Northumberland Care Trust is £14 million in debt and must save £11.9 million to break even in April 2008.
An indefinite vacancy freeze is already in place and local community nursing teams are being 'restructured' to save another £1 million.
A spokeswoman for the trust said it had also reviewed the cost of the local PMS contracts, which cover 88 per cent of the population, and had asked PMS contractors to identify the services they provided 'over and above' the GMS contract.
'We will be building up new PMS contracts and associated contract values based on that work,' the spokeswoman said.
'We have been meeting with PMS representatives on a monthly basis since June of this year to discuss this.'
Northumberland LMC medical secretary Dr Jane Lothian confirmed it was in negotiation with the care trust over the PMS contracts, which GPs themselves were keen to renegotiate because the original agreements dated back almost 10 years.
'We have quite a few large and very sophisticated collaborations of practices in this area and we have long aimed to develop services under PMS contracts.
'However, to do so the structure of the contracts needed to be renegotiated,' Dr Lothian explained.
She said conclusion was needed by the end of the calendar year and she was still hoping for a successful resolution.
'We are very concerned that the current care trust actions will result in a detriment to the service,' Dr Lothian added.
A local newspaper has reported that many of the LMC members want to bring a vote of no confidence in the care trust executives.
However, GPC chairman Dr Laurence Buckman said that every PCT and care trust in England was carrying out a similar review as Northumberland and PMS GPs had been warned this might happen.
'It was a guaranteed consequence of the way the PMS contracts were set up,' he said.
'We told GPs at the time they should take the money that was being thrown at them but they needed to accept that there could be a day of reckoning. LMCs are equipped to handle this threat.'
Dr Buckman added that no confidence votes were not worthwhile.
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