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GP - Role of the independent sector in primary care

December 2006

Alternative Provider Medical Services (APMS) in Primary Care
This briefing paper applies to England only

Contents

• Overview
• Summary of the BMA’s position
• Patients could lose out under APMS
• Patients' preferences are being ignored
• Existing GPs may be disadvantaged in competing for contracts, which potentially jeopardises continuity of care
• The wider introduction of private providers may lead to serious conflicts of interest
• APMS may drain funding from existing services
• APMS providers could receive more resources than other providers leading to inequity and inefficiency
• The tendering process for APMS contracts can be unfair
• Doctors working for APMS contractors or under APMS contracts may lose out

Overview
Alternative Provider Medical Services (APMS) contracts are one of the four contracting routes available for providing primary medical services. reference 1

By and large, primary medical services relate to GP services and encompass General Medical Services (GMS), Personal Medical Services (PMS), Primary Care Trust Medical Services (PCTMS) and APMS. Currently, the vast majority of GP services are provided through GMS and PMS. APMS has broadened the range of potential providers from whom Primary Care Organisations can commission services. It is now possible for the independent sector (including UK-based commercial companies and overseas companies) as well as the voluntary sector and traditional providers to hold primary medical services contracts.

The provision of primary care by private providers has the potential radically to alter the face of healthcare in the UK. The extent to which this will happen remains uncertain but the government is now actively encouraging primary care trusts (PCTs) in England to attract new types of provider.

Although it is currently unclear what effect large scale privatisation of the provision of NHS primary care will have on patients, the BMA believes it is likely to lead, in the longer term, to higher costs, reduced accountability and increased fragmentation. Continuity of patient care may also suffer. It may also reduce the options for patients who benefit from the long-term, trusting and personal relationships with traditional healthcare professionals such as GPs. Those working in APMS providers are more likely to be salaried and have short term contracts and so may have less commitment to the long term care of their patients and the development of the practice. There is a serious risk of a reduction in the ability of the NHS to address health inequalities.

Summary of the BMA’s position
Patients could lose out under APMS
The BMA has very significant concerns about the effect of the increasing provision of health services by private companies. Although GPs are “independent contractors” they are steeped in the ethos of the NHS and put the interests of their patients at the heart of their work. In many ways GPs’ independent contractor status is simply a reflection of the way they are paid rather than any suggestion that they not an integral part of the NHS. The BMA is worried that private companies, that are primarily answerable to shareholders, will not work in the same way or share the same values. Furthermore, there is a risk that these companies may be selective in the services they provide in the future, focusing on services that are “easier” and can be more cheaply provided rather than delivering long-term, holistic care. This may be through the greater use of skill mix which would tend to restrict access to doctors.

Patients’ preferences are being ignored
It is clear that PCO tendering decisions are seldom guided by patients’ stated preferences and although PCOs are expected to consult before putting services out to tender it is clear that this does not always happen. This was recently demonstrated by the legal case in Derbyshire where it was judged that the PCO had failed to consult adequately with patients before appointing a large private healthcare company over a popular local GP. In other areas, consultation takes place but patients’ views may be treated in a tokenistic way and have little bearing on the outcome of the process.

While there is often a local demand for additional provision of services for patients in some areas, the evidence so far suggests that once these services are made available they are not always taken up as patients prefer the continuity of provision available from their existing provider. This has certainly been the case in secondary care in respect of several of the Independent Sector Treatment Centres..

Existing GPs may be disadvantaged in competing for contracts, which potentially jeopardises continuity of care
APMS was originally promoted as a mechanism to fill gaps in service provision but there is evidence that it is being used increasingly as the default contract choice, often, it appears, for political rather than, purely, health reasons. The BMA has received reports that competent GPs, currently working in PCT-run practices, are being asked to compete for their own practice contract against large private companies, despite considerable local support for the services they are providing. If this becomes widespread it will have a deleterious effect on patients and the continuity of their care by the practitioners they have come to trust. The BMA believes that the use of alternative providers in primary care should occur only where there is an identified need and where existing providers have been given a realistic chance to deliver the service.

The wider introduction of private providers may lead to serious conflicts of interest
As general practice in the UK operates as a gatekeeper to secondary care services, more extensive use of large private providers to run primary care services, some of which have interests in secondary care provision or pharmaceuticals, introduces potential risk of conflicts of interest in referrals and treatment.

APMS may drain funding from existing services
There is not normally any additional funding in situations where the Department of Health insists that APMS providers are established. There have been instances where the PCT has been put under huge pressure to create APMS even though it believes there is no demonstrable need. In such cases the funding comes from existing primary medical service budgets leading to potential instability of other services and reduced access for patients.

APMS providers could receive more resources than other providers leading to inequity and inefficiency
If patients choose not to use new APMS services the result may be a wasteful use of resources. As an example, an APMS provider in the North East, just two years after establishment, receives an annual payment per patient of £278.98 compared to the local average for traditional practices of £67.70 (range £59.13 to £90.00). This is the result of a poor uptake for the service despite its excellent service and quality. If there is to be a level playing field APMS contractors should be given resources broadly equivalent to those given to other practices.

The tendering process for APMS contracts can be unfair
The General Practitioners Committee is concerned that there should be a level playing field between different types of provider and an equitable bidding process. This means that when a contract for a practice is put out for tender, local GPs with the motivation and ability to provide the service should have as good a chance of winning the contract as a large company with similar plans.

Large companies will often have better access to the business and marketing acumen required to produce a visually impressive bid. There is also a chance that some large companies may bid for practices as loss leaders in order to get a foothold in the area. More fundamentally, medical services are subject only to limited procurement controls and the advertising and tendering process for APMS contracts varies widely. The BMA has received reports of PCOs choosing contractors in a non-transparent way or improving the terms of a contract once they have appointed a company to provide services. It is vital that there is an adequate right of appeal against the tendering decisions made by PCOs so inequitable processes can be addressed and rectified.

Doctors working for APMS contractors or under APMS contracts may lose out
APMS providers are not obliged to employ salaried GPs under model terms and conditions of employment. These providers may therefore be in a position to undercut other bids by, for instance, not contributing to the pension scheme. The BMA does not wish to see APMS-employed GPs disadvantaged in this way and recommends that APMS providers adopt the standard terms set out in the model contract for salaried GPs.

In the interests of patient care it is vitally important that any private provider of services to the NHS is required to meet the same expectations and requirements of proof of quality as current NHS providers in order to maintain the continuity of staff recruitment, training and quality.

The BMA is concerned that those working for APMS contractors are not always able to join the NHS pension scheme. This is inequitable for those providing NHS services.

Reference:
National variations Although there are provisions for APMS across the UK (it is known as Health Board Primary Medical Services in Scotland), Scotland, Wales and Northern Ireland are not pursuing the implementation of this type of contract as vigorously as the government in England.

For further information, please contact the Parliamentary Unit:
Email: parliamentaryunit@bma.org.uk