Personal medical services agreements
Section 2 - PMS and new GMS
Many elements of the new GMS contract – some involving new sources of funding - have been applied to PMS. These include;
- Quality and Outcomes Framework
- Ability to transfer responsibility for out of hours
- Enhanced services
- New premises flexibilities
- IT investment
- Seniority improvements
- Superannuation improvements
This section addresses how they relate to PMS. The new GMS contact documents are all available at www.bma.org.uk/ap.nsf/Content/Hubthenewgmscontract
2.1 Quality and outcomes framework (QOF)
The QOF is a system of paying practices for providing set levels of quality that are pre-specified and measured using detailed, evidence-based indicators. It uses a points system to translate achievement into payment after adjustments for average list size and, if applicable, prevalence of the disease area covered. It is an important new source of income for GMS and PMS practices.
To make sure that the quality of general practice is consistent across PMS and GMS, and to ensure equitable access to funds between PMS and GMS practices, the Department of Health agreed that PMS practices should be able to participate in the QOF. However, because the Statement of Financial Entitlements applies only to GMS, the participation of PMS practices in the QOF is not directly governed by regulation. As a result, PMS practices and PCOs can agree that the practice uses a varied version of the QOF, which could include different quality specifications and targets, although these must be evidence-based and at least as good than the QOF standard.
The QOF points “offset”
By introducing the QOF to PMS practices, the DoH intends to give them equal access to new funds for quality. However, this gives rise to a complication. For PMS practices to have received exactly the same quality payments as GMS practices would have benefited PMS practices to the detriment of GMS practices, as a proportion of GMS cash-limited expenditure (for chronic disease management, sustained quality allowance and half of cervical cytology payments) under the old GMS contract was mapped on to the new quality funds. However, the equivalent money remained in PMS baselines.
Therefore, to ensure that PMS practices in fact have equal access to new quality funds only, on a fair and equitable basis with their GMS colleagues, the DoH has recommended a standard deduction of points (which has become known as an “offset”) from the achievement points of PMS practices. This has been calculated as 168 points for 2004/2005 (see section 2.7 for why this figure has fallen from the originally agreed 174 points), falling to 109 points for 2005/2006.
Only the agreed number of quality points should be deducted, irrespective of the baseline contract price, in respect of quality. PCOs may attempt to make further deductions because they believe that certain quality payments are included in the baseline contract price. These attempts must be resisted. The nationally determined offset calculation was agreed precisely because of the difficulties inherent in trying to separate PMS finance out into baseline, non-baseline and growth money.
In support of this principle, section 4.3.1 of the DoH guidance on PMS states;
“Because of national commitments not to unpick existing PMS contracts, as long as practices continue to meet their contractual terms they are entitled to the full contract price, plus achievement payments for meeting agreed quality standards. Therefore, if PCTs agree to implement the full national QOF then practices will be entitled to receive achievement payments for hitting all the quality indicators - even if they have already been given additional money through their existing PMS contracts to deliver the same benefits.”
(Sustaining Innovation through new PMS arrangements, section 4.3.1)
Variations to the national QOF
This process of varying the national QOF for PMS practices can become fraught with difficulties. The GPC encourages all PMS practices to adhere as far as possible to the nationally agreed framework. If agreeing variations to the national GMS QOF, practices must examine carefully all financial ramifications, preferably after consulting the local medical committee, and ensure that it is not signing up to a more demanding framework for the same rewards. They should also be aware that all the software, including that for monitoring the QOF, is specific to the nationally agreed framework
The DoH suggests the following possible categories of variation:
- Core based on the national QOF plus local add-ons
- Different interventions for related fields
- Fewer interventions for the same disease areas
- Local use of different indicators
- Different evidence base
For further information on the nationally agreed QOF, see GPC guidance Focus on the Quality and Outcomes Framework and Focus on Quality Payments.
2.2 Out of Hours
The new GMS contract gives contractors the choice to transfer their responsibility for out-of-hours work. This provision has been extended to PMS. In GMS, the practice’s global sum (the basic funding it receives to provide essential services) is reduced by 6% if a practice opts out of out-of-hours.
However, PMS practices do not receive global sums, but contract prices, or “baselines”. The DoH has therefore recommended a set method of calculating the opt-out price. This involves calculating an average per-patient cost of opting out of OOH in GMS, equal to £3.31 per patient, then multiplying this by raw list size for the PMS practice.
The process for opting out is broadly the same as in GMS and is set out in Schedule 4 of the National Health Service (Personal Medical Services) Agreements Regulations 2004. It has not been reproduced in full here because of the complexity of the procedure.
2.3 Premises
PMS practices have equal access to the premises “flexibilities” negotiated as part of the new GMS contract and to any new funding to implement premises initiatives.
A separate GPC guidance note, Focus on Premises Costs, on this is available at www.bma.org.uk/ap.nsf/Content/focusonpremisescosts0104
The relevant legislation covering premises costs are the National Health Service (General Medical Services – Premises Costs) Directions 2004. Although these are GMS Directions, the intention is for these to be used as best practice for PMS as well. There are no separate directions relating solely to PMS premises costs. The Directions are available at
www.dh.gov.uk/assetRoot/04/07/68/20/04076820.pdf
2.4 Enhanced Services
PMS practices have equal access to the funding streams available for enhanced services on the same basis as GMS practices. This is made clear by section 6.3 of Sustaining Innovation Through New PMS Arrangements.
“This initial PMS allocation should be supplemented with other funds. Some of the funding streams will be allocations covering both PMS and GMS. This includes enhanced services, OOH funding, additional funding for premises and IT. These resources should be used equitably to fund primary care services across GMS and PMS practices”.
Comprehensive GPC guidance on enhanced services, Focus on Enhanced Services and Focus on the Financial Monitoring of Enhanced Services, can be found at
www.bma.org.uk/ap.nsf/Content/Hubenhancedservices
PMS practices are advised to consult these guidance notes for further information and guidance on enhanced services. They will also find it helpful to liaise with their LMC who, in many cases, will have negotiated the local provision of enhanced services.
If there is any clear disparity in treatment between GMS and PMS practices in the commissioning and pricing of enhanced services, the LMC should be consulted and the GPC office informed.
2.5 IM&T
New resources for IM&T must be made available to support both GMS and PMS practices.
For further information and guidance on IM&T see the GPC guidance notes, Focus on Choice of Nationally Accredited System, Focus on Funding for IM&T (three updates), Focus on Exception Reporting, which are all available at,
www.bma.org.uk/ap.nsf/Content/Hubinformationtechnologyandmanagingpatientrecords
2.6 Seniority
PMS GPs will receive the same increases in seniority pay as GMS GPs will receive under the new contract.
Sustaining Innovation Through New PMS Arrangements suggests two methods of calculating this (for 04/05 and 05/06). The first is to apply the uplifts that GMS GPs received for seniority to the baseline. In this case, the partners have to agree amongst themselves how then to distribute this increase to the more senior GPs. The second method is to calculate a notional entitlement for each partner separately (with reference to what their entitlement would be if they were still GMS) then apply the relevant uplift to that figure.
In 03/04 this generated some confusion, because the uplift in seniority for GMS GPs was rolled up in a global 3.225% uplift to fees and allowances. For ease of administration, therefore, many PCTs simply chose to apply the same 3.225% to PMS, intending it to include an equivalent uplift for seniority.
However, the DoH guidance mentioned above states that PCTs can do this only with the agreement of the practice. Practices should not be pressurised into one method.
2.7 Superannuation
The indexation transfer
There have been major changes to superannuation, both as part of the new GMS contract and as a result of the “indexation transfer” or “Treasury transfer”, which is not related to the new contract. (This is the transfer from the Treasury to the NHS of responsibility for the element of pensions contributions arising from the cost of retail price indexation of NHS pensions). This means that employers contributions rise from 7% to 14%. In the case of general practices, this additional burden falls on practices not PCTs, in respect of practice staff.
GP superannuation
The changes to superannuation negotiated under the new GMS contract apply equally to GMS and PMS. There is detailed GPC guidance, Focus On Superannuation Contributions, and Focus on the Dynamisation Factor on the BMA website at www.bma.org.uk/ap.nsf/Content/focuspension0704
PMS GPs are strongly advised to read this guidance, as the changes are complex. The main development is that GP pensions will in future be based on actual profits, rather than on Intended Average Net Remuneration.
The additional 7% employer superannuation resulting from the indexation transfer for PMS GPs should have been included within the baseline allocation.
Because of the considerable investment in general practice delivered through the new GMS contract and the changes in PMS described in this guidance, practice profits in GMS and PMS will rise. Because GP pensions are now based on actual practice profits, superannuation contributions (employer and employee contributions) will have to rise too.
The GPC has secured considerable new funding for these increased contributions (£88 million across 2004-2006) although it believes that this funding will be insufficient to cover the increased costs in full.
This PMS share of this money will be passed on to PMS practices in two ways. First, through an increase to the PMS baseline and also through a reduction in the quality points offset described in section 2.1 of this guidance. The result of this is that the offset was reduced from 174 points to 168 points for 2004-2005.
There is further detail in the GPC superannuation guidance.
Salaried PMS GP performers
Salaried GPs who became or in future become PMS GP performers for the first time in PMS, will accrue NHSPS membership on an assistant practitioner basis on or after 1 April 2004.
PMS practices who currently hold forms SD55 for salaried GPs accruing NHSPS membership on an officer (non-practitioner) basis, because they became GPs for the first time in pilot PMS, should liaise with their PCO and send a terminal form SD55 to the Pensions Agency showing the “last day of pensionable membership as an officer”, as 31 March 2004. The PCO should then send a joiner form SS14 to the Pensions Agency, showing a “commencement date of membership” as an assistance practitioner, of 1 April 2004.
Staff superannuation
A sum has been made available nationally, and passed on to PCTs in their primary medical services allocations, to cover the increase in employers contributions from 7% to 14% for PMS practice staff.
It is up to local negotiation to determine how this funding is distributed to practices, although the GPC has been pressing the DoH to provide clear guidance to PCOs and practices.
Ideally, this money should have been added to PMS staff budgets as part of their 04/05 uplift, but it has become evident that many PCTs did not pass it on or were not aware they had received it.
Despite pressure from the GPC, the DoH has so far been reluctant to direct PCTs to do so. It is important for LMCs and PMS practices to be aware that a transfer of money was made to PCTs, whether they are aware of this or not.