GP funding: Co-payments could be the way to evolve primary care

A co-payment system, where GP practices could charge patients extra per item of service, would reward high quality practices and drive up standards, argues Dr John Lockley.

Given that the whole of the natural world has developed so elegantly through blind evolution, I am always surprised when humans try to interfere with complex dynamic arrangements that aren’t working, rather than having the good sense to stand back and let the system sort itself out.

Evolution is a potent – and ultimately very subtle – force for good. Yet we mustn’t forget that at its heart is death – the death or discontinuation of individuals and variants that aren’t as fitted as others to the current situation.

Yet despite evolution’s success, people will insist on trying to interfere. Take general practice: if we all stood back and let primary care evolve we would by now have a superb system, loved by clinicians and patients alike.

Instead, because of managerial and political interference we have the ridiculous situation in which high-quality performance often goes unrecognised and unrewarded (or even penalised) – while failing practices are propped up with extra resources allocated in a blunderbuss fashion. This is not how the natural world does it.

How could co-payments work?

How can primary care evolve to allow the survival of the fittest without permanently disadvantaging patients of failing practices, or forcing all patients to go private?

What if we could devise a scheme that reliably and automatically identified and rewarded good practices – and, conversely (like evolution in the natural world) targeted the bad practices and killed them off? That would work to everyone’s benefit, wouldn’t it?

So here’s the plan: pay practices by co-payment. Have a standard local fee per appointment, call, or visit, paid by the state and automatically adjusted for local conditions. Then allow each practice to charge extra per item of service, on a pre-arranged, yearly, individual basis with each patient – a bit like agreeing an excess per claim with an insurance company.

Finally, require the state to supply its own separate, nationwide, salaried primary care system for anyone locally who wants to register there – perhaps working out of walk-in centres and similar – which is not allowed to charge co-payments. In addition, each of these centres has to fulfil centrally-designated GP targets and break even each year.

Immediately some existing GP practices will start charging extra on top of the state payment. The better the patients’ perceptions of the practice, the higher the patient’s co-payment which the practice will be able to charge.

Rewarding higher quality and driving up standards

Consequently practices which deliver more; or to a higher quality; or to a level of greater patient acceptability, will receive more money – which in turn will give them a better profit margin, or more resources to retain staff or develop their practice.

Medium-quality practices won’t be able to charge as much, because the patients won’t be prepared to pay extra for poorer service – though a lower charge may make these practices more attractive to patients, so the practice will see people, but for less money.

Really bad practices won’t be able charge anything extra, because patients will want to be seen by the better practices of which there will eventually be many.

Finally, in the higher-charging practices, each patient will have a real incentive not to book appointments for frivolous reasons as it will cost them personally each time.

Advantages of the system

The advantages of this system are significant: patients will never be deprived of a GP because the state has been given a duty to run a basic primary care system in each area in a salaried fashion and make it balance its books.

If the state cannot attract enough doctors to run its own salaried service locally then it will have to increase the local state item of service rate in order to be able to pay the market rate and keep its own system going – and that extra charge will of course automatically be added to each and every item of service claim paid by the state to the non-state-run practices in that locality.

The beauty of this situation is that at all stages evolutionary pressure is maintained: the best practices flourish; crucially, poorly performing units die off. Patients can vote with their feet (and their wallets) for a better service – and those who cannot afford to pay will have access to free treatment through the state-run centres.

Finally, the state pricing structure will be locally sensitive, automatically adjusting for the extra costs of working in an expensive location or an area that doesn’t easily attract staff.

The next, absolutely massive, benefit is that, like evolution, it is all self-correcting. There will be no managers arbitrarily dictating levels of remuneration and trying to force down the price. Nationwide it works according to the laws of supply and demand – and evolution.

QED. And remember – doing nothing in the face of the current crisis in primary care means that we risk ending up with a different evolutionary solution altogether: mass extinction.

  • Dr Lockley is a GP in Bedfordshire

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