28
oct
0

Do PCN finances stack up?

Posted by Blogs, The General Practice BlogNo Comments

I understand the primary aim of PCNs is not to be a source of income for practices, but it is important they don’t become a drain on already under pressure practice finances.  So do PCN finances stack up?

Just as a reminder, the aim of PCNs (according to the BMA) is to focus services around local communities, help rebuild and reconnect the primary healthcare team across the area, alleviate workload, be practice-led, and allow GPs and primary care practitioners to deliver a new model of care for their patients and communities.  It is interesting there is no mention of money, despite the financial challenge in general practice PCNs are supposed to be part of the solution to.

The headline investment figure into PCNs is the Additional Role Reimbursement Scheme (ARRS), which brings with it total investment of £1,412M by 2023/24, equating to an average reimbursement pot of £1.13M per PCN.  Member practices receive a £1.76 participation payment.  PCNs directly receive £1.50 core funding (which I discussed last week), 2 to 3 sessions reimbursement for a Clinical Director, and the Investment and Impact Fund – the proceeds of which PCNs have to commit to reinvesting in additional workforce or primary medical services.  There are also extended hours payments and care home “premium” payments, but these are funds for specific pieces of additional work.

The eye catching figure is of course the investment via the ARRS.  But what is increasingly emerging are a set of hidden (and not so hidden!) costs for PCNs and their practices associated with these roles.

Many areas have not been able to recruit the roles within the salary reimbursement available, and each role where this has been the case becomes a cost pressure on the PCN.  These cost pressures will accumulate as more roles are added, and as staff expect pay rises beyond the reimbursable amounts available.

It is also unlikely the on costs will meet the training, supervision and professional development costs of the roles, along with equipment and property costs – apparently NHS Property Services has recently stated that where its property is used to house PCN services this will incur additional property costs for those practices.

When PCNs were first being set up there was quite a bit of talk about the risk of incurring VAT, but that died down relatively quickly.  However, as PCN turnover starts to exceed the VAT allowance of £85,000, which it increasingly will do as the number of roles recruited to increases, then the spectre of this charge will quickly re-emerge.  There is no obvious source of funding to meet any such VAT charge, other than directly from member practices.

The other issue for PCNs to consider is whether they should be creating a financial buffer, to mitigate the potential risk of any employment costs that may arise out of the new PCN staff group.  Often companies will try and ensure they have at least three months of salaries as a financial buffer, which by 23/24 would be £250-300K for an average PCN.  That money will need to come from somewhere.

What approach, then, should PCNs take to PCN finances?  It seems to me that PCNs have one of two choices.

They could choose to think about PCN finances in terms of the net impact on member practice finances.  This would mean practices actively monitor the total positive impact on practice profitability of the PCN.  They would take the £1.76, the impact of the new roles in reducing staff costs, and any increase in income from PCN contracts, and subtract any direct costs to the practice of the PCN, such as financial contributions, property charges and staff time, and ensure that it remains net positive.

The key to making this approach work would be ensuring each practice receives a direct positive impact from the additional roles that are brought in, rather than treating them as PCN-staff that are not really anything to do with the work of the practice.

The other option would be for PCNs to operate financially like a business.  The principle here would have to be that the total income of the PCN should match the total costs.  Outside of the DES contract itself there are soft funding pots available, both through the national PCN development funds and local initiatives.  The Investment and Impact Fund was initially presented as an opportunity for PCNs to earn money by reducing secondary care expenditure, but that was lost as it was watered down into what we have now.  The big potential income generating opportunity on the horizon is the shift of extended access funding to PCNs from next year.  It remains to be seen whether this too will still exist once the final guidance has been agreed.

My worry is that many PCNs at this point in time are not taking either of these approaches.  PCN finances can stack up, but to do so will require active financial management.  The big risk is that without this in place PCNs could end up having a significant negative impact on member practice finances.

21
oct
0

The £1.50 Challenge

Posted by Blogs, The General Practice BlogNo Comments

Each PCN receives “core funding” of £1.50 per patient.  The Network DES states, “A PCN is entitled to a payment of Core PCN Funding for use by the PCN as it sees fit” (9.5.1).  This freedom has created a level of ambiguity around the use of this funding that is hindering rather than helping most PCNs.

If we start at the beginning, there is no way that £1.50 per patient (c£75k for the average PCN) is sufficient to cover the running costs of a PCN.  A PCN will soon be employing upwards of 20 staff, and be managing a budget well in excess of a £million.  It is not possible for the administrative overhead to be £75k and expect payments to staff and practices to be made accurately and on time, for staffing issues to be dealt with appropriately, and for the huge system expectations of PCNs to be met.

A helpful piece of context might be the running costs of CCGs.  When they were established they were allocated £25 per patient (which was still a cut on the running costs of their predecessor PCTs).  Admittedly PCNs are not statutory organisations like CCGs, but the expectations are still high, and having only 6% of the running costs given to CCGs highlights the challenge PCNs are facing.

PCNs may have been able to get by so far, as the actual demands have been limited to sorting out extended hours and some early recruitment.  But now there are new staff in post, 3 service specifications to deliver, and with the prospect of sorting out extended access on the horizon things are soon going to feel very stretched.

The challenge many PCN Clinical Directors (CDs) are facing is their member practices do not want the £1.50 to be spent, and resist proposed uses of the fund.  Because the expectations were relatively light in year one some PCNs were able to return some (or even all) of the £1.50 to member practices.  This in turn has set an expectation that practices will receive some such funding directly from the PCN each year.

So when a new PCN manager is under pressure it can often turn into questions to the CD from practices about what value are we really getting from this role anyway?  And before you know it, the PCN has decided they do not need a PCN manager after all.

Other PCNs have turned to the £1.50 to make up for the shortfall in the ARRS funding for the new roles.  So where the roles have come with additional costs (salary shortfalls, training supplements, venue/location costs etc) the £1.50 has been used to meet the deficit.

The problem of course is that this will only work for the first couple of roles.  If you are cutting £75k across more than 20 roles it is not going to solve the overall funding shortfall problem that the ARRS scheme presents.  At the same time, it is eating into an already underfunded running cost allocation.

I have written previously on how essential the PCN manager role is.  There is a rumour that PCN managers may be included in the next list of roles that can be funded from the ARRS.  But whether it is or isn’t, no individual can be an expert change manager, project manager, finance manager and HR manager.  PCNs need a team of support to be successful.

The £1.50 challenge for PCNs, and particularly for PCN CDs, is how to withstand pressure from member practices not to spend it or to spend it on topping up additional roles, and instead to use every penny to put in place the best possible support infrastructure for the PCN.  Because without it, the PCN is going to struggle as it moves forward.

14
oct
0

Is the PCN CD Model Reinforcing Historic Leadership Approaches and Cultures?

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Introduction

In 1998 I completed an MBA. For my dissertation I undertook a triangulated study to identify the barriers to public participation in General Practice. I found culture, leadership and structure of General Practice to be contributory factors.  These terms were alien to NHS management language at the time. In the emergent purchaser provider split of the time, with the introduction of commissioning and competition into the NHS, there was a reliance on quantitative and empirical evidence, with little room for qualitative evidence. As a result, my dissertation sat on a shelf until I became a Practice Manager.

Finding my personal motivation and beliefs constantly conflicted in a toxic command and control environment, I found it increasingly challenging to function as a middle manager in commissioning. At the time, I thought academic leaning was my route to influence in the NHS. Heading towards a PHD I was head hunted to apply for a practice manager job. Taking it became the best decision of my career. More on that later………………

Fast forward to November 2019 when I was fortunate to attend a Kings Fund conference on “The Challenge of Culture Change in the NHS”.  Promoting a move away from the command and control culture, this event explored the type of culture (in alignment with the Interim NHS People Plan) that would make the NHS a better place to work in. The emergent words on the day included “collaborative and compassionate culture and leadership”. This brought music to my ears. Emotionally exhausted from hearing some very brave individual accounts of collaborative and compassionate leadership, I left the conference with renewed hope and personal ambition!! I had waited two decades for this.

Having dusted off my MBA dissertation and reflected on my findings, it becomes clear to me that the structure, culture and leadership style in individual practices not only prevented meaningful engagement with patients and the public, but may also be a contributing factor to the challenges we face in embedding PCNs and new models of care.

Leadership and Culture

Many GP practices aspire to a command and control leadership style and culture, aligned to a vertical organisational structure. This leadership style is authoritative in nature and decision making is top-down. Privilege and power are vested in the Senior Partner (the heroic leader) with limited opportunities for broader involvement and engagement. This leadership style facilitates a weak organisational culture, one in which core values are not defined or communicated. The absence of shared values results in individualistic compliant behaviour, with a greater need for policies, procedures and bureaucracy.  Employees are compliant with low morale. Staff are disengaged and disempowered.

 

A weak culture is associated with:

  • Incompatible vision, mission, goals, and a lack of understanding about the future direction of the organisation, which may lead to failure;
  • Lack of leadership, poor direction from senior managers, competition and poor role models, and;
  • Lack of quality of service provision, poor running of the organisation, and priorities externally perceived as being incorrect.

 

A strong positive culture is evident in practices where members within the organisation have deeply embedded shared values and beliefs. In this culture committed employees understand what is required of them and are empowered to act in accordance with the core values. Bureaucracy is reduced and there is high staff morale, engagement, and productivity. Internally, this positive culture provides the “glue” that binds the organisation together. Many practices with this culture and collaborative, compassionate leadership style are forging the way forward towards successful new models of care and scaled up General Practice.

 

The Practice Manager Continued….

Working at Oxford Terrace Medical Group taught me that command and control is not the only model available to general practice. There was no Senior Partner.  Leadership roles were distributed across the partnership.  Individual partners worked with the practice manager on management issues, taking an active role in running their business. At first there was limited involvement of patients and the broader Primary Health Care Team.

 

Equipped with my MBA and the necessary operational management skills, my first job was to co-ordinate a merger with a failing practice. It became very clear to me early in the process, that operational management skills alone, were not adequate for the culture change required to lead large scale transformational change. With three clear strategic priorities: improving access; transforming the workforce, and premises development, I embarked on a quality improvement programme. This provided structure for the merger project, through three modules:

  • Fundaments of quality improvement;
  • Human dimensions of change, and;
  • Facilitation Skills and developing a compelling narrative.

 

A focus on human dimensions of change and quality rather than finance, transformed engagement of patients and employees during, and after the merger, enabling us to achieve the first two priorities quickly. We developed new roles (Frailty Nurse, Older Peoples Specialist Nurse, Care Navigator and Occupational Therapy in GP) to meet population need, this helped us to manage the access issues. Tied up in the merry-go-round of the ETTF process, premises development eludes me to this day.

 

What I learned was that a distributed leadership model focused on engagement and collaboration could not only succeed but also make a real difference within the general practice environment.

 

Quality Assurance and Quality Improvement

CQC further perpetuates the command and control leadership style and culture through target driven “quality assurance”, stifling opportunities for collaboration and the value of quality improvement. The Well Led KLOE, focused on transactional process is a clear indication of this.

 

There is a recognition now that the Well Led KLOE is limited, and there are plans to split the transactional (quality assurance) from the transformational (quality improvement) elements. A strong organisational culture requiring less bureaucracy, is better placed to facilitate quality improvement and collaborative, compassionate leadership with strong organisational culture.

 

Putting quality at the heart of the organisation, embedded though continuous improvement, involving all levels of the organisation working together to produce better services and care, through transformational processes and action. Quality improvement relies on the use of methods and tools to continuously improve quality of care and outcomes for patients. There is no place for command and control leadership in this environment.

 

PCN Leadership and Culture

Faced with changing demographics, people living longer with long-term conditions, with increasingly complex health needs alongside a shortage of GPs and nursing staff, the unprecedented pressures in primary care are well rehearsed. To date, workforce in general practice has remained simple with GPs, Practices Nurses, Health Care Assistants, Administrative staff and recent introduction of pharmacists in some practices. As new roles emerge, a different leadership style, culture and structure will become essential to enable safe embedding and sustainability of the new roles.

 

It is disappointing then, that the traditional leadership style and culture has been lifted and shifted from General Practice into Primary Care Networks in the guise of the Clinical Director role (The heroic leader).  Lip service is paid to management and non-clinical leadership, with only one paragraph in the PCN DES relating to administration support for CDs. The ensuing effects are already being felt by individuals and across the system.

 

Contracting of PCNs perpetuates financial incentives to passive engagement. This culture, with a focus on process, individual targets and transactional approaches to organisational and team development minimises the full potential of PCNs.  It limits the opportunities of active participation of individual practices. This will result in increasing performance management and bureaucracy for practices to maximise PCN income.

 

The rhetoric is around collaboration and integration, but actions are individualistic. The structure around practices is changing, but there are no incentives in the contract to influence and facilitate the necessary culture and leadership changes for collaboration and integration. The continuation of the existing culture, leadership style and levels of engagement across PCN practices will present significant risk to the introduction of new roles working across practices. Patient and staff safety will, therefore, be compromised.

 

To grow and flourish, PCNs will require a different leadership style and culture. A collaborative and compassionate leadership style, embedded in a strong positive, supportive and facilitative organisational culture. For PCNs to succeed we need Clinical Directors functioning as inspirational leaders, supported by a collaborative infrastructure with complementary skills.

 

Conclusion

My conclusions in 1998 were that the structure, culture and leadership style of general practice were barriers to patient and public involvement. My reflection now is that these are also contributing factors to some of the challenges we face in general practice, potentially including the move away from partnerships.

In his last address to the North East RCGP faculty: GP Reimagined conference in 2018: the late Sir Donald Irving (RIP) invited us to be brave, be accountable and be responsible in order to maximise the benefits and opportunities offered by new models of care. I believe, this is exactly what we must do to transform not only the structure of general practice, but also the leadership style and culture. It will take a brave leader to challenge the engrained culture that has endured decades of change in General Practice but maybe the time is nigh!

7
oct
1

10 Challenges PCNs face introducing new roles

Posted by Blogs, The General Practice Blog1 Comment

The majority of PCNs are experiencing difficulties as they recruit into these new roles.  Here are 10 challenges PCNs are grappling with:

  1. Understanding the Role

Just because a PCN has recruited a social prescribing link worker (for example), it does not mean the practices in the PCN understand what the social prescribing link worker should be doing, or that the new incumbent understands what they are to do in the new PCN environment.  There are a growing number of examples where this basic lack of clarity on both sides is leading to the early breakdown of new roles.

  1. Recruitment Capacity

Many PCNs are recruiting as many as 10 new roles all at once.  This involves creating job descriptions, developing different job adverts, shortlisting from maybe 100 applications, interviewing up to 50 applicants, negotiating 10 job offers, creating 10 contracts and putting in place 10 induction plans.  It is a huge amount of work for any PCN, and many PCN CDs are finding the scale of the required work simply overwhelming.

  1. Line management

There is a huge challenge introducing a new role into a practice, let alone a PCN.  The change process involved creates tensions within the practices in the PCN and inevitably for the new role incumbent.  These individuals require line management support, in addition to making sure their equipment, annual and sick leave is being managed.  Many PCNs initially underestimated the line management requirements of the new roles and are finding it difficult to create the additional capacity needed to support the new recruits.

  1. Location

General practice is not sitting on lots of empty space, and a huge challenge for PCNs as the new roles start is finding the clinic space for them to operate out of, as well as identifying desk space for their permanent base.  There is no obvious remuneration for this (there are only so many times you can spend £1.50), and so unsurprisingly it is creating internal disputes between PCN practices.

  1. Clinical Supervision

The new recruits come with varying levels of experience.  In particular the physician associates currently being recruited are often still to sit their final exams, let alone have any years of professional experience.  The clinical supervision requirements, particularly when these new roles first start, are significant, and PCNs are often relying on the goodwill of individual GPs from across their member practices to ensure these are met.

  1. Professional Development

Each of the new roles requires support and a plan for their continuing professional development.  There are pathways laid out for some of the roles, for example for the clinical pharmacists, which again require significant input from the PCN.  Health Education England is providing some resource to training hubs to support this, but in many areas this is not converting into the tailored, individualised support that PCNs require.

  1. Ownership

Who exactly do the new recruits into PCNs work for?  PCNs are not legal entities, and while they may comprise of the member practices, practices in general see the PCN (and so the new recruits) as separate to themselves.  New recruits often arrive but end up not really being owned by anyone, as they work for a PCN that no one really owns.  If a new recruit does not feel they belong anywhere, or that anyone really wants them, it will only be a matter of time before they start looking elsewhere.

  1. Additional Costs

The ARRS funding formula is rigid in terms of what PCNs can claim for.  Each additional role generates its own set of additional costs.  In some of the bigger urban areas this even includes salary costs, before we even get into some of the unfunded delivery costs.  Normally a business generates income to enable these costs to be met, but the nature of the PCN contract means there are very few ways PCNs can generate additional income (the potential impact of the Investment and Impact fund looks limited).  Given these costs it is hardly surprising that enthusiasm for additional roles from PCN member practices is often somewhat muted.

  1. Monitoring Impact

One of the key ways any new role establishes itself in a new environment is by demonstrating the value it is adding.  While there are some examples of some of the new roles starting to do this, e.g. first contact physiotherapists demonstrating a reduction in the number of GP appointments and secondary care referrals, for many of the roles there are no clear impact measures in place.  However they are funded, practices need to see the value the new roles are adding.  Otherwise it will be only a matter of time before discontent with the additional time and cost burden of the new roles reaches unsustainable levels.

  1. Retention

It is unsurprising given all of these challenges that even where PCNs have been able to recruit the new starters often do not stay for very long.  In part this is due to the huge number of additional roles being recruited by PCNs up and down the country and the seller’s market this is generating, but primarily it is because PCNs haven’t had the time, capacity or support to work through many of the challenges above.  The result is many new recruits are moving on quickly.

 

It is when you think about the extent of these challenges that the assessment of some GP leaders I have spoken to that we are still 12-18 months away from feeling the impact of these new roles starts to make sense.  It is going to take that long for PCNs to establish the systems, processes and ways of working that will enable these new roles to thrive and flourish.  In the meantime what PCNs need is support and assistance to help them get there as quickly as possible.

30
sep
1

What is the Optimum Practice List Size?

Posted by The General Practice Blog1 Comment

The latest figures on GP practice size indicate that the number of GP practices has fallen from over 8,000 when the NHS England first published the statistics to 6,708 in September this year.  Fewer practices, as well as an increase in the size of the registered population, has meant the average practice list size has risen from 5,891 in 2004 to 9,007 now.

GP practice size has always been a (relatively) controversial issue. There are fierce defendants of small practice sizes and the relationship it creates between the practice and the population it serves.  At the same time there has been a move to larger (sometimes much larger) practices as a response to workforce, workload and financial pressures.

Research on the issue is generally inconclusive.  The 2014 study by the Institute of Fiscal Studies Does GP Practice Size Matter? GP Practice Size and the Quality of Primary Care, while it found that, “all three indicators of quality that we examined show that smaller practices are associated with poorer quality in primary care services”, it equally had to caveat, “The relationships between GP practice size and GP behaviour are not necessarily causal. This report controls for differences in the characteristics of the practice population, the local area and the GPs themselves in order to adjust for factors that may impact on both practice size and the indicators we examine. However, a considerable number of unobservable factors remain, such as the underlying health status of the practice populations, and could explain why smaller practices tend to perform differently.”

The Nuffield Trust 2016 report “Is Bigger Better? Lessons for large scale general practice” found that although, “larger scale has the potential to sustain general practice through operational efficiency and standardised processes, maximising income, strengthening the workforce and deploying technology”, the “evidence that these organisations can improve quality is mixed. Patients had differing views about the benefits of large-scale organisations. Some appreciated increased access, while others were concerned about losing the close relationship with their trusted GP.”

Overall the research is inconclusive.  A bigger practice feels more resilient, but brings with it concerns around quality and losing the ‘essence’ of general practice.

All of this research was of course before Primary Care Networks were introduced.  Before last year the range of at-scale options available to practices was essentially mergers, super-practices, and GP federations.  Each had varying losses of autonomy and potential associated benefits (ie merging meant changing the core functionality of the practice but with a huge possible upside, whereas joining a federation meant minimal change but with a much more limited upside).

Why PCNs are interesting is they signal a clear commissioner intent to drive the majority of investment in general practice through PCNs.  All previous movements towards at scale working were in the context of a core contract centred on the individual GP practice.  Now there is the PCN contract and all that entails to take into account.

If we add in the RCGP Fit for Future 2019 report, which basically establishes the future role of general practice as that attempting to be played by the PCN (an expanded multi-professional team, joint working across practices and collaboration with other local organisations to serve a local population), then it doesn’t take a huge leap of faith to think the PCN contract may ultimately become more important (in terms of financial and workload implications) than the GP practice contract.

PCNs are developing their infrastructure, staffing and delivery capability as we speak.  The obvious question, then, is whether it is sensible to have parallel practice and PCN delivery structures?  If one practice was the PCN, it would have the governance, be able to flex the utilisation of the staff, and be able to build on existing delivery capacity.

Is it really stretching the imagination for practices to start to consider whether the answer to what is the optimum practice size is actually that of the PCN?  I understand the resistance to this, why fears of exactly this is what fuelled the backlash against the PCN DES, but as a neutral observer looking at the strategic options for practices this is definitely the direction I would head if I was running a practice right now.

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