The government has announced that there will be a review of the Carr-Hill funding formula.  What are the implications of this review for the profession, and could it mean that the future of the GMS contract is potentially under threat?

In the government’s announcement it states,

“The 6-month review will launch today (9 October) and will be conducted by the National Institute for Health and Care Research (NIHR).  The review will:

• identify a new allocation formula
• assess the impact and feasibility of implementing it while ensuring it aligns to the government’s 10 Year Health Plan
• make an overall recommendation to replace the outdated Carr-Hill formula”

Noone disagrees that the funding formula needs to be reviewed.  However, doing this in isolation poses a number of risks for the profession.

The first and most obvious risk is that if the funding formula is changed without an injection of additional money then some practices will receive more funding at the expense of other practices receiving less.  Practices that are already struggling to make ends meet are not going to be able to take another financial hit if their practice is one that will lose out.

The review does say it will look at the impact and feasibility of implementing it but that does not necessarily mean removing funding from practices won’t happen.  The minimum practice income guarantee (MPIG) was used to protect practices when the move to the global sum was first introduced, but that wasn’t pain free for practices (particularly as it was removed).  If there is no additional money announced (and the BMA have reportedly been told that the review may need to be cost-neutral) it is hard to see how such a guarantee could be introduced this time round.

It is noteworthy that the review of the Carr-Hill formula has been announced as a standalone exercise.  It has not been included as part of a total review of the GMS contract.  The GPC has been insisting on this review and only signed up to this year’s contract on the basis that this would happen, and yet no plans for this review have been put in place other than this review of the funding formula.

It also appears that the GPC and BMA were not consulted on the launch of the review and are not part of the review group.  Maybe the timing of the announcement coming only 9 days after the GPC announced it was entering dispute over the contract changes was not coincidental.  As I wrote about last time, one of the risks of entering dispute is the potential loss of voice and ability to influence policy and in particular the role of general practice within neighbourhoods.

But the biggest potential risk of this review is how it may link in with the new Neighbourhood Provider contracts.  Of course there may be no link at all, and the timing of this review to finish just as the contracts for next year are to be introduced could be entirely coincidental.  But there is the possibility that this review may be part of a wider change, and a move away from the existing GP standalone contract.  A scenario whereby this review recommends that potential “losers” on whatever comes out of the funding formula review shift to the neighbourhood contract instead to mitigate any loss does not feel totally outside of the realms of possibility.

While the review is finally tackling an issue that has negatively impacted many practices for many years, the risks of doing so, along with its positioning as almost a response to general practice entering dispute with the government, will be of real concern to the profession.