Primary care is under significant pressure. Waiting times have been increasing, with the average wait time for a non-urgent face-to-face GP appointment being 10 days; up by 15% since last autumn. GPs need to see more patients than they do currently, and given the significant problems with GP recruitment and retention, existing GPs will have to be more efficient and productive in order to see more patients. This can be done by replacing the current funding model and introducing Payment by Results (PbR).
Under PbR, each treatment is classified into Health Resource Groups (HRGs), which are groups of similar treatments under similar clinical conditions, each having a fixed tariff. Healthcare providers are paid per individual case, with the amount depending on which HRG the patient falls under. PbR encourages improvements to productivity and efficiency – providers who see more patients generate more revenue.
PbR has been gradually introduced into secondary care between 2004 and 2007. As a result, waiting lists fell from 1.8 million in 2003/4 to 650,000 in 2007/8. Despite its clear success, PbR has only been used in secondary care (where care is given by a specialist), and not in primary care (typically the first point of contact, where care is given by a generalist).
Primary care is currently funded by a capitation model of ‘global sum’ payments, where each practice is paid according to the number of registered patients, weighted by the Carr-Hill formula which considers factors like rurality and demographics. Under this system, there is no financial incentive to see patients, as practices receive funding for having patients registered, not for treating them. Only the Quality and Outcomes Framework (QOF) gives this incentive, as it gives practices additional funding if they meet certain thresholds for patient care. However, QOF has been temporarily suspended to allow practices to focus on vaccination programs and recovery from Covid; and it only provided around 10% of practice budgets. In contrast, global sum payments account for around 50% of practice income. The lack of financial incentive to see and treat patients is a barrier to sufficient provision of primary care services.
PbR and HRGs could easily be applied in primary care. Due to longer appointment times, face-to-face consultations could be reimbursed more generously than virtual or telephone consultations. Urgent appointments and more serious conditions could be reimbursed more generously too, providing a greater financial benefit for dealing with more difficult cases, encouraging practices to do so. Applying the Carr-Hill formula to PbR would ensure that funding continues to be fair across the country. PbR could be particularly effective in primary care, given that 61% of full-time GPs are partners. This means they own a stake in their practice, and receive a proportion of the annual profits, so there is a direct incentive from PbR.
And unlike most other reforms advocated for the NHS, changing the primary care funding model to PbR would not require any additional funding. The existing budget would just be reallocated to be used in a more efficient way. The practices which receive less funding would be those that see fewer patients relative to their list size, so there would be an incentive for those practices to see more patients.
Whilst PbR incentivises doctors to provide more care through seeing more patients, this may come at the expense of quality of care. To counteract this, QOF funding should be increased as a proportion of practice income. Practices would have a greater incentive to adhere to the level of care set out in QOF. In addition, Care Quality Commission (CQC) inspections ensure that practices do provide an adequate quality of care.
PbR is already used in primary care in other countries with single-payer healthcare systems like the UK. In Australia, their GP practices are funded almost entirely by PbR payments. Despite Australia only spending 6.7% of total healthcare spending on primary care (compared to 7.7% in the UK), their average waiting times are around 4 days, a fraction of the waiting times in the UK.
Waiting times in primary care are simply too long. This long-running problem has a solution, which has already proved its worth in the NHS, and delivers better results in primary care for our international peers. Applying PbR in primary care is a necessary step to bring down waiting times and ensure all patients get the care they need.
Martin Guy is currently undertaking work experience at Bright Blue. Views expressed in this article are those of the author, not necessarily those of Bright Blue. [Image: Hush Naidoo Jade Photography]
