Medical Finance - AISMA conference update

I have recently attended the AISMA conference with two of my Haines Watts colleagues. The highlight of the conference is the annual earnings survey and for 2010/11 at least it shows that GPs’ incomes were virtually static – so the predicted doom and gloom has not materialised…yet.

The really tough times are no doubt still ahead.

New structures look bureaucratic and CCGs are being rushed into making complex decisions before they are really ready.  Here’s a summary of what was covered:

CQC registration

GPs should not underestimate the costs involved – particularly in upgrading premises so they are fit for purpose.

Pensions

By 2014, the average GP will pay 14.5% contribution of his or her pensionable income. Also the 14% employers contribution is now only partially funded.

The annual allowance (AA) charge or tax on pension contributions is going to be a complex calculation and will be time consuming. This is particularly the case for GPs – or rather their accountants.

Funding

Banks are willing to lend but the old rates that GPs might be used to are gone for good. Expect to pay between 3% – 5% secured.

Also capital repayment holidays (interest only) are difficult to come by – capital repayments mean less money available for drawings.

Predictions for the future

Practices

Static in number with less mergers than of late.

Salaried GPs

Fewer in number, with more becoming partners.

APMS contracts

The number will rise substantially.

Premises

A squeeze on funding, especially sub-standard premises. The idea that notional rent will be capitation based and therefore follow the patient cannot be ignored.

New contract

Likely to be unified – in approximately three years

In the meantime, static (at best) income,the increase in costs (especially CQC compliance), additional pension and tax contributions will mean the prospect downward pressure on drawings.

If ever there was a case for GP’s asking their accountants to help them plan ahead, it must surely be now.