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'Premiums' for taking on patients from deprived areas

Think tank urges radical shake up of resource allocation in primary care

OnMedica Staff

Tuesday, 05 January 2010

A radical revamp of the way resources are allocated to general practices is needed and patients should have to reregister with practices every two to five years to promote competition, a think tank says.

The centre right Policy Exchange has published a report Which Doctor calling for fixed payments, which currently distort the market in primary care, to be removed. These include the Minimum Practice Income Guarantee (MPIG) and seniority payments.

"We propose that resource allocation in the NHS should be distributed by the Department of Health, or by any new independent NHS board, to a much more granular level - down to individual postcode level of just 15 households - and that the second resource allocation process performed by Primary Care Trusts should be abolished," it says.

"The NHS resource allocation formula should be weighted on a capitation basis with just three elements: age, postcode and an additional 'patient premium' to act as an incentive to GPs to provide healthcare to patients in areas with the worst health and deprivation indicators."

The "patient premium" is an extension of the pupil premium concept put forward some years ago by former adviser to the Blair government Professor Julian Le Grand. The aim was to enhance the progressive impact of school choice by encouraging schools to take on pupils from deprived areas

"The patient premium should work in a similar fashion, providing GP practices with a direct incentive to take on patients from poor areas, and at the same time giving them resources to deal with any extra calls on their services that such patients might make," said Professor Le Grand, who wrote the foreword to the report.

The report adds that registration with a GP should become an active process which needs to be repeated every two to five years. "This would drive competition and contestability into the primary care market. The process of decision making would better engage patients in their own healthcare as well as give a longer budgetary cycle to GP practices, which would also help reduce unavoidable variation in healthcare spending."

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