Is Your Practice Receiving The Right Network Payments?

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Primary care networks (PCNs) have now been up and running since 1 July 2019. Two months on, we are finding that not all practices are receiving the correct funding, while there is also uncertainty about how to administer the funds.

Here are my tips to ensure you secure the funding due to your practice.

Income receipts – what practices should expect

All practices – PCN (Network) participation payment

Every practice should now have received two PCN participation payments relating to the annual payment of £1.76 per patient. This should have been paid along with your July NHS payment and been shown on your Open Exeter Payment schedule. This is a monthly payment that should have been backdated to April 2019. So, you should have received a payment for the three months from April to June and a second monthly amount for the month of July. You will
continue to receive this payment each month for the rest of the year.

PCN nominated practice payments

• Clinical director payment. The nominated practice should now be receiving a monthly payment in respect of the clinical director, the value of which will relate to the size of the PCN. The amount being paid is 68.7p per patient.
• PCN Extended Hours Funding. The extended hours DES has now been transferred to the PCNs as from 1st July 2019 and the nominated practice should now be receiving a monthly payment in respect of this. The payment is an annual payment of £1.45 per patient which equates to about 12p per month.
• PCN Network Payment. The nominated practice should now be receiving a monthly payment in respect of this, which amounts to £1.50 per patient backdated to April 2019.

All the above payments will have been paid into the nominated practice’s own bank account along with their normal monthly NHS income and will have been included on the practice’s Open Exeter statements.

However, we are aware that not all practices and nominated practices have received the above payments and if not, you should be querying this with your CCG, or local NHS England office, as soon as possible.

Bank accounts

In some instances, setting up the PCN bank account has been more problematic than it should have been. It was initially anticipated that all payments, except for the PCN participation payment, would be made directly into the new PCN bank account that all PCNs were required to set up.

However, this has not happened as the payments had to be paid via the Open Exeter system into a practice holding a GMS/PMS contract. Therefore, all payments have been made into the nominated practice’s/federation business bank account.

All monies relating to the PCN should, therefore, immediately be transferred into the PCN bank account on receipt. This is except for the £1.76 participation payment.

Who should deal with the administration?

The responsibility for ensuring that all monies are paid over from the nominated practice’s account to the PCN account will lie with the nominated practice, but it would be wise for the clinical director to ensure that this is the case.

In all likelihood, the practice manager of the nominated practice will be administering the funds of the PCN unless this role has been passed over to the Federation.

It is wise to appoint a specialist medical accountant to help assist with the financial aspects of running the PCN.

It would also be advisable to set up an accounting system that allows access to the accounting records of the PCN by different members. There are several cloud-based accounting systems on the market which offer visible access to records, so that all practices within a PCN can have sight of the income and expenditure.

Who is paying network staff?

This was an issue from the beginning and for some practices it is still causing problems. For the moment, most PCNs are getting the nominated practice to pay the staff although in some instances other practices are paying staff. This will ensure that any member of staff will be able to join the NHS pension scheme.

Any recharging to other practices by the lead practice or federation should not be a problem initially in respect of VAT, as it should fall below the VAT threshold of £85,000 VAT-able turnover a year. The threshold should be constantly monitored, but the position is likely to need reviewing in Year 2 as more funding and different staff come through.

Clinical director payment and payroll issues

Clinical directors may be feeling overwhelmed with the level of work involved, from recruiting staff to holding PCN meetings with the rest of the network practices. The support of a good practice manager is crucial.

The method of payment for the clinical director is causing practices some concerns.

Some practices have contacted us asking if they can pay their clinical directors gross, either directly or via their practices if the income is to be pooled.

If the clinical director is a partner in the nominated practice, they will have to be paid gross, as a partner cannot be an employee on the practice payroll.

However, if the clinical director is from another practice, they may be paid gross but this payment will contribute to the VAT threshold issue with regard to the supply of staff. Moreover, although this payment is made under a DES, HMRC could challenge this arrangement as they could view the post as an officer role and might expect it to be paid via the payroll with PAYE and NIC deductions.

Don’t lose out on staff funding – recruit now

One of the main challenges practices are now experiencing is in recruiting the new staff funded this year under the Network Contract DES. Very few will have actually managed to recruit the clinical pharmacists and social prescribers who are to receive funding. Practices are to be reimbursed 70% and 100%, respectively, of salaries for these posts once filled. Crucially, however, NHS England has indicated that if these staff are not appointed the funding is likely to be removed and passed to another PCN within the CCG in future years, so it is currently looking to be very important to get these positions filled as soon as possible.

This is going to lead to a great deal of competition between PCNs vying for these staff. Also, some practices are sceptical as to the real benefit of such staff when they are to be spread so thinly amongst the network practices. Others are not sure if social prescribers will benefit their practices at all. However, it is worth bearing in mind the risk that the funding will be passed to another PCN who has managed to recruit.

How to spend the PCN network payment (£1.50 per patient)

There are still ongoing discussions about how much of the funding should be required to pay for the administration of the PCN. Some lead providers are keeping the whole amount for administration, or charging at least £1 per patient for administration, with the remaining amount being used to pay 30% of the pharmacist salary that is not funded.

How to spend the PCN participation payment (£1.76 per patient)

We understand that some practices are also being asked to contribute some of this towards the administration of the PCN, but it is unlikely that this should be required. Individual practices should be allowed to spend this as they see fit, to help facilitate the work of the PCNs within their own practices.

Future financial planning

It remains to be seen whether PCNs will fulfil the role intended, which is to help promote the use of a combination of healthcare professionals to offer coordinated health and social care to their local communities.

We are anticipating that more funding will be fed through the PCNs, including more funding for specific staff.

It is important that all PCNs seek advice from a medical specialist accountant and/or solicitor regarding their specific circumstances.