarantee has been to perpetuate historic inequalities in funding between practices, say both the NHS Confederation and the British Medical Association.

It also reduces the impact of payments that give GPs more money for taking on patients with greater needs – a formula intended to reflect workload and help those in deprived areas.

“The guarantee undermines the principle of fair funding,” Mr Stout said. “And it undermines choice to some extent because GPs can lose a lot of patients from their list but still get the same income.” This also discouraged primary care trusts from bringing in new providers because they would still have to pay existing GPs a minimum income, he said.

Dr Laurence Buckman, chairman of the BMA’s family doctors committee, said it too had little enthusiasm for the guarantee. “We would like to see it phased out over time,” he said.

Putting the cash into basic payments for GPs would work for many, Dr Buckman said. But a proportion of practices, perhaps 10 per cent, “would be such serious losers that many of them would probably have to close”.

Mr Stout acknowledged that “getting rid of the guarantee overnight would cause a lot of disruption. But we do need to find a way of phasing it out”.

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