Contract Failures in GP Services

In primary care, the government’s enthusiasm for private company involvement led to encouraging groups of GPs to band together to set up their own private limited companies to run large groups of surgeries all in the name of efficiency. 2016 saw two of these federations collapse and go bankrupt – Danum Medical Services in Doncaster and surrounds and Horizon Health Choices Ltd in Bedfordshire. The common thread to the failure of these enterprises was not enough money is available to fund high quality services. In other cases, such as The Practice and Greenbrook Healthcare, private companies have abandoned contracts finding it impossible to make a profit.

An investigation by Pulse published in May 2018 found that in the previous five years over a million patients had to move surgeries due to closures. Nearly 450 surgeries had closed in this time period, with an acceleration in the last two years. Of these closures, many were due to GPs handing back contracts due to retirement, but others were due to private companies pulling out of contracts due to financial pressures.

In April 2021, Pulse reported that GP practice closures had totalled almost 800 in the past eight years, forcing an estimated 2.5 million UK patients to move providers.  In 2020 alone 96 practices closed their doors, mostly in England.

One outcome of the failure of these contracts is that patients don’t get the continuity of care that is needed for the best outcomes. In June 2022, Prof Martin Marshall, chair of the Royal College of GPs (RCGP), said at the annual conference that trusted relationships between family doctors and patients are the most “powerful intervention” for delivering effective, high-quality care as they boost patient satisfaction and health outcomes, and reduce use of hospital services.

Babylon Health

In October 2022, Babylon Health announced that it was ending its GP services in Birmingham at the end of November 2022, meaning 5,000 patients had to find a new GP. Babylon Health had begun services using its GP at Hand app and one physical clinic in the city in late 2019, but the company’s financial difficulties have meant that it has restructured its business in the UK, leaving Birmingham and all its deals with NHS trusts. More details can be found on the company profile here. Babylon Health had been lauded by the Conservative government, in particular Matt Hancock when he was Secretary of State for Health, as a new way of doing primary care that would be better for patients and GPs.

DMC Healthcare

DMC Healthcare had a number of contracts for GP surgeries in the Medway area. However, when the Care Quality Commission (CQC) visited in mid-2019 it found serious concerns with the quality of healthcare. Enforcement action was taken against the company and DMC Healthcare was removed from running five surgeries and suspended from three others. This left the company actively running only one surgery in the area. DMC had taken over running the surgeries all within the previous two years.

Following this move, DMC Healthcare notified NHS chiefs that it would be handing back its £4.1 million contracts in Medway as with only one surgery being actively run by the company it was no longer viable to continue the contract.

The Practice Group

In Brighton and Hove, The Practice Group announced in January 2016 that it will terminate its contract for five GP surgeries in the city at the end of June, leaving 11,500 patients looking for a new GP. After NHS England intervened, The Practice Group continued to operate the surgeries until September 2016, to allow more time for the local CCG to put new services in place.

The Practice Group gave several reasons for giving up the contract, including the need to relocate two surgeries due to redevelopment projects, rising demand for services, and a difficulty in recruiting and retaining GPs, however a major reason is a reduction in central funding for the surgeries. Local MP Caroline Lucas  said: “Once again it looks like patients may end up paying the price for the privatisation of our health service. These surgeries are at risk because a profit-making company couldn’t balance the books, not because they’re not needed.”

Greenbrook Healthcare

In October 2016, Greenbrook Healthcare announced its intention to hand back an APMS contract for five GP surgeries in west London nine months before the end of the contract. This puts around 27,000 patients at risk of losing their GP. Greenbrook Healthcare has been in discussions with NHS England since early 2016, however no additional funding has been offered. The company stated that due to rising demand and problems with GP retention the contracts have become “unfit for purpose”.

Danum Medical Services

The private limited company Danum Medical Services Ltd was set up in Doncaster by 23 local practices and had 63 individual shareholding GPs’. The company held APMS contracts for six practices in the Midlands and Yorkshire. In March 2016 DMSL went into administration leaving individual GP surgeries in debt, with one surgery reported to be facing losses of £20,000.

The company reported that it provided a high quality service but as one GP involved said: “The reason they have failed is they have tried to provide high quality care on a budget where it is impossible to do so.”

Horizon Health Choices Ltd

Horizon Health Choices Ltd was a private company set up by 54 GP surgeries in Bedford and the surrounding area. In November 2016 the decision was announced to liquidate the company due to problems with recruiting GPs and internal management issues. The liquidation of the company will lead to the closure of one GP surgery and the loss of thousands of pounds by the surgeries that had invested in the company.

Horizon was launched in response to Government encouragement for GPs to work at a large scale. NHS England has made such working at scale a national priority with the GP Forward View and the new Multispeciality Community Provider contract for groups of practices with at least 30,000 patients.

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