Privatisation of GP services

One quirk of the NHS at its inception in 1948, was that GPs are independent contractors working under contract to the NHS.  The majority of GPs are partners in what is effectively a very small business. Where GPs have always stood out as different from a private company, however, is that their prime focus is on their patients, not on increasing profits and paying shareholders.

The introduction of a new type of APMS (alternative provider of medical services) contract in 1997  triggered the entry of a different type of GP business, one with much  more in common with a private for-profit company. These GP companies sought to run chains of surgeries where GPs were employed on salaries (rather than as partners). These companies have profits to make and are therefore not solely focused on patient care. Leading GP companies include The Practice Group, AT Medics and SSP Health.

There were two major changes that opened up primary care to privatisation;  allowing GPs to opt out of providing out-of-hours care and the introduction of APMS contracts.

The opt-out


If GPs opted out of providing out-of-hours care to their patients, commissioners sought provision elsewhere and there were a number of private companies that gained substantial contracts around the country to provide phone advice and home visits. In other areas, consortia of local GPs were awarded the contracts. In both cases, the changes allowed profit driven entities to gain a foothold in the primary care market. For further details of the privatisation of emergency care (Out-of-hours, NHS 111) see The Issues: Emergency Care

Creating a market in primary care


Two distinct policy steps opened up primary care to the private sector. The introduction of a new contract (APMS 1997) and the passing of the Health and Social Care Act (2012), which boosted opportunities for non-NHS organisations to run primary care. It opened the doors to companies such as Virgin Care, Care UK and The Practice to take on several surgeries. Not only that, but existing GPs holding GMS (general medical services) or PMS (primary medical services) contracts could also bid for and win additional APMS contracts, and it therefore opened the way for GPs to expand from a small business to a much larger business run along the lines of a company with shareholders.

The problems of privatisation

The marketisation of general practice and the use of the APMS contract has been associated with several problems, most notably:

  • Problems with the recruitment and retention of GPs, who will be employed as salaried rather than as partners, which leads to an increase in the use of locum GPs;
  • Companies not making sufficient profit on the contract walking away, leaving thousands of patients without a local GP.

Examples of closures include:

The Practice Group


In Brighton and Hove, The Practice Group terminated its contract for five GP surgeries in the city at the end of June 2016, leaving 11,500 patients looking for a new GP.

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 was a reduction in central funding for the surgeries, which made the venture non-profitable.

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 put around 27,000 patients at risk of losing their GP. Greenbrook Healthcare said that their withdrawal was due to rising demand and problems with GP retention.

Other GP companies that have also failed, including Danum Medical Services in Doncaster and Horizon Health Choices Ltd in Bedford and the surrounding area. Both of these companies went into administration.

Virgin Care


The GP partners at the Sutherland Lodge Surgery in Chelmsford handed back their contract after funding was slashed by NHS England. A new 10 year APMS contract (of higher value than the previous contract) was then awarded to Virgin Care in July 2016. Then in the space of just 18 months the surgery went from being rated as 'outstanding' by the CQC to 'inadequate'.

Digital primary care services

Over the past two years, the expansion of private companies in primary care has focused on the use of digital technology. The perception, which unfortunately due to underfunding and understaffing is often correct, is that it is very difficult to get a GP appointment and even more difficult to get an appointment within a reasonable timeframe, such as the same or next day.

As a result, the market has seen the entry of a number of companies aiming to provide on-demand GP services, using smartphone apps or online consultations.

The private providers claim they are helping drive down waiting times – and that there wouldn’t be any demand for them if it weren’t for the lengthening waits for appointments in NHS general practice.

Several of these companies are using crowdfunding to raise money rather than seeking finance from banks and more traditional investment funds.

NHS England is very keen on digital technology as a means to reduce costs and cope with increased demand. As a result these private companies are already beginning to make inroads into the NHS.

The largest of these companies and the one with closest links to the NHS is Babylon Health, which came into the public eye in late 2017 when it launched its GP at Hand app in London under an NHS contract.

The company's artificial intelligence (AI) chatbot technology has also been tested as a replacement for NHS 111 in a trial in North London.

Babylon Health's GP at Hand smartphone app has been operating in London from a single Fulham surgery site since late 2016. However, in November 2017 Babylon Health, under a contract with NHS England, launched GP at Hand at a further five sites in London.

The company promises that patients will be able to 'book an appointment within seconds and have 'a video consultation with an NHS GP typically in under two hours of booking, anytime, anywhere'.
Babylon is working with the GMS practice of Dr Jefferies and Partners, based in Lillie Road, Fulham in West London. Under the Government's 'GP Choice' scheme, which  allows  practices to sign up patients from outside their traditional boundaries, Dr Jefferies' surgery could sign up people from all over London. Therefore, Babylon has been able to target patients who live across London and those who work in zone 1 to 3.

Patients who sign up for GP at Hand are de-registered from their own GP's list and re-registered on the list of Dr Jefferies and Partners as an out-of-area patient. In the four months since GP at Hand was offered out of area, the Lillie Road Medical Centre's total list size increased from 4,970 to 23,997.

Data from NHS Digital released in April 2018 show that a total of 85% of new registrations since November have been from patients aged between 20 and 39 years old. Of all new patients signing up since GP at Hand was opened up to out-of-area patients, 94% were aged between 20 and 49.

There are multiple concerns with Babylon's GP at Hand, including: cherry-picking of healthier, younger patients; destabilization of the local health economy; deskilling of GPs; referral problems; and performance concerns.