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.