Beauty and the beasts
A new series on aesthetic practices begins by looking at problems of starting up P10
A fad you should link into Our marketing expert explains there is one social media site you shouldn’t ignore P20
By Robin Stride
Independent practitioners have expressed anger with the Care Quality Commission (CQC) after it hit them with a 9% increase in its charges for the year ahead.
Private doctors’ disgruntlement was heightened after they learned that dentists will escape any fee rise while they are forced to pay much bigger bills than some larger NHS practices.
Many independent practitioners feel they are being unfairly targeted by the regulatory body, which this month launched its beefed-up inspections regime following nationwide trials and feedback from the sector.
As one Harley Street GP, Dr Samina Showghi, put it: ‘We pay enough already.’
Leading the objections to the higher charges is the Independent Doctors Federation (IDF), which represents more than 1,100 private doctors, including around 400 GPs.
In a statement, it said: ‘The IDF is dismayed that, once again, the independent sector is being asked to subsidise a public body with this recent 9% increase in CQC inspection fees, particularly as dentists are exempt from a fee increase.
‘The IDF is concerned that there appears to be a persistent bias against the independent sector and will continue to work towards creating a fairer system.’
Former practice manager Martha Walker, who advises private practices and clinics about meeting CQC requirements, told Independent Practitioner Today: ‘It still appears that the independent sector is continuing to subsidise the NHS.
‘The average doctor practising out of one location – for example, a doctor in rooms in Harley Street – will now pay £1,679 in 2015-16 (£1,540 in 2014-15). This compares to an NHS GP practice in one location with between 5,000 and 10,000 patients who will pay only £725.’
Mr Ian McDermott, managing
partner of London Sports Orthopaedics, said consultants were already facing practice cost rises of 10% a year and had to also cope with cuts of up to 50% in some insurers’ reimbursement rates.
He called it a ‘one-sided onslaught’, adding: ‘The CQC fees hike is just typical of the ongoing current craziness in the independent sector.’
According to David Briggs, general manager at London Medical in Marylebone High Street, more big fee rises are now on the way. He warned: ‘There is no doubt governance is important, but the level of governance in the medical sector and the consequent costs will only increase.’
He predicted single independent practitioners would be hurt most and would be increasingly forced to look to work within organisations such as his or the large hospital groups, where governance is managed to the highest standard and they are not faced with manag-
ing CQC costs and annual inspections on their own.
The Association of Independent Healthcare Organisations (AIHO) gave a cautionary response, saying it welcomed the CQC’s ‘ongoing positive dialogue’ with the independent sector.
It said it would continue to develop this relationship in the coming months ‘to ensure that the sector’s views are effectively represented and taken into account’.
Chief executive Fiona Booth said AIHO and its members had been working closely with the CQC over the past few months on the new inspection regime for the independent sector and as part of the Fees Advisory Panel.
She added: ‘It is important that the fees required for providers are proportionate. As such, we welcome the CQC’s efforts to better evidence their value for money through their formal performance and evaluation programme.
➱ continued on page 9
changes in social media
We look at the implications for private practice of evolutions in social media P16
Prepped for the poll
Advice on how you can safeguard your finances ahead of the general election P19
a way to avoid strife at work
How mediation can resolve staff disputes and prevent a harmful drop in morale P24
How they decide what’s negligent continuing our series on becoming a clinical negligence expert witness P32
make the most of pension freedom the pitfalls and opportunities of using bigger lump sums to buy property P39
greater powers to look into your life
How to cope with HMRc’s ever increasing power to scrutinise your tax affairs P44
ediTorial commenT
If you have not been keeping a close enough eye on your pension situation, then now’s the time to do so.
As we report on this page, yet another attack on your nest egg is scheduled for next year with the Budget’s cut in the lifetime allowance to £1m.
Every senior doctor could hit this new pension limit and risk a 55% tax charge for going above it. Only seven years ago your retiring colleagues could get to £1.8m without tax kicking in.
But a lot has been changing and, despite the last Government’s much publicised good news on pension freedoms,
doctors are one of the professions paying dearly for being dedicated and working hard.
The results of the general election could even bring more pension pain.
While there is still some time to react, we urge everyone to get in touch with their independent financial adviser, who can help you think clearly through your options and suggest possible actions.
And as our feature on page 30 points out, do not forget that there are better reasons now than ever to insist your financial planner and your accountant talk to one another.
Tell us your news Editorial director Robin Stride at robin@ip-today.co.uk
Phone: 07909 997340 @robinstride
To adverTise Contact advertising manager Margaret Floate at margifloate@btinternet.com Phone: 01483 824094
To subscribe lisa@marketingcentre.co.uk Phone 01752 312140
Publisher: Gillian Nineham at gill@ip-today.co.uk Phone: 07767 353897
Head of design: Jonathan Anstee chief sub-editor: Vincent Dawe 12,000 circulation figures verified by the Audit Bureau of Circulations
by leslie berry
The Chancellor will penalise senior doctors for working hard to save for a healthy retirement, financial advisers have warned.
George Osborne’s Budget cut in the maximum amount that can be saved into a pension from £1.25m to £1m from April 2016 is set to hit them all.
Senior doctors will now lose tax relief on their total retirement savings over £1m.
And the new lower rate will also catch many middleearning doctors who are tied to making NHS pension contributions.
The lifetime allowance has already been cut by over 30% from £1.8m in 2011. Those breaching the savings threshold face a 55% tax charge.
Simon Bruce, managing director of specialist financial planners Cavendish Medical, told Independent Practitioner Today: ‘Plans to cut the lifetime allowance have been touted by many of the political parties, so we are not surprised to see higher earners will bear the brunt of the costsaving exercises declared in this preelection Budget.
‘But it is frustrating that this dis
appointment comes soon after the relatively good news of new pensions freedoms. While the pensions industry tries to keep up with the constant tinkering to the rules and regulations, doctors are being penalised for working hard to save for a healthy retirement.
‘The very nature of the NHS pension means more doctors than ever before will be trapped by the new lower threshold if they have completed many years of loyal service.
‘When previous changes to the lifetime allowance figure have been implemented, various forms of pension protection products were introduced. We await details of any such measure.’
From 2018, the lifetime allowance will rise in line with inflation. Mr Osborne ruled out further changes to the annual allowance which limit yearly pension contributions to £40,000. In a welcome move, he said individuals who had already retired would benefit from an extension to new pension freedoms. From 2016, annuity holders will be able to swap their fixed annual payments for cash, subject to their marginal rate of tax.
The ‘abolition of tax returns’ was an eyecatching Budget announcement, but accountants were still awaiting details of what will replace them as we went to press.
James Gransby, a partner at MHA MacIntyre Hudson, said: ‘On the face of it, that could be a vote winner – but it is not at all clear what will replace them.
‘We are told that by the end of the next Parliament everyone will have a “digital tax account”. It seems likely that this will be used to send information to HMRC,
and that will form the basis for tax liabilities. It is hard to see how that is not a “tax return”.’
Apart from the pension changes, many of the tax announcements had a neutral feel for private doctors. Mr Gransby said for those earning over £100,000 the personal allowance continues to be withdrawn, producing a marginal rate of tax of 60% in the band between £100,000 and £121,200. For those who have no personal allowances (income over £121,200), the overall effect is a small tax rise of £32.
by robin stride
Private anaesthetists have welcomed an appeal judgment upholding a Competition and Markets Authority (CMA) finding that forming and operating an anaesthetic group does not lead to adverse effects on competition.
The Association of Anaesthetists of Great Britain and Ireland (AAGBI) supported the original CMA ruling in April 2014 which was part of the authority’s private healthcare investigation.
AXA PPP subsequently challenged that before the Competition Appeal Tribunal (CAT) last January, but last month heard that it had lost on all three grounds.
Dr Paul Barker, chairman of the AAGBI Independent Practice
Com mittee, told Independent Practitioner Today: ‘Patient safety is the AAGBI’s primary objective. We believe that group anaesthetic practice brings important benefits to patients when their care is provided in this way.
‘Oncall systems, subspecialisation and governance structures that reflect those found in the NHS and provide a single point of contact for patients both pre and postoperatively further improve safety and quality of care.’
He said the AAGBI, which represents 10,800 anaesthetists, welcomed any opportunity to improve safety and quality of care, as these were priorities for patients and members.
AAGBI engaged with every stage of the inquiry, submitted evidence
to the initial investigation and also intervened in the appeal proceedings.
AXA PPP said: ‘We are surprised and disappointed the CAT has not upheld our appeal.
Fitnesstopractise tribunal decisions against doctors could now be appealed by the GMC if it thinks they have been treated too leniently and the public is unprotected.
Changes to the Medical Act approved by Parliament will also enable reforms to the way complaints about doctors are handled.
Tribunals, run by the Medical Practitioners Tribunal Service (MPTS) operating separately from the GMC, will now be placed on a statutory footing.
Changes include:
Streamlining how cases are prepared and managed to make hearings speedier and more effective;
Giving tribunals power to award costs against the GMC or the doctor if either has not complied with directions and has behaved unreasonably;
Introducing legally qualified chairmen for some tribunals.
GMC chief executive Niall Dickson said: ‘These changes will also help us streamline our investigations, reduce the time it takes to deal with complaints and make our procedures faster, fairer and more efficient.’
But he claimed more reform was still needed as the law governing doctors’ regulation was ‘outdated’.
Mr Dickson added: ‘The draft Bill
produced for the Government by the Law Commissions of the UK would allow us to be more responsive and better serve the needs of patients and support improvements in medical practice. We hope this change in the law will be introduced as soon as possible after the general election.’
The GMC has launched a consultation on new and amended rules which will be needed to implement changes to the law.
MPTS chairman His Honour David Pearl said the changes would strengthen its prehearing case management and save time lost in hearings to legal argument.
New online training aims to give aesthetic business owners a lowcost solution to marketing challenges.
Aesthetic Business Transformations’ 6D Patient Attraction System teaches tried and tested strategies.
Creator Pam Underdown said: ‘This system will help eliminate any myths about online and
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‘It will teach you the essential lessons of marketing and business development and how to avoid the all too common pitfalls.’
Workbooks, downloads, templates and additional support are
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‘The evidence we presented –namely that, in some local markets, the combination of anaesthetist groups with high market shares and the practice of collective fee setting within those groups leads to a loss of rivalry and consequently has an adverse effect on competition – was sound and in keeping with our own experience and that of others who purchase private anaesthetists’ services.
‘We remain concerned that this is a significant issue for patients and we will continue to challenge unfair practices in the interests of our members.’
An earlier version of this story, with the CMA’s detailed findings, can be found at www.independentpractitionertoday.co.uk.
New independent practitioners, established private consultants and GPs are being invited to the BMA Private Practice Committee annual conference on 30 April at BMA House, London.
Visiting speakers will talk on a wide variety of issues affecting private doctors’ businesses, including company structure, financial subjects, billing, legal matters relating to setting up in private practice and Care Quality Commission registration and inspections.
Details: email confunit@bma. org.uk or phone 020 7383 6137.
Nominate your PA
Consultants and GPs are being invited to nominate staff for The Private Medical Secretary/PA of Year Awards 2015.
Sponsored by the British Society of Medical Secretaries and Administrators and Helix Health, they offer prizes of up to £500. Nomination forms are available from kathy.perkins@ bsmsa.org.uk.
By Robin Stride
A new eye clinic in London is the only one in the world able to implant a miniature telescopic lens for patients who have agerelated macular degeneration and who have had prior eye surgery for cataracts.
The Harley Street Eye Clinic, the vision of ophthalmic surgeon Mr Ahmed El Amir, was officially opened by doctor, journalist and author Dr Max Pemberton at a packed launch ceremony.
It will be able to provide its MacularScope Plus implant for cataract patients who have had a synthetic lens implanted into their eye. The synthetic lens must be removed to make space for the
clinic’s MacularScope Plus implant.
Mr El Amir, who is director of the clinic at number 84, said he expected a third to a half of his patients to come from abroad, depending on the time of year, and around 50% to be selfpayers or from embassies.
He said: ‘At our clinic, we determine whether the synthetic lens for cataract surgery can be extracted safely and if there is enough support to balance our MacularScope Plus implant in the eye. We do this without carrying out a surgical procedure.
‘If we are satisfied that the surgery will be a success, we remove the synthetic lens and replace it with our implant. Our patients
The Harley Street Eye Clinic team and the IMT device (inset) pictured on an index finger (from left) Mr James McAllister, consultant ophthalmologist; Nicola Wood, lead optometrist; Mr Ahmed El-Amir, senior consultant ophthalmic surgeon/director; Mr Raj Das-Bhaumik, consultant ophthalmologist and ophthalmic plastic surgeon
can expect equally good results compared to those who have not had prior cataract surgery.’
Mr El Amir continued: ‘Our MacularScope Plus implant is based on, and extends the use of, the wellestablished CentraSight minature telescope.’
The CentraSight implantable miniature telescopic lens (IMT) is
Improving the quality of complaints handling by providers remains a key task, according to the Independent Sector Complaints Adjudication Service (ISCAS).
It has been recently working with members of its voluntary scheme to improve their processes for handling and investigating complaints.
ISCAS identified that weaknesses in the initial investigation stage were a recurring theme –failings that could lead to protracted and costly complaints resolution.
The body provides independent adjudication on complaints made by privatelyfunded patients that members have not been able to resolve locally. The service is free for complainants to use and is funded by the membership.
Adjudicators considered 40 complaints cases in 2014, including 151 heads of complaint.
ISCAS senior adviser Disa Young told Independent Practitioner Today the three largest categories of heads of complaint in 2014 were:
Complaints handling (20%);
Nursing care (19%);
Consultant care (17%).
Adjudicators last year drew on the advice of clinical experts in 25% of cases reflecting a broad range of clinical issues. The average cost of an adjudication case was £2,412.
Goodwill payments can be made to complainants in recognition of inconvenience and distress and in 2014 the average was £479.
Adjudicators work from a Goodwill Payments Guide which uses a fourtier scale and sets out the mitigating and aggravating factors that determine the size of the goodwill payment.
The ISCAS adjudicator’s decision is final and Ms Young said ISCAS members valued the fact that complainants agree the inde
pendent adjudication report brings the complaints process to a conclusion.
She said the scheme covered the vast majority of UK independent healthcare providers.
Learning points highlighted in the ISCAS Annual Report 2014 include:
The need for accurate and detailed recordkeeping;
The importance of a thorough consent process;
Managing patient expectations in terms of outcomes, especially in the cosmetic surgery arena;
Presenting accurate profiles of clinicians.
There were no independent adjudications on independent practitioners, represented through the Independent Doctors Federation (IDF).
For more information about ISCAS and its activities, see its Annual Report 2014 at www.iscas. org.uk/iscasannualreport
the first and only IMT that is both CEmarked – signifying that the technology conforms with relevant EU health and safety directives – and also passed by the US Food and Drug Administration.
The Harley Street Eye Clinic team offers a comprehensive service ranging from cataracts to retinal conditions.
ASPIRING DOCTOR: A GP has become a private hospital director. Dr Fergus Macpherson takes over at Spire Liverpool Hospital.
The former partner at a practice in Leith, Edinburgh, was most recently Spire Healthcare’s director of pathology, which he grew from a service purely working on tests for the group’s hospital network into being one of the UK’s largest independent pathology laboratories.
Dr Macpherson said he wanted to increase private work across all specialties and expand the hospital’s work with the NHS.
Mr Robert Walters with the Orbis UK ‘flying
Consultant ophthalmologist Mr Robert Walters, chairman of eye care charity Orbis UK, was recognised for his dedication and contribution to the fight against preventable blindness at the Charity Staff and Volunteer Awards, where he was named Trustee of the Year.
For the past 22 years, Spire Hospital, Cardiff, consultant Mr Walters has donated thousands of hours to training ophthalmologists in developing countries, attending and chairing board meetings, lobbying organisations around the world and speaking at events.
Since his first trip – to Sudan to volunteer on board the Orbis Flying Eye Hospital – he has participated in a further 15 overseas teaching trips.
He said: ‘In 2014, Orbis treated
6.4m people and helped make the world a better place. I am immensely proud of all of the dedicated people in Orbis around the world who enabled this to happen.
‘There is still much to do and, working together with our generous donors, selfless volunteers and our many dedicated partners, we will help even more of those many, many millions of people who require our care to allow them to see and enjoy the beauty of the world around us.’
Orbis UK chief executive Rebecca Cronin said: ‘As chairman, Rob has overseen a huge expansion in the number of people treated by the charity.
‘In 2008, Orbis delivered 786,606 treatments to children through its global programmes. In 2013, this increased to 2,793,000.’
By Leslie Berry
Aspen Healthcare Ltd’s nine private hospitals and clinics in the UK are to be sold to US giant Tenet Healthcare Corporation in a $215m cash deal due to be completed this summer.
The buyer said the purchase represented an attractive opportunity to enter the UK market, where it sees the demand for private healthcare services is steadily increasing due to demographic changes, growth in consumer healthcare spending and increasing opportunities to work with and support the NHS.
It is envisaged Aspen’s name will continue and the deal with current owners Welsh, Carson, Anderson and Stowe will mean further expansion and new developments.
Tenet has 80 hospitals, 214 outpatient centres, employs 110,000 people and generates annual revenues of £17.5bn. Until now, it has had no other interests in Europe or elsewhere.
Alongside the purchase is another Tenet deal with United Surgical Partners International Inc to combine shortstay surgery and imaging centres into a new joint venture to be the US’s biggest provider of ambulatory surgeries.
Tenet will initially own 50.1% of the joint venture and will consolidate its financial results. Welsh
Carson and the other existing investors in USPI will initially own the remaining 49.9%. Tenet will have a path to full ownership of USPI over the next five years.
The company said the joint venture will have ownership interests in 244 ambulatory surgery centres, 16 shortstay surgical hospitals and 20 imaging centres in 29 US states. It will maintain the USPI brand, as well as USPI’s innovative three way partnership model with physicians and leading notforprofit health systems.
Tenet president and chief executive Trevor Fetter said: ‘Through strong partnerships with physicians and leading health systems, USPI has built a network of relationships and facilities that are providing high quality surgical care across the US. Creating this joint venture with the premier operator of short stay hospitals and surgery centres has strategic and financial benefits for both parties.’
He added: ‘Aspen Healthcare has achieved a strong trackrecord of performance under Welsh Carson’s ownership, and their significant and smart capital investments in recent years have positioned the company to drive additional robust growth in the future.’
Aspen began as a two hospital system. It was acquired by USPI in April 2000 with backing from Welsh Carson.
The Private Healthcare Information Network (PHIN) has appointed four more nonexecutive directors as it takes up its Competition and Markets Authority (CMA) role as the independent Information Organisation for private healthcare.
The new appointments are:
Prof Sir Cyril Chantler, retired consultant paediatrician;
Prof Nancy Devlin, Office of Health Economics director of research;
Prof Sir Norman Williams, former Royal College of Surgeons of England president;
Dr Gerard Panting, nominated
by the Federation of Independent Practitioner Organisations (FIPO). Those appointed will act in a personal capacity.
PHIN is charged with overseeing the implementation of the CMA’s information remedies set out in its Private Healthcare Market Investigation Order 2014. These address
the CMA’s concerns about a lack of good information to help patients understand and choose their specialist consultant and hospital.
PHIN chairman Dr Andrew VallanceOwen said the appointments should give everyone confidence in its independence and capability.
The NHS is about to move into the Harley Street enclave with a private patient outpatient facility.
Royal Brompton and Harefield Hospitals Specialist Private Care told Independent Practitioner Today it plans to open the unit in early 2016 at 77-78 Wimpole Street.
The 11,162ft2 property will feature consulting rooms, treatment rooms and extensive diagnostic facilities with the aim of having the capacity to deliver single daycase assessment.
It said the consulting rooms and diagnostic facilities will initially only be available for use by the NHS hospital’s consultants.
A large portion of them do private patient work and are said to be ‘closely involved and very supportive of the project’.
A spokesman said: ‘There are collaborations in the works with other local healthcare providers, as well as plans to build upon existing relationships with the local GPs, embassies and businesses in the area. More information will be available on these closer to launch.’
Royal Brompton and Harefield Hospitals’ Specialist Care provides private care at what is the largest specialist heart and lung centre in the UK.
The private patients’ centre claims to offers some of the most sophisticated treatment in the world, specialising in complex cases which often cannot be treated elsewhere.
It says: ‘Every private patient can be confident that they will have access to the most comprehensive range of advanced surgical, medical and diagnostic facilities delivered by medical staff from around the globe whose combined experience enables our hospitals to lead the way in heart and lung care.’
Consultants and others helped run Women’s Health Day, a special event at Highgate Private Hospital, north London. Specialists were on hand to provide answers on focus areas such as gynaecology, physiotherapy, preventative health screening and dermatology. Guided tours of the hospital, which recently had at £15m redevelopment, were offered as well as the opportunity for all guests to book advice sessions with specialists to talk about specific health issues.
Bupa UK managing director Richard Bowden has warned its insurance arm will maintain pressure to get private hospitals to cut prices.
He said: ‘We know customers want private healthcare to be more transparent and affordable and reform across the whole sector is needed to deliver this.
‘The agreements we have reached with some hospital groups have ensured that prices they charge us for treating our customers will not rise in 2015. This is a key factor in
delivering lower premium increases and we will be looking to work with other providers in a similar way.’
Mr Bowden, speaking as Bupa UK reported revenues up 5% and profit up 25% to £175m across its five businesses, argued its corporate customers were seeing the benefit of hospital agreements.
He said: ‘In 2014, over half of our renewing corporate customers had their premiums either reduced or held level, meaning they have experienced some of the lowest premium increases on record.’
By Edie Bourne
Independent sector acute medical hospitals and clinics generated £4.6bn revenues in 2013, up 1.8% in real terms taking account of economy inflation over the year, according to market analysts.
Estimates in the third edition of LaingBuisson’s Private Acute Medical Care say insurers’ medical cover payouts dropped 2.5% and the self-pay market rose by 2.5%. Most of the revenue rise came from treating NHS patients, generating a 6.5% revenue increase outside London.
Overseas patients recorded the
strongest growth with spending up almost 20% and similar growth forecast for 2014.
Economist and report author Philip Blackburn said investor interest in the market had improved and was likely to increase competition in a number of areas.
A challenge for new hospitals and clinics would be to bring new private demand into the marketplace with their business propositions.
‘At a time when insurers are looking for further cost reductions to stimulate private medical cover demand, it appears crucial that new structural developments can
deliver efficiencies for the sector.’
Another LaingBuisson report –Private Acute Medical Care in Central London – reports that growth in facilities is currently up around 9.2% a year in nominal terms compared to 2006, with the NHS hardly making any register as a purchaser.
Revenues from independent hospitals and NHS private patient units in central London hit £1.3bn in the year to December 2013 and £1.5bn is estimated by the end of 2015.
The City’s market accounts for around 34% of national private patient-only revenue and has not
only survived the recession but has prospered.
Author and healthcare consultant Ted Townsend reported significant growth away from Harley Street with 68% of revenues now generated outside W1G in areas. He noted hospitals were providing more tertiary, higher acuity care for patients with more complex needs.
Private Acute Medical Care, third edition, £1,175. Private Acute Medical Care in Central London, £950. Prices include hard copy and back-up PDF and Excel files. Website: www.laingbuisson.co.uk
By Leslie Berry
Fifteen world-leading doctors have got together to set up a sophisticated and detailed health screening unit for senior executives in Devonshire Street, London.
XVIII – The Centre for Advanced Screening aims to give early detection of six of the biggest killer diseases of modern times: bowel cancer, breast cancer, cardiovascular disease, lung cancer, pelvic cancers and prostate cancer.
The unit, a division of HCA International off Harley Street, goes beyond traditional well man and well women tests by combining a thorough assessment of an individual’s risk factors with the very latest diagnostic technology, all under the same roof. Its programme aims to guide very time-pressured men and women at the top of their professions towards a personal programme of lifetime management of their risk of future disease.
Clients include chairmen and chief executives of major organisations, leading entrepreneurs for whom life brings high pressure and stress levels, and those seek-
ing the most thorough advanced screening available.
XVIII’s clinical board chairman is Prof Roger Kirby, a pioneer in new treatments for prostate cancer and other urological conditions. He is founder and medical director of The Prostate Centre, London, and former head of urology and co-director of postgraduate medical education at St George’s Hospital, London.
He explained: ‘We all share a common obsession. Passionately believing that early detection of disease saves lives, we know that many currently available health screens fall well short of achieving their aim – or rather your aim, since it is your health and your future at stake.
‘At XVIII we have access to gamechanging technology, which gives us dramatically improved means of detecting killer diseases – while at the same time reducing or eliminating the risks of the tests themselves.
‘It is this that has brought us together to offer clients the opportunity to learn more about their health and to take control and manage their health into the future. Our very personalised ser-
The centre has what chairman Roger Kirby calls ‘game-changing technology’
vice is simply not available elsewhere.’
Apart from conventional and state-of-the-art scanning investigations, XVIII uses a number of innovative tests. For example, cardiac disease is still the UK’s biggest killer and the centre carries out the newly developed online calcu-
lator of cardiovascular risk – ‘Heart Age’ – faced by individuals. The centre said all tests with abnormal results were interpreted by world-renowned specialists who were driving change and innovation and ‘enhancing the reputation of London as a worldclass centre of medical excellence’.
Dr Syed Babar – consultant radiologist specialising in gynaecological MRI at Hammersmith Imperial Health Trust.
Prof John Betterridge – consultant endocrinologist; Dean of the Royal College of Medicine and emeritus professor of endocrinology and metabolism at University College London.
Dr David Burling – consultant gastrointestinal radiologist; chair of the National Co-ordinating Group for Quality Assurance of CT Colonoscopy.
Prof John Deanfield – consultant cardiologist; professor of cardiology (British Heart Foundation) University College Hospital London, and director, National Centre for Cardiovascular Disease Prevention and Outcome.
Dr Paul Ettlinger – GP and screening specialist and founder of The London General Practice.
Mr Alan Farthing – consultant gynaecologist, surgeon and oncologist, the West London Gynaecological Cancer Centre, Queen Charlotte’s Hospital.
Dr Peter Harper – consultant medical oncologist and director and founder of Leaders in Oncology Care, London and Manchester.
Dr Anna Herrey – consultant cardiologist, The Heart Hospital, University College Hospital and The Royal Free Hospital.
Prof Sam Janes – consultant in respiratory medicine, University College Hospitals NHS Trust; director of London Lung Cancer Pathway Board and vice-chairman of the National Clinical Reference Group.
Prof Mike Kirby – primary care physician; visiting professor to the University of Hertfordshire and editor of The Primary Care Cardiovascular Journal.
Miss Fiona MacNeill – consultant breast oncoplastic surgeon, The Royal Marsden Hospital, London; vice president, Association of Breast Surgery and examiner, European Breast Surgery Board.
Dr Uday Patel – consultant radiologist and specialist in uro-radiology and advanced
imaging, St George’s Hospital and Medical School, London; member of The Prostate Cancer Advisory Group and head of Radiology The Prostate Centre, Wimpole Street, London.
Dr Nick Perry – consultant radiologist; clinical director The London Breast Institute and chairman of the European Reference Organisation for Quality Assured Breast Screening and Diagnostic Services.
Dr Francesca Pugliese – consultant radiologist and senior clinical lecturer, Centre of Advanced Cardiovascular Biomedical Research Unit, St Bartholomew’s Hospital London; executive committee member of the British Society of Cardiovascular Imaging and specialist committee member of the NICE Diagnostic Assessment Programme.
And together with Dr Paul Ettlinger, the GPs at The London General Practice: Dr Amarjit Raindi, Dr Catrin Bevan, Dr Angela Rai, Dr Stuart Sanders, Dr Sam Bennett and Dr Justine Morris
By charles King
Consultants’ pay from the NHS is a dozen years out of date, according to the chairman of the BMA’s consultants committee.
Dr Paul Flynn warned: ‘While workloads are rising, doctors’ pay has been steadily chipped away at in recent years, leaving consultant pay, in real terms, back at 2003 levels.
‘This is because billions of the Government’s so-called “efficiency savings” in the NHS have, in fact, come from cuts to frontline staff pay, leaving doctors feeling devalued and demoralised.’
He said with only weeks until the general election, consultants were calling on politicians to ‘stop playing games with the NHS’.
They wanted them to put
patient care first by listening to senior doctors’ concerns about NHS funding, creeping commercialisation of services and rising workload pressures which lead to burnout.
The effect of rising pressure on
services was exposed in recent BMA surveys, where half of consultants described their workload as unmanageable and identified excessive workloads as the greatest barrier to delivering the care they wanted to for patients.
Many consultants routinely worked across seven days, with nine in ten senior doctors working evenings and weekends as part of an on-call rota and seven in ten reporting they did not have adequate rest periods between shifts.
The BMA said excessive workloads and stressful working environments were leading to burnout and a recruitment and retention crisis in some specialties, such as emergency medicine, as junior doctors chose to train in other areas of medicine or existing doctors left the NHS.
Doctors are being warned that they must ensure patients are aware of material risks and of any reasonable alternative or variant treatments when getting consent from them.
In a major change of policy, the Supreme Court has introduced a new approach of informed patient consent for the first time in negligence law.
The ruling in its judgment on Montgomery v Lanarkshire Health Board has done away with the previous test, applying from the cases of Bolam and Sidaway.
This was that a doctor would not be negligent if the information given to a patient about a treatment or procedure was compatible with that which would be given by a responsible body of medical opinion, provided the
standard was considered reasonable by a Court.
Dr Michael Devlin, head of professional standards and liaison at the Medical Defence Union (MDU), said the Supreme Court justified its decision on the basis of the change in the nature of the doctor-patient relationship since the case of Sidaway 30 years ago.
He explained that the new legal approach recognised that patients want to be well-informed about significant risks and reasonable alternative treatments.
Dr Devlin went on: ‘However, warning patients about these risks is already enshrined in ethical guidance and the Supreme Court judgment endorses the approach to sharing information with patients contained in the GMC’s consent guidance.
Doctors’ defence bodies have backed last month’s Government’s withdrawal of support for the Medical Innovation Bill.
Medical Protection Society medico-legal adviser Dr Pallavi Bradshaw called the Bill ‘flawed’ and ‘an unnecessary piece of legislation’.
He said it would have had the potential to undermine safe and established routes of innovation and could have damaged doctors’ relationships with their patients.
Dr Bradshaw said it would also have created a number of adverse unintended consequences.
‘It gives the false impression to vulnerable patients and their families that all experimental treatments would be readily available, confuses what is meant by the term medical innovation and may cause fundamental disagreements with patients and their doctors about ongoing care.’
At the Medical Defence Union (MDU), Dr Michael Devlin said medical innovation was fundamental if medicine was to progress and if the law was any bar to it, then his body would have called for reform years ago.
‘Doctors will already be aware of the need to warn patients about material risks. But as a result of the judgment, making a detailed record of the information provided to the patient about the risks involved in proposed treatment is likely to be all the more important.
‘While the new legal approach applies to cases of alleged negligent failure to inform about treatment risk, it does not apply to negligence actions more widely, which remain determined by the Bolam test,’ Dr Devlin added.
The MDU has published detailed legal guidance for its members about the new test on its website at www.themdu.com/guidance-andadvice/latest-updates-and-advice/ doctors-must-ensure-patients-areaware-of-material-risks.
He went on: ‘There was never any need for new legislation in this area and many doctors will breathe a sigh of relief that there will be no new legislation to bring confusion to what is currently a straightforward matter.
‘We know doctors innovate all the time, as we regularly advise MDU members about the medicolegal implications of using an innovative treatment.’
But he said the Bill provided an opportunity to make it clear to doctors who were uncertain that litigation was not and should not be a bar to innovation.
‘The law is already very clear and any new law would only have created delay and confusion. That would not have benefited patients or doctors and it is reassuring to see that Parliament understood this.’
With many private consultants and GPs angry at the Care Quality Commission’s imposition of a 9% rise in the fees it charges them – starting this month –martha Walker (right), the author of Independent Practitioner Today’s The Essential Guide To CQC Registration, gives her response
April 1 brought with it the Care Quality Commission (CQC) 201516 fees guide for all providers of health and social care in England.
And, as we report on the front page, most providers will see a 9% rise in their annual fee.
This increase is going ahead despite the majority of responders to a fees consultation paper that went out last autumn saying they did not think a 9% increase was acceptable.
They gave a range of reasons, including:
‘Not value for money’;
‘Above the cost of living’;
‘Unfair’.
But the CQC has justified the increase by saying: ‘Our consultation document set out the requirement for CQC to recover its chargeable costs from the providers we regulate – this is HM Treasury policy, and one we are obliged to meet.’
It still appears that the independent sector is continuing to subsidise the NHS.
The average doctor practising out of one location – for example, a doctor in rooms in Harley Street – will now pay £1,679 in 2015-16
whereas the previous year (201415) they paid £1,540.
This compares to an NHS GP practice in one location with between 5,000 and 10,000 patients who will pay only £725.
Dentists have been made exempt from any fee increase.
As one doctor commented: ‘It’s not rocket science to see which practice will involve the bigger CQC inspection team and subsequent workload.’
Of course, it could be argued that a £139 increase is not the end of the world. But I think there is more to this than just the fee increase.
no explanation
Despite the CQC issuing a very detailed document supporting the fee increase and offering extensive reasons for the rise, it did not explain why a private GP practice in one location (patient list not relevant) will pay £1,679 while their colleagues in an NHS practice in one location and more than 15,000 patients will pay only £948.
In the spirit of openness and transparency – and, dare I say it, candour – shouldn’t the CQC say
Private doctor/clinic in £1,679 One location fee on sliding one location scale up to £53,628 for more than 15 locations.
NHS primary care (GP) in £616 One location fee on sliding one location up to 5,000 scale up to £948 for more patients than 15,000 patients.
NHS primary care (GP) in £1,341 Sliding scale up to £16,759 two locations (number of for more than 40 locations. patients not relevant)
A dental practice in one £600 One location fee on sliding location with one chair scale up to £1,300 for over six chairs
exactly why it cannot charge both sectors the same?
Many years ago, at a time when it was still being discussed how and when to inspect and register NHS primary care, I had a conversation with a senior inspector from the CQC’s predecessor, the Healthcare Commission.
The official candidly told me: ‘We can hit the private sector over the head and you will do what we
say. If we did that to the NHS, they would say: “We need more money to do that – and the only place that can come from ultimately is the taxpayer, and that won’t do”.’ It feels like nothing has changed.
Martha Walker is an independent adviser on CQC registration to GPs and consultants for consultants www.cqcconsultancy.co.uk
this would be unfair and not represent value for money.
The Care Quality Commission (CQC) said the fees increases were necessary so that it could effectively register, monitor and inspect and make sure people received ‘safe, high-quality and compassionate health and adult social care’.
It had recommended a 9% rise in a consultation but then failed to bow to respondents’ pleas that
The CQC said dental providers would have their fees frozen ’because the cost of their regulation is recovered fully already’.
Chief executive David Behan said: ‘Our commitment is to make sure that people receive safe, highquality and compassionate care and we are confident our new way of registering, inspecting and monitoring services allows us to do this.
‘We understand that the increase in fees is happening at a difficult economic time for many providers, but we hope that they and, importantly, those who use their services are seeing the benefits of our inspections, which allow us to identify where improvements are needed and to celebrate what services are doing well.
The CQC expects to consult in the autumn on its fees strategy for 2016-17.
It said it would soon introduce the option for providers to pay by instalments and by direct debit to help them manage cash flow.
This month, it was due to publish a calculator on its website to help providers work out their exact fees for 2015-16, alongside detailed fees guidance.
‘We are determined to deliver value for money by being an efficient and effective organistion.’
bREAking inTo ThE AEsThETics bUsinEss
In the first of a major new series for Independent Practitioner Today, Pam Underdown (right) warns that unless you can set yourself apart, either by offering something your competition doesn’t, or knowing you can provide something better, then it will take a long-term investment of time, money and patience before you can build your reputation and start attracting enough high-spend patients
This is a highly competitive and demanding industry and just having great clinical skills certainly does not guarantee success
A decAde Ago, aesthetic professionals really didn’t have to try too hard to fill up their appointment book with high-spend patients.
They opened their doors and the patients really did come flooding in.
c redit was readily available, consumers were spending and increased curiosity about the celebrity lifestyle and reality TV made it possible for everyone to believe that they could have a new life with cosmetic enhancement.
Having been involved in the medical aesthetics business for a decade, I have seen first-hand how the marketplace has evolved.
When I opened my first aesthetic business in 2005, things were very different. Prospective patients attended demonstration evenings, bought their friends and booked in immediately.
It was exciting and new and if you were good at it, your business quickly grew.
Today, it is certainly not easy. Business-owners are frequently contending with increased public scrutiny and changing consumer behaviours.
competition abounds
competition is everywhere, legislation is minimal and too many discounts flood the high street. A growing number of business-owners feel as if their business is running them, instead of the other way around.
despite this, there continues to be a growing number of health professionals quitting their day job and setting up their dream anti-ageing business. And who can blame them?
For many, the appeal of the aesthetics industry can be glamorous and far more exciting than shift work, sickness and death. Health professionals can combine their keen judgement with their clinical skills and creative eye.
All they need to do is attend a day-long course in facial aesthetics, practise on a few friends and they are ready for business –right? Well, actually, no; it is not that easy.
This is a highly competitive and demanding industry and just having great clinical skills certainly does not guarantee success.
The pressure can often feel overwhelming as the growing realisation of having what it takes to build a business successfully can shatter many dreams
So is the ‘dream’ a good enough reason to risk everything and start again as you hope to claim your slice of the aesthetics pie?
In order to grow a profitable medical aesthetic company today, business-owners must have a wealth of skills and knowledge in all areas:
Marketing;
Social media;
customer service;
Astute financial skills;
Fundamental business skills; exceptional clinical skills.
Which is quite a challenge for anyone managing the fine balance of working in their business, treating patients, dealing with day-to-day operations, staffing issues and finding the time to work on their business, marketing it and keeping up to date with the latest techniques, while strategically planning for growth.
The pressure can often feel overwhelming as the growing realisation of having what it takes to build a business successfully can shatter many dreams and bring reality crashing down.
I hear instances of many new business-owners who simply did not realise the level of upfront costs they needed to invest.
Many start with pound signs in their eyes, believing that, by charging £300 or more per treatment, it won’t be long before they are making a profit. However, after the initial investment in training, a website, a logo and stock, they can be thousands of pounds out of pocket before they have even started.
Many do not take into account that they will need to build their confidence and experience with low-cost or even free treatments first.
The most switched-on practitioners do keep their day job to ensure they can pay the bills, and build their business on a part-time basis.
They practise on friends and family, establish themselves as a mobile practitioner, either converting a room at home, building the treatments into their current practice or renting a room in a salon that already has a stream of potential patients coming through the door.
Regrettably, I know of instances where individuals are spending tens, or sometimes even hundreds of thousands of pounds, setting up a new clinic; paying for builders, fancy interiors, expensive couches, the latest high-tech equipment and that gorgeous new desk and chair that they ‘must’ have.
seriously overspent
However, it doesn’t take long for the excitement to die down when they realise they have seriously overspent on the refurbishment and have none left over for the serious business of finding and attracting some patients – the marketing.
If you stop and think about it, your survival as a business-owner is solely dependent on your ability to find and keep customers. For brand-new aesthetic businessowners, it is even harder to find enough patients.
Many are contending with a huge amount of competition; practitioners who have years of aesthetics experience already operate in their area. Their competition offers a wider range of treatments and not just the ‘bog standard’ Botox and fillers that they are able to offer in their early days.
Aesthetics is a very personal and emotional experience. If you have built a connection with your existing practitioner, you won’t jump ship just because someone new has opened their doors. So, instead, the newbie is faced with trying to attract brand new patients, which takes time, education, marketing, money and full market understanding.
Unless you can set yourself
apart, either by offering something that your competition doesn’t or knowing you can provide something better than your competition – then, in reality, it’s going be to a long-term investment of time, money and patience to build your reputation and start attracting enough highspend patients.
If it isn’t happening as fast as you would like in the early days, then panic can set in, resulting in many practitioners continuing with heavy discounting and building themselves a reputation as a discount provider.
They often set up deals with the large online discount sites that can bring in volume, but offer little or any profit.
At first, it’s great; they take ‘the hit’, as they are busy building their experience and confidence. However, they soon start to realise those patients are just one-off bargain hunters, who rarely come back for a second treatment.
If you do have the money to invest in marketing your business, then you need to ensure that
what you are investing in produces a return.
Unfortunately, I have spoken to a number of people who have outsourced their marketing, website or social media, paid a lot of money, but had little results. So, why is this?
There can be many reasons: perhaps the designers have not been given clear guidelines, expectations, branding information, ideal patient profile, unique selling proposition or any other useful information, so they end up second-guessing the requirements and not really understanding the individual business needs or the aesthetic marketplace.
Perhaps they did not grasp the business vision, so they could not get the messaging right. or perhaps the business-owner found it difficult to explain what they were looking for and assumed the expert would come up with something wonderfully creative that would solve all of their marketing challenges.
In reality, it is usually a lack of clear communications, expectations and detailed marketing knowledge – all of which are the responsibility of the businessowner.
As the global economy continues to improve, the business of aesthetics continues to be flourishing, with no end in sight. c osmetic intervention is fast becoming a cultural norm. So, do you think you have what it takes to be a leader in this fastpaced market? Start off with a rigorously-honest self-assessment and ask yourself: do you have the stamina to run a business? do you have resilience? An optimistic mind-set?
do you have support from family and friends? Is funding in place or has it at least been identified to help you through the startup phase and any tough times? Are you willing to learn, stretch and push yourself out of your comfort zone?
How will you cope when it’s six months down the line, you are facing daily challenges and you haven’t broken even? Will you give up or will you learn from your mistakes – and those of others –and fight even harder to succeed? And most important of all, is your desire to improve the lives of others greater than your desire to line your own pockets? If not, you are considering the wrong game. Running a business, any business, is not easy. Those who succeed will be those who prepare well, have the right business and marketing strategies in place, those who listen and respond to their patients’ needs and those who constantly strive to be the best. If you are ready to join this exciting and highly competitive marketplace, then follow our series each month as we delve deeper into what it takes to really master the business of aesthetics.
Pam Underdown is chief executive at Aesthetic Business Transformations
g rowing doctor interest in the aesthetics business was reflected in the turnout for last month’s Aesthetics conference and exhibition 2015 in London.
organisers said the record attendance of 1,800 visitors included nearly 600 cosmetic doctors, surgeons, dermatologists and gPs.
The two-day event, with 61 clini-
cal and business sessions delivered by 71 speakers and 100 exhibitors, showcased an array of innovations, treatments and techniques presented by doctor specialists.
Doctors, private hospitals and clinics are losing business because they are not understanding the mobile-using patient, warns Scott Hague
With some three-quarters of the UK population now owning smartphones, we have a wealth of knowledge, products and services at our fingertips constantly.
the digital patient is a reality. Your existing patients are undoubtedly among the 90% of online adults who have used the internet to access information about health.
And with more internet usage than ever before now taking place on smartphones and tablets, there is more to consider than just ‘being online’.
our research found that, over a 12-month period, the number of mobile visits to N hs websites increased by a staggering 118%.
We have found that, in terms of digital technology adoption, the private patient is very much like the Nhs patient and therefore it is reasonable to assume that your existing patients and your potential new patients are already using their devices to browse for information about their health.
so what should you, as a private healthcare provider, be doing about it? t his, of course, comes down to your goals.
if your goals are to enhance the experience for your existing patients, then your considerations should be focused on:
ensuring you know what your patients need and what they want;
e nsuring you provide what they need and want:
l At the right time;
l in the right place; l in a format in which they can conveniently access it.
i f your focus is on raising awareness of your services with potential new patients, then your considerations should be:
What are they looking for?
how are they looking for it? Do i provide what they are looking for in the format in which they can easily access it?
When they are looking for something, is my website visible in the right place at the right time?
where are your patients?
With nine in ten adults using the internet to access healthcare information, the opportunity is phenomenal. m any of these adults will turn to Google to find information they need or to look for care providers.
i f someone is searching Google for a private psychiatrist in Reading and you are a private psychiatrist in Reading, then you want to be the site they find. Likewise, if someone is searching Google to find out what the treatment options for a certain injury or illness are and you can answer their question, then you want to be the site they find.
And this comes down to search engine optimisation (seo) and paid-for search engine advertising to ensure you are present at the right time.
But in the mobile-optimised world of the web, such market-
ing and advertising now has another layer: mobile friendliness.
Google has made shifts recently to reward websites that optimise their content for mobile users by rolling out a ‘mobile-friendly’ badge for sites optimised for the user’s device. Google also takes this into account when determining where any site should rank for a given search on a given device (see illustration on the right).
A long-term strategy to ensure you are in the right place on search engines comes down to:
Understanding what your patients are looking for. Using search tools such as the Google Keyword Planner in addition to simply surveying your patients will help;
Putting in place a content strategy that ensures you are providing all the information they need and want;
Using Analytics to understand what devices your users are accessing your website’s information on and ensuring you are presenting it in a way that matches. often, the solution is to ensure your website is responsive – in other words, that your site is designed to reformat to fit multiple, different screen sizes.
While search engines remain at the centre of people’s access to healthcare information online, social media is playing an increasingly large role. so again, presenting the right information to the right people at the right time on these platforms is imperative. it comes down to research once again. Which platforms do your patients use? Which other medical providers or information sources do they engage with and which bits of those organisations’ content do they like the best? there is no substitution for surveying your existing patients, of course, but Facebook does offer up some insight in the form of its Graph search.
You can run queries about a certain page’s fans, about a certain demographic or even your own page fans to begin to build a picture about the social content they interact with.
For your own page, you can view i nsights about the interac -
tion with content so you can begin to understand what your patients want more of or less of.
And, of course, you can reach new patients by advertising directly at people in certain areas, who have been to certain places –or checked in at other clinics – or who have mentioned certain things.
And it may come as little surprise to find out that the overwhelming majority of social media usage takes place on mobile devices, again re-emphasising the importance of ensuring you are presenting information that smartphone users can consume, engage with and take action on.
there is a lot to think about, of course. But, particularly when you consider how low the take-up has been in private healthcare in the UK compared with sectors such as travel or retail, the opportunity is vast and growing.
see feature article on ‘social changes’, page 16
HMRC tax investigations and disputes create difficult and stressful times.
Scott Hague (right) is development director and owner of Integrated Change, a Londonbased Digital Healthcare Agency which develops mobile apps, medical websites and online marketing strategies for healthcare
As an award winning firm of tax experts, our highly experienced partners specialise in resolving problems relating to tax investigations and disputes with HMRC.
To find out, in confidence, how we can help call 0800 734 3333.
‘Here to help. Not to judge.’
Social media, where users are encouraged to create and share news, updates and content with one another, has now become a way of life for many.
Never more so are images being shared, videos being watched and interesting content discussed. Social media is evolving more than ever from a marketing tool into a business strategy for private practice.
social advertising c hanges in the Facebook algorithm earlier this year mean that paid advertising will be given precedence and the prediction that organic posts will be pushed out of sight will become a reality.
Basically, Facebook has more content than it can handle and, as a consequence of its income model, this means it is encouraging more paid advertising and allowing more paid advertising to be seen in social streams over free content.
So why does this matter? it matters because to continue doing what was always done means that a significantly smaller number of people will see what is being posted.
it seems that once you located where your potential customers were, it was relatively easy to communicate with them.
increasingly, it will become necessary to pay in order to get found and seen.
Promoting posts through paid advertising can generate around a tenfold increase in the number of people seeing your content. But it obviously costs and i am sure that many people will have concerns spending their money in this way. However, investing correctly in your private practice can see significant dividends.
social conversions
i f a website is performing well, then it should be attracting new business. a new visitor should be encouraged to complete a form of inquiry so that the process of meeting their needs can begin. o ver this coming year and beyond, people will gradually adopt new methods of making inquiries and they will instinctively seek the easier option.
Times are changing. For example, it is now possible to buy products directly from Twitter and to purchase directly from Pinterest. in essence, people will very easily get used to being able to get what they want, instantly. Facebook even has a hidden payment feature in its messenger app ready to be put to use whereby people can send money to each other via Facebook.
i t is important that new technologies and approaches are examined, tested and adopted if they can help expand private practice.
social stars
Reviews are so important. This has been discussed here in Independent Practitioner Today before. during this year, Google stars (review ratings) are going to take precedence as Google plus becomes more local.
Those with Google stars will find themselves ranked higher than those without stars in the expanded local listings that are anticipated. The possession of Google stars does improve the click through rate (cTR) to your site.
Seeking reviews, feedback and testimonials will become more important if you want to be valued above and against your competitors.
social customer service improved customer service from social media channels such as Facebook and Twitter mean that responses are often handled far more quickly than by email. as these conversations are public, customer relationships are improved and customers are given the information they want
when they want it and in a format they can use.
o f course, there are ways to send individuals private messages. doing so quickly indicates that you are listening and aware of their concerns, leading you to make improvements where appropriate.
With the increased access to information and customer service via social media, many are demanding more transparency.
‘Truly social brands will listen to what customers are saying and feeling and use that insight to adapt and create products and services,’ says Kelly colbert, director of strategic advertising at insurer WellPoint.
Research conducted by Pw c ’s Health Research institute, back in 2012, revealed that patients are now seeking answers to their healthcare concerns on social media to self-diagnose, get a second opinion on a recently diagnosed illness or to gain support from people suffering from the same conditions in the wider community.
This certainly matches my experience of patients increasingly using social media to seek answers over the past year. in the same Pwc survey, 80% of individuals between the ages of
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18-24 were found to be likely to share health information through social media and trust that same medical information. a nd they do – i see it every day.
Your private practice may not be exactly targeted at this group, but make a start and this age group could soon be part of your typical patient profile. investment now will lead to accurate knowledge, professional guidance and a higher profile.
The importance of social customer service is that you need to be monitoring your conversations, or those that you need to be aware of or involved in, and this is best done via social media as well as a well optimised website.
For example, c ancer Research UK listens and monitors all its social media channels and the information it obtains informs and influences policies and campaigns.
Brighton and Hove m ater nity Services liaison committee has a Facebook page to answer people’s questions to help them get the best from local maternity services. So define your online professional profile, monitor it daily and provide help and advice.
Online relationships
d ue to the exponential use of social media, there is a growing emphasis to make a greater effort to engage with people.
What is it that makes an experience meaningful? What will stay in people’s minds and what do people want to talk about?
Telling stories about others’ experiences is a great way. Having open lines of communication also helps significantly to create positive experiences. We already know that more than 41% of people are influenced by social media as to their choice of specific doctor, hospital or medical facility (Pwc HRi Social media consumer Survey).
mediabistro identified that 40% of consumers say that information found via social media affects the way they deal with their health, and 54% of patients reported being very comfortable with their providers seeking advice from online communities to better treat their conditions.
Sixty per cent of social media users are the most likely to trust
social media posts and activity by doctors over any other group.
So many trust the reliability of crowd-sourcing information from other like-minded individuals. So what conversations are you having with your potential private patients? How are you building relationships online?
Answering people’s questions
People ask questions every day so there is greater emphasis to ensure that those questions are answered, are in the public domain and in a format that is understood.
o nline interactions are not about discussing whether a procedure is appropriate for someone to undertake but whether the information provided is relevant for the customer/patient. How relevant is your information?
Your words are your currency and tell the world who you are. They also build relationships and are a form of customer service enabling them to consider coming to you. Your focus should be on accurately informing people about the health-related issues in your field so as to outshine misleading information.
wearables and apps
These are rapidly expanding sectors that will impact on us or may already be doing so.
o n a personal level, we may have come across many different types of wearable fitness-trackers. We may also have encountered apps for weight monitoring, diet and calories consumed and activities completed plus many, many more besides.
in addition to these, there will be an explosion of more sophisticated accessories. For example, hair slides that identify the amount of ultraviolet exposure received on a summer’s day, headphones that also monitor heart rate and shirts that track biometric data.
The market leaders (microsoft, Google and a pple) have all launched their own health kits, with some being linked to GP systems already and feeding back data.
c ustomers and patients are wanting to be more informed and are finding ways to do so as is shown by the speed at which crowd-funding projects for new
Your focus should be on accurately informing people about the healthrelated issues in your field so as to outshine misleading information
wearable technologies are obtaining their funding goals.
For example, a new product measuring heart rate, exercise load, resting heart rate, recovery rate and other biometrics reached its funding goal of $50,000 in just over five days. This is for a disposable patch, replaced daily: all aimed at providing information for the user.
e qually, those fitness trackers already available on the high street are becoming more affordable and more accessible. Whether or not wearables are accurate or not is not the question at the moment; their accuracy will be proven in time.
meanwhile, the user will make the assumption that they have useful data and understand their body in a way they have not before. What is important is that they could be making an impact on your private practice, by choice or demand.
Their impact on social media and healthcare is already evident. Some fitness apps are linked to forums where users discuss health, weight and diet issues.
Fitness tracker apps are becoming ever more popular
others give live feeds of activity taking place and encourage ‘cheers’ via social media. Such groups of people are accessible and online, seeking information to aid them.
Social media is becoming more sophisticated and more demanding, requiring a transparency and constant involvement.
i t will always be difficult to measure the return on investment of social media activity because the baseline is constantly evolving. By moving with the times and using social media, potential private patients will be more informed than they have ever been.
Social media activity will ultimately impact on how customers integrate with information that they accumulate and that which they find elsewhere, and if your voice is that one they refer to, then you will be the one who they turn to.
Catherine Harriss (right) is the founder of MultiWorksMarketing. co.uk, specialising in medical private practice marketing and management
why you should be Linkedin, page 20
Qwith the general election countdown now in full swing, is there anything i can do ahead of it to safeguard my finances?
accountant susan hutter (below) says:
iT
iS almost impossible to predict which political party/parties will hold the balance of power after the general election and a lot of private doctors have been asking me the same sorts of questions.
i s there anything they should be doing prior to the election that would help with their tax planning? The short answer is ‘yes’.
The coalition Government has increased the personal tax-free allowance to £10,600. However, both c ameron and c legg have now promised to increase the taxfree band to £12,500. labour was yet to comment as i wrote this.
i f one plans sensibly, the personal allowance can save doctors quite a lot of tax, especially if they trade as a limited company.
a s long as they are gainfully employed, there is nothing to stop a consultant putting their spouses and children on the company payroll so that family members can be paid in a tax-efficient manner.
i t is important to be able to demonstrate that the salary paid is commensurate with work they carry out.
as long as the salaries are below the tax-free band, then the individuals concerned will not have to pay tax. a lso, if the salary is below £8,060, then no National insurance is due, neither by the company nor the recipient. if doctors are still funding their offsprings’ living expenses and they are actually carrying out work for your company, this is a very tax-efficient way of providing for them.
Understandably, H m Revenue and c ustoms is keen to ensure that the salary is paid for work actually carried out for the com-
pany and therefore one will need to be able to demonstrate that spouse/children are actually working for the company.
a number of consultants employ their children to carry out iT work, as often they are better at it than their parents! This would include such things as setting up databases and keeping them up to date. it would also include clerical work such as book-keeping, invoicing and collecting debts.
Top rate of tax
one of the main questions people are asking is what will happen to the top rate of income tax? at the moment, it is 45% on income over £150,000.
You may remember that, just prior to the general election in 2010, alistair darling, the labour chancellor, increased the top rate of tax from 40% to 50%. George o sborne, for the coalition, reduced the rate from 50% to 45%
in 2013. This gave rise to much criticism by the opposition. it is obvious that tax rates for higher earners are under scrutiny. it is unlikely that a conservative Government would increase the top rate of tax. indeed, it is expected that, over a period of time, they would cut it back to 40%.
However, although nothing in life is certain, it is quite likely that a l abour Government would increase the top rate of tax back to 50% sooner rather than later. in fact, if they do get into office, there may be an emergency Budget later on in the summer so that they can do just that. For those consultants that operate as limited companies, the best advice is always only to draw money as a salary or dividend, if needed.
if one also has an NHS appointment and/or other income, it is usually advisable to spend the
money from those sources before you draw money from your companies.
m ost consultants who have incorporated as limited companies have brought their lowerearning spouses on board as share holders. This means that, when dividends are drawn, the top rate of tax is mitigated, as the dividend is shared between the consultant and the spouse. There could be legislation in the future to end this type of arrangement.
But, for the time being, it still works. For those who trade as a limited company or are considering doing so, it is worthwhile bringing their spouse in as a shareholder with a minority shareholding.
additionally, one may wish to gift their children over the age of 18 a small number of shares so that they can participate in the dividend as well.
The maximum investment into an iSa has just gone up and is currently £15,240 for 2015-16. This can be made up of cash and/or stocks and shares. a s a general point, it is worth maximising the iSa, including spouses’ holdings. There have been no rumours that iSas will be abolished or the investment amount reduced, but for those that have the money available, it’s worth maximising your investment into an iSa this financial year before the general election.
Susan Hutter is a specialist medical accountant for the medical profession at Shelley Stock Hutter LLP
One social media website independent practitioners really should not underestimate is LinkedIn. Surgeon Mr Dev Lall explains why he thinks you should all sign up
Social media often gets very good press in the mainstream business establishment as a way of growing a business.
There is much talk of ‘engagement’, ‘brand awareness’ and ‘community’. a nd, in my view, it’s all a load of old rubbish if your goal is growing your practice.
The trouble is that there are so many fads out there, and people are actively trying to invent new ways of using one of the many social media platforms to promote their business.
Not that there’s anything wrong with that – on the contrary, there’s everything right with it.
But it all falls down in the following way. No matter how you choose to deliver your message to the public – in this case, about the benefits of private healthcare and specifically the benefits of seeing you as an individual – in the final analysis, you absolutely must be able to measure the results of your efforts.
No ifs, no buts. You have to be able to say with a reasonable degree of certainty that you put X pounds into a given practice promotional campaign, it generated Y number of patients and the total profit was Z pounds. if you don’t approach your marketing in this way, you’re a fool. Because how do you know if it’s working; if it’s actually generating any income for you?
it really is no different to coming up with a new treatment for a disease, yet not looking to see if people actually get better as a result of that treatment. i n the first case, you’re likely to lose money and, in the second case, people are likely to die.
So having got that out of the way, i want to focus on one of the most underestimated and underused advertising platforms out there – linkedin.
what exactly is linkedin?
Now, not everyone has heard of it, but it is a business-oriented social media site. i t is essentially the equivalent of Facebook for business-owners and professionals. and, like Facebook and the multitude of other social media platforms out there, it can be used in two very broad ways.
Firstly, in terms of social interaction. You can create a profile, search for and connect with colleagues and join groups of people
with similar interests. You can post updates and opinions and you can ‘follow’ other people and companies so you receive regular updates when they post new information.
There are a multitude of types of groups out there and they cover every special interest you care to imagine, both within medicine as well as outside medicine. and on the off chance you can’t find a group catering to your interests, you can easily start one of your own. i myself have my own group – UK doctors in Private Practice. all consultants welcome.
So that’s the social side of the platform. and, like all social media platforms, while it can be fun and even educational to ‘do the social thing’ on l inked i n, the terrible danger you are exposing yourself to is wasting vast amounts of time to little practical purpose.
Yet, like other social media platforms, linkedin seeks not only to connect people but also to monetise those connections. This means that it is possible to advertise on linkedin, and that is where things start to get interesting.
linkedin vs. Facebook
We’ve already compared linkedin to Facebook – both are social media platforms that allow people to connect online. But the big difference, of course, is who uses each of those platforms.
Facebook users tend to be younger and the emphasis, if anything, is more about fun and social interaction.
conversely, linkedin users tend to be slightly older, but, most importantly, are professionals (lawyers, accountants, doctors) and businessmen/women who are using the platform to connect with other professionals to further their own careers.
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So people are online looking for job opportunities, business opportunities and to network with influential people in their industry to foster future opportunities for trade and business growth. m any of these people are not only affluent, but when you factor in that captains of industry and the chief executives of major public and private companies such as Richard Branson and duncan Bannatyne use the platform, it becomes clear that many are also very wealthy indeed.
Because it is all about the demographics. i f you want to reach the kind of people we have just talked about – affluent/ wealthy, professional/businessmen or women, l inked i n is the place to go.
and, of course, when it comes to private healthcare, it is clear that this is exactly the sort of person who has either private medical insurance or the ability to pay for private care from their own pocket.
another much-overlooked reason for using linkedin is that, for some specialties, access to leaders of organisations and businesses can be very valuable indeed. Take, for example, a urologist. a urologist might offer a well man or prostate-screening programme, for example. if he or she were to take on a patient who happens to run a business with several hundred employees and does a good job for them, then that patient might well ask if the consultant could provide the same service to 20 or 30 of his executives.
This is why certain clients are so much more valuable to your practice than are others over and above the obvious fee a consultant might earn for a particular investigation or procedure. Strategic thinking and planning is never wasted.
We have talked about targeting before, and this applies to l inked i n as much as any other approach to growing your practice, either online or offline. But while l inked i n users tend to be affluent, what puts so many people off who would really do well
It is all about demographics. If you want to reach affluent/ wealthy, professional/ businessmen or women, LinkedIn is the place to go
to give linkedin a try is the apparent cost of doing so.
Because using the PPc (pay-perclick) model, the minimum cost per click on l inked i n is $2, or roughly £1.30.
many people see this and object to using the platform on the grounds that it is ‘too expensive’. But is it really? and the answer is ‘it depends’ and, once again, highlights the vital importance of knowing your numbers.
So, say, for every 100 visitors to a particular page on your website, you get two paying patients. Note ‘page on website’ not ‘website’. it is vitally important to send visitors to specific pages on your website depending on what they are looking for, not to your home page.
That would mean that, if all that traffic had been generated through l inked i n PP c advertising, it would have cost you 100 x £1.30 i.e. £130 to ‘buy’ those two patients – in other words, £65 each.
Would you object to spending £65 to generate a patient who earned you £100? £500? £1,500? more?
as you can see, both objective maths are involved here as well as your own personal and subjective opinion, because while paying £65 for a patient that earned you £100 is mathematically very worthwhile, you still have to allow for the ‘hassle’ factor of treating that patient, and that is a personal judgement for you.
yet more targeting
You can target the patients you want to attract in many ways: in terms of demographics as above, but also in terms of condition.
a nd one of the fascinating things about population
All consultants should consider using LinkedIn to promote themselves and their practices to patients, because the demographic targeting is so powerful
demographics is not just the differences in disease incidence and prevalence which we all are aware of, but also issues of desire and perception.
To clarify: when it comes to cosmetic surgery, for example, while women of all occupations and ages want to look their best, a woman who is the chief executive of a company might place even more importance on her appearance than a woman of comparable age in a less high-flying position, to the extent of having more cosmetic surgery done as well as the financial wherewithal to pay for it.
Similarly, an executive might be more willing – and financially able – to have refractive laser surgery or complex prescription cataract surgery than a comparable person in a less prestigious job.
For similar reasons, affluent people tend to be more proactive in terms of regular health screening checks as well as in terms of weight loss and fitness. a good example of the latter is pre-skiing season strength training.
Final thoughts
linkedin is a very powerful way of reaching out to affluent, professional and business people. a ll consultants should take the time to get an account on l inked i n and to familiarise themselves with how it works for the same reasons they should do this with Facebook.
and all consultants should consider using linkedin to promote themselves and their practices to patients, because the demographic targeting is so powerful. But successful linkedin advertising – in fact successful advertising full stop – requires understanding and knowledge of a few critical numbers from your own practice, and without knowing those numbers, you are just blundering around in the dark.
Spending the time to work out which conditions deliver the greatest return for your practice is time that is never wasted, no matter how you choose to promote your private practice.
Mr Dev Lall (left) is an upper-GI surgeon and runs a specialist private practice consultancy www.Private PracticeExpert.co.uk
• Initial data capture of archived patient files, including ongoing processing of live files/data
• Reduction in labour costs and time associated with manual paper filing
• Consultants have remote access to patient data when and wherever they need it
• Complies with the national initiatives
Conflict is uncommon within close-knit private occur and are left to fester, then they invariably performance and patient care. And they can even Mike Hill shows how mediation can resolve workplace
Subscriptions
practice teams – but if personality clashes do have a damaging ripple effect on morale, even exert a financial toll on your business. workplace disputes
PERHAPS THE rarity of workplace disputes actually makes it harder for private doctors to know how to respond appropriately.
With little experience of managing conflict resolution, and unable to seek advice from the HR department, many lack the confidence to get involved for fear of making matters worse.
As a result, opportunities for dealing with disputes are missed: conflicts are either ignored in the hope they will fade away or formal grievance procedures are initiated straight away, without attempting any informal reconciliation.
These approaches can further undermine relationships to the extent that employees try to avoid working with each other, causing operational difficulties which then have an adverse impact on patient care.
And should one of the parties decide to leave the practice, there is still a real risk they could take their case to an employment tribunal. In addition to the reputational damage of a lengthy tribunal case, the cost to your business in legal fees, compensation and a financial penalty could be severe.
This is a shame, because most workplace disputes can be resolved informally, if you intervene quickly, an approach which is advocated by the Government.1
Under the Enterprise and Regulatory Reform Act 2013, anyone who wants to lodge an employment tribunal claim is obliged to notify the Arbitration, Conciliation and Advisory Service (ACAS) first, who will offer to conciliate between both sides to resolve the dispute out of court.
However, ACAS itself stresses that the best option is for employees and employers to try and resolve their differences as early as possible.
This is where mediation can make a difference.
principles and practice of mediation
Mediation is a type of alternative dispute resolution (ADR) in which an impartial third party sits down with two or more individuals to discuss the problem and find a solution that is acceptable to all concerned.
Unlike conciliation, which is employed when a dispute has reached the tribunal stage, media-
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tion can be used as an early stage. And, in contrast to arbitration, it is relatively informal and the parties are not legally bound by the decision of the third party. Rather, the emphasis is on reaching a voluntary agreement.
Participation in mediation is voluntary, but, before they can give informed consent, people need to understand the process and the principle of confidentiality. Meetings are not recorded, but if the mediation is successful, a written plan of action is signed by all parties and, with their agreement, this will be fed back to the employer.
The fictional case scenario described in the box on the right sets out how the process works in practice, from initial conversations to joint meeting and followup.
The mediation route
For the last ten years, I have worked as a mediator within commercial and health organisations, helping to resolve disputes which range from accusations of bullying behaviour and derogatory comments to clashes over operational matters and perceived professional slights.
In my experience, both sides in workplace disputes feel genuinely aggrieved that they have been wronged or misunderstood in some way and feel the other person is poles apart from them.
However, that is rarely the case. For example, both want the best for patients and often recognise the destructive impact of their dispute on colleagues.
An added complication is that the parties have often stopped talking and mediation has been seen as a last-ditch alternative to formal grievance or disciplinary proceedings.
However, if positions are allowed to become entrenched, it becomes harder for each side to set their emotions aside and accept the need for discussion and compromise. The earlier that mediation – or any alternative dispute resolution – is tried, the greater the chance of re-establishing dialogue.
But I would not generally recommend mediation if one or both parties are unable to conduct themselves professionally –for example, shouting, swearing
Another misconception is that mediation is a ‘soft, fluffy’ option. in fact, many participants are surprised by how demanding it can be
A consultant cardiologist who established his private practice in partnership with a colleague decided they needed an experienced administrator to manage non-clinical matters. unfortunately, the person he appointed quickly fell out with his partner about the response to a patient complaint. The pair blamed each other for the complaint, but refused to talk directly, communicating only by email or through intermediaries – which left other members of the practice feeling embarrassed and awkward.
The cardiologist was unsure how to resolve the situation. His colleague could be quite abrasive and he was reluctant to take him to task.
on the other hand, he couldn’t ask the practice manager to leave, as she was a hard-working and competent member of staff and he feared she might take her case to an employment tribunal.
eventually, on the advice of his lawyer and with the agreement of the ‘warring parties’, he consulted a qualified mediator.
The mediator spoke separately to the consultant and manager and asked each for their side of the story. He then invited them to attend a confidential meeting in a neutral place and discuss a way forward.
and ignoring the other person. Nor should it be ever used to solve problems that have to be formally investigated, such as allegations of harassment or discrimination.
Another misconception is that mediation is a ‘soft, fluffy’ option. In fact, many participants are surprised by how demanding it can be.
For example, they are expected to sit down with and listen to the person’s point of view and they may be challenged by the mediator if they behave inappropriately or contradict themselves.
One mediation session is often all it takes to resolve a dispute, but if agreement is within sight, the mediator might continue for as long as it takes. Most reputable mediators will also follow up some time later to check participants are keeping their side of the bargain.
Mediation has long been an option for private sector companies and organisations in the public sector, with some even recruiting and training their own cadre of internal mediators from among their employees.
An ACAS guide to workplace mediation 2 published in 2013, includes case study material from a housing association, West Midlands Police, a marketing agency and Salisbury Cathedral among others. And, while not yet mainstream in healthcare settings, a number of NHS trusts now offer mediation as an informal option for resolving disputes, as
The meeting took place several days later. At the outset, both the consultant and practice manager agreed not to interrupt each other or raise their voices.
After each had given their version of events and set out what they wanted to happen, the mediator summarised what had been said and highlighted the common ground, including the fact that both wanted the practice to thrive and recognised that the situation couldn’t continue.
The consultant and practice manager acknowledged their strained relationship was counterproductive and tentatively committed to make a new start.
After talking for several hours, they mutually signed up to a set of behavioural ground rules which they agreed would avoid antagonising each other. The action plan included weekly meetings to build their understanding and address problems before they caused another rift.
After three months, the mediator contacted the relieved cardiologist who reported that the atmosphere in the practice had improved significantly.
The consultant and practice manager had collaborated in making revisions to the practice’s complaints procedure based on the lessons they had learnt from the original adverse event.
well as helping to avoid costly grievance proceedings or employment tribunals.
The ACAS guide includes general advice on finding an external mediator. Usually, only one is needed.
However, given the number of mediation providers available, I would advise independent prac-
cess of mediation depends on the strength of personal relationships. While mediators should have good interpersonal and communication skills and be diplomatic, participants should feel comfortable with the mediator, recognise their independence and be ready to work with him or her.
is a great way to initiate a conversation when communication has broken down.
Mike Hill (below, left) has been a mediator for ten years. He has a background in healthcare and was head of management and staff development for a large NHS teaching hospital in Yorkshire. In addition to being a direc-
Last month, Garry Chapman highlighted key medical billing and collection issues that independent practitioners need to get on top of to carry out the process smoothly and efficiently.
Here, he covers the important operational aspects of the process
The practice should always aim to raise the invoice within 24 hours of the treatment being carried out.
There are many reasons for doing this and not least of these is making sure that the cash flow of the business runs smoothly. We are constantly surprised to see that this is not always the case and it is not uncommon to see a private practice run many weeks behind in raising the invoices.
Before sending the invoice out to the relevant payee company/ patient, there should be a checking process that takes place to make sure the invoice contains all the relevant information and is correctly priced.
Once the invoice is sent, it is too late to change anything and this can either lead to losing money by undercharging or delays in payment if the invoice does not contain all the correct information, which can cause cash flow issues.
Raising invoices to the private medical insurance (PMI) companies still needs to be done quickly so that there is the best chance of it being settled in full.
If there is a delay in sending the invoice, you run the risk of the policy benefit limits being exceeded by other consultants’ claims, which means that the amount becomes the liability of the patient. This creates more administration work and is harder to collect.
There is a big push by some of the PMIs to send invoices electronically. While there is a major
benefit to them in doing so, there is also a huge benefit to the practice, as it means the invoice should be assessed and paid quicker because there is less human involvement.
Raising the invoice directly to the patient should be the first priority of the practice, as this area is the biggest risk of bad debts.
In this area, I also include invoices raised for shortfalls caused by the terms of the insurance policy, such as patient excesses, benefit limits or co-shares.
There are times when a practice should also consider requesting payment in advance, particularly when seeing patients that do not reside in the UK.
When raising invoices to the embassies, it should always be accompanied with a letter of guarantee (LOG) which matches the invoice at all points: date of treatment, patient name, location and name of exact embassy.
Another area which can cause problems within a practice is not reconciling the remittances correctly against the invoices raised.
Each PMI should send a remittance to the practice when it sends the money, which is typically done electronically direct to the practice bank account.
However, in practice, the remittance does not always arrive at the practice, so unless the practice is chasing the PMIs or reconciling the bank account on a regular basis, the invoices remain out -
standing on the system that the practice operates.
This, in turn, can then lead to further problems, as the remittance that has been missed and not reconciled can have shortfalls identified on it which should have been sent to the patient and therefore have never been sent –which leads to more bad debts.
We know about the above problems because when we chase a backlog of outstanding invoices for a practice, we encounter these issues all the time.
The way to rectify this is to make sure that remittances are reconciled the same day that they are received and to chase the missing remittances from the insurers on a regular basis.
This will ensure that you keep on top of outstanding invoices and also know at the earliest opportunity if you have to invoice a shortfall to the patient.
This is an area which we find to be the one that gives most practices the biggest headache. The reason for this is that it is a very difficult area both within the insurance market as well as the self-pay sector.
There are not many practices that find it easy to deal with the patient on both a medical and financial level, as it can lead to many discomforts on both sides.
In our experience, every invoice potentially needs chasing, including invoices sent to the PMIs, because quite often the invoice either does not reach them or does not end up on their system. The practice has to decide what process they are going to intro -
Every invoice potentially needs chasing, including invoices sent to the private medical insurers, because quite often the invoice either does not reach them or does not end up on their system
duce and who is going to be responsible for carrying out that process.
Once the chasing process has started, it needs to be followed, otherwise the patient will think that you are not being serious, which will just lead to even more bad debt. The process should consist of contacting the patient as well as sending letters and all of this should be recorded so that you keep a log of any action taken.
Once all the avenues in the chasing process have been exhausted, a decision then needs to be taken by the practice whether to send the case to debt collectors in order for them to continue chasing the patient, with the potential of eventually taking legal action to collect the debt.
This decision will typically depend upon the patient, the circumstances involved in the treatment and the associated costs involved.
If the decision is taken not to send the patient to the debt collectors, then the practice should consider writing the amount off as bad debt. It is unlikely that the patient will choose to pay the outstanding amount for some random reason in the future.
Before taking this final action, the accountant should be consulted, as they would know the individual circumstance of the practice and be in the best position to offer the correct advice.
Once all of the above has been addressed, then the practice needs to be able to raise reports based on
the financial aspects of the practice from both a business as well as a tax perspective.
HM Revenue and Customs (HMRC) takes the view that you are responsible for your own tax affairs and does not consider ignorance or negligence as any reasonable defence.
Unfortunately, HMRC looks upon the medical arena as being a prime area where the financial affairs are not as robust as they should be, which leads to a higher percentage of investigations compared to other areas of business.
From a business perspective, you should be running reports on invoices raised, payments received and outstanding invoices on a monthly basis to ensure that all financial aspects of your practice are in order.
If not, then you do not have the information in a timely manner in order to take any action that is required to keep your practice on track and avoid any cash flow issues and to minimise bad debts.
Most people underestimate the important area of medical billing and collection. I can assure you that it is not easy and it is getting harder and harder to do it internally.
If you decide to continue to carry out this process in-house, then I urge you to take action to ensure it is done correctly, other-
wise it is something that you may regret later.
If you do not want to invest the time and effort to do this internally, then consider outsourcing this crucial area and let the professionals do it for you.
Chapman is managing director at Medical Billing and Collection
There are some very good reasons why independent practitioners should now
insist that their accountant and financial planner are talking. Specialist financial planner Simon Bruce (below) talks to medical accountant Nicholas Saxby on the benefits of working together
THeRe IS a perception that your accountant and financial planner have very different roles to play in organising your finances.
To some extent, this is true. An accountant will be looking specifically at tax compliance and efficiency, while the financial planner will be proposing how you can achieve your overall wealth objectives.
But given the overlap between many of the key finance areas they cover and a constantly changing financial landscape, there is a greater need than ever before to have a united source of advice.
Unless you have two-way communication between both parties, essential information can be
vate practice investment income or even academic work. This in-depth information can be extremely useful to the financial adviser meticulously planning how to make the client’s assets work together to generate future income.’
This joined-up approach is also highly beneficial to families looking to make the most of each member’s relevant income and tax allowances. Their finances need to be working constructively together so that the security of future generations can be protected.
Nick continues: ‘Quite often, when I’m talking to clients, they will mention important considerations “in passing”. They might say “My daughter’s off to university next year” or “We are thinking of moving”.
‘Funding and planning for these different life stages really requires a financial planner. If we both have all the facts to hand, we can provide more accurate projections of future tax and other financial obligations.’
The fact is that the vast majority of doctors are too busy to spend time organising their finances and, in our experience at Cavendish, they appreciate expert help with important decisions.
They value straight-talking, honest advice, particularly about detailed financial issues that they may not have dealt with before. The more receptive the relationship becomes, the easier it is for us to appreciate their position and, in the long run, the better the outcome.
missed or you can receive conflicting advice that leads to poor decision-making.
When dealing with large sums of money and critical life choices, doctors need to ensure their professional advisers have the complete picture of all their financial interests.
‘In working together, the client gets a much more rounded solution,’ explains Nick Saxby, who has run his medical accountancy practice for over 13 years.
‘For example, an accountant will have an accurate record of the income of the client from every source – which is usually quite complex at senior consultant level when you may have NHS and pri-
Nick adds: ‘It also helps to work with professionals who understand the client’s industry. For me, it is far easier to work with a financial planner with experience of the NHS remuneration package and the very complex pension scheme. Calculations for the convoluted annual allowance or “added years” for pensions are all too easy to get wrong for a non-NHS expert.’
Why is joint working more important now than before?
Personal finance has become much more complicated. There is a plethora of savings and investment products, which may bring more opportunity for the individual, but also more risk.
Very recently, we have had the introduction of vastly improved
ISAs, so-called ‘pensions freedoms’ and a conveyor belt of changes to pensions saving limits and tax relief.
In fact, ever since 2006, when the government held ‘A-Day’ – an attempt at ‘pensions simplification’ in the UK – pensions have, ironically, become much more complex. There are new rules governing the amount you can put in and take out, and just when the industry gets on board, those rules change again.
The tax on contributions to and withdrawals from your pension is particularly challenging. The new annual allowance rate which limits yearly savings requires very specific calculations because of the way in which HM Revenue and Customs views the NHS pension.
And many more senior doctors will find that their overall pension savings will be caught by the much-reduced lifetime allowance rate, generating a harsh tax penalty of 55%.
We have seen new clients who have been previously poorly advised in this area because their former advisers had not duly considered the NHS element.
Nick adds: ‘There are also confusing marginal rates of income tax – most people understand the higher rate of 40% and a top rate of 45%. Less well known is that there is an effective rate of 60% on the band of income between £100,000 and £120,000, which then drops back to 40% for figures beyond £120,000.’
There is no doubt that life has also changed substantially. With the NHS under financial pressure, retirement options are not the same as before and you may have many more difficult choices to consider.
Doctors are retiring later – no longer clocking off permanently at aged 60 and often phasing their retirement over several years. In fact, life at 60 is very different to that of past generations and these lifestyle choices, which might include ‘retire and return’ or ‘24hour retirement’ bring an extra facet to the finance discussion.
Says Nick: ‘It is becoming the norm for our clients aged over 60 to reduce NHS working hours to one or two days a week.’
The strict lifetime allowance limits have encouraged some doctors to consider leaving the NHS Pension Scheme early rather than trigger large-scale tax payments –an option which is beneficial to a limited number of individuals.
With a clear idea of a client’s entire financial scene, we can conduct very specific modelling which could show that it might be advantageous to retire after, say, 37 years rather than continuing to contribute for more years of service.
Another major change is that the majority of doctors in private practice used to be sole traders. Now senior medical professionals are using company trading structures which require specialist guidance.
Check you have a retirement plan. One of the most challenging parts of our job is helping people who have left any form of financial planning until they are about to retire or, harder still, after they have actually retired and finally have the time to think about their future.
If you do have a plan, check if it is still an accurate reflection of your objectives. Has it kept pace with your current standard of living? If you sought advice ten years ago but have not reviewed your financial status recently, it is imperative to check your savings and investments are fit for purpose.
Do you have a realistic expectation of your income in retirement? Do you understand what your annual expenses are at present?
Many clients can be surprised by how much they need to maintain their lifestyle. The top question we get asked is ‘will I have enough?’ Planning ahead is the only way to get complete peace of mind that the retirement you hope to enjoy is actually attainable.
Does your financial plan reflect your attitude to risk? For example, we helped a new client who, at 59, had been previously working with just a stockbroker with many of his assets tied up in highrisk investment products that were completely unsuitable for his situation.
Are you making the most of the basic financial tools available?
ISAs have become significantly more useful as a savings vehicle. Are you making sure that the entire family, across the generations are maximising their allowances? It is quite possible for senior doctors to start pension funds or ISAs for grandchildren.
Have you protected your family from unnecessary tax by considering your inheritance tax position? Do you and your adult children have up-to-date wills in place? As busy professionals, it is easy to let these things slip, but if the unthinkable happens, you would not wish to add financial concerns to their emotional burden.
There are also many cases where individuals have not maximised their annual capital gains allowance, which was £11,000 for 201415. This provides great scope to reap investment gains every year totally free of tax.
With proper stewardship, you and your partner can both build a good-sized portfolio before you need to worry about capital gains tax.
While the introduction of pension freedoms will present opportunities for many senior doctors, many do not realise the best course of action for them.
It is particularly important to use spousal allowances and leave plenty of time to make decisions about drawing out of the pension.
Some older-style personal pension plans may not be ready to allow withdrawals, despite the media hype around individuals taking cash lump sums. Are you aware of the tax implications of accessing your cash and have you thought about staging your withdrawals?
There is much speculation about the changes to pensions and taxes which might arise following the general election. Are your finances suitably placed to withstand a political ‘blow’ for higher earners?
The lifetime allowance is set to come down again from its current rate of £1.25m to £1m in April next year, causing considerable tax bills for every senior doctor.
In addition, pensions minister Steve Webb would like to reduce higher-rate tax relief for pension savings to just 33%, down from 45%. Labour has promised to cut
this further to just 20% and proposed reinstating the 50% income tax band for higher earners. This could trigger more doctors to consider ways of mitigating tax.
You may well have considered the advantages of trading as a partnership or limited company, but are you really maximising the efficiencies that these can provide?
If your spouse is a formal partner and sharing some of your practice income, it is likely that he or she will be paying higherrate income tax now but may not be in the future. A typical pension contribution strategy takes advantage of this.
Is there excess cash on your company’s balance sheet which could give better long-term returns if directed to pensions and investments? A limited company can contribute ‘pre-taxed’ company income to a pension.
Adds Nick: ‘If you are trading as a limited company, your accountant and adviser should have unified thinking over your income requirements now and your future exit strategy.
‘You will need to consider whether to opt for formal liquidation and hope that entrepreneur’s Relief will apply or to maintain the company and extract dividends for a number of years postretirement.’
The decisions you take now will have a big effect on your future income. Make sure your adviser and accountant have the same objectives and put in place a coherent plan that leaves you free to get on with life.
With thanks to Nicholas Saxby of Saxbys chartered accountants.
Simon Bruce is managing director of Cavendish Medical, specialist financial planners helping senior consultants in private practice and the NHS
The content of this article is for information only and must not be considered as financial advice. Cavendish Medical always recommends you seek independent financial advice before making any financial decisions. Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor. The value of investments and the income from them can fluctuate and investors may get back less than the amount invested.
In the second part of his series on becoming a clinical negligence expert witness, Michael R. Young sets out more of what you need to know right from the start
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As A n expert, you will need to know about the civil legal process, and you will need to have a very good understanding of the legal tests that lawyers apply in clinical negligence claims.
You must also know about the Civil Procedure Rules Part 35 (CPR 35), which sets out how a case is to be effectively and efficiently managed by the solicitor and the expert.
CPR 35 covers the following aspects of your work:
Your duties as an expert;
The range of your expert advice;
The terms of your appointment;
How the solicitor will instruct you;
How you should accept instructions;
When and how you can withdraw from a case;
What you must include in your reports;
What happens after the solicitor has received your report;
Under what circumstances you can amend a report;
How discussions between experts are to be conducted;
Your attendance at court.
There is so much information about CPR 35 on the internet, not all of it relevant to clinical negligence, that to save time I would ask for guidance from the instructing solicitor as to exactly what are your legal terms of reference, and your role and responsibilities. The solicitor should give you only the bits that are relevant to you. Firstly, understand the concept of duty of care. Every clinician owes a legal duty to his or her patients to exercise reasonable care and skill in diagnosing, advising and treating them.
The law imposes this duty independently of any contract with the patient and arises out of the doctor’s assumption of responsibility to provide care for the patient. It does not matter whether the clinician is treating a patient under the nHs or privately; that duty of care still holds true. The clinician breaches his or her duty of care if he or she fails to meet the standard of care required by law.
Breach of duty of care is also known as negligence. The basic test for negligence is whether the defendant’s conduct was reasonable in all the circumstances. The defendant is the doctor being accused of negligence.
However, the word ‘negligence’ has particular meaning for lawyers. It does not simply mean carelessness. A mistake is not necessarily negligent. negligence in a legal sense can only be found where three things are established:
1 Fault. For solicitors to establish a claim, they have to show that the investigation or treatment in question fell below the standard of a reasonably competent practitioner in the relevant field.
The test for assessing criticism of the investigation or treatment is whether the allegations can be justified ‘on the balance of probabilities’ (more likely than not) rather than the more rigorous proof ‘beyond reasonable doubt’ – amounting effectively to certainty – required in criminal cases. It may be a defence to show that a substantial body of reputable practitioners in the relevant field would have carried out the investigation or treatment in the same way as the defendant did.
The existence of a body of reputable practitioners who would have carried out the investigations or treatment as the defendant did is not of itself a defence. The court will decide which body of expert advice it prefers and, in addition, the court is entitled to consider whether the practice was responsible.
2
Causation. The solicitors have to show that it was this fault, or these faults, in the investigations or treatments that caused, or materially contributed to, the injury complained of. In other words, what difference has the faulty investigations or treatments made?
3
Damage. The solicitors need to be able to show that the injury is one for which the law will provide compensation. In general terms, compensation will be paid in cases where fault and causation have been established and where damage has occurred.
The standard of care expected of a professional person, such as a doctor, is that of a reasonable professional. The test of professional negligence is known as the Bolam test.
The test is the standard of the ordinary skilled man exercising and professing to have that special skill. A man need not possess
the highest expert skill at the risk of being found negligent. It is well established law that it is sufficient if he exercises the ordinary skill of a competent man exercising that particular art.
What this means for the expert witness is that you have to remember that you are not judging the doctor’s work by the standard of the most experienced or highly qualified practitioner in his or her field.
A consultant should be judged against the standards of a reasonably competent consultant. The expert must always compare like for like.
But there is a second part to the Bolam test. A doctor is not guilty of negligence if he has acted in accordance with a practice accepted as proper by a responsible body of medical men skilled in that particular art. Putting it the other way around, a doctor is not negligent if he is acting in accord-
ance with such a practice, merely because there is a body of opinion that took a contrary view.
Just because there are two ways of doing something does not mean that one of them is wrong. However, it is not as straightforward as that. Expert medical opinion will not be simply accepted by the court but, rather, it must withstand logical analysis:
The court has to be satisfied that the exponents of the body of opinion relied upon can demonstrate that such an opinion has a logical basis. In particular in cases involving, as they so often do, the weighing of risks against benefits, the judge, before accepting a body of opinion as being responsible, reasonable or respectable, will need to be satisfied that, in forming their views, the experts have directed their mind to the comparative risks and benefits and have reached a defensible conclusion.
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This is the essence of the Bolitho test, which – as an expert – you must also know about.
What this all comes down to is that, as an expert, you have to be able to ascertain whether or not the doctor breached his or her duty of care, such that the care and/or treatment the doctor or dentist gave fell below an acceptable standard, i.e. liability.
You will then have to consider whether or not the substandard care and/or treatment caused physical injury and financial loss and expense, i.e. causation. There are two further questions you might want to ask yourself:
1 How should a reasonable, responsible and respectable body of medical/dental practitioners have conducted themselves?
2
Can I provide a logical explanation for what was actually done or omitted, knowing all of the facts of the case?
Before the publication of the Woolf Report (Access to Justice) in 1996, civil litigation had always been slow and expensive, which naturally favoured those with the most money. The whole process was run by the litigants and not by the courts.
More recently, the Jackson Report (Review of Civil Litigation: Final Report) was another attempt to control costs and speed up the civil litigation process. There are two things in the report that have a direct bearing on your work.
First, the costs in a case must be proportionate to its overall value. Gone are the days when the expert could expect to be paid £2,000 in a case that was only worth £3,000.
The people footing the bill –more often than not an insurance company – are now more likely to tell you how much they are going to pay you rather than you telling them how much you want.
second, the courts will be sticking to very strict deadlines for the submission of expert reports and will impose harsh penalties, such as your evidence being struck out, if it is delivered out of time.
Adapted from The Effective andEfficientClinicalNegligence Expert Witness, by Michael R. Young, price £60 from Otmoor Publishing
next month: Price –setting your fees
1. The individual (potential claimant) approaches a solicitor.
2. The solicitor accepts the potential claimant’s instructions.
3. Funding will be confirmed.
4. The solicitor will begin his or her investigation by obtaining the relevant medical and/or dental records and instructing an appropriately qualified expert(s) to advise, possibly only on a preliminary basis at this stage. The solicitor may initially only instruct one expert, but others may be needed later in complex cases. an initial screening report, which is not for disclosure to the defendant’s lawyers, may be required, as might a clinical examination of the claimant.
5. if the investigations support a claim of negligence, the solicitor sends a letter of Claim to the potential defendant’s representatives in accordance with the pre-action protocol.
6. The defence is allowed a set time – as set out in the pre-action protocol – in which to respond to the letter of Claim with what is called a letter of Response. The defendant may obtain expert advice before he or she serves the letter of Response.
7. some cases might be settled at this stage. if no letter of Response is received, or if some issues remain in dispute, then an expert or experts will be instructed by the claimant’s solicitor to provide a CpR 35 or ‘courtcompliant’ report clarifying issues of liability and causation. a court-compliant report dealing with the claimant’s current condition and prognosis might also be required. sometimes a combined report dealing with all of these issues is prepared. These first reports, sometimes called draft reports, despite being CpR 35 compliant, are not usually disclosed to the defendant’s lawyers.
8. Once the claimant’s solicitor is in receipt of the liability and causation report or reports, and if liability has been denied, he or she will instruct a barrister to draft the particulars of Claim. The barrister relies on the expert’s liability and causation report when drawing up the particulars of Claim.
9. The particulars of Claim are sent to the defendant’s representatives.
10. The barrister will also prepare a preliminary schedule of loss, setting out the claimant’s past and anticipated future financial losses. The barrister relies on the expert’s current condition and prognosis report when drawing this up.
11. after proceedings are served, the court will hold a ‘case management conference’ – a hearing to set the procedural timetable for the future conduct of the claim. Dates for the exchange of factual evidence, the exchange of expert evidence and for the experts to meet will be fixed at this meeting. solicitors should inform the experts they instruct of the various deadlines on the case, including when a trial date has been fixed. all parties will be asked for their unavailability, usually for a given three-month trial window.
12. The defendant’s barrister will draft a defence based on the defendant expert or experts’ evidence. This must be served within so many days of service of proceedings.
13. Factual evidence will be exchanged in accordance with the court timetable. if acting for the claimant, you will be expected to consider the defendant’s factual evidence and you may need to amend or expand your draft report, which is then disclosed to the defendant’s lawyers, accordingly. The factual evidence may have no effect on your opinion, it may confirm your initial view, or it may cause you to change your view. it is important that if you change your view, you must tell your instructing solicitor as soon as possible.
14. Experts’ reports are exchanged between the claimant’s and the defendant’s lawyers. You will be given a copy of the defendant’s expert’s report and will be asked to comment on it.
15. agendas for experts’ meetings are drawn up and agreed by the lawyers. areas of agreement and disagreement between the experts are identified.
16. The experts meet to try to narrow the issues.
17. Unless the defendant admits liability and/or unless the case settles, the case will proceed to trial. sometimes expert evidence can be agreed and experts may not need to attend trial to give evidence. The case only proceeds to trial if the differences are significant and cannot be resolved.
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Financial Secretary to the treasury David Gauke could not have been more timely last month as Independent Practitioner Today went to press with its page one story ‘Doctors’ tax shocker’.
He announced: ‘ t he Government has taken unprecedented steps to clamp down on tax avoidance. Our tough new rules will force high risk promoters to change their behaviour and help protect taxpayers from unscrupulous advice.
‘Promoters who do not change their ways should be in no doubt – HM r evenue and c ustoms (HMrc) is taking swift and decisive action to use these new rules.’
Promoters of tax avoidance schemes will receive notice that they are being monitored and, as such, will be required to comply with requests to change their behaviour.
i f a promoter receives such a notice, they will be required to inform their clients – who, as our story showed last month, include a lot of doctors.
However, it will take some time for HM rc to seek out some of these promoters, as not all register for a Disclosure of tax avoidance Schemes (DOtaS) number because they do not believe they are selling a scheme. this is where a doctor may fall foul unwittingly of the taxman.
to counteract any tax advantage before it is tested to be allowed, HMrc is either not making repayments of taxes overpaid or is using a new power to collect taxes in dispute. these are called accelerated payment notices.
an accelerated Payment notice is a notice issued by HMrc to taxpayers who have used tax avoidance schemes that fall within the DOtaS rules or are counteracted
under the General a nti a buse rule (Gaar).
t he notices will be issued to request upfront payment of the tax avoided under such schemes where the scheme arrangements are subject to dispute. the idea is to ensure that the disputed tax is held by the e xchequer rather than the taxpayer, thus removing the cash flow advantage.
Before, or at the same time, as issuing an a ccelerated Payment notice, HMrc must issue a Follower notice.
t here are a number of conditions to be met, but principally there must be an open inquiry and HM rc must be aware of a judicial ruling which is pertinent to the disputed tax arrangement. this Follower notice forces the taxpayer to take corrective actions to amend their tax return to reflect the judicial decision in a relevant tax case rather than to wait years for their own decision to battle through the courts and the exchequer loses the use of the tax in dispute.
Both measures are designed to act as deterrents preventing taxpayers relying on schemes for a tax advantage.
these provisions apply to:
income tax;
corporation tax;
capital gains tax;
inheritance tax;
Stamp duty land tax;
annual tax on enveloped dwellings. as taxes creep upwards, increasingly large numbers of professionals like doctors, hit hard by the loss of personal allowances and additional rates of income tax, are tempted into such schemes by claims that schemes are not under dispute, as the promotor holds a counsel’s opinion in their favour.
So how do you know what to look out for?
Ten things you must consider before avoiding tax
1
t he consequences are all yours. i f the avoidance you have taken is not legal – only decided by the courts, not by you, your scheme promoter or counsel but by a judge having heard all of the facts – you will have made an incorrect tax return.
you, the taxpayer, are obliged legally to pay all taxes that are due. i t is likely that you will be charged penalties if you are proved incorrect in your interpretation of the law.
2t he majority of tax avoidance does not work; tax planning is a much better method of keeping taxes under control. you may be persuaded that some ‘schemes’ do work by being informed that they are in the spirit of the legislation and that there is legal opinion to support the view of the law.
Do not forget there are many differing opinions, which only become relevant when tested in court. you cannot sue a barrister for giving an incorrect opinion.
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3
What is your maximum exposure if it all goes wrong? treat the avoidance as an investment: it can go down as well as up. So if you can’t afford to lose the money and pay the taxes and penalties with interest on top, think again. no promoter will give you a guarantee that a scheme will work. Often firms change name and registered office so they are difficult to track. and your fees are nonrefundable.
4 avoidance schemes are complex. t hey can give rise to unintended additional tax consequences and the fees you pay the promoter do not count as tax paid. So you could end up paying much more than just the tax you are trying to avoid.
5 you will have significant fees to pay. these are upfront to join the scheme; usually around 10% of the amount of cash handled, plus Vat then, if the scheme
This is a political hot potato and tax avoidance is to become the drink-driving campaign of the decade
is litigated, you are likely to have hefty legal fees to defend your stance. your promoter usually asks for a contribution to a ‘fighting fund. is this good money after bad?
6
you could face public ‘naming and shaming’ by HMrc in the local press or you may attract publicity as a taxavoider when named in court papers. i t may not do celebrities any lasting harm, but, as a professional, the bar of integrity may be higher and could damage your business.
7
could you face criminal conviction or potential disciplinary action from the GMc? if you deliberately mislead or conceal information from HM rc , you could be prosecuted and convicted.
8
Schemes are never approved by HMrc. Getting an avoidance scheme reference number merely means that HMrc recog
Vanessa Sanders (above) is a director at specialist medical accountants Stanbridge Associates
nises the scheme has signs of being deliberately designed to avoid tax.
9 i t is likely that you will be considered for many years as a highrisk taxpayer. Use of such aggressive tactics will highlight your tax affairs, which will be closely scrutinised in future.
10 HM rc wins eight out of ten cases where taxpayers and promoters take avoidance schemes to court. this is a political hot potato and tax avoidance is to become the drink driving campaign of the decade.
Basically, if you live and earn in the UK and enjoy the benefits of the nHS, free schools and a police force to be reckoned with, then you will have to pay tax here. if it looks too good to be true to cut your tax drastically, then it probably is just an illusion. The taxman becomes more aggressive, see page 44
New pension legislation coming into effect earlier this month on 6 April for the first time allows you to withdraw 100% of your personal pension.
Dylan Mitchell looks at what you need to know, the pitfalls and opportunities, and how you could use the money in your pension to invest into real estate overseas
We H aV e all been attracted to saving in a pension because of the attractive tax breaks offered. But the drawback has always been the inability to access all the money as a lump sum when you retire.
Until now, once you reached age 55, you would be able to withdraw 25% of your pension as a taxfree lump sum and the remaining 75% must be used to provide an income throughout your retirement. this could be done in two ways:
1. buy an annuity
t his is a financial product that you purchase from an insurance company using the money from your pension.
t he attraction of annuities is that they will pay you a set income for the rest of your life.
t his income could be level or linked to inflation. With an annuity income, you will always know how much income you will have coming in and there are no more financial decisions to make. this is a simple, lowrisk solution. However, in recent years, annuity providers have come under increasing criticism for offering very poor levels of income, which can make this a very expensive option.
2. income drawdown a n alternative that has become more and more popular in recent years has been to withdraw a regular income directly from your pension.
this means that the remaining funds are still invested and could
continue to grow. t he level of income permitted is a similar level to that available from an annuity, but as you would still be in control of your pension savings, there is the potential to increase the size of the fund and therefore the size of the income.
so what changed on 6 April 2015?
Under the new rules, from age 55, you will actually be able to withdraw all of the money in your pension as a lump sum. this gives you complete freedom and control to decide what you want to do with your pension. you will still be able to withdraw 25% of your pension as a taxfree lump sum. the remaining ➱ p40
As much as £5bn of pension money is expected to be moved into property markets throughout the UK and overseas
75% can still be used to purchase an annuity or remain invested with income drawdown. However, under the new rules, the remaining 75% could also be withdrawn fully as a lump sum. a ny withdrawals from the remaining 75%, either fully or partially, will be taxed as income in the tax year that you make the withdrawal.
so what happens if i withdraw all the money from my pension?
as an example, let us say you have £200,000 in your pension. you would be allowed to withdraw 25% (£50,000) as a taxfree lump sum. t he remaining £150,000 could be used to buy an annuity, continue to be invested within the pension or withdrawn as a lump sum.
if you withdraw the £150,000, this amount would be treated as income and added to any other income – for example, salary, state pension, interest on savings, dividends – for the calculation of income tax.
is it possible to reduce the income tax?
yes! By simply being patient, and instead of withdrawing all the money in your pension as one
lump sum, withdrawing the funds as smaller lump sums spread over multiple tax years, you could significantly reduce the income tax liability.
i n the above example, if you were to make partial withdrawals of the £150,000 over four years instead of as one lump sum, then you could reduce the tax rate from 40% to 20% (assuming no other income).
what about inheritance tax?
a pension is a type of trust, so any savings in your pension are outside of your estate for inheritance tax. However, regardless of the value of your estate, your pension could still be liable to inheritance tax, as pensions have their own iHt rules.
Until now for anyone under 75 years old, if you had not withdrawn any money from the pension, including the 25% taxfree cash lump sum, then in the event of death your pension would pass to your beneficiaries without any inheritance tax.
However, if any income or lump sum had been withdrawn from the pension, then the remaining funds would be liable to inheritance tax at a hefty 55%.
Once you are over 75 years old, then all pensions would be liable
By simply being patient, withdrawing the funds as smaller lump sums spread over multiple tax years, you could significantly reduce the income tax liability
to inheritance tax at 55% regardless of having taken any income or lump sums, or not.
Under the new rules, from april 2015, the 55% tax will be scrapped. Whether an income or a lump sum has been withdrawn or not, the pension fund will be able to be passed on to beneficiaries without any inheritance tax.
Only if the beneficiaries decide to cash in the pension as a lump sum will they be taxed, and that would be as income tax at their usual income tax rate.
i f you were to decide to withdraw all, or part of, the funds within your pension, these funds would then be back inside your estate for inheritance tax.
it would therefore be prudent to seek advice on how to mitigate this liability. there are some simple and costeffective strategies to deal with inheritance tax.
if i want to invest in property, what options did i have before 6 April within my pension?
it was possible to invest the funds within your pension directly into property. this was predominantly restricted to commercial property; for example, care homes, shops, dental and doctor practices and offices.
you could invest into residential property, but the pension could not own more than 10% of the property, so in practice this was limited to structured property funds. i t was also possible to invest in property overseas, but this was complicated and often very expensive.
what opportunities are there after April 2015?
invest in rising property prices
t he British are well known for their enthusiasm for purchasing property.
Skepticism about pensions, high fees and poor performing funds is widespread. as a result, as much as £5bn of pension money is expected to be moved into property markets throughout the UK and overseas.
the effect of all this money that was previously barred from being invested into residential property
We could also see European property prices increase sharply
would, of course, have a huge inflationary effect on property prices, especially in more affordable areas such as the north of england and Scotland.
With the UK Pound e uro exchange rate being at its best in nearly ten years, combined with the positive effects of quantitative easing that recently started in europe, we could also see european property prices increase sharply.
new source of capital to repay your mortgage
Most property investors use interestonly mortgages to buy rental properties. But, of course, this borrowing has to be repaid at some point.
For those that intend to pay off their mortgages, pensions will now be a new and potentially lucrative way of repaying borrowings. and with tax relief on pension contributions, you are essentially getting up to 40% tax relief on your mortgage.
For those that intend to pay off their mortgages, pensions will now be a new and potentially lucrative way of repaying borrowings
there is no doubt that the new freedom that came into effect this month will have a major impact on both property and how we view pensions in the future. a lthough more control and choice is definitely a positive move, it is important to remember that the purpose of your pension is to provide financial security in your retirement.
With this caveat in mind, before making any decisions, it is extremely important to seek financial advice.
these new rules will only apply to selfinvested pensions (SiPPs), personal pensions and workplace pensions known as ‘defined contribution’ schemes.
Work related pensions where pension income is linked to salary, also called ‘defined benefit’ schemes, will not be affected.
Dylan Mitchell is director of French Leaseback.com property investments
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Independent practitioners who set up their own websites for their private practice need to take care when it comes to promotion. Dr Nicola Lennard (below) answers questions from two readers whose websites have thrown up unexpected difficulties
Q
I am in the process of creating a new website to advertise my private work and would like to use some testimonials from previous patients. Are there any issues I should be aware of when doing this?
A When patients look for a doctor to carry out a procedure, they like to pick one they can trust. But with so many doctors to choose from, how do they know which is the right doctor for them?
Recommendations or testimonials from previous patients can
A patient should never be put under pressure to agree to their testimonial or photo being used
be a good way for a doctor to showcase the many patients they have and help them stand out from the competition. New patients may be reassured to know their chosen doctor comes highly recommended by others. But if you decide you would like to use testimonials on your website, you must ensure that they are factual and verifiable. Any claims about the quality or outcome of a treatment must be justifiable. If you do plan on using testimonials or any other patientspecific information such as photographs, you must inform your patient how you would like to use it and obtain written consent from each patient before using them. Even if the information used does not identify the patient, it is important that you still obtain
consent prior to publishing it on your website.
The GMC produces comprehensive guidance in its document Making and using video and audio recordings of patients
A patient should never be put under pressure to agree to their testimonial or photo being used and it is important that when consent is obtained, you tell the patient:
Exactly how you will use the information;
Who is likely to view it;
How long it will be in circulation.
Written consent should be obtained for each type of use. If, for example, the patient consents to use of the information on your website and, at a later date, you decide you would like to use it in leaflets or brochures, you must obtain the patient’s written consent again for these new uses. You might also need to consider obtaining consent from your employer or independent hospital if images are taken of patients in the clinical setting.
QI am planning on employing a web design and marketing company to create the content for my new website, and a series of advertisements to promote my work. Is there anything I should consider when briefing them on what I require?
ALike doctors, web design and marketing companies are experts in what they do, so it is understandable you may wish to employ the services of the professionals when creating your website and other marketing material.
However, they may not appreciate the professional and ethical obligations that doctors hold.
You might wish to ensure that the company is aware of the strict code of patient confidentiality that the GMC imposes on you before engaging their services.
If a third party is preparing work for you, it is important that you check it very carefully before publication to ensure it meets the standards you require.
It must, for example, comply with the GMC’s ethical guidance. You may wish to seek the views of an impartial colleague or your medical defence body before you agree to anything being published. This includes work that is both in print and digital format.
Bear in mind that the GMC says you should not make unjustifiable claims about the quality of your services or offer any guarantees of cures, nor exploit patients’ vulnerability or lack of medical knowledge.
If in doubt about whether any website, marketing material or advertisement meets your ethical obligations, it is important to check with your medical defence organisation and make sure you are fully satisfied with it before it is published.
Dr Nicola Lennard is a medico-legal adviser at the MDU
Doctors are facing ever greater scrutiny by HM Revenue and Customs about their tax affairs. Andrew Walker (right) explains the background to HMRC’s focus on tax inquiries and outlines what you should do if you have additional income to declare
Doctors, along with other professionals, are coming under ever-closer scrutiny from HM r evenue and c ustoms (HM rc ). With multiple sources of income, the potential for medics to make errors is increased.
a key driving force behind the taxman’s strategy is that the department is now equipped with huge amounts of electronic financial detail which it can cross-reference using the latest data analytical software, known as connect.
Information could be drawn from medical insurers, private hospitals and nHs trusts, not to mention the l and r egistry, UK bank returns, international banks, local councils, websites and social media.
returns from firms which process payment by credit and debit cards are also fed in to the system, along with data from trusts, partnerships and businesses, plus information from offshore sources.
HMRC is now equipped with huge amounts of electronic financial detail which it can cross-reference using the latest data analytical software
Equipped with all this detail, HMrc’s connect system analyses the information to paint a picture of taxpayers’ finances. this data is compared with personal and business tax returns, taking account of both direct and indirect taxes, and discrepancies highlighted. With this information at its disposal, HMrc has the detail it requires to make specific and targeted inquiries.
a tax campaign aimed at doctors and dentists a few years ago raised approximately £70m and has fuelled HM rc ’s interest in the medical profession. this interest is typically conducted through its a ffluent Unit, a specialist team looking into the affairs of the ‘mass affluent’.
Ultimately, HM rc ’s focus on tax compliance reflects its efforts to close the tax gap. For 2012-13 this was estimated at some £34bn,
With this information at its disposal, HMRC has the details it requires to make specific and targeted inquiries
and in spite of its significantly reduced workforce, HMrc is trying to change attitudes and behaviour among taxpayers. In its quest to close the tax gap, it has a two-pronged strategy.
HMrc has focused significant resources into tax compliance and investigation while increasing its information gathering and information exchange. alongside this, it has increased the use of targeted campaigns and disclosure facilities providing the ‘carrot’ to encourage people to come forward.
this approach is backed up by a more aggressive stance towards non-compliance through the increased use of penalties and is ultimately supported by a published goal to significantly increase the number of criminal prosecutions.
Doctors frequently have to deal with some genuine grey areas in ➱ p46
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their tax affairs, so it’s worth being alert to these to make sure you get them right.
Areas doctors get wrong
o ne area which has caught out many medics in the past is the use of the home as a place of work and hence claims for the cost of travel from home to the hospital, surgery or practice rooms.
But in the vast majority of cases, unless you regularly see patients at your home, such travel expenses can’t be offset against income to reduce your taxable liability. another area of confusion has been around the employment of a spouse or family member who undertakes administrative or other duties to support you in the practice.
t here is nothing wrong in employing a close family member, but any income paid in respect of such duties should be set at commercial rates. If not, this can make you an easy target. overseas earnings, be they from
WHAt sHould you do if you tHink you MAy HAve AdditionAl inCoMe to deClARe oR HAve not pAid youR tAx liAbility in full?
1 first and most importantly, make a positive decision to deal with the matter on your terms and prior to receiving the unwanted ‘brown envelope’ from HMRC. voluntarily taking a matter to HMRC will generally result in a better outcome for the taxpayer as opposed to waiting to be investigated.
2
Collect together all the financial paperwork that is readily available to you relating to both personal and professional income including any uk and international sources. in addition, request copies of any items you have lost or misplaced. Remember, any documentary evidence you can locate will be helpful in dealing with the matter. you will need information on all sources of income, both from employment and private investments, any properties that you own and let. but don’t just concentrate on income; you also need to consider details of business expenses including rent for your surgery or premises, travel expenses, purchase of capital items and so on.
3 you can approach HMRC direct, but ideally you should look to discuss your position with a tax adviser familiar with assessing potentially undisclosed sources of income. do not delay in this step, even if you do not hold all the detailed paperwork. An initial outline discussion may well suffice at this stage, and the detail can come later. if you feel more comfortable, this initial meeting can even be held on an anonymous basis.
4 the purpose of this initial meeting would be to determine the best course of action for your particular circumstances, as a number of options may be available.
5 frequently, on the basis that an undisclosed liability does exist, the next step is for your adviser to approach the appropriate HMRC team relevant to your circumstances.
6 there would be no hard-and-fast rule in terms of the time taken for the matter to be finalised with HMRC, but it would normally be a number of months rather than weeks. but it is essential that the right strategy is determined at the outset to ensure the process runs as efficiently as possible.
employment, personal investments, bank accounts, longstanding overseas family assets, or even an overseas holiday home which is occasionally let, can add a further layer of complexity.
t he taxman has been paying particular attention to such assets and, through information-sharing agreements with numerous other jurisdictions, the UK tax authorities have this information firmly on its radar. any earnings from overseas sources must therefore be carefully accounted for to ensure you do not fall foul of an investigation.
Doctors with private patients will almost certainly have more complex tax affairs than their nHs colleagues. However, HMrc will judge whether an individual took ‘reasonable care’ or was ‘careless’ in completing their tax return.
should there be any inquiry or investigation, the ‘behaviour’ of the individual is key in determining how matters are dealt with in
terms of the type of inquiry, the number of years to be reviewed and, ultimately, the potential penalty that may be charged. getting it right from the outset is crucial and so professional advice at an early stage is pivotal.
incentive to declare
People are encouraged to come forward with the prospect of reduced penalties, even as low as 10% and limited retrospection in certain circumstances. Higher penalties, potentially up to the value of the unpaid tax in question, are generally reserved for taxpayers who do not volunteer information.
Moreover, should the case warrant it, HMrc may look into an individual’s tax affairs for up to the past 20 years.
In summary, given HM rc ’s shrinking staffing levels and higher compliance targets, its preferred approach is to use targeted campaigns and disclosure facilities to encourage a voluntary disclo-
sure resulting in a cash payment of the outstanding liabilities. However, full consideration of the facts should be made before embarking on any disclosure. Professional advice at the outset is often the most crucial in dictating the best approach to be used to achieve full disclosure and put an end to the matter as soon as possible.
Andrew Walker is tax investigations partner at Smith & Williamson, the accountancy and investment management group
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing. The tax treatment depends on the individual circumstances of each client and may be subject to change in future.
The Chancellor George Osborne’s final Budget last month before the forthcoming general election contained a number of important announcements for independent practitioners as well as the usual tinkering of personal allowances and tax bands. ian tongue assesses the impact on senior doctors and gives some timely advice
Following successive reductions in the l ifetime a llowance from £1.8m to the current £1.25m, the chancellor announced a further reduction from 6 a pril 2016 to £1m.
t his equates to a pension –under the n H s ’s 1995 Pension
scheme – of just under £43,500 a year. therefore, a significant proportion of doctors will be affected by this.
transitional protections such as those available in the past should be available and this may be a good time to discuss your circumstances with an independent financial adviser (IFa).
s ome good news is the announcement to index-link the l ifetime a llowance to the c onsumer Prices Index from 2018.
the annual allowance remains unchanged at £40,000 a year. readers will also be aware of the changes to the n H s Pension s cheme that were implemented from 1 april 2015.
If you have any form of pension protection, it is advisable to speak with your IFa to ensure that the conditions to retain such protection are still valid. s ignificant penalties can arise for retaining certain pension protection when not eligible.
also potentially affecting pension protection is ‘auto-enrolment’, which is well underway. this measure is to introduce a workplace pension scheme for all employees. For those that have
become deferred members, it is important that you take advice to ensure that you take appropriate measures to retain any pension protection you may have in place.
Tax avoidance schemes
HM r evenue and c ustoms (HM rc ) certainly has the bit between its teeth when it comes to tax avoidance – as last month’s front page of Independent Practitioner Today demonstrated (right) – and the Budget built on those measures already implemented.
Measures to counter tax avoidance have been introduced over the past few years and the government has introduced powers to allow HMrc to request any tax avoided in advance of any inquiries into the scheme being concluded.
If you have entered into any tax planning scheme it is important that you speak with the advisers that sold the scheme to understand your position.
Unfortunately, many taxpayers who have entered into tax avoidance schemes or aggressive tax planning are facing a tax shock, as Independent Practitioner Today made clear last month. (see ‘If it’s too good to be true, it is’, page 36).
savings the chancellor introduced a welcome change to the taxation of modest savings which, after all, have most likely already suffered tax.
Basic-rate taxpayers benefit the most with up to £1,000 of savings no longer subject to tax. For higher-rate taxpayers, this falls to £500 but equates to the same amount of tax. However, additional-rate taxpayers – those earning more than £150,000 – will not see any benefit. t hese changes apply from 6 april 2016. additionally, those that are saving modest amounts in an Individual savings account (Isa) may benefit from this change if they are able to obtain a higher interest rate elsewhere.
Following an overhaul of Isas last year, the amount that can be invested in an Isa increased significantly from 1 July 2014 and the restriction on composition between a cash Isa and stocks and shares Isa was relaxed.
the 2015 Budget increased the
the Government has introduced powers to allow HMRC to request any tax avoided in advance of any inquiries into the scheme being concluded
maximum amount that can be saved to £15,240 for 2015-16 and announced more flexibility for those saving in Isas.
Following consultation in the autumn with Isa providers, individuals should be able to withdraw and replace money from the cash Isa in the same year without it counting towards the annual I sa subscription limit. t his is a welcome change and will broaden the use of Isas.
the government has also proposed a new ‘Help to Buy I sa’ launching in the autumn to assist first-time buyers in purchasing their first home. Its proposal is for HMrc to pay up to £3,000 into the I sa , at which point you will have saved £12,000 over a four-year period. this may be of use to help children over the age of 16 save for their first home. However, it should be noted that, under the proposals, if you take out a Help to Buy Isa, it restricts your option to open a cash I sa in the same year. therefore, you should seek advice prior to going down this route to consider your options.
the headline rate of corporation tax has been falling for some time now and the c hancellor confirmed that, from 1 a pril 2015, the standard corporation tax rate is 20% irrespective of size, unifying small and large companies. this measure will benefit those with larger private practices earning profits in excess of £300,000 a year.
n ow is a good time to revisit matters for those not operating their practice through a limited company or have discounted this in the past due to earning in excess of £300,000.
the Chancellor announced measures to remove the requirement to complete a tax return for individuals and small businesses by 2020 as part of a ‘tax simplification’ plan
t his has been a useful measure over the years to promote capital investment by businesses, providing them with accelerated capital allowances.
It was previously proposed to reduce to £25,000 from 1 January 2016, but the c hancellor has announced that this will be reviewed in the autumn with the intention of it being at a more generous level.
The death of the tax return? the chancellor announced measures to remove the requirement to complete a tax return for individuals and small businesses by 2020 as part of a ‘ tax s implification’ plan.
HMrc has not announced the detail apart from a framework of digital reporting, which is likely to be similar to that used for Pay a s You Earn (PaYE) schemes known as real time Information (rtI).
For many taxpayers, this will come as a relief, as often a tax return is prepared with very little on it; for example, spouses. However, for the vast majority of consultants engaging in private work, their affairs are more complex and accounts need to be prepared.
t he multiple income sources and complexity make a switch to monthly submission unlikely for many consultants in the short term at least.
If one were being cynical, ‘tax simplification’ and ‘tax payment acceleration’ can probably be used interchangeably here, as the winner is likely to be HM rc ’s bank balance.
t he biggest uncertainty for the adoption of the above is clearly the general election next month.
Many of the changes announced are to be implemented in the ‘next parliament’ or within a year, which gives the g overnment in power the option to change. s hould a new g overnment be in power, it is likely that a further Budget will be announced to implement immediate changes.
A round-up of some of the figures making the news in healthcare analyst LaingBuisson’s latest review of the private healthcare market
The number of independent sector acute medical/surgical beds in 2014
9,147 84 £7.17 billion £5.6 billion
The estimated number of dedicated NHS private patient units (PPUs) in the UK with a total of 1,150 beds at mid-2014. Six of the units offer day-care surgery only
The value of the UK private acute medical care market in 2013
the five largest providers by revenue generated: of the overall sector revenue of £4,739m in 2013. General Healthcare Group had revenues of £855.6m and a market share of 18%; spire Healthcare 16.1%, HCA 15.8% and nuffield Health 9.6%
68%
£550M £1,690M
The value of specialists’ private fees in the UK in 2013. The independent acute medical hospitals and clinics value was £4,561m
SoUrceS of fUNdiNg for iNdePeNdeNT acUTe medical/ SUrgical HoSPiTalS aNd cliNicS, UK 2013:
the amount spent on health cover products in the uk in 2013. Most of this, £4.48bn, was spent on private medical cover
down 8.7%
The fall in spending on all health cover markets in real terms, comparing calendar year 2013 with the last pre-recession year of 2008
The estimated annual value of privately-funded g P services provided entirely separately from the NHS Pmi
share by income 2013
laingBuisson’s Healthcare market review – 27th edition is sponsored by GvA Health property Advisers and is available priced £765 for an individual package (hard copy book accompanied by single licence pdf and excel data sheet back-ups) or £2,350 for an office package (hard copy book accompanied by office-wide licenced digital back-ups).
to purchase, contact laingbuisson, 29 Angel Gate, City Road, london, eC1v 2pt phone: 020 7923 5396. Website: www.laingbuisson.co.uk
Volvo’s longrunning friendship with doctors is still very much on, finds Independent Practitioner
Today’s motoring corrrespondent Dr Tony Rimmer
DesPiTe The onslaught of multimedia news reporting and political spin-doctoring, the medical profession has managed to remain top of the list when it comes to trust and respect in the eyes of the public.
This is probably why a doctor was cast as the driver of car fighting through the snow to get to a sick patient in a television advert a few years ago.
The car was her trusty friend and the message was that if a doctor trusts the car, the public should too. The car make was, of course, Volvo and the script linked nicely to safety as having a high level of priority for the brand.
Fast-forward to current times and Volvo cannot rely on safety alone being its biggest selling point.
All new cars have to pass stringent crash tests before being put on sale and the swedish brand is no better or worse than most competitors.
however, reputations stick and i bet if you asked your medical colleagues what the Volvo brand means to them, safety would be one of the first things mentioned. so how has Volvo moved with the times? how has it positioned itself in the highly-competitive premium market where the German makes like Audi and BMW excel?
Well, it still appeals to the family market and has been incredibly successful with the large XC90 4x4 sports utility vehicle ( s UV), which it first announced in 2002 and has sold over three-quarterof-a-million versions.
Compact version several years later, in 2008, Volvo released what was essentially a smaller compact version and called it the XC60. it has recently given this model a makeover and i have been testing the latest version.
Competing directly with the BMW X3 and Audi Q5, this Volvo has its work cut out to impress.
Available with two diesel engines and one petrol, the most popular and best suited powerplant is the new high-tech 2.0 litre four-cylinder diesel D4 which produces 181bhp with a claimed 62.8mpg and only a 117g/km emission rating.
These figures are based on the standard front-wheel drive version. i f you go for four-wheel drive, these fall to 53.3mpg and 139g/km.
and curves
When my test car arrived, i was impressed as to how stylish modern Volvos look. Gone are the boxy straight-line dimensions and the XC60 is all about contours and curves.
s tepping into the cabin, the raised driving position and supremely comfortable seats are a highlight and the controls look modern and clear.
Volvo’s trademark floating centre console makes an appearance as do the really clear and intuitive pictogram controls for the climate control.
Despite it being the XC90’s smaller sibling, there is still plenty of space for three full-sized rearseat passengers and lots of luggage space, but there is no sevenseat option, so those of you with bigger families will need to look at the bigger car.
The use of soft-touch materials gives a high-quality feel to the interior and although not quite up to Audi or BMW standards, it definitely feels like a premium car. There are four levels of trim and equipment available, but even the base se model gets parking sensors, cruise control and Volvo’s City safety system, which applies
the brakes if the car senses a collision that the driver has not reacted to. This feature only operates under 19mph and boosts Volvo’s established safety credentials.
Now Volvos are not known for their sporty prowess and this XC60 is most at home on the motorway where the superb ride and muted diesel powerplant allow the miles to drift by effortlessly.
Push the engine and it gets a bit noisy but the wonderful 400Nm
mid-range torque is particularly useful and reassuring. Because of this torque, you don’t have to change gear too often and this is a good thing, because the standard six-speed manual gearbox feels a little indirect. As i have already said, this is no sports car.
Impressive engine
This is really a tall family estate car rather than an full blown 4x4. The cheaper and more economical front-wheel drive model is
Body: Five-seat hatchback sUV engine: 2.0 litre four-cylinder turbo-diesel Power: 181bhp
Torque: 400Nm
Top speed: 130mph
Acceleration: 0-62mph in 8.0 secs claimed economy: (combined) 62.8mpg co2 emissions: 139g/km on-the-road price: £35,160
The xc60 comes with Volvo’s city safety system, which applies the brakes if the car senses a collision that the driver has not reacted to
absolutely fine and you would only need to choose the fourwheel drive version if you pull a horse-box or go off-roading.
The new D4 engine is very impressive and using all of the large fuel-tank could theoretically transport you and your family for up to 1,000 miles before refuelling; great for holidays.
Overall, i am left quietly impressed by the XC60. i think that the Volvo brand suits us medics in the way that other, now
defunct, swedish brand sAAB did. it portrays quality and sophistication without any flashiness; the intellectual, thinking-person’s car. Perhaps that’s why they chose a doctor as the driver in their advert. Choosing this XC60, specified as my test car, would indeed be an intelligent choice.
Dr Tony Rimmer (right) is a GP practising in Guild ford, Surrey
DO yOU FIND OUR PROFITS FOCUS SeRIeS USeFUL?
Please let us know if it helps you or not. and if it doesn’t, what other data would you like to see presented?
email robin@ip-today.co.uk
Profits for urologists in our latest benchmark survey have achieved a double-digit rise – but for the long-term future eyes are focused on the political direction of the next government, reports Ray Stanbridge. Additional material from Martin Murray
Aver A ge incomes for urologists in private practice increased by £11,000 (or 10%) between 2012 and 2013, going up from £109,000 to £120,000.
c osts rose by £6,000 (or 16%) on average between the two years from £37,000 to £43,000.
As a result, taxable profit increased by £5,000 (or 6.9%) from £72,000 to £77,000. margins fell from 66.1% fees invoiced to 64.2%.
We do urge extreme caution in interpreting these figures, which –
as we have previously stated – are not statistically significant. our figures are based on a representative sample of urologists who:
Have either an old-style or a new-style nHs contract;
Have been in private practice for at least five years;
Have been earning at least £5,000 a year gross from private practice;
may be trading as a sole practitioner or a member of a group; may or may not have incorporated.
aveRage INCOMe aND eXPeNDITURe OF a CONSULTaNT UROLOgIST WITH aN eSTaBLISHeD PRIvaTe PRaCTICe
The commercial environment in which consultant urologists are working is also fast changing and is making any consistency of comparisons between our figures increasingly difficult.
As reported in the April 2014 edition of Independent Practitioner Today , some consultants have chosen to incorporate, giving them changes in cost structure.
o thers have focused increasingly on choose and Book work through private hospitals and have reduced their professional indemnity and other operating costs. Yet others have undertaken n H s work as additional PAY e rather than private income.
i n addition, some have added diagnostic and other tests to their range of services and/or have formed themselves into groups.
Advantages of groups
Expenditure
Year ending 5 April. Figures rounded to nearest £1,000 (percentage is also rounded up)
Source: Stanbridge Associates Ltd. Additional information: Sandison Easson and Co
s ome limited evidence suggests that there can be real income enhancement by virtue of working through a group – patients, hospitals, n H s contractors and some insurers all like the concept of group activity.
Yet despite all of these real difficulties of data collection, there are some general trends which can be reported on.
income fluctuations are volatile. For many, nHs choose and Book work can make a significant difference to incomes on a year on year basis. insurers have squeezed per item fees, but there does seem to be some growth – albeit modest –in self-pay.
cost increases
m edical assistant costs seem to have shown a small increase. e ffectively, as consultant urologists become busier, they will utilise more services of junior colleagues.
s taff costs seem to have increased again slightly. Again, there is a correlation between growth in staff costs and the growth in the income tax-free personal allowance. There is, of course, a difference between salaries paid to a consultant’s family member compared to the open market rates for medical secretaries.
s ubscriptions/professional indem nity costs have risen, and for a number of urology consultants now approximate to close to 10% fees invoiced.
new insurers came into the market in 2012-13 and some urologists with low-risk practices have negotiated reduced premiums.
We anticipate continuing growth in larger practices and therefore a continuing widening of income ranges
We would expect these to be reflected in our figures in due course. There is some increase in costs in courses and conferences. This fluctuates depending largely on the nature and location of international urology conferences. There seems to have been some increase in accounting/legal costs.
Legal advice on Hr matters has become an important issue for some. c ontractual advice for those with nHs or other contracts is also being taken.
‘ o ther’ costs have shown an increase. This primarily reflects marketing costs. Less than a decade ago there was a flush of costs
For
as surgeons set up their own websites. some of these now need upgrading and an increasing number of consultants are taking more sophisticated marketing advice.
what of the future?
We are seeing some urologists with small private practices ‘opting out’ and taking a second job with a private hospital or undertaking additional n H s work through PAYe
o thers are expanding their practices significantly, by establishing groups or moving into providing diagnostic tests. This development has, in recent months, stalled following the competition and markets Authority rulings of october last year.
All of these factors will affect future growth and profitability. The major effect on private income is, however, likely to be the political direction of the next government.
m any urologists, as with all other consultants, will be waiting for the outcomes of the election with extreme interest.
next month: oncologists and dermatologists
Ray Stanbridge runs an accountancy, finance and tax advisory service specialising in the medical profession. Martin Murray is a partner at Sandison Easson and Co, specialist medical accountants
Use
ending 5 april
Make sure you don’t miss our next issue, published on 21 May. Only subscribers to the journal are guaranteed to receive every copy and we don’t think anybody who is serious about continuing private practice in the future, when there is so much happening that will affect them, can afford to miss any issue.
Coming up next month:
Make the most from your meetings with your accountant – we show how
are you doing enough to maximise the profitability and performance of your business?
Reports from the BMa’s annual private practice committee conference
Pricing transparency leads to fewer fee problems. Medical Billing and Collection’s garry Chapman shares his tips
Profits Focus examines earning trends for dermatologists and oncologists
What’s happening in the Independent Doctors Federation
Some of the brightest and the best in the worldwide medical travel business have been in London for the IMTJ Medical Travel Summit. They will be sharing their knowledge of what works . . . and what doesn’t!
How to get ‘stuff’ done: a surgeon shares what works for him
Is the aesthetics market right for you?
Published by The Independent Practitioner Ltd. Independent Practitioner Today is editorially independent and thanks Bupa for its assistance with distribution.
Printed by Pepper Communications Ltd Material is governed by copyright. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form without permission, unless for the purposes of reference and comment. Editorial layout is the copyright of the publishers. If you wish to use it for promotional purposes on websites or for reprints, we would be happy to discuss licensing the copyright to you.
© The Independent Practitioner Ltd 2015
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Write to Independent Practitioner Today PO Box 198, Cranleigh GU6 9BB
eDITORIaL INqUIRIeS
We report on plans by the new chairman of the association of Medical Insurance Intermediaries to develop closer relationships between insurers, brokers and providers – both specialist and hospitals – for the interests of patients
electrifying! Independent Practitioner Today’s motoring correspondent Dr Tony Rimmer gets a charge from the Tesla Model S (right)
Business dilemmas: Dr Nicola Lennard answers doctors’ questions about patients’ issues with the DvLa
Ten ways to make your practice more welcoming – an architect’s prescription
Defence body advice on how private doctors should react to patients who turn up for appointments armed with printed notes or information on smartphone or a health app
Plus all the latest news and views
aDveRTISeRS: The deadline for booking advertising for our May issue falls on 24 april
Robin Stride, editorial director
Email: robin@ip-today.co.uk Tel: 07909 997340
aDveRTISINg INqUIRIeS
Margaret Floate, advertising manager
Email: margifloate@btinternet.com Tel: 01483 824094
Publisher Gillian Nineham Tel: 07767 353897.
Email: gill@ip-today.co.uk
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