April 2020

INDEPENDENT PRACTITIONER TODAY

The business journal for doctors in private practice

In this issue

Fix for faults shown by Paterson probe

Could The Private Practice Register be a solution to the information deficit shown by the Paterson Inquiry? P14

How to navigate the GDPR labyrinth Advice on data protection and the confusion surrounding consent P20

your business through the

Read the regular expert advice on our website on how to keep you and your business afloat

www.independent-practitioner-today.co.uk

Avoiding the fall-out

Why having a practice agreement is essential if you don’t want to lose everything P36

Remedies for testing times

By Robin Stride

Independent practitioners are being given wide-ranging advice to help secure their business futures from the ravages of Covid-19.

Hundreds of doctors with private practices committed themselves totally to patients in the NHS and others made way as their independent hospitals helped the state at cost price.

Specialists laid off secretaries, while others were hit by staff absences caused by transport problems and partners self-isolating or staying home to child-mind.

Many sought financial help and here are some key issues and experts’ tips:

Doctors were advised to seek a defence cover reduction for the lower level of work anticipated for the upcoming year or they might otherwise pay too much (see story on page 4).

James Gransby, of RSM UK Tax and Accounting Ltd, added that those operating through a limited company and with built-up cash through retaining profits could find that now was the time to

deplete reserves to pay personal living costs.

‘The main ways will be via dividend, taking a loan from the company or depleting money you have previously loaned the company. Taking a salary is also possible, but would incur more tax.

‘When extracting profits as dividends, then dividend tax of up to 38.1% will be payable personally, so don’t overlook this and keep some money aside for when this becomes payable.

‘If you have a company filing deadline approaching soon, Companies House has given flexibility over submission deadlines, so keep checking its website for the latest news on this. Presently, they are offering a two-month extension to the normal filing date.

‘You can borrow money from your company by way of a loan without having to declare dividends. This must be repaid within nine months of the company year-end to avoid a tax charge.

James Gransby

‘So operating with a 31 March year-end then taking it on or after 1 April 2020 will mean it does not need to be paid back until 31 December 2021.’

Mr Gransby, a spokesman for the Association of Independent Special ist Medical Accountants, said enough should be retained to pay any corporation tax due.

‘You need to ask for the extension before your normal filing date, it is not giving this automatically.’

Paul Gordon, medical specialist financial planner at MacArthur Gordon, said consultants and GPs were worried about meeting existing expenditure, but cutbacks were possible.

They were taking a mortgage payment holiday of up to three months, the limit as we went to press, without impacting their credit score. This applied to both residential, buy-to-let and loans.

Mortgage payments after expiry of the three months would be adjusted upwards to take the unpaid amount into account.

The process was ‘relatively straightforward’ with lenders

accepting instruction by phone, with some allowing email to avoid being on hold.

The Government is protecting 80% of an employee’s salary up to £2,500 monthly to avoid them being made redundant. Payments are expected this month, backdated to March if staff are re-employed and granted a leave of absence.

Mr Gordon added: ‘The July income tax payment can now be deferred until January 2021, which is certainly welcome and, better still, no action is required, although I suggest contacting accountants to confirm the position and prepare for the increased January payment.

‘But note that those impacted by the pension annual allowance and looking to use Scheme Pays for 2018-19, the deadline remains 31 July 2020.

‘Mortgages can be switched to an offset facility, using funds reserved for tax liabilities/savings to reduce the interest payment. These funds can be accessed when required to supplement income and cover expenditure.’

➱ continued on page 3

TELL US YOUR NEWS Contact editorial director Robin Stride

Challenge the rogues

Curiosity cured the cat. The head of the independent sector’s trade body says the Paterson saga shows it is vital for doctors to speak up P12

Email: robin@ip-today.co.uk Phone: 07909 997340 @robinstride

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EDITORIAL COMMENT

Keeping you up to date

If you have been making regular trips to our website, you will have seen some special reports to bring you up to date on a variety of issues that we felt just couldn’t wait for the monthly print run.

This enabled us to give you same-day and wide coverage on the Paterson Inquiry and its implications to save you having to read hundreds of pages.

And we followed this up with some exclusive reports on the Budget, particularly looking at implications for private doctors.

Within days of the Chancellor sitting down, we were all hit with the ramifications of Covid19. The virus has, of course, changed the lives of everyone as it swiftly took its opportunities. Extraordinary demands have been placed on doctors and their teams and, for many private practitioners, there have been mounting business implications – such as their own cash flow or running a service without the necessary staff.

All this alongside the concerns for their own health and that of those they work with.

Much of the private healthcare sector’s normal activity has rightly stood aside for the greater needs of the NHS and its patients.

Private doctors have returned to work there, they have answered the call to come out of retirement and many have cancelled normal procedures. Others are ready to be called up if needed.

News stories have had to change constantly to take account of new advice, laws and instructions.

So we have been busy adding more information and news to our website from specialist medical business advisers to help support you.

In the days ahead, regularly visit our News section at www. independent-practitionertoday.co.uk to stay informed and make the most of what support you can get.

Business is on the up

Research of the private acute healthcare market in London – before Covid19 – revealed that ‘Growth is back’ and consultants are in demand P17

‘Don’t let on in prison that you are a quack’

Surgeon Mr David Sellu continues his saga of being convicted for a patient’s death, then reprieved on appeal P28

Too many hands on deck can spoil your catch

With group practice becoming ever more popular, Simon Brignall advises on avoiding chaos when billing P32

Trusts

report rosy future for PPUs

The national NHS private patient units’ conference received an early forecast of market performance of trusts’ PPU services, showing good news P38

Police need your help to solve RTA

A doctor is asked to reveal the identity of a patient involved in a cycling accident. Kathryn Leask gives advice in our regular medico­legal Q&A P40

PLUS OUR REGULAR COLUMNS

Start a private practice: How you can account for your figures

Ian Tongue looks at how accounts are prepared and provides useful tips to interpret the figues P42

Doctor on the Road: Very good value car with no pretensions

The Skoda Scala gives you a similar experience to that of expensive car marques – at a much lower cost P46

Profits Focus: Keeping a steady stream

Our unique benchmarking series looks at the financial fortunes of urologists P52

Circulation figures verified by the Audit Bureau of Circulations

Budget relaxes but doesn’t cure pension tax trap

By Edie Bourne

Independent practitioners and their advisers have welcomed longawaited lower tax charges on their pensions from this month.

Chancellor Rishi Sunak’s Budget last month raised the threshold for tax-free allowances.

Under previous rules, anyone with a ‘threshold’ income – the total income from all sources – of £110,000 or more was subject to a reduced annual allowance. The standard figure is £40,000 but it tapers on a sliding scale to as low as £10,000 for some high earners.

Mr Sunak put this threshold up by £90,000 to £200,000 in a move he said would remove 98% of consultants and 96% of GPs from the ‘taper’ altogether.

Huge tax bills generated by the tapered annual allowance triggered a workforce crisis with many doctors choosing to work less hours or retire early.

Patrick Convey, technical director at specialist financial planners Cavendish Medical, told Independent Practitioner Today: ‘The tapered

annual allowance has caused misery for many doctors, often facing large tax bills which are difficult to predict or manage in advance.

‘Many will be disappointed that the ‘taper’ has not been scrapped entirely, as it is needlessly complex for defined-benefit schemes such as the NHS, but this move is a definite improvement on the tax situation in recent years.’

But it was not all good news for doctors, as the Chancellor also cut the minimum annual allowance from £10,000 to just £4,000 for those with incomes over £312,000.

and do not face unexpected charges.’

The Budget confirmed that the lifetime allowance, governing total tax-free pension savings, will rise this year in line with inflation from £1,055,000 to £1,073,100.

The Association of Independent Specialist Med ical Accountants (AISMA) welcomed the £90,000 annual allowance threshold rise.

Spokesman Andrew Pow said: ‘This means that any doctors earning up to £200,000 will now get the full annual allowance of £40,000.

‘Don’t

forget to plan for the worst’

➱ continued from front page

Mr Gordon said it was important for doctors to nominate beneficiaries for benefits from their NHS Pension Scheme if they were to die, with benefits paid to the spouses or civil partners survivors. For all others, the nomination of beneficiaries was easy and accessed on the NHS Business Service Authority website.

Insurances should be reviewed for protection of income during ill-health, mortgages in case of death or critical illness, and commitments such as childcare and education costs in the event of death.

Mr Gordon said: ‘This is particularly relevant for those who have opted to cease contributions to their NHS pension as a result of the annual/lifetime allowance and have seen both death and illhealth benefits reduced.’

Mr Convey said highest earners should carefully consider the value of pension saving and seek expert advice to find the best way forward.

‘Despite the positive announcement regarding the taper threshold, it is still imperative that doctors look at their own tax position in detail to ensure they are making the most of opportunities to reduce liabilities where possible

While this will not remove higher earners with growth above £40,000 from having a tax charge, it will mean most doctors will not have their annual allowance tapered down.

‘It will be important that NHS pension records are kept up to date so that higher-earning doctors can assess their tax position.’

 See pages 8 and 9

Watchdog visits suspended and revalidation dates eased

Independent practitioners are being advised that, although the Care Quality Commission (CQC) has postponed ratings inspections, doctors should ensure any changes to normal working patterns are clearly documented and riskassessed for future reference.

All providers have welcomed the CQC’s decision to stop routine inspections.

Medical management consultant Martha Walker, of CQC Consultancy.co.uk, said: ‘Independent doctors have experienced staff shortages and increased patient requests due to Covid-19.

‘Many doctors have changed working patterns, including conducting remote consultations and allowing administration staff to work from home.

‘So knowing the added burden of Care Quality Commission inspections has been removed will be applauded.’

 The GMC said it was doing all it could to support doctors and employers on the front line, where patients needed them most.

Revalidation dates from 17 March to 30 September are deferred for a year.

Doctors are also advised to ensure their billing is timely while they are under such pressure. Some groups were owed over £250,000, even before the virus.  See billing advice, page 32

Most doctors unaffected by self-employed rescue plan

Government aid for the selfemployed hit by Covid-19 will only touch a handful of full-time private doctors due to a £50,000 earnings cap on the bailout.

Those who recently became selfemployed and were building their business would not have filed the necessary 2018-19 tax return.

The cap is attracting criticism for creating a ‘cliff edge’ effect.

But medical accountant James Gransby said it seemed unlikely the Treasury would reconsider the plan given the effort to get legislation passed in such a short time. Payments are not expected to be made available until June.

Patrick Convey

‘I’m not ready to hang up my scalpel just yet’

What happens now? Private practice full-timer Mr Jeremy Latham sees his enforced free time as an opportunity to polish up his practice for an avalanche of work to come

Twenty years as a consultant orthopaedic surgeon with a good private practice; what could possibly go wrong at this stage of my career?

The answer: Covid-19.

The private hospitals have quite rightly handed over their capacity to the NHS to care for patients who are sick, but not in need of ventilatory support.

We won’t be able to do any elective surgery for the foreseeable future. I’ve offered to help at the NHS trust where I was a consultant for 17 years, but it’s unlikely that they will need a specialist hip replacement surgeon at the moment.

The patients who were hoping to have their joints replaced will have to endure more pain and suffering for longer while their health deteriorates and they become increasingly at risk of falls and frailty.

Once the pandemic has run its course, there will be a huge backlog of cases – some of them more complex due to deteriorating pathology and co-morbidities. Worryingly, the surgical workforce will be relatively de-skilled, which will increase the risk of complications.

Of course, those who need private practice income to pay for mortgages, cars, school fees and comfortable lifestyles won’t get

much sympathy from our colleagues, but that’s not surprising.

I feel very sorry for the younger consultants in the early part of their careers, building up their reputations and bringing up their families. They will be hit hardest by this catastrophe, but at least they will have their NHS income to soften the blow.

So how do we prepare for this abrupt change in our lives?

On a personal level, I’m going to embrace the unexpected opportunity to be at home with my family. We’ve got two teenage boys, one of whom was due to sit GCSEs in the summer.

I will spend lots of time practising the piano, hoping to sit the Grade 8 exam (again) in December. The pleasures of reading, getting fit and being in the garden are undeniable, and I will see them as a dress rehearsal for retirement.

But I’m not ready to hang up my scalpel just yet.

For those of us in full-time private practice, this is an opportunity to polish up our websites and social media marketing, in preparation for the avalanche of work to come.

I set up a small home studio a couple of years ago to make short videos for my YouTube channel. I’m no Steven Spielberg, but I have really enjoyed the challenges of

how to make and edit videos and, of course, they are an important part of promoting my services online. Reducing outgoings is essential. The costs of running a private practice are, of course, considerable. Suspending indemnity cover is not possible (but see the story below), but office and room hire charges will be reduced.

I’ll keep in touch with patients by setting up phone and video consultations. Data protection and security need to be thought about, but common sense should guide you and there is plenty of advice online.

The private hospital where I work will keep in place some secretarial support, which will allow us to register patients and schedule

I’ll keep in touch with patients by setting up phone and video consultations

MR JEREMY LATHAM

virtual clinics. The insurance companies have agreed to let us bill for these consultations, so hopefully there will be some income being generated.

Keeping open clear lines of communication with colleagues and hospital management is vital in a rapidly changing hostile environment.

We all want our practices to survive and thrive, but there will inevitably be casualties and things will never be the same again. Fortune favours the prepared mind. I’m planning to use this time to make me and my private practice ready for whatever happens. Good luck!

Jeremy Latham is a consultant orthopaedic surgeon, based at Nuffield Health Wessex Hospital in Chandlers Ford, Hampshire

Cut indemnity cover costs if income drops

Independent practitioners can cut defence cover costs due to current uncertainties in the private sector.

MDU members were advised to let it know if they found income levels change as a result of COVID-19 so it could adjust their subscription.

The MPS said it was keen to sup-

The MDDUS said it was adjusting subscriptions to levels based on members’ own changed estimates of likely income for the current year and would make any necessary retrospective adjustments.

port those who had seen a significant drop in their work and a dramatic fall in income.

Themis Clinical Defence said policyholders were seeing ‘a dramatic drop in business’ and it would review premium levels previously purchased if doctors got in touch.

Doctors who had never done any private practice work but were covering for a sick colleague needed cover as state-backed indemnity only extends to NHS patients.

Insurance still has a role to play at this time

Insurers must be adaptable and flexible in supporting clients to maintain vital cover, especially private medical insurance and health cash plans, an industry leader has warned.

Association of Medical Insurers and Intermediaries (AMII) chairman Mr Stuart Scullion said unemployment, reduced hours and financial worries meant members had a key role to play in supporting clients.

He said: ‘It would be easy to say: “Why should I keep my cover when I may be unable to access private hospital facilities?”, but private medical insurance and health cash plans provide much more than hospital treatment.

‘Digital GP services, employee assistance programmes and digital and phone-based mental health support can be invaluable to customers at this difficult time and continue to deliver real value to customers.’

Mr Scullion said insurers were looking at several options from payment holidays to enhanced NHS cash benefits for those unfortunate enough to contract Covid19.

He praised private hospital groups providing staff and facilities at cost and asked all insurers and intermediary firms to work together to fight the pandemic as one.

Customers also needed to protect their underwriting status, he warned. ‘Private medical insurance is not like a TV subscription service that you can cancel and recommence when you are ready. Consumers need to protect their underwriting status and cover to ensure they do not find themselves with a new moratorium or exclusions applied.

‘Intermediaries have a responsibility to ensure they convey this message clearly. We would encourage anyone who is thinking of cancelling their cover to speak with their intermediary or insurer before doing so.’

A friend you can count on

If you need help at this stressful time, then the Independent Doctors Federation (IDF) is there as a set of friends to support you, says its private GP president Dr Neil Haughton

As consultants and GPs worked valiantly to cope with the mounting effects of the Covid-19 pandemic on their professional and personal lives, president Dr Neil Haughton gave this message to members

Dear IDF member,

How things change in seven days. A week ago we were agonising over whether to cancel the study weekend and now that seems utterly frivolous. We have all seen rapid changes in our practice, patients, workload, staffing and business security.

I have been asked a few times this week to comment publicly on how the private sector is responding to the Covid-19 pandemic, but declined, as it was not the right time. And we should certainly not be profiteering from the crisis.

The IDF has always strived to promote the decent professionalism of independent practice and will continue to do so.

Many of our colleagues will be required to return to NHS roles or volunteer to do so, which is exactly what is required, and private hospitals and staff will now provide front-line services in the crisis.

We only ever seek to comple -

ment the NHS and times like this just reinforce my admiration and support for the institution that trained us all. We are lucky indeed to have such a powerful force in the UK.

The IDF has sought to support its members during this time and is adjusting its service provision; our office is closed, education will go online, appraisal is on hold, but we are still a designated body and our regulatory work will continue.

We have also consistently lobbied our colleagues at Public Health England, the Care Quality Commission, NHS England, the RCGP and others to have access to the right information and equipment – although the latter still evades us. We are no longer able to meet in the same way, see and support old and new faces, which is such a fundamental part of the IDF and will return.

In the meantime, please use the IDF as a set of friends who will have difficulties in the months to come, so we should and must support each other.

There may be scope to share equipment, staff, premises or knowledge to help keep our services relevant and ready to resume when the crisis eventually resolves and Covid-19 is just another box in the vaccine fridge.

Please use us to connect with each other and provide assistance at this time, even for just a friendly chat.

Please also remember our psychiatric support network which may be of benefit to members at this stressful time; you can find the details when you log in to the IDF website.

For the moment, the NHS is facing its biggest challenge and they have our unreserved support.

We will help in whatever way we can or is required of us.

Stay safe and well and I hope to see you all soon.

Thank you,

Neil Haughton

Consent failures spur claims hike

By Olive Carterton

Negligence claims due to failure to inform patients before they consent to procedures have shot up since a landmark legal ruling in 2015.

A new study by Queen Mary University of London found that while the rate of increase of other claims has remained steady, cases relating to consent have risen fourfold in four years.

And where failure to inform was added as a contributory claim, the rise was nearly ten-fold.

The change follows the landmark Supreme Court ‘Mont gomery’ judgment. This altered the legal test for determining what is sufficient disclosure before consent is given to treatment, by moving away from asking what a reasonable doctor would warn about and asking instead what a reasonable patient would expect to know.

Study lead and professor of cardiology David Wald told Independent Practitioner Today : ‘Although the data we used was purely from the NHS, the problem will affect all healthcare providers.

‘It’s highly likely that the rise in

Capital gains tax deadlines for property sales toughen

Important deadline changes when paying Capital Gains Tax (CGT) affect property owners selling a residential property in the UK. From 6 April 2020, if a UK resident sells a residential property in this country, they will now have 30 days to tell HM Revenue and Customs (HMRC) and pay any money owed.

claims linked to failure to inform will also have an impact on private practice – in fact, it probably has already.’

He said a Supreme Court case in 2015 was reasonable in overturning a judgment in favour of the claimant, Nadine Montgomery, but research showed the broader implications of the ruling had serious, unintended consequences.

‘By blurring the requirements for what doctors should tell patients and changing how negligence is determined, it has made it harder for hospitals to defend allegations of failing to properly inform patients before consent. The Supreme Court believed their ruling would reduce litigation but the opposite has happened.’

The team obtained the data through a Freedom of Information request on the claims settled by the NHS between 2005 and 2019. Of 70,000 cases, just over 2,300 were linked to failure to inform, with a total value of nearly £400m.

Researchers found that between 2011 and 2015, costs for settling these types of cases rose from £25m per year to £28m per year. From 2015 to 2019, costs rose to

Non-UK residents will still be required to declare within 30 days if there is tax to pay and will no longer to be able to defer payment via their self-assessment return.

A new online HMRC service aims to make it easier to report and pay any CGT.

Owners may need to make a CGT report and make a payment when, for example, they sell or otherwise dispose of property not used as their main home, a holiday home, a property they let out and an inherited property not used as their main home.

Further advice and guidance is available at online at www.gov. UK.

£62m per year. The rise was purely due to the increase in numbers of claims, as the cost per claim remained steady.

Prof Wald said: ‘Claims involving failure to inform are normally invisible in the overall numbers of negligence claims, but the rise we’ve identified is striking and shows no sign of stopping.

‘The data support concerns that lawyers are adding consent-related claims to other allegations, which,

on their own, may not be successful in court. The Montgomery ruling now makes these cases much easier to win and the NHS is paying the bill.’

He believes there is an urgent need for hospitals to improve communication before consent – and for lawmakers to consider revising the legal framework to provide a fairer and less costly system.

The study found lawyers’ fees accounted for about 40% (£155m) of costs paid in settled claims due to failure to inform.

Prof Wald has developed multilingual animations for medical and surgical procedures, which are made available to patients to give them time to consider the benefits, risks and alternatives and prepare any questions prior to treatment in order to support the discussion before consent (see www.explainmyprocedure.com).

 Solicitor Paul Sankey warned in Independent Practitioner Today in March 2017 (see above) that ‘surprising numbers’ of independent practitioners were putting themselves at risk because they had not caught up with new duties for obtaining consent to treatment. Check out his advice in that issue at www.independent-practitioner-today.co.uk.

Doctors unprepared for attending inquest

Doctors are concerned about the implications of attending a coroner’s inquest, according to a new survey published by the Medical Defence Union to coincide with the latest edition of its journal.

A survey of members found:

 73% worried about the possibility of being criticised at a coroner’s/ procurator fiscal’s investigation;

 61% were unsure as to whether to inform the GMC if they were criticised;

 72% were apprehensive about the media reporting on the coroner’s/ procurator fiscal’s inquest;  60% were concerned about the need for legal representation during this time;

 50% would feel uncomfortable appearing at a coroner’s/ procurator fiscal’s hearing.

Of the 253 respondents, only 23% would feel prepared if called to an inquest and 34% would not know what to expect.

PRIVATE PATIENT UNITS’ ANNUAL CONFERENCE

PPUs predict long-term success

Compiled by Philip Housden

£1bn a year – PPUs confident of long-term growth

Private patient units (PPUs) are growing and should be confident of long-term success.

That was the message from many speakers to the sixth annual NHS Private Patient Units national conference at St Thomas’ Hospital, London, before Covid-19 struck.

Trusts were encouraged by Nick Dawson, head of commercial, finance and analytics at NHS England and Improvement (NHSEI).

He said they should continue efforts to generate extra private patient income in line with best practice – and where this benefited local NHS patients and services.

Mr Dawson told delegates that NHSEI was working to support them from the centre and would share ideas and proposals for action in the coming months.

He said PPUs had an opportunity to fill in service gaps left by small private hospitals – and this could be worth an extra £800m to £1bn a year income to trusts across England.

NHSEI therefore wanted to identify best practice and then share tools PPUs could use. It also aimed to promote collaboration by developing regional networks so PPUs could support each other.

The event was chaired by the Guy’s and St Thomas’ Trust’s head of private patients, Kim FoordPaton, commercial medical director Prof Adam Fox and private practice clinical lead Dr Mark Ibrahim.

Their key messages focused on choice and patient safety. The conference was told that consultants might have a lot of choice on where to practise privately, but they would support their local NHS PPU if the service to them was professional and they were treated as customers.

Dr Ibrahim said: ‘The Paterson inquiry and implications for high governance structures, which the NHS is the gold standard for most of the time, are going to show that

you can be private, and you can be of the highest standard.’

 See survey results on page 38

Support for a national voice Trusts were urged to support:

 Collaborative working;

 The creation of more regional groups;

 A national support network to promote best practice and a more joined-up approach.

The plea came from Anne Bishop, private healthcare business manager at Royal Devon and Exeter NHS Foundation Trust.

She also chairs the only surviving regional support network for NHS PPU managers – the 29-member Western group.

Ms Bishop told the conference: ‘I hope my colleagues working in private patient units will be inspired to take action and to be part of a really exciting change in the landscape where we can have a national voice once again.’

Options growing for PPUs

Sarah Porter, private and overseas patient manager at Taunton and Somerset NHS Foundation Trust, shared local examples of growing private treatment and care options.

These particularly involve selfpay and treatments complementary to core NHS services.

The Parkside Unit at her trust has 12 beds currently generating around £2.5m a year with growing revenue.

Insurers quizzed

Health insurers were present and an informative panel-based session included questions to John Crompton, Bupa’s head of hospital management, Matthew Cox, hospital relationship manager at AXAPPP and Dr Doug Wright, medical director at Aviva.

The challenge of balancing the price of insurance and costs of healthcare provision versus trusts’ experience of lower tariffs for provision of more complex patient care were explored, among a range of topical issues and concerns.

PPU managers and staff heard that if PPUs were treated as a single provider, they would form the insurers’ fourth largest customer.

‘Make time for PHIN’ PPUs were urged to start using the Private Healthcare Information Network (PHIN) website to demonstrate their volume and quality of services.

PHIN’s member services director Jonathan Finney said patients were increasingly searching trusted sources to help make informed decisions about their care.

Judging complaints for PPUs

Sally Taber, director of the Independent Sector Complaints Adjudication Service (ISCAS), reminded conference that private patients in the NHS cannot access the service of the NHS Ombudsman if they have a complaint.

Trusts can join ISCAS, a subscription-based member organisation, to provide an important independent third-stage review process for PPUs.

PPU growth predicted

As managing director of Housden Group, I delivered the annual state of the market report, confirming that recent years’ growth trends are expected to be reported in trusts’ 2019-20 annual reports and accounts, due in July.

Using data from a recent survey of trusts, the NHS PPU Barometer (see page 38 for details) total private patient revenues are forecast (pre-Covid-19) to rise around 9% to reach over £750m for the first time by 2021 – up over £100m in two years.

London delivers most growth and the top ten trusts, all in London, bring in 65% of the total.

The most important market driver is a top-led changing culture to support PPUs and patient safety in the light of Paterson, leading to more patient demand for the confidence of 24/7 critical care infrastructure and capacity. I declared there was opportunity to open and grow PPUs in every trust, but joined-up thinking and action across the sector was needed to achieve this.

PPU Service Awards 2020

The conference hosted the inaugural Private Patient Service Development Professional Achievement Awards, which recognise excellence. The winners were:

 Best customer and patient experience: Endri Setyawati, chef at Bournemouth Private Clinic, Royal Bournemouth and Christchurch Hospitals NHSFT;

 Leading administration and back-of-house team: Elyas Talha, international patients manager, Guy’s and St Thomas’ Private Healthcare;

 Service leader for growth and development: Sarah Porter, private and overseas manager, Parkside Suite, Taunton and Somerset NHSFT.

PPU AWARD WINNERS (L-R): Sarah Porter, Elyas Talha and Endri Setyawati. Details of their accolades are listed at the bottom of the page

The Budget and you

Analysis and tips for private doctors

Specialist

medical accountant Vanessa Sanders (right) provides a detailed round-up of Chancellor Rishi Sunak’s changes and shows what you can do now

AS WE head into the unknown with Brexit fall-out and the health of the nation of great concern, the Budget brings a few welcome nuggets this month to independent practitioners.

PERSONAL TAX

The National Insurance Contribution (NIC) threshold goes up from £8,632 to £9,500 from 6 April 2020, so those doctors who follow these thresholds for the purposes of paying employees may consider increasing pay levels for the new 2021 fiscal year.

Please bear in mind the threshold for auto-enrolment into a workplace pension remains at £10,000.

PENSIONS

Although consultants and GPs were hoping for the pensions tax charge legislation to be reversed, it has instead been softened.

Many will have felt the bite of the restriction on pension savings’ growth in their last tax bill, because nearly all will have used up their unused relief from earlier years and been faced with a liability arising.

This resulted in many doctors deciding reluctantly to reduce their efforts within the NHS, and so a crisis arose, leading NHS England to take the decision to commit to reimbursing for this one year those who suffered a pension reduction upon retirement.

This move means many will be electing to have their pension excess for 2020 paid for by their pension schemes.

After consultation, the Government has announced the pensions annual allowance thresholds will

rise by £90,000 each. So, the threshold income will now be £200,000 rather than £110,000 and the adjusted income will go up from £150,000 to £240,000.

This will assist all those who work only within the NHS, but will remain a concern for those in private practice, because adjusted income includes taxable income from all sources plus the pension growth – or contributions in a private scheme – added to any salaryrelated pension scheme.

The sting in the tail, however, is that the minimum tapered annual allowance will be decreased from £10,000 to £4,000 from 6 April 2020.

MAKING TAX DIGITAL (MTD)

Currently, VAT-registered businesses have been enrolled in the Government’s initiative to digitalise tax, so there is a discrepancy with those not registered, which is most doctors in private practice because their businesses are exempt.

So it is welcome news that the Government will publish an evaluation of the introduction of MTD for VAT before introducing all others to the system.

But be warned – it has also pledged increased funding for HM Revenue and Customs (HMRC) to improve compliance and this is unlikely to be held off indefinitely

because of the current disparity between businesses.

ENTREPRENEURS’ RELIEF

Entrepreneurs’ relief (ER) is a lower rate of capital gains tax (CGT) charged when an individual, a partner or shareholders in a limited company sells a material stake in their business.

The rules basically state you must have held at least 5% of the voting and distribution rights for the previous two years; and be entitled to receive at least 5% of the proceeds if the whole of the share capital were to be sold.

Following significant lobbying, the Government has decided ER

has primarily benefited a small number of affluent taxpayers and does little to generate and to support genuine risk-taking and creativity where it is proven to be effective.

It has taken the step to reduce the lifetime limit on gains from £10m to £1m. This will apply to all disposals made on or after 11 March 2020 to avoid a sudden rush to the liquidators.

This measure is anticipated to raise over £6.3bn for the Exchequer by 2025 and, according to analysis, only affects 20% of business owners, with the remaining 80% being able to benefit in full at the reduced cap.

The Chancellor has also included some provisions to counter certain arrangements which seek to ‘lock-in’ the previous £10m lifetime allowance.

In some cases, parties to the disposal will be required to demonstrate the transaction was entered into for commercial purposes not to obtain a capital gains tax advantage.

This measure is likely to affect independent practitioners offering their services through limited companies and effectively ‘saving up’ their profits and using their corporate structure as a tax shelter, by restricting dividend distributions to shareholders.

It has long been a bone of contention with HMRC that returns to shareholders of profits should be distributed based on commercial factors rather than the individual position of the owner/ director.

The move towards formal liquidation of companies with more than £25,000 of assets allows HMRC a window into such actions, as it can raise questions as to why large reserves have been built up rather than being paid to shareholders.

Now may be a good time to review dividend policies to ensure the commercial test for actions is met and the anti-avoidance rules finger cannot be pointed. Recognising the need for innovation and enterprise to sustain prosperity in the economy, the Chancellor confirmed savings obtained from ER reform will be directed straight back to fund three other significant tax breaks for businesses:

1

An increase in the research and development expenditure credit (RDEC) from 12% to 13% from 1 April 2020.

This will enable many companies to claim a larger corporation tax deduction for relevant research and development spend. This may be relevant to some doctors who are at the forefront of innovation in their field.

2

Increase in the maximum employment allowance by £1,000 to £4,000 from April 2020.

This supports businesses by providing relief of up to £4,000 on their employer’s secondary Class 1 NIC liabilities.

It may allow doctors to consider paying employees higher rates of pay. There are restrictions where the employees are household staff included on a payroll.

3

Increase in structures andbuildings allowance (SBA) from 2% to 3%.

From 1 April 2020 – or 6 April 2020 for unincorporated entities – businesses can claim a 3% deduction on qualifying expenditure. This increased rate will apply to both existing qualifying structures brought into use on or after 29 October 2018 and any new additions.

CAPITAL ALLOWANCES FOR BUSINESS CARS

For all of those dreaming of a Tesla, from April 2021 the first-year allowance on zero-emission vehicles will be extended, which means if you buy an electric vehicle, you will receive 100% of the cost as a deduction to your profits.

There is a reduced benefit-inkind charge of 0% on list price for 2021.

VAT

A zero rate of VAT will apply to e-publications from 1 December 2020; including e-books, e-newspapers, e-magazines and academic e-journals.

VAT on women’s sanitary products will be abolished from 1 Jan 2021.

There will be further announcements in the Autumn with another Budget statement.

Vanessa Sanders is a partner with accountancy, finance and tax advisory medical specialist Stanbridge Associates Limited

Pension tax ills

‘not yet solved’

Chancellor Mr Rishi Sunak’s response to extensive doctor lobby ing over pensions tax will not remove the whole problem, BMA pensions committee chairman Dr Vishal Sharma warned.

He said: ‘The vast majority of doctors are now removed from the effect of the taper and will no longer be in a situation where they are ‘paying to go to work’. But this solution is long overdue.

‘For the past 18 months, patients have suffered, and doctors have faced an intolerable dilemma, with many forced to cut short their service to the NHS, reducing hours or turning down vital additional work – not being able to care for their patients as they would want to.’

If the Government had acted when the association raised the issue in August 2018, the impact on doctors and patients could have been avoided, he said.

Dr Sharma said the BMA believed the annual allowance was unsuited to defined benefit schemes such as the NHS. ‘Many doctors with incomes far below the new threshold income will face tax bills as a result of exceed-

Surgeon poll shows extent of the tax trap on pensions

Royal College of Surgeons of England president, Prof Derek Alderson, expressed delight that the Government listened to concerns on the ‘pensions’ tax trap’ issue.

He said: ‘It has been a genuine worry for senior surgeons and doctors. Our latest survey showed 61% of consultant surgeons had been advised to refrain from taking on additional work, because it could trigger a large and unpredictable tax bill.’

Dr Sarah Tennant, pensions lead for the Hospital Consultants and Specialists Association

ing the standard annual allowance, which remains at £40,000.

‘This can happen simply following a modest rise in pensionable pay; for example, when receiving a pay increment, taking on a leadership role or being recognised for clinical excellence.’

Hospital Consultants and Specialists Association pensions lead, Dr Sarah Tennant, welcomed the removal of ‘a huge number of hospital doctors from the ill-conceived annual allowance taper’. It was an extremely welcome step but would not solve the whole problem.

The Association of Medical Insurers and Intermed iaries has expressed relief that Chan cellor Rishi Sunak did not increase Insurance Premium Tax (IPT). It pledged to continue to lobby for lower rated healthcare products.

Executive chairman Stuart Scullion (right) said: ‘Against the current global health backdrop of the Covid-19 outbreak, an IPT rise would have done nothing to relieve any pressure on an NHS already on its knees.’

A look back through our journal’s archives of ten years ago reveals that although times change, some issues are not so new

A trawl through the archives: what made the news in 2010

HMRC won’t ease tax deadline

Private doctors’ hopes of winning an extension to the 31 March deadline for confessing any tax errors under what was called the ‘Tax Health Plan’ were dashed.

HM Revenue and Customs ignored the Chartered institute of Taxation’s plea for more time and hit back with reminder letters to 28,000 doctors and dentists.

Recipients were told: ‘Using information we hold, we will begin investigations into medical professionals we believe have subsidiary income from additional work which has not been declared. This will start in April.’

But doctors’ advisers said this resulted in only a trickle of consultants taking up the referential 10% penalty regime. Non-responders were waiting to see if the taxman would target them.

Indemnity price war

A defence body price war erupted as consultants fought back against rocketing indemnity costs.

After launching a breakaway insurance scheme of its own, The British Association of Aesthetic Plastic Surgeons (BAAPS) claimed members were already making ‘extraordinary savings’ of 30-50%.

The company behind the scheme said over 85 surgeons had

switched provider, saving as much as £15,000.

Consultants then reported receiving letters from their existing defence body offering them cut rates amounting to thousands of pounds.

Legal fees raise bill for negligence

The total value of reported and unsettled clinical negligence claims shot up by 40% in the previous year in England and Wales.

According to the Medical Protection Society, around one third of its top 20 outstanding claims arose from specialist private practice.

And four of the top five, by value, were claims arising from the independent sector.

We reported that a major driver of the rise in the cost of clinical negligence claims was escalating claimant legal costs.

In lower-value claims, with damages under £10,000, the society typically paid nearly twice as much in claimant costs as in damages.

Most doctors freeze prices

A big majority of doctors with a private practice were freezing their fees to patients for the new financial years.

The status quo matched the Doctors’ and Dentists’ Review Body award for consultants’ NHS scales.

Only 5% of independent practitioners were estimated to be increasing their prices.

Insurer widens its curb on fees

Hundreds of consultants hit out against AXA PPP’s bid to cut costs and bring in new reimbursement limits.

Response to a survey by the Federation of Independent Practitioner Organisations (FIPO) warned that the insurer’s plans threatened clinical quality and patient choice.

Get patients’ consent 2 txt

Private GPs and consultants who were contacting their patients via

text message were advised to ensure patients had opted in to the service.

The Medical Defence Union warned that it was unwise to rely on patients’ implied consent to allow the practice to communicate with them in this way.

Doctors were urged to be cautious and get the patient’s express consent.

Use power of silence in negotiations

Members of the Independent Doctors Federation (IDF) were given some quiet words of advice – ‘shhh.’

The power of silence could be a useful weapon when negotiating deals, a marketing expert advised. Darren Clare, managing director of Create Medical Marketing, said doctors increasingly had to negotiate – with hospital providers, insurers or when setting up joint ventures with business partners.

Once doctors got a deal they were happy with, they should agree it, get it in writing – and know when to stop negotiating.

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 See page 24

PREVENTING ANOTHER PATERSON

Challenge the rogues Speak out!

Curiosity cured the cat. The Paterson saga shows it is vital to speak up in the independent health sector, says David Hare

AS THE whole of the healthcare system reflects on the former Bishop of Norwich’s report into the Paterson Inquiry, one key theme comes across time and time again.

That is the importance of all those working in healthcare having greater curiosity about what is going on around them.

This means asking more questions about the safety, performance and data collected by their organisations, and providers devel oping a culture which encourages people to speak up to get the right answers.

In this light, therefore, it was interesting to read the latest report from the National Guardian’s Office on the role of Freedom to Speak Up Guardians (FSUG) in the health service.

This concept was introduced by Sir Robert Francis following a 2015 review into ‘whistleblowing’ processes in the NHS and it aims to develop cultures where safety concerns are identified and addressed

What Freedom to Speak Up Guardians do is help foster a culture of ‘healthy scepticism’ in the health system

early on, before people feel the need to ‘blow the whistle’.

All providers of NHS services subject to the NHS Standard Contract must now have in place a FSUG and, in the independent health sector alone, almost 100 have already been established.

Positive culture

Surveying almost 600 Freedom to Speak Up Guardians (FSUGs), the National Guardian’s report from earlier this year found that, across all healthcare providers and regulators, independent health providers came out on top in terms of their culture around ‘speaking up’.

Indeed, three­quarters of FSUGs working in independent providers agreed that ‘my organisation has a positive culture of speaking up’, which compares with 62% of respondents from NHS organisations and healthcare regulators.

Almost two ­ thirds (65%) went on to agree that ‘people in my organisation do not suffer detriment as a result of speaking up’ – a

figure that drops to 45% in all pro viders. And just 13% of independ ent­sector FSUGs stated that ‘there are significant barriers to speaking up in my organisation’, compared with 30% of guardians from all responding organisations.

Managers and senior leaders in the independent health sector were also found to be more sup portive of staff who raised con cerns around safety and other key issues.

Almost seven in ten (69%) of FSUGs in the independent sector said that ‘managers support staff to speak up’, rising to 75% who believed that senior leaders supported staff in this area. This falls to just 45% and 65% respectively for all FSUGs.

It’s positive to see that this work has been so embraced by independent providers, with almost 100 guardians already in place.

Challenging professionals

And why does this matter? As many have pointed out in the aftermath of the former bishop’s inquiry, it’s not easy challenging medical professionals such as Paterson.

People are reluctant to disbelieve specialists who have undergone years of training, particularly if they are known to be charming and persuasive as Paterson was.

Equally, there can be a tendency to explain away rather than question poor or unusual behaviour among clinicians – ‘looking for

But we see huge potential to grow this number and want to ensure all independent healthcare providers have appointed a guardian in place and are submitting data to the National Guardian’s Office.

So, for healthcare providers in both the NHS and independent sector, speaking out should be less ‘curiosity killed the cat’ and more curiosity ‘cured’ the cat. 

David Hare (right) is chief executive of the Independent Healthcare Providers Network

Fix for faults shown by Paterson probe

The Private Practice Register initiative, from Healthcode, already has the profiles of more than 18,000 consultants and practitioners. It is an obvious solution to the information deficit within hospitals identified in the Paterson Inquiry report, argues Fiona Booth

MOST ORGANISATIONS criticised in the Paterson Inquiry report have accepted their responsibility and individuals are being held accountable for their acts or omissions.

This is necessary, but it is equally important to focus on the practical steps that can be taken to address the collective failures which meant that Paterson could continue his malpractice for so long.

While there were several con ­

tributory factors that allowed him to get away with malpractice for so long, one common theme running throughout the report is the information deficit that exists within the healthcare sector.

This applies in two senses:

1. The paucity of accurate information about consultants’ whole practice to support effective clinical governance;

2. The lack of appropriate information sharing to support patient safety.

One common theme running throughout the report is the information deficit that exists within the healthcare sector

Paterson’s activities weren’t confined to breast surgery and he was carrying out procedures on men and women in the independent sector that were outside his scope of practice in the NHS (see report pages 19, 56, 82 for examples).

On page 106, the report states: ‘Around a sixth of patients and relatives gave evidence that Paterson performed procedures other than breast surgery, mainly at Spire hospitals. These procedures included thyroidectomies, hernia repairs and anal stretches.’

Unsafe and inappropriate practice

Paterson was notorious for the unrecognised ‘cleavage ­ sparing mastectomies’ that he continued to carry out, even after concerns were raised about their safety.

1 Consultant information and clinical governance

The inquiry report includes numerous examples of relevant data about Paterson, which was unavailable or inaccurate, including :

 His scope of practice;

 His unsafe and inappropriate practice;

 Clinical governance.

It is a common misconception that Paterson’s victims were all women patients that sought his ‘expertise’ as a breast surgeon.

However, his unsafe practice went far beyond this; for example, unnecessary treatment and carrying out breast cancer surgery before arranging proper investigations.

This is covered in chapter 4 of the report, which comments on page 124: ‘Patients told us that they thought consultants were being monitored by both the NHS and independent sector providers.

‘We heard that this did not take place in any meaningful way in either sector, but that this was particularly the case in the independent sector where Paterson con tinued to do operations the

hospital director had told him to stop, carried out operations he did not perform in the NHS, and did unnecessary procedures. We heard that the hospital monitoring data in the independent sector did not show Paterson as being out of the ordinary.’

Clinical governance

Clinical governance was compromised because those with responsibility for overseeing Paterson’s practising privileges did not have a complete picture of his whole practice in the NHS and independent sector.

The report found that ‘measures to monitor and limit [Paterson’s scope of practice] at Spire were inadequate’ (page130).

On page 183, it states: ‘Multiple witnesses, including the Independent Healthcare Providers Network (IHPN), HCA, Healthcode, the Royal College of Surgeons and Spire told us that there should be a

Clinical governance was compromised because those with responsibility for overseeing Paterson’s practising privileges did not have a complete picture of his whole practice in the NHS and independent sector

single repository of all data [about every consultant]’.

This is one element in the Medical Practitioners Assurance Framework developed by the IHPN which aims to introduce consistent standards for clinical governance in the independent sector

– as reported in Independent Practitioner Today in November 2019).

It is carried forward in the report recommendations on page 218: ‘There should be a single repository of the whole practice of consultants across England, setting

out their practising privileges and other critical consultant performance data; for example, how many times a consultant has performed a particular procedure and how recently.

‘This should be accessible and understandable to the public. It should be mandated for use by managers and healthcare professionals in both the NHS and independent sector.’

Healthcode’s response

Healthcode’s The Private Practice Register (The PPR) is a sector­wide directory of consultants and other practitioners offering private healthcare services and a definitive source of consultant data, including type of care provided and where they hold practising privileges.

It currently has over 18,000 profiles and has been rolled out to more than 300 private hospitals.

The Paterson Inquiry report

The company is already working on a development roadmap for The PPR in collaboration with its industry user group, which will give hospitals a complete picture of their consultant population and support clinical governance.

Future releases will include:

☛ Profile information including consultants’ designated body and Responsible Officer (RO) and scope of practice in the NHS and private sector.

☛ Profile alerts about GMC warnings, overdue indemnity insurance and overdue appraisals for all profiles associated to their site.

☛ Governance dashboards for hospitals to check consultants’ indemnity, appraisal and revalidation status.

☛ A procedure credentialing system so that hospitals can oversee which procedures consultants are authorised to conduct as part of their practising privileges. This feature includes the ability to attach supporting evidence

The PPR is an obvious solution to the information deficit within hospitals identified in the report.

It is already functionally superior to other directory services with new features on the way. And, most importantly, hospitals, private medical insurers and consultants are already using it, so it would be cost­effective and quick to implement across the sector.

2 Information sharing

The report notes the perceived and actual barriers to information sharing which meant stakeholders were not aware of red flags concerning Paterson. For example:

➲ Clinical coding

It found that Paterson used the incorrect procedure codes when billing private medical insurers in order to attract a higher fee or to enable him to justify further treatment.

At page 170: ‘We were surprised that Paterson was not detectable as an outlier, given the very large number of procedures he was carrying out almost entirely in one hospital, let alone the number of procedures he was undertaking on individual patients, including many costly diagnostic tests such as PET scans. Spire told us that they would welcome early sharing of concerns by private medical insurers, so that they can take timely action.’

➲

Variance in coding

Another issue was a variance in data standards in coding which was noted on p184: ‘We were also told that the data collected in the NHS and private sector is not always easily comparable, with different coding structures used in each sector.’

In chapter 6, the report looks specifically at sharing concerns and information across the healthcare system (page 182) and notes on page 185: ‘We have concluded that there is confusion about individual organisations’ responsibilities, data protection legislation and commercial confidentiality, and that this stands in the way of the timely sharing of information to protect patients.’

Healthcode’s response: Healthcode has always been totally committed to interopera ­

ble technology, shared standards and sector­wide collaboration so that business, clinical and commercial data can be exchanged securely and efficiently.

This approach underpins all its services, including:

 Secure ebilling – providers sending data to private medical insurers;

 Clinical coding management for private providers – including mapping tools to ‘convert’ the procedure and diagnosis codes used in the private sector to those used in the NHS. Healthcode has also developed Industry Standard Charge Codes covering clinical and non­clinical services (HSCCC);

 Secure messaging and healthDrive – enables users to store files on Healthcode’s secure platform and share encrypted information with others on Healthcode’s Global Directory.

 The PPR – different organisations can access the data on The PPR via a secure online platform and shared securely by users from different organisations in both the private and NHS sectors.

Healthcode has also been at the forefront of efforts to encourage collaboration and appropriate information ­ sharing by privatesector stakeholders in the interests of delivering safe, high ­ quality care and services.

Its view is that information must be accurate, up to date, accessible, secure and shareable, when appropriate, if it is to have any value.

For example, in June 2019, Healthcode managing director Peter Connor, spoke about the need to overcome barriers to information sharing at The Private Healthcare Summit.

He warned the audience: ‘I am concerned that standards and sharing are two words that are rather alien within our sector.

‘I often encounter resistance to sharing on data protection grounds and I also believe we are often hampered by the “island mentality” from organisations that says :“We’ve built our own system and if you want to do business you have to do so on our terms”.

‘We have to recognise that our data only has a value if it can be shared appropriately, securely and in the interests of patients by helping to deliver high ­ quality or

improving access. And we can only achieve this if we trust each other enough to embrace common standards and collaborate.’

Conclusion

We believe independent consultants, hospitals and private medical insurers are serious about addressing the shortcomings highlighted in the Paterson Report, in terms of effective communication and information sharing. It is common following the publication of a high­profile report for everything to go quiet while the Government and other interested parties consider the findings. In her statement to the House of Commons, junior health minister Nadine Dorries praised the recommendations and promised a full response in a few months’ time.

However, she continued: ‘The inquiry does not jump to a demand for the NHS and the independent sector to invent multiple new processes, but to actually get the basics right, implement existing processes and for all professional people to behave better and to take responsibility.’

In the same spirit, we hope that the sector will build on existing solutions which can be implemented quickly to address the information deficit and meet our obligations to Paterson’s many victims.

 See ‘Shared data still has a long way to go’, page 26

Fiona Booth (right) heads up the Private Practice Register project at Healthcode

Healthcode boss Peter Connor

A test example of the dashboard profile of a consultant on The Private Practice Register. The blue tabs show different areas including NHS and private practice and indemnity

Business is on the up

‘Growth is back’ appears to be the headline for the private acute healthcare market in London, according to latest research by LaingBuisson, conducted before the Covid-19 pandemic. And it seems consultants who can bring patients to a hospital have never been in higher demand, reports Ted Townsend (right)

AFTER A FEW years of low to negative growth in revenue – at least in the independent sector – the overall value of the private healthcare market from a hospital perspective reached £1.59bn in 2018, a growth of 3.2% on 2017.

LaingBuisson forecasts that this will have grown by another 5.5% in 2019.

Some hospitals such as The London Clinic are reported to have had over a year of consecutive month ­ on ­ month increases in revenue, and Bupa Cromwell is said to have had its best month ever in late 2019.

Meanwhile, revenue for private patient units as a group grew by c.9% in 2018 (see page 38).

But these results far outstripped the results of the independent hospitals as a whole, at 1.7%, indicating the growth has not been across the board.

The main reason for the upturn is the return of embassy patients to the city, almost by definition people requiring more complex care. Revenue from these sources for independent hospitals rose by nearly 30% in 2018.

While these clients bring with them higher revenues per patient, the overall number treated in London is broadly flat, suggesting a competitive market for attracting UK patients.

Within the independent hospital sector, revenues from patients with private medical insurance were down around 3% in 2018, while self ­ pay saw only modest growth of circa 2%.

Despite the low growth in nonembassy patient revenues, central London is about to see a huge boost in hospital capacity, particu­

larly from overseas operators offering different business models for working with consultants.

It would seem consultants who can bring patients to a hospital have never been in higher demand.

New ways of working

For example, the LaingBuisson report highlights that the recently opened Schoen Clinic, which employs its consultants, gained an estimated 11% market share in orthopaedics within 16 months by the end of 2019.

And One Welbeck Health, where consultants can form single ­ specialty partnerships with a share in the profit generated by the partnership’s diagnostics and procedures, is starting to hit its stride, with reports of over 100 consultants signed up already. It is a path previously pioneered by Fortius in orthopaedics.

But these new ways of working could well be dwarfed by the opening of the Cleveland Clinic in the

summer of 2021. The clinic has said it will have a mixed employment model for working with consultants, although it primarily uses an employed model in the US.

So it is interesting watching how the established leader HCA responds, as well as leading individual hospitals like The London Clinic and Bupa Cromwell, which collectively have followed the practising privileges model of working with consultants.

Expansion in capacity

On top of the Cleveland Clinic, this year and next will see further expansion in hospital capacity with the opening of new facilities at King Edward VII’s Hospital, expanded facilities at the Hospital of St John and St Elizabeth, plus a new Nuffield hospital at Barts.

This increase in capacity will likely affect hospital margins, already under severe pressure.

Nearly half the earnings before interest, taxes, depreciation, amortisation and restructuring or rent

costs (EBITDAR) available in the market in 2013 has now disappeared. The weighted average EBITDAR ratio as a percentage of sales has dropped from 22.3% in 2013 to 10% in 2018.

Despite the recent increases in revenue, this does not appear to have helped the bottom line, as costs such as wages, governance and marketing all continue to go up.

Also going up are the costs of engaging with consultants. Whether this is through salaries and guaranteed bonuses or through other means such as splitting out portions of a hospital’s business and allowing consultants to co­invest, the different business models available from different, competing, hospitals suggest that the overall price of consultants will continue to go up, affecting hospital margins still further.

All of this points to some sort of industry consolidation or restructuring soon, according to LaingBuisson.

Central London is now or will soon be home to three well­capitalised international medical groups in HCA, the Cleveland Clinic and Schoen.

Circle’s acquisition of BMI adds a new twist, as does Nuffield’s entry at Barts. The competitive picture looks very different than it did a few years ago.

 www.laingbuisson.com/ shop/private-acute-healthcarecentral-london-market-report6-ed/

Ted Townsend is author of the LaingBuisson Private Acute Healthcare Central London Market Report, 6th edition

ACCOUNTANT’S CLINIC: THE BUILDING BLOCKS OF ACCOUNTANCY

FOR

to of top tips is for Income Tax

INDEPENDENT practitioners

trading as a sole trader or partnership, income tax will be charged on their total annual profit, whether they draw it from the practice bank account or not.

If you trade as a limited company, it will pay corporation tax on its profits and you will only pay income tax on money drawn from the company, whether as a dividend or a salary.

Many doctors draw both a dividend and a salary. To minimise your income tax liability, you should look at the following areas:

Personal allowances

In the current tax year 2020-21, depending on the level of overall income, everyone receives a personal allowance of £12,500. All income up to that level is tax-free.

However, for those whose income exceeds £100,000, the personal allowance is reduced by £1 for every £2 of income over that figure. So, by the time £125,000 annual income is reached, the personal allowance has been dissipated.

If you have NHS income as well as private income, it may be worth trading through a limited company for your private income, so that you can control the amount of income and, if you can, attempt to keep it below £100,000.

You can share dividends in the company with a lower incomeearning spouse in order to ensure that they have a share of the dividends drawn, which may allow you to ensure that you and your spouse’s income does not exceed £100,000 a year.

For those of you with spouses who do not have any income, the £12,500 personal allowance is being wasted. Therefore, if they do some work for the company, you can pay

them a salary, as long as it is commensurate with the work done.

Basic-rate tax

After the personal allowances, the next band of income, which is up to £37,500, is taxed at 20%. Similar comments therefore apply to the personal allowances, so if you have a lower income-earning spouse who is not availing themselves of the 20% band, sharing in the dividends of those of you trading as a limited company is tax-effective.

Higher-rate band

For those with income over and above the personal allowances of £37,501 to £150,000, this band of income will be taxed at 40%.

For everything over £150,000, the tax rate is 45%. The equivalent rate for dividends for a 20% taxpayer is 7.5%, a 40% taxpayer is 32.5% and a 45% taxpayer 38.1%.

Therefore, a limited company can also be used to ensure that your own income does not exceed £150,000, i.e. by not drawing anything over and above that, which when added to an NHS salary or other income reaches this level, and/or including a lower-earning spouse as a shareholder in the company.

Although the dividend rates are lower than the rates for other types of income, it should be noted that dividends are not an allowable deduction for tax purposes against the corporation tax bill of a company.

Salaries, which attract the higher rates, are taxable. This should be borne in mind, together with the fact that National Insurance is payable on a salary, whereas it is not payable on a dividend. The arithmetic needs to be done, and it is recommended that you take advice. 

Susan Hutter (below) continues with her A-Z of top tips. This month she turns to ‘I’

is for Investigations

HM Revenue and Customs (HMRC) can either raise an ‘aspect’ investigation, whereby it questions one aspect of a taxpayer’s accounts or tax return, or a more random investigation where it has a look at a wider spectrum of issues. It is a bit of a fishing exercise.

As far as ‘small’ companies are concerned – and most private doctors who trade as companies fall within this definition – HMRC has 12 months from the filing date to raise an inquiry. Remember, this filing date is 12 months after the year-end or 12 months after the quarter date (31 January, 30 April, 31 July or 31 October) following the first anniversary of the day on which the return was delivered.

For example, for those of you whose year-end date is 31 December, HMRC has until 31 December 2021 to investigate the 2019 accounts, as long as they are filed by 31 December 2020.

As the tax payment date is 1 October 2020, it is usual that most consultants file their tax returns well before the HMRC filing date, particularly as they are required to be filed at Companies House nine months after the year-end.

As far as income tax is concerned – that is to say, your personal tax return – HMRC can inquire into a self-assessment return in the 12 months following its submission.

Deadlines for filing

The deadline filing date for income tax returns is 31 January following the year of assessment.

For example, your tax return for

2018-19 should have been filed by 31 January 2020. HMRC then has until 31 January 2021 to open an inquiry. If your tax return is filed late, it has up to 12 months from the end of a quarter (January, April, July, October) after the filing. In all cases, if there is something unusual in your accounts or tax return, it may give rise to an aspect or even a random inquiry. If you trade as a sole trader or partnership, or if there is something unusual on your tax return in general, it is wise to explain the issue in what is known as the ‘white space’ notes in the tax return. This is an effective way of communicating within HMRC and therefore averting a potential inquiry.

For those of you who operate a payroll (PAYE), HMRC officers can visit your business to check you are paying the right amount of tax and National Insurance on behalf of your employees.

It will usually contact you in advance to arrange such a visit and will normally give you at least seven days’ notice. You will be advised of the information inspectors will want to see and also how long the investigation is likely to take.

For most private doctors, this is over and done within a day. Inspectors generally want to look at the payroll records for the current tax year and the previous one.

If HMRC needs to take any action following an investigation, it can look at your records for the previ-

Navigating the GDPR labyrinth

In the latest General Data Protection Regulations, the question of ‘consent’ has caused confusion and frustration. Jane Braithwaite and Karen Heaton reveal medical practices did not properly understand whether they were required to ask patients for their consent for certain processing activities or how to do so

IN THE medical sense, ‘consent’ is very clear. But in the latest EU General Data Protections Regulations (GDPR), the question of consent has been one of the most confusing and frustrating issues to come to terms with.

How many emails did you receive in the run­up to the GDPR deadline about ‘opt ­ ins’ for marketing or just ‘opt­ins’ in general?

Our experience is that medical practices and businesses in general really did not properly understand whether or not they were required to ask patients or clients for their consent for certain processing activities or how to do so.

On a personal level, it was a very useful opportunity to clear out unwanted junk email and compel organisations to take unsubscribe requests seriously. This had clearly not been the case in the past.

But were all these emails about consent necessary?

Well, that depends on a number of factors:

 The lawful basis you have for processing an individual’s data;

 How you received an individual’s data;

 What you have told individuals – patients, clients or employees –about how your practice handles their personal data.

For medical practices who act as data controllers, there is the potential for non ­ trivial reputational damage and large fines from Information Commissioner’s Office (ICO) investigations regarding poor consent practises.

So, to answer this question, let’s look at:

a) Your lawful basis for using that data;

b) The data you process and how it is processed.

Lawful basis for processing data

It is useful to understand the lawful bases available for the processing of personal data, which are:

1 Performance of a contract entered into with the data subject;

2

Legal obligation which the controller must comply with;

3

Legitimate interest of the controller – where you use people’s data in ways they would reasonably expect and which have a minimal privacy impact or

When considering your practice’s obligations for obtaining consent, look first at how data is collected and where it goes

where there is a compelling justification for the processing;

4 Vital interests of the data subject;

5

Performance of a task carried out in the public interest;

6 Consent: the organisation must be able to obtain, maintain and validate lawful consent received from the individual.

Where your practice cannot satisfy the first five lawful bases, then consent is required. Medical data and other special category data require explicit consent.

Understanding your data

In previous articles in this series, we have explained why understanding the data that your practice processes is the crux of data protection compliance. Without properly mapping out the data you are responsible for, it will be difficult to be compliant with all aspects of data protection, including consent.

For medical practices, it is pretty clear that there is certain critical data which must be processed in order to treat patients safely. The consent requirements for data about medical treatments, operations and retention periods for that information are robustly determined by medical standards such as those from the Care Quality Commission. Consent for marketing activities and the geographical location of stored personal data is less well understood.

The latter is likely to be an issue that practices need to consider in the lead­up to the end of the Brexit transition agreement on 31 December 2020. Until then, there are still some checks and balances which need to be undertaken if your practice stores personal medical data outside of the European Economic Area (EEA). ➱ p22

When considering your practice’s obligations for obtaining consent, look first at how data is collected and where it goes.

For marketing activities, it is important to first understand who is being communicated with and how the practice obtained the contact details for those individuals.

Newsletter example

A medium ­ sized private medical practice has a database of around 3,000 individuals and wants to send those contacts a quarterly newsletter with information about new treatments and advice on health tips. Does it need to ask the individuals in its database to ‘opt­in’ to the newsletter?

If the practice can validate that all the individuals in their database are patients or are individuals who are not patients, but had previously contacted the practice for information about the services

It is useful to ensure that all new patients are specifically asked to consent to their preferences for marketing emails

your practice offers, then consent need not be required.

It would be acceptable to send them the newsletter under Legitimate Business Interests. However, it is important that there is a clear and easy­ to ­ use unsubscribe option in place for the newsletter.

And it is useful to ensure that all new patients are specifically asked to consent to their preferences for marketing emails as part of the onboarding process and that the unsubscribe option is made clear to them.

If the practice is not sure where some of its contacts came from, then those individuals will require to consent to receive marketing emails. In particular, if contact data were purchased from a third party, under GDPR, the third party has the duty to ensure that consent to sell or transfer contact details was received from the data subject.

If this consent cannot be evidenced or confirmed, then it would be advisable to reconsider the decision to buy the data, as it may be unlawful for the company to sell it in the first place. Equally, if the individuals did not consent to their data being sold, the contact list may not be commercially useful.

For data stored or processed in or transferred to countries outside the EEA, each of these countries needs to be checked for data protection standards. Only a handful of non­EEA countries are deemed ‘adequate’ for data protection by

the EU. So the countries should be categorised into secure and nonsecure third countries.

In addition, the privacy notices, contracts and cookie policies of the organisations your practice is considering for the ex ­ EEA processing or storage must be checked for data protection standards.

Outsourcing billing example

A large private medical practice decides to outsource some of its administrative operations – for example, patient billing – to India, which is a Third Country under EU GDPR rules and does not currently meet data protection adequacy standards. In order to undertake that processing, the outsource organisation needs to access patient data and accounting systems.

The patient data will include special category data – medical information – as well as contact details and possibly dates of birth.

CALCULATE YOUR NHS ANNUAL ALLOWANCE

The medical practice, in its role as data controller for its patient data, must inform patients that their medical data is being handled outside of the EEA and request consent for this.

If the data being processed by the outsource organisation in the Third Country is not special category data – which is, for example, medical information or child data – the data could be processed under Legiti mate Bus iness interests if the following additional measures are in place.

For countries which are not deemed adequate by the EU, the practice must check what data security and operational standards the outsource organisation has in place to protect patient data and consider performing a Legitimate Interest Assessment to assess the privacy risks to their patients.

Specialised data protection contractual clauses approved by either the ICO or the European Data

Protection Board will need to be added to the contracts unless other allowable exemptions are in place. Additionally, regular checks or audits of the outsourced organisation should be undertaken.

Finally, it is important for the practice managers and owners to understand that privacy risks may have increased as a result of the decision to outsource operations to an organisation based in a third country without an EU adequacy ruling.

Tracking consent

Where consent is required to process data, your systems must be set up to track and manage that consent, preferably with a description of how consent was given – for instance, during the customer registration process or during a consultation. That way, an audit trail of consent is maintained which will assist in demonstrating compliance with data protection. Consent need not be a burden if

For countries which are not deemed adequate by the EU, the practice must check what data security and operational standards the outsource organisation has in place

practices understand the rules and put appropriate systems and checks in place to obtain and manage their patient or employee consent.

We cannot stress enough the importance of understanding and mapping out your practice data and processing activities. It may initially feel like a time-consuming exercise, but the benefits are highly likely to outweigh the initial costs in the medium to long term.

Jane Braithwaite (right) is managing director of Design ated Med ical, which offers business services for private consultants, including medical secretary support, book­keeping and digital marketing.

Karen Heaton (right) is the founder of Data Protection 4 Business, which offers consultancy services to design and implement GDPR­compliant solutions, as well as online training, outsourced data protection officers and specialised software technology to support data protection compliance.

Together, Designated Medical and Data Protection 4 Business offer consultancy services and support to help private practices and clinics design and embed a data protection compliance culture into their organisations.

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Shared data still has a long way to go

At the heart of medical finance

The Federation of Independent Practitioner Organisations (FIPO) here gives its response to a consultation on changes to how private healthcare data is collected and made available within NHS reporting systems

ANALYSIS OF Hospital Episode Statistics (HES) provides a valuable insight into healthcare provision in the UK.

There are some key differences in coding, recording and datasets between the public and private sectors, which make it difficult to draw direct comparisons between the two sectors.

The Federation of Independent Practitioner Organisations (FIPO) supports the alignment of data sets for HES across the NHS and private sectors, in order to provide clarity.

The private sector uses the Clinical Coding and Schedule Development Group (CCSD) codes for recording procedures, whereas the NHS uses OPCS­11. These are not directly comparable, although the data requirements of the Private Healthcare Information Network (PHIN) mean that OPCS coding has now also been adopted.

Meaningful comparisons

Also, diagnostic coding – such as ICD ­ 4 in the NHS – is needed to assess case complexity. This is currently not comprehensively recorded in the private sector.

There is some coding variation across private providers, which makes meaningful comparisons even more challenging. There is no doubt that a combined NHSprivate dataset would be of great value to policy makers in the NHS and private sector.

However, there is a key difference in attribution between the NHS and private sectors. In the NHS, patients are treated by a team led by a consultant(s).

Diagnostic coding – such as ICD-4 in the NHS – is needed to assess case complexity. This is currently not comprehensively recorded in the private sector

THE BACKGROUND

As Independent Practitioner Today reported last month, NHS Digital and the Private Healthcare Information Network (PHIN) launched a consultation – ending in March – as part of a programme to align private healthcare data with NHS recorded activity.

This sets out changes to how data is recorded and managed across private and NHS care, along with a series of pilot projects, based upon feedback from a variety of stakeholders.

It aims to seek the views of private and NHS providers, clinicians, the public and other organisations with interests in private healthcare and will be used to help shape the future changes.

Under proposals in the Acute Data Alignment Programme (ADAPt), PHIN will share the national dataset of private admitted patient care in England with NHS Digital, creating a single source of healthcare data.

In private practice, patient care is entirely consultant ­ delivered. Indeed, consultant­delivered care is one of the main attractions for private patients.

NHS HES therefore cannot, at present, be directly aligned to private practice episodes and ascribed to the performance of an individual consultant.

FIPO would have grave concerns if such a combined dataset were to be used in this manner.

While ADAPt can achieve a major step forward in understanding all aspects of healthcare provision in the UK, this must be driven by non­commercial interests and surrounded by robust governance.

Its primary aim should be to drive clinical improvements and enable prompt investigation of issues as they emerge. 

THE CHAIRMAN’S VERDICT

FIPO chairman Mr Richard Packard said: ‘There is a need to put this into context. This should include the widespread deployment and further development of clinically rich databases, such as those provided within the various specialty national audits.

‘This programme will require considerable work and independent clinical oversight,before the quality of data can be universally accepted. Only then can individual consultant performance data, whether generated by PHIN or others, be reliably interpreted.’

This was supported by recommendations in the Paterson Inquiry to create a single repository for practice of consultants in private and public healthcare across England. It will use common standards to record and report activity, quality and risk in a consistent way across both sectors.

It aims to allow providers, care planners, regulators and researchers to better understand how private and public healthcare data sits alongside each other and how it can be used to deliver better care.

NHS Digital will also pilot collecting data on privately funded care directly from independent providers.

Data will be shared with PHIN to assess if it would be suitable to use for the publication of hospital and consultant performance information as mandated by the Competition and Markets Authority (CMA).

Mr Richard Packard

IMPRISONED FOR MANSLAUGHTER

‘Don’t let on in prison that you’re a quack’

Surgeon Mr David Sellu (right), convicted for gross negligence manslaughter of a patient – overturned on appeal after a 30-month prison sentence – continues his story from our last issue

THE PRISON van whisked me from the Old Bailey to Belmarsh. Forced to go through a series of metal detectors and X-ray scanners, I was asked to ‘open wide’ before undergoing a strip search. To my relief, rectal or other internal examinations were not required.

I had come to court that morning in a suit. I had on a watch and with me a wallet with £120, the usual bunch of cards, a belt and spectacles. I also had a notebook and a pen I had brought daily to the trial to record proceedings.

I was allowed to keep my watch, underpants, socks shoes and spectacles but everything else was taken away, to be ‘carefully marked’ and returned to me on release.

My money was also taken away and the officers told me they would put it into an account for my use in prison.

Transformation complete

I was given two large transparent carrier bags containing two sets of maroon prison tracksuits, bedding, towels and basic toiletry items such as a bar of soap, a toothbrush and toothpaste. I changed into a prison tracksuit and at that point my transformation into a prisoner was complete. I did not need a mirror to know I looked ridiculous.

I would be sharing a three-man cell. It measured three steps by five steps, obviously designed for two but now accommodating three. There was a single bed on the lefthand wall and a bunk bed on the right.

The space between the beds had a small table and chair on the far wall and on that wall were shelves that had cloths, a few books, plastic plates and bowls and plastic cutlery.

There was a TV and an electric kettle on the table. On the near wall was a washbasin and on the floor beneath it was a large open black bin with leftover food.

I discovered later that inmates were locked up in their cells as soon as they had collected their food and there was no opportunity for uneaten food to be discarded outside of the cell until the next day.

Between the single bed and the sink was a tiny cubicle with half a door from ground level and this

was the toilet. I could see if there was someone sitting on it. The window behind the TV had no curtains and had been left partially open in an attempt to clear the air.

The room was cold on that November evening. One of two occupants was lying on the single bed and the other on the lower of the bunk beds. It was obvious that

I was to occupy the top bunk.

‘Hello,’ I said. ‘My name’s David.’

There was a moment’s delay before each simply said hello, adding, ‘I’m John’ and then ‘Clive’.

I was not sure how long they had occupied the cell, but I could imagine that having a third person dumped in this tiny space was unwelcome. I pushed one of the two bags I was carrying underneath the bunk bed and left the second in the narrow passage between the beds.

There was not a lot of room underneath the beds, with the existing occupants’ belongings already deposited there. The second bag had two bed sheets, a blanket and a towel and I proceeded to make the bed I would be sleeping in.

Hard mattress

The bed sheets were just large enough to tuck under the mattress and it was not hard to figure out that once I got into bed, it would be only a matter of time before the sheets were off the bed. The mattress was a thin piece of hard plastic and the pillow was made of the same material.

Clive, the inmate on the lower bunk bed, got up and cleared one of the shelves on our side of the cell to give me space to place my toiletries and other items.

You either had to be an athletic acrobat to get up the ladder or, like me, resort to standing on the one chair available to get a foothold. I got into bed and wanted to go to sleep but the light and the TV were still on. The light switch, I discovered, was just by the door as you came in and whoever switched the light off had to get out of bed to do so.

‘When do we switch the light and the TV off?’ I asked wearily.

‘The last person to go to sleep turns the light and the telly off,’ said Clive from the bed below.

‘Remember, you can’t get to the ➱ p30

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light switch or the telly from your bed, so if you are last, you will have to come down and switch it off. Then you have to find your way back in the dark to your bed.’

It was two o’clock in the morning when the loud sound of snoring coming from John’s direction suggested that he had fallen asleep. Clive was asleep too. The bunk bed creaked as I tried to descend the steps. This exercise proved more demanding than I had expected.

The floor was miserably cold and I walked to the door, trying hard to negotiate my way in this tiny cramped space. I noted that there was an alarm button just by the light switch but the notice beside it said you will be put on immediate report for improper use. I was informed later that inmates had often pressed the alarm while groping for the light in the night.

I finally got to the top of the bunk beds and tried to fall asleep. Even at that late hour, there were sounds of music coming from other rooms and of guard dogs howling. There was intermittent banging on the walls and a string of loud obscenities shouted from other cells. I do not believe I got more than an hour’s sleep that night.

Circumventing problems

Prisoners were not charged for food or lodgings; electricity, gas and water were free, as were materials for personal hygiene like toothpaste, soap and shaving gel. Money, banknotes and coins, was forbidden.

Prison taught me that whatever obstacles man can invent, man can circumvent. Prisoners found other ways of selling and paying for drugs. My first haircut cost me a packet of biscuits. Drugs could be exchanged for other drugs of equivalent value, although I never worked out how inmates calculated how much cannabis to exchange for crack cocaine.

A typical prison day would be as follows:

7.15am: Bell rings to wake up.

7.30am: Prison officer comes round to do roll call.

8.15am: Exercise in yard if there are enough warders to supervise and it is not raining – 45 minutes. 9.00am: Locked up in cell; rarely there would be an ‘activity’.

Don’t let on in prison that you’re a quack. If others find out, they will bully you till you have nowhere to hide. They fink every doctor in prison went to the Harold Shipman School of Medicine. Professional killers, know what I mean?

Personal visits were the most important dates in my empty calendar, especially in those grim early days of my incarceration. There was nothing that I looked forward to more than seeing my wife and children and perhaps the occasional friend. I was also entitled to a visit by my legal team.

Only those whom a prisoner chose were able to visit. The prison obviously wanted to avoid revenge attacks on prisoners, but some inmates exploited this arrangement to nurture their infidelities.

accepted as a classroom assistant, teaching computer applications to other inmates. In the meantime, I took the opportunity to use the gym for some sorely needed exercise.

Meanwhile, my family, friends and colleagues were lobbying hard to expedite my transfer to an open prison. Two workmates visited their MPs asking them to look into what they reported was a miscarriage of justice in my case.

12.30pm: Collect lunch and bring back to eat in cell.

1.30pm: Locked up in cell; rarely there would be an ‘activity.’

5pm: Association: meals, phone calls, shower, meeting other inmates.

6.45pm: Locked up for the night.

Educated accent

I told one prisoner I was a doctor. ‘I guessed as much,’ he said. ‘I can suss you guys from miles away.

‘How can you tell?’

‘You look like one, You speak like one. Educated accent. You wash your hands after you’ve had a crap, innit? You take notes every day and your writing is ******* terrible.’

He gave me some advice: ‘Don’t let on in prison that you’re a quack. If others find out, they will bully you till you have nowhere to hide. They fink every doctor in prison went to the Harold Shipman School of Medicine. Professional killers, know what I mean?’

I did not tell him why I was in prison. He assumed I was in for fraud for fiddling my practice expenses. When he was last in prison, he’d met a senior hospital doctor who had claimed huge amounts of money for duties he did not do and when the authorities finally figured out what he had been doing, they reported him to the police.

He assumed that financial swindling also was common among doctors. I was grateful for his advice. I was definitely going to keep my medical background to myself.

I witnessed an occasion where a prisoner was visited by a female partner and four children on one visit and two weeks later by a different partner and a new set of three children, who also addressed him as ‘Daddy’.

Inhumane conditions

After 28 days, I was moved to HMP Highpoint South. I had no idea where it was, but anywhere was preferable to ‘Hellmarsh’. Another prisoner I got on with was transferred with me and we shared the same cell – clearly designed for a single occupant.

A few bed sheets previous inmates had sewn together enclosed the toilet bowl on the floor and the cistern above it, and while they offered a modicum of privacy, did nothing to disguise the smell. These were awful and inhumane conditions.

After the cell door was opened at 8.20am, we were free to wander within the building. We agreed that one of us should always stay in the cell, as items such as plugs in the sink, the remote control for the TV, cartons of milk, sugar, coffee, stamps and writing paper were targets for thieves.

Unlike at Belmarsh, where the activity each prisoner was allowed was allocated on a day-to-day basis, at Highpoint, the onus was on the inmate to find work or sign up for education.

As places on these programmes were severely limited, the prospects of a place on them were poor. Reasons for wanting placement were that the weekly wages were higher for those engaged in activities and they were more likely to have their IEP (incentives and earned privileges) status elevated to the enhanced category.

It took eight weeks before I was

A large body of doctors in Ealing Hospital wrote a letter to the Minister of Justice asking for my case to be reviewed and in the meantime for me to be moved to an open prison.

I had an unexpected visit from the deputy governor. He told me he had received a letter from the Ministry of Justice about my case. He promised to investigate it in the light of the new information they had; if he came to any different conclusion about my case, he would be in touch. He said he made no promises, gave no details, and did not entertain any questions.

Unexpected freedom

A while later I was moved to a modern block that housed older prisoners and those serving long life sentences. A prison officer, to my surprise, now handed me a key and said it was for me to use to allow myself into and out of my cell.

I was now allowed to wander out of my cell and into the courtyard at any time during the day as long as I stayed within the perimeter fence around the unit. I was keen to take advantage of this unexpected freedom whenever I had the opportunity.

But freedom depended on there being enough prison officers on duty to supervise inmates getting out of their cells. There would be occasions when, owing to staff shortages, we were confined to our rooms for up to 22 hours a day.

 Adapted from Did He Save Lives? A Surgeon’s Story, £9.99, Sweetcroft Publishing ISBN 9781912892327 from Amazon. His story continues in Independent Practitioner Today next month

BILLING IN GROUP PRACTICES

Too many hands on deck can spoil your catch

WE HAVE seen a large rise in the number of consultants who decided to form groups over the past decade.

This makes a lot of sense, as they can benefit from economies of scale by sharing costs for administration, marketing and other overheads.

There are often other benefits such as increased patient footfall driven by the group’s reputation and the ability to effectively manage holiday and sick cover.

Groups can lead to improved quality of care, by having several doctors working together within the same specialty yet with each having specific expertise within their own subspecialty.

The current drive towards the provision of patient-reported outcome measures (PROMs) will only support this trend.

Groups can also benefit from increased volume, as insurance companies and GPs are more likely to refer patients to them because they know they have capacity and expertise within their field. They can choose to adopt from a wide range of structures depending on their group dynamic and specific needs. The simplest is a virtual model that is effectively a branding exercise. It may include a website, but the various consultants continue to work as independent practices.

There are more formal models such as forming chambers, limited liability partnerships or limited companies. These group structures may also include founding partners and have rules around the distribution of funds and the allocation of costs.

Groups clearly provide many benefits, but we find that unless a close eye is kept on the practice’s administration side, they can very quickly run into difficulties.

At Medical Billing and Collection, we partner with a wide range of groups across various specialties. They have experienced many common problems such as those highlighted below.

With the forming of group practices increasingly popular among independent practitioners, Simon Brignall (left) reflects on their billing issues which can lead to administrative chaos if not properly understood and effectively managed

Volume

Groups can easily become victims of their own success. Coping with the volume of activity generated is the single biggest issue to deal with. And the more successful the group, the bigger this issue becomes.

The level of administration needed as a result of consultants working together is often underestimated. This covers all aspects, from the raising of the invoices to the volume of phone calls and emails that require answering, dealing with private medical insurers as well as clinics and hospitals.

Often the first thing to suffer is invoices being raised in a timely fashion. The delay in bills being sent out can quickly lead to greater debt, as there is a knock-on impact to the reconciliation of payments received and subsequent raising and chasing of shortfall invoices.

This situation can easily escalate, as the busier the group practice becomes, the less time is spent on this function, resulting in a backlog of work which has not been billed and so remains uncollected.

In some cases, this can result in consultants earning less money than they did before they formed or joined the group, which obviously defeats the point.

One group practice, established for under a year, joined us with a backlog of outstanding invoices amounting to over £250,000. I often take on groups owed much more. Our average bad debt rate is under 0.5%.

Groups who employ administrative personnel need to make binary decisions about staffing to cover the workload. As the group expands or contracts, it can be difficult to ensure there is capacity and adequate cover to manage issues.

They may suffer from a key person dependency and that is a major factor in why they often choose an outsourced solution. It provides them with excess capacity when required, tied to a cost structure linked to received income.

Another benefit I often hear during client reviews is that the patient experience has been improved because staff are freed to focus on each patient’s specific needs. This benefits the group financially from increased referrals and quicker responses to new inquiries.

Billing and pricing

Another headache for groups to manage is the various pricing policies that each consultant uses. This can occur by choice that reflects the consultant’s expertise and experience.

But more commonly this is as a

A headache for groups to manage is the various pricing policies that each consultant uses

result of the individual contractual terms the consultant is subject to by the private medical insurance companies. Each consultant can have a different fee schedule for their consultations and their procedures for each insurer.

This has become more prevalent over the past decade as new consultants are restricted to set consultation fees with Bupa and AXA and sometimes other insurers, whereas older doctors may have their own tariffs for all or some of the companies.

Bupa and AXA also mandate that all new consultants must bill their procedures to guidelines. These provide set fees for procedures using Clinical Coding and Schedule Development Group (CCSD) codes, specific to each insurer.

On top of this, some established consultants, even if not restricted by insurers, can choose their own fee policy: they can choose to either match insurers’ guidelines, or set their own fee tariff.

Each can also have their own fee schedule for procedures for self-pay patients. Some consultants require their fees to be collected directly from the patient or alternatively as part of a fixed-price package and this can vary depending on the location or treatment type.

This requires the group to maintain accurate records of the price structures and payment pathways used by each consultant.

If this wasn’t enough, somebody needs to be responsible for keeping up to date with the ongoing changes that occur within each insurer’s schedule and the changes to the CCSD schedule to ensure the practice bills correctly for each consultant.

This can often prove to be challenging and, if done incorrectly, can lose the group tens of thousands of pounds in lost income. We’ve seen it. Groups that incorrectly invoice insurance companies also suffer from delays in payments, recoups and, in the worse cases, derecognition.

Reconciliation and chasing

The most common problem groups face is keeping on top of the reconciliation and chasing process. In a busy group, this is quite often the first task that gets deferred as they prioritise their day to day workload.

Reconciling monies against outstanding invoices is a vital area, as only after the payment is allocated to the appropriate invoice can you have visibility on how much money is owed.

With insured patients, this is key, as only once this process is complete can a separate invoice be raised to the patient if there is an outstanding balance due.

These shortfalls occur when the full value of the invoice is not reimbursed by the insurer. This means many practices can easily run up a backlog of outstanding invoices and, with a group structure, this issue is amplified due to the volume and often mixing of the funds received.

To chase outstanding debt effectively, you need a process in place that is carried out routinely and ensures you resolve any queries.

Quite often when groups get into trouble, their aged debt quickly spirals, which leads to cash flow difficulties. Even when they take steps to remedy the situation, it is often only a short-term fix and the problem recurs worse than before.

Bank accounts

Depending on the model the group choses to adopt, there can be different arrangements concerning payments and bank accounts.

Formalised group structures may have one pooled bank account or sub-accounts to put payments into. Insurance billing is normally processed using the individual consultant’s provider number. Some groups have their own provider number shared by all members, but this is less common. Payments need to be identified and allocated to the appropriate

consultant and any subsequent onward payments made to them depending on the equity structure after accounting for costs.

Some doctors may also choose to practise outside of the group. However, this makes it extremely onerous on both the group and the individual consultant because payments can normally only be made to one designated bank account linked to that provider number, and the remittance advice can only be sent to one contact.

Even in those cases where a second bank account is an option, it is common for payments to be made to the wrong account. So there needs to be good communication between all concerned to identify what belongs where.

Virtual group structures are where consultants act as individual practices with payment going to each practice’s relevant bank account. These require reporting that allows for the recovery of costs for the running of the group.

It can be quite common for us to take on groups where we find that payments have not been going to the correct bank account and so the group has been missing out on income for years.

Reporting

It is key to ensure that, whatever processes you implement, there is good visibility for all stakeholders involved and that reports are both accurate and up to date.

We recreate the group structure in our software, which allows for reporting at both the group and the individual consultant level.

This provides the group’s management an array of real-time reports at the group level as well as providing each consultant access to their own data.

Groups have many benefits resulting from their economies of scale. It is important to ensure these benefits are not lost by ineffective management.

It is worth reviewing your group to examine each of these key areas. If you find any parallels with any of the issues I have raised, then I recommend you seek the advice of a professional medical billing company. 

Simon Brignall is director of business development at Medical Billing and Collection

RETIREMENT INVESTMENTS

Stay calm, don’t panic. . .

Don’t let concerns about retirement funds add to your distress. In the most challenging of times, it is important to keep perspective. Patrick Convey (right) on the things to remember now

IN THE modern era, we have far greater access to world news at just the click of a button or from flash news alerts on our phones.

This is not always a good thing, as newspapers and websites publish stories that will attract readers.

It can be all too easy to focus on these stories and get gloomy, disheartened or uncomfortable about the reported danger to life, society or wealth of these threats, the latest being Covid-19.

Speaking purely from a financial point of view, economists will remind us that these world and health events have happened throughout history with some regularity.

Over the past 20 years alone, there have been many material events that we may have found particularly hard at the time. As distressing as the situation is for all those affected, investors should not be surprised by the financial

effects they may be witnessing on their investments.

During such times of uncertainty – at least from a market perspective – it can help to look at the past to ease our concerns. The past may not, of course, repeat itself but markets have been remarkably resilient.

Uniquely unsettling

It is important to remember that, in an efficient market, current world events and investors’ views are already factored into share prices, whether we deem these rational or irrational.

Covid-19 is, by its nature, uniquely unsettling on a human level. It also presents information challenges both for individuals and markets.

Where even the experts cannot easily predict the disease’s spread and impact, speculation can breed hysteria, amplified through our

internet enabled, 24-hour news cycle.

We do not know how long this latest market uncertainty will last as governments, epidemiologists and health leaders try to understand the implications of the outbreak and implement contingency and recovery plans.

In the short-term, equity markets will most likely continue to be volatile as new information on the economic impact is assimilated.

This is entirely normal market behaviour when investing and should not add to our very real concerns at this time.

If you have a robust, diversified portfolio, you should continue your investment journey with a long-term view. What you can do:  Remain a long-term investor in a broadly diversified portfolio;  Reduce your anxiety by accepting the market’s inevitable ups and downs;

If you have a robust, diversified portfolio, you should continue your investment journey with a long-term view

 Make sure the people advising you align with your perspective;  Stop trying to time the markets – this is unachievable.

Many doctors are at the forefront of helping the UK with the outbreak. Concerns over financial investments or their retirement funds should not add to their distress.

You should be leaning on your adviser at times like these and asking for their reassurance that market volatility is normal. 

Patrick Convey is director of Cavendish Medical, specialist financial planners helping 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 that 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.

. . . Markets have always been a rollercoaster

Doctors concerned at Covid-19’s impact on investments should consider their long-term position, not make rash decisions, writes Patrick Convey of specialist financial planners Cavendish Medical

IT HAS been a harrowing time for all, but particularly those on the medical front line. We do not want financial worries concerning markets to add to their anguish.

We have reassured our clients that despite what attention-grabbing headlines may state, if you are properly invested with a credible long-term plan, your portfolio will have been created to withstand such volatility.

The market has behaved the way we would expect and all our client portfolios are constructed in the sound knowledge that global events like this will occur at some stage.

For that reason, they are diversi-

fied across geographic regions and sectors – so any challenges to one particular industry, such as tourism, cause minimal impact.

Furthermore, our portfolios include a mix of bonds and equities, so at times of high stock exchange volatility, the bonds are working hard to balance the status quo.

Markets recover

It can be daunting for investors to live through these rollercoaster moments, especially with the noise of the media too.

But historical data shows us that markets always recover – as long as you take a long-term view and your

financial plan is fit for purpose.

The worst moves investors can make now are to panic, to try to time the market or to make kneejerk reactions.

You should be leaning on your adviser for financial support and listening to their guidance.

Anyone concerned that they have not had sound advice in this area or do not have a portfolio with a suitable attitude to risk should seek help without delay.

The content of this article is for information only and must not be considered as financial advice. Levels, bases of and reliefs from taxation may be subject to change

and their value depends on the individual circumstances of the investor.

Cavendish Medical Ltd is the go-to company for retirement planning for doctors. It has over 450 senior consultants as clients and £455,000,000 in client assets under administration. Cavendish Medical Ltd operates a transparent investment policy and a fee-based approach allowing independent financial planning advice.

Cavendish Medical is regulated by the Financial Conduct Authority to provide independent financial advice to individuals and businesses. For more information, please visit www.cavendishmedical.com.

KEEP IT LEGAL: PARTNERSHIP AGREEMENTS

Avoiding the fall-out

Face the consequences – possibly losing everything – if you don’t have an LLP agreement. Justin Cumberlege (right) explains why one is essential

A DOCTOR’S ASSETS – including their house – can be at risk if a claim is made against them. Some risks are not covered by insurance.

For example, if you fall ill, you may not have enough insurance cover to pay for the rent and other outgoings for the consulting rooms.

Those losses would be the personal, uninsurable, liability of the doctor’s. A contract may seem innocuous, until things go wrong and a claim for the provision of services may include not only financial loss, but damage to reputation.

One way of protecting personal assets is to incorporate and by forming a limited liability partnership (LLP), if you can do so. Medical

accountants may also recommend LLPs to gain some tax advantages.

What is often overlooked is having a partnership agreement. This comes into sharp focus when the doctors in partnership have a dispute. Expelling a partner is not going to be done using the force of law, as there is no law to assist in normal circumstances.

Little option

What happens when a partner is to be expelled depends on the partnership agreement, otherwise there may be very little option but to dissolve the partnership and suffer the consequences, costs, a possible tax hit and losses which follow.

Unlike unincorporated partner­

ships, an incorporated one cannot be dissolved by one partner, so the only option is to retire and leave all the assets and goodwill you have built up with your partner to them.

This article focuses on LLPs, which are partnerships with limited liability. The partners are referred to as ‘members’ in the legislation.

LLPs have only been possible since the Limited Liability Partnership Act 2000 (LLPA), which was a response to pressure from the solicitors and accountants wanting the benefits of individual taxation enjoyed by a partnership and the limited liability enjoyed by a company.

They are corporate entities and

therefore a legal entity, like a company, and are registered at Companies House with a number pre ­ fixed with OC – which, confusingly, stands for ‘other company’.

Legal bodies

As such, they can deal in property, employ people, enter into contracts, pursue claims and be sued in their own name. This contrasts with partnerships, which are not legal bodies, and therefore each individual partner is jointly and severally (individually) liable. As well as the way that they are taxed, the other similarity with partnerships is that LLPs have very little statutory corporate structure. When a company is formed, not only will many of the 1,000 sections of the Companies Act apply to it, but also it will have articles of association.

These may be bespoke or the statutory model articles which contain several provisions as to how the company is to operate.

With an LLP, the opportunity to have a members’ agreement is possible, but there is no compulsion and, without one, the members fall back onto the very brief provisions of section 5 of the LLPA, which states:

5(1) Except as far as otherwise provided by this Act or any other enactment, the mutual rights and duties of the members of a limited liability partnership, and the mutual rights and duties of a limited liability partnership and its members, shall be governed:

(a) by agreement between the members, or between the limited liability partnership and its members or;

(b) in the absence of agreement as to any matter, by any provision made in relation to that matter by regulations under section 15(c).

(2) An agreement made before the incorporation of a limited liability partnership between the persons who subscribe their names to the incorporation document may impose obligations on the limited liability partnership – to take effect at any time after its incorporation.

Difficult to prove

Therefore, it is possible to have an unwritten LLP agreement, but, like any contract which is not in writing, proving what the terms are and that they favour your desired outcome in any dispute is often not possible.

If a custom and practice of doing something in a particular way in your practice or in your accounts can be shown, then that may be sufficient evidence as to what was agreed for that one thing.

In the absence of an agreement as to any matter, then the members must rely on the regulations

Having an agreement in place before the LLP starts trading is essential for peace of mind, as well as ensuring that it meets everyone’s expectations

made under section 15(c), which were passed as the Limited Liability Partnership Regulations 2001.

Regulation 7 gives ten requirements, including that every member of the LLP may take part in the management of the LLP [regulation 7(3)]. If the members were to seek to exclude a member, this could result in that member bringing a claim for unfair prejudice. Setting up a similar neighbouring business, and cutting the difficult member out, is not a

solution either, as regulation 7(9) states that a member cannot set up a business in competition with the LLP.

Furthermore, regulation 8 prohibits the expulsion of a member, even if all the other members agree, unless there is an LLP agreement to the contrary.

Vital agreement

Without an agreement, there is no way out, so having one in place which reflects what you are or intend to do is vital, but often forgotten.

Also, without an agreement, any disagreement between the members connected with the LLP’s business may be decided by most of the members. Any proposed change to the nature of the business of the LLP requires the consent of all members [regulation 7(6)].

If you were to set up another business, then regulation 9 states

that you must account for profits from the competing business, which means that you must account for and pay over to the LLP all profits made in that other business.

There is no duty of good faith between the members. The members may decide to provide for fiduciary duties in the LLP agreement itself.

Having an agreement in place before the LLP starts trading is essential for peace of mind, as well as ensuring that it meets everyone’s expectations.

It is highly unlikely this is an offthe­shelf­document and it would be wise to have one written to meet your primary concerns, including the way decisions are made. Otherwise be prepared for many arguments with your fellow doctors or face losing everything. 

Justin Cumberlege is a partner at Hempsons

Free legal advice for Independent Practitioner Today readers

Independent Practitioner Today has joined forces with leading healthcare lawyers Hempsons to offer readers a free legal advice service.

We aim to help you navigate the ever more complex legal and regulatory issues involved in running and developing your private practice – and your lives.

Hempsons’ specialist lawyers have a long track-record of advising doctors – and an unrivalled understanding of the healthcare system as a whole.

Call Hempsons on 020 7839 0278 between 9am and 5pm Monday to Friday for your ten minutes’ of free legal advice.

Advice is available on:  Business structures (including partnerships)  Commercial contracts  Disputes and litigation

HR/employment  Premises  Regulatory requirements and investigations

Rourke

NHS PRIVATE PATIENTS’ BAROMETER

NHS trusts report a rosy future for PPUs

Delegates at the national NHS Private Patients Unit Conference at St Thomas’ Hospital, London, received an early forecast of market performance of NHS trusts’ private patient services. Philip Housden (right) reports

DELEGATES TO this year’s national NHS PPU Conference last month at St Thomas’ Hospital, London, were given an early forecast of market performance of NHS trusts’ private patient services.

Housden Group presented the findings from the 2020 ‘NHS PPU Barometer’. This is the first summary of this kind giving a snapshot of trading and the confidence within the NHS PPU sector.

The survey was completed by 23 trusts representing £219m private patient revenues and 33.4% of the total NHS market last year 2018-19.

The barometer gives an early forecast, as actual information will not be available until all NHS trusts have published their performance in their annual accounts. These are usually available between July and September.

The online survey asked: ‘How has your trust’s private patient services performed in the current financial year 2019-20?’ And the results (pre-Covid-19) show that 48% of responding trusts expect to be at least 5% or more up on last year by the year-end.

Average growth from the responding trusts is reported to be 9% and is evidence of continuing gains in the sector, which has enjoyed compound growth of between 5-6% over the past five years. This suggests that overall NHS private patient revenues for 2019-20 will grow around £40-

60m to a total of around £700720m (2018-19 total was £655m).

In London, growth over the same period has been higher, at 8-9% and, from the six London trusts taking part in the survey, growth was higher still at 11%. As reported recently by LaingBuisson in their Central London Market Report, growth in the capital continues to be driven by PPUs, which now take up 25% of the market –an increase in share of around 5% compared to ten years ago.

10% growth target

What is more, the 2020-21 budgets set by trusts for next year further continue the trend, with a third of PPUs responding that a target of 10% or more growth has been agreed for the coming year. Growth at these levels could drive the total market value to c£770m by April 2021

How are trusts going to deliver this growth? The barometer asked for changes and investments that the trust and PPU team were planning.

Of responding trusts, over half plan to provide additional diagnostic capacity and 30-40 to increase beds and/or day-case capacity. However, increased theatre sessions, rated most highly by consultants, seems harder to provide.

Marketing and back office systems will also get attention, with

Revenues UP by 10% or more

Revenues UP by more than 2% but less than 5%

Broadly the same as last year (2018/19) i.e. +/-2%

Revenues DOWN by more the 2% but less than 5%

Revenues

Revenues

of 10% or more Growth of more than 2% but less than 5%

Broadly a roll-over from 2018-19 (i.e. less than 2% growth and less than 2% decline) Decline in revenues of more the 2% but less than 5%

Decline in revenues of more the 5% but less than 10%

Decline in revenues of more than 10%

IN TO GROW PPUs

Figure 1: SURVEY RESULTS OF TRUSTS’ PPU GROWTH IN 2019-20

Figure 2: TRUSTS’ FORECAST PPU GROWTH FOR 2020-21

Figure 3: AREAS TRUSTS INTEND TO INVEST

over 50% of responding trusts investing in this area.

What would help?

The survey asked for a ranking of the factors which impact the most in helping to deliver growth for NHS private patient units. Those with the most impact were ranked #1 and with the least impact ranked down to #10.

The average scores show that open support from the trust leadership team is rated the single biggest influencer on trust private patient success.

This chimes with previous research undertaken by Housden Group in many consultant surveys in recent years. The important and topical issue of governance ranked second with insurance company relationships third.

Consultants’ behaviour

Trust private patient service managers were also asked questions about relationships with consultants in their PPU. It is clear from the responses that consultants, as expected, do not tend to work exclusively with their trust for their private practice.

However, at present, trust private patient service managers report a high majority of new consultants are applying for PPU practising privileges in order to at least start their private practice using their PPU.

Most striking is the finding that 87% agreed with the statement that ‘Consultants wish to admit their most complex private patients to the PPU’. This again is in line with previous surveys within individual NHS trusts.

Perhaps this patient safety and governance-driven trend will eventually help unlock the untapped potential of growing the private patient market for trusts and for consultants through provision of ‘take’ services for non-elective admissions ,which is only happening in a minority of PPUs at the present time.

However, while 65% of newly appointed consultants do apply for PPU practising privileges, only 22% of trusts reported that their consultants work exclusively with them.

If this figure is to increase, there is work to do across most trust private patient services to get the

Figure 4: FACTORS THAT RESPONDENTS

SAID HELP THEIR PPU GROWTH

More open support from your trust leadership team (chairman / CEO / DF / COO etc)

Common NHS-wide governance enabling consultants more flexibility in job plans to blend NHS and private patients

Improved relationships with insurance companies (including recognition within networks)

Availability of capital to invest in new/improved capacity/facilities

Agreement to ask all registering patients at your trust their insurance status

More open support from NHS Improvement / the ‘Centre’

Practising privileges / patient safety concerns within independent hospital sector

Closer working with one of more trusts to develop a ‘chain’ or group model of service for private patients

Recognition by CCGs of PPUs’ services for insured population

Closer working with one of more other trusts to share back office costs

Consultants wish to admit their most complex private patients to the PPU

New consultants apply for practising PPU privileges

Strongly disagree / never

Neither agree nor disagree / sometimes Strongly agree / always

customer service right for consultants.

(ranked in order of importance)

Consultants are happy to provide an admissions ‘take’ service for nonelective patients admitted to the trust with insurance

Disagree / rarely Agree / usually

Consultants work exclusively with the trust PPU

Finally, the lost market opportunity for trusts that is the admission of non-elective and trauma patients who are insured will require a solution to ‘take’ rosters and working practices. This opportunity may be worth up to £1bn a year and could be the catalyst to sector-wide longterm growth for NHS PPUs. This first survey has been successful in opening up a window on PPU ‘on-the-ground’ views. It is planned to repeat the survey annually, helping to build up a picture of key trends in the sector, with the results shared in a future article. 

Philip Housden is a director of Housden Group

Figure 5: SURVEY OF PRIVATE PATIENT SERVICE MANAGERS

A doctor is asked to reveal the identity of a patient involved in a cycling accident. Kathryn Leask gives advice

Police need your help to solve RTA

Dilemma 1

Do I reveal who my patient is?

QI work as a private dermatologist and today I received a visit from a detective constable who was investigating a road traffic incident that took place outside my clinic building yesterday.

He explained that a cyclist had hit a pedestrian after cycling recklessly out of the clinic grounds and up the crowded

• Completely open scanner that is well tolerated by claustrophobic patients

• Weight-bearing scans for spine and joints enable a more precise diagnosis

• Patients who are large or cannot lie down can be accommodated

pavement. The pedestrian had suffered a broken arm and cuts and bruises.

The incident was witnessed by passers-by, but the cyclist rode away without stopping. I have looked at the CCTV from inside and outside the clinic and am satisfied the cyclist was a patient I saw that day.

I have been asked to provide information to allow the police to identify the cyclist. Should I disclose any information about him to the police?

ADoctors have a professional ethical duty of confidentiality to patients which must be considered before making any disclosures of confidential patient data.

In certain circumstances, it may be appropriate for a doctor to disclose confidential patient information and the GMC has produced guidance on disclosures required or permitted by law which may be helpful.1

It updated its guidance on confidentiality to reflect the requirements of the EU’s General Data Protection Regulations and the Data Protection Act 2018.

In circumstances where you have already decided that disclosure is justified, you may not need to ask for consent from the patient, but you

should let them know of the disclosure if it is appropriate to do so. There are limited circumstances when a doctor can disclose information to the police and one such situation is the legal requirement imposed by the Road Traffic Act 1988.

Where a traffic offence has taken place, this allows the police to require information from anyone, including doctors, which will allow them to identify the driver. Under the Act, the driver can include a cyclist and it is an offence to fail to comply with the police request. So, in this situation, you do have a legal obligation to provide information to the police which will allow them to identify the cyclist. This would usually be limited to relevant information only such as their name and address and should not include any clinical information, for example, the reason for their attendance at your clinic. You should document carefully your discussion with the police, noting what information was disclosed and what your justification was for doing so.

Reference 1. www.gmc-uk.org/ethical-guidance/ ethical-guidance-for-doctors/ confidentiality/disclosing-patientspersonal-information-aframework#paragraph-17

There is no obligation for an expert to accept instructions to take on a case and they can therefore decline any request from the outset

Giving evidence

A would-be expert witness asks for advice on his role.

Kathryn Leask (right) has the answer

Dilemma 2 I’ve been asked to give opinion

QI am a consultant vascular surgeon working in the NHS and with a small private practice. I have been asked by a solicitor who is assisting one of my private colleagues with a claim, to provide my opinion on the standard of his work.

I have not done this type of thing before and am keen to help. I have been told that I would be paid a fee.

Is there anything in particularly I should be aware of?

AIn giving your opinion about your colleague’s work, you are taking on the role of an expert witness, rather than being a professional witness whose role it would be to state the facts of a case. An expert witness is instructed due to their special expertise and has a duty to the court rather than to the person instructing them.

You should not have been involved in the patient’s care yourself and you would need to declare any conflict of interest; for example, that the defendant in the claim is a colleague of yours.

The court expects that health -

care professionals who undertake expert medico-legal work fully understand and follow the rules and official guidance, such as the Part 35 of the Civil Procedure Rules.1

Many doctors who work as expert witnesses will attend relevant courses that provide training in report writing, legal processes and court appearances to ensure they have the appropriate knowledge to effectively carry out the role. The GMC also has specific guidance for those acting as an expert in legal proceedings.2 The Royal College of Surgeons also provides guidance to surgeons considering acting as an expert.3

Being cross-examined

It is important that you understand exactly what is being asked of you and what questions you are expected to answer. You should not give an opinion on anything other than that which falls within your area of expertise. Your opinion must also be entirely independent.

Please also bear in mind that you may be expected to attend a trial or hearing and listen to evidence from other witnesses before giving evidence yourself and being crossexamined.

Unlike a professional witness, who is likely to have been involved

in the patient’s care, there is no obligation for an expert to accept instructions to take on a case and they can therefore decline any request from the outset. It is also important that you have the appropriate indemnity in place if you decide to undertake medicolegal work. Experts can be sued in their own right, just like doctors working in private practice and their indemnifier needs to be aware of all of the different types of independent work they are doing. 

Kathryn Leask is a medico-legal adviser at the MDU

References

1. www.justice.gov.uk/courts/ procedure-rules/civil/rules/part35

2. Acting as a witness in legal proceedings, GMC, 22 April 2013

3. www.rcseng.ac.uk/news-and-events/ media-centre/press-releases/expertwitness-guidance/

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A PRIVATE PRACTICE – Our series for doctors embarking on the independent journey

How you can account for your figures

Ian Tongue (right) looks at how accounts are prepared and provides some useful tips to interpret the figures

EVERYONE CARRYING out private practice should be preparing accounts and a tax return, but the figures prepared can be daunting to understand. Yet, ultimately, you are responsible for the figures submitted to the tax inspector so it is important you understand them.

Private practice accounts

These are a record of financial performance and are prepared up to a financial year-end. This may be in line with the tax year-end for individuals of 5 April – more commonly 31 March in practice – but could be any date during the calendar year.

Sometimes, there are cash flow advantages to adopting a financial year-end that does not coincide with the tax year-end, but your accountant should discuss this with you.

The records kept by the business are extremely important to ensure that complete and accurate records are being maintained. Your accountant does not ‘audit’ your figures, but, they should be bringing to your attention any deficiencies or problems that they come across.

Annually, your accountant will

ask you to submit your records and, as a minimum, they will produce a summary of income and expenses; but for companies and larger practices, a balance sheet will also be prepared.

The balance sheet is an important part of the accounts production process and its inclusion is generally accepted as reducing your risk of an HM Revenue and Customs (HMRC) inquiry.

Additionally, there are often notes to the accounts which can provide further analysis of certain categories or provide additional information.

For companies and limited liability partnerships, the format of the accounts is prescribed under the Companies Act. For sole traders and other partnerships, the format is more flexible, but for both companies and the selfemployed, there are accounting standards which govern how accounts are prepared.

Accountants should follow these standards as a matter of course, but, unfortunately anyone can call themselves an accountant, so it is important you choose someone regulated by a professional body.

Make sure you meet with your accountant periodically to go through things you are unsure of

Ensuring that your accountant is suitably qualified ensures they have the training, expertise and are accountable for their work and ethics.

Income and expenses account

This can also be referred to as a profit and loss account and is basically a summary of your income and expenses, the net of which is your profit for the financial year.

Note that your accounting net profit may be different to your taxable profit, so if you are looking to match up the figures between your private practice and tax return, the figures may be quite different.

The main reason for this is that certain expenses are not ‘taxdeductible’ and this means that despite them being recorded as an expense in your accounts, they

must be added back when calculating taxable profit. For most consultants, these costs will relate to depreciation and legal fees.

Depreciation is an accounting term and is basically writing off the cost of an asset such as computer equipment over a period rather than in one go. A typical depreciation policy for a computer would be three years, resulting in a third of the cost being included for three years.

The tax position is different, as you are given capital allowances for purchasing most assets and, at present, you have a generous allowance of £1m to encourage capital investment in businesses.

This would be an example of why your accounting profit may be higher than taxable profit in the year an asset was bought but

lower than taxable profit in subsequent years. This is because the annual investment allowance is effectively accelerated tax relief into the year of purchase, which reduces that year’s taxable profit accordingly.

Costs such as legal fees have special treatment, as certain costs are not deductible against your trading profits. Such legal costs would not be tax-deductible even though they may be shown as an expense in the accounts. This would be another example of why your taxable profit may be higher than your accounting profit.

Tips for reviewing income and expenditure

The key thing to consider is whether the figures look reasonable against your expectations. If

the accounting records are high quality, there should be less room for error.

But if the records are fragmented and perhaps mixed with personal income and expenses, it can lead to error or omission. It is recommended to run your private practice through a separate bank account and, for companies, this is the only option.

The first way to review accounts is to compare with the prior year to see if an expense looks reasonable compared to the year before and your expectations. Many costs rise proportionately with income, but others may not track in the same way.

When looking at expenses that have been incurred during the year, consider the timing of payments when reviewing costs, as an

expense incurred covering a period after the year-end is likely to be prepaid into the next period.

Income disclosure

Income disclosure, or revenue recognition as accountants call it, is an important aspect to consider. It may seem unfair to have to disclose income that was not paid to you before your financial year-end but, for most, this is the only option.

For clinical work, this is not usually a problem, as you will be paid well in advance of making any tax payments on that income, but for medico-legal work, you may well be paying the tax in advance of being paid.

For small self-employed businesses where income is less than the VAT registration threshold –

It may seem unfair to have to disclose income that was not paid to you before your financial year-end but, for most, this is the only option

£85,000 as I write – you can account for income and expenses on a cash basis. But the transition to an earnings basis can be problematic, so the advice generally is to use the earnings basis from the start.

For companies, the cash basis for disclosing income and expenses is not possible at any income level.

Tax returns

As mentioned previously, it is common for your taxable profit per your private practice accounts to differ to the figures reported on the tax return. Your accountant should provide a tax computation indicating the key components of the tax return and give information about your individual circumstances. Any estimates or items requiring your consideration should be brought to your attention.

The pension annual allowance information has frequently been unavailable at the time of preparing the personal tax return and therefore, as a minimum, your accountant should be able to estimate your position and advise you.

Many tax returns need to be amended following the receipt of your actual pension growth figures, so don’t be surprised if you receive a revised tax return from your accountant.

Understanding your private practice accounts and tax return is important to ensure you are comfortable with the figures being disclosed to HMRC. It can take some time to obtain a thorough understanding, so make sure you meet with your accountant periodically to go through things you are unsure of.

 Next time: The importance of planning ahead

Ian Tongue is a partner at Sandison Easson Accountants

DOCTOR ON THE ROAD: THE CAR OF THE FUTURE

An office on wheels

What sort of car might consultants or GPs be claiming mileage on in the future? Auto Trader reveals its predictions for what cars will look like in 2050

BY 2050, cars will be fully autonomous, electric and kitted out for hosting meetings, Skype calls and getting work done on the commute.

The car of 30 years’ time is a driverless vehicle in the shape of a smooth pod with all the necessary tech that doctors might need for getting down to business.

The UK’s largest digital marketplace for new and used cars, Auto Trader , has released concept designs for what it forecasts vehicles will look like – based on the expertise of futurologist Tom Cheesewright, the rate of technological development, market trends and research into consumer demand.

Auto Trader’s 2050 concept car is a fully electric and autonomous vehicle which provides passengers with a spacious interior that is geared up for business activities, as well as offering a range of technologies that allow passengers to customise their ‘driving’ experience.

Meetings on the go

The spacious cabin is set up with an inward-facing seating arrangement, ideal for hosting meetings on the go. Around one in five surveyed said they would use the space to get work done while on the commute and 8% said they would host conference calls in the vehicle.

The car has in-built wi-fi capabilities – a feature that 29% of drivers said they would want access to – and the interior is kitted out with a large in-built TV, ideal for Skype calling or giving the computer slide deck a final check before that all-important meeting.

The 2050 vehicle also features 360° panoramic windows with black-out functionality that can be activated with a quick tap; a handy feature to remove glare on

the TV screen while delivering presentations on the go.

Featuring ‘digital paint’, the car allows passengers to change the colour and style of the car from the tap of an app, a feature that could enable professionals to alter the colour of their vehicle to match their brand colours. Advances in technology suggest this feature could be widely available as early as 2040.

Passengers can also relax on the built-in mattress while in transit between meetings or catch up on some much-needed sleep while returning from late-night events or office parties – a feature which 24% of motorists said they would use.

Catering to the 10% of drivers who want cars to be fully voice-

operated in future, the car welcomes passengers with friendly artificial intelligence (AI) that helps them set their preferred driving speed and style, whether out for a leisurely drive or dashing to a meeting.

Car pooling

The 2050 car is fitted with windows that extend right over the roof in one large bubble, offering more head room to allow professionals to freely move around during transit. The social setup and added headroom also provides the ideal environment for car-pooling, which would help ease rush hour congestion.

Auto Trader’s Rory Reid says: ‘The Government’s recent announcement on bringing forward the ban

on sales of petrol and diesel cars to 2035 is already influencing what Brits are looking for.

‘Overnight we saw a 165% increase in searches for electric vehicles on Auto Trader. So it’s no surprise that the 2050 car will be fully electric, but it’s fascinating to think what these advancements, including driverless tech, could mean for the actual design of cars and how they could be used.

‘The development of autonomous vehicles could completely transform the role that cars play in the business world, enabling motorists to reclaim the commute and fully make use of their time en route to meetings and events. We can see the car of 2050 becoming an extension of the office, creating new levels of efficiency within the workplace.’

Futurologist Tom Cheesewright adds: ‘Tomorrow’s car takes you from A to B with minimum fuss and in maximum style. Future technologies will give designers free reign to create more space and comfort, so that we can get on with our lives while an AI takes care of the driving.

‘While our cars won’t be flying any time soon, we can all benefit from cleaner, quieter, safer roads. In just 20 years, the age of the combustion engine will be well and truly over.’

Partnering with Mr Cheesewright, the world’s first applied futurist and leading futurology author, Auto Trader’s report combines motor industry forecasting with a survey of 2,142 UK drivers to build a picture of the future of the car industry 10, 20 and 30 years from now.

 For Auto Trader’s Car of the Future design and report, including a timeline of the evolution of the car, see www.autotrader.co.uk/content/features/cars-of-the-future

The car of the future provides interiors geared up for business activities

DOCTOR ON THE ROAD: SKODA SCALA

Very good value car with no pretensions

Functional family transport like this may not excite the enthusiastic driver, but the similarly sized Audi A3 shares the engine, transmission and many other parts and will cost you 35-40% more. Dr Tony Rimmer (right) reports

THERE ARE many times when simplicity and straightforwardness win the day. For instance, if your clinic needs a new piece of equipment, then you go for something that does the job efficiently and is good value for money.

So long as the quality is acceptable, there is no more to do. Business balance sheets work without emotions; pragmatism and practicality guide all decision-making. Fortunately, or perhaps unfortunately, we humans use additional and different criteria when we spend money on personal items like our individual transport. We become susceptible to matters of style, performance and brand image that often means that we

spend much more than is sensible for our vehicles.

So I thought that I would investigate the popular family hatchback market for a car that should do everything you need it to do, but costs a lot less. Do you, as a buyer, suffer in any way from making this financially sensible decision?

Shake off the past

Fortuitously, Skoda has stepped into the frame with the launch of its new Scala. Sitting between the smaller Fabia and the larger Octavia, this five-door hatchback is a replacement for their Rapid model and competes with the Ford Focus, Vauxhall Astra and Volkswagen Golf, among others.

Over recent years, Skoda has gained a reputation for building great value products with VW Group build quality. It has managed to shake off any negative connotations from the past and now leads the field in many areas.

As expected, the Scala is keenly priced from just £16,595 and is available with a choice of three engines – 1.0litre three-cylinder (94bhp and 113bhp) and 1.5litre (148bhp) petrols and a 1.6litre (113bhp) diesel.

The standard transmission is a six-speed manual, but a sevenspeed automatic direct-shift gearbox is available as an option. My test car was a 1.5 TSI with range-topping SE L trim and the manual box.

Standard equipment, even in the basic S trim, is generous with DAB radio, cruise control and electric mirrors. The SE model adds an 8.0-inch touchscreen, a leather steering wheel, Apple CarPlay and rear parking sensors.

Useful features

The SE L has VW’s Virtual Cockpit, a 9.2-inch touchscreen and 17-inch alloy wheels. Skoda’s ‘simply clever’ features are carried over to the Scala: there is an umbrella in the door jamb, a ticket-holder on the windscreen and an ice-scraper behind the fuel-filler door – all useful features that make you question why other brands don’t offer them.

The Scala looks smart and modern, but is a bit predictable in its styling. There are no quirky or adventurous design features and this trend continues to the interior where everything is clear, functional but a bit bland.

It does excel in useable space though: rear-seat passengers get a lot more legroom than a Focus or Golf and the boot is 25% bigger than both the Ford and Volk swagen rivals.

Decent refinement

Although the chassis is based on the smaller Fabia rather than the bigger Octavia, it provides decent refinement on smooth roads.

The ride may be caught out on urban pot-holed surfaces, but the steering is sharp enough. Interior noise levels are normal for this class of car and motorway journeys are comfortable.

Performance from the 1.5litre petrol engine in my test car was quite sprightly and it would be perfectly fine with the 1.0litre three-cylinder engine for most of the time.

The handling was predictable, safe and secure, but keen drivers will find that it lacks the more sophisticated suspension set-up found in the Octavia and VW Golf. Ford’s Focus is the best handling car in this category and the Golf is the most refined.

Something honest

So, should you, as an independent practitioner, consider buying this new Skoda? Well, this purely depends on what value you personally put on luxury features and a premium brand.

A similarly sized Audi A3 that shares the engine, transmission and many other parts of this Skoda

will cost you an extra 35-40%. I really liked this Skoda despite it being dynamically neutral. There is something honest about great functional design without frills.

The Scala does everything you would expect a five-door hatchback to do but, apart from interior space, no more. It is well built, well equipped and has up-to-date tech. As straightforward functional family transport it cannot be criticised.

It may not excite the enthusiastic driver but it is not designed to do so. Remember, it is exceptional value and it is refreshing to drive a car without pretensions. 

Dr Tony Rimmer is a former NHS GP practising in Guildford, Surrey

SKODA SCALA SE L 1.5 TSI 150ps

Body: Five-seat hatchback

There is something honest about great functional design without frills

Engine: 1.5 litre four-cylinder petrol

Power: 148bhp

Torque: 250Nm

Top speed: 137mph

Acceleration: 0-60mph in 8.2 seconds

WLTP combined economy: 47.9 to 42.2mpg

CO2 emissions: 111g/km

On-the-road price: £22,130

Rear-seat passengers get a lot more legroom than a Focus or Golf and the boot is 25% bigger than the Ford and VW

All you need to know about accountancy for private practitioners

Keeping a steady stream

Our latest profits benchmarking survey shows private practice income for urologists has been disappointing for many. Ray Stanbridge reports

2018 WAS a year of little change for consultant urologists. Their gross income rose on average by £1,000 or 0.7% from £144,000 to £145,000.

Costs showed a small fall of £1,000 (1.9%), going down from £54,000 to £53,000. As a result, gross margins rose by 2.2% from £90,000 to £92,000.

Our figures, while not statistically significant, aim to represent what is happening to an average urologist’s private practice.

We have reported in previous editions of Independent Practitioner Today that there has been a growth

in self-pay, particularly for consultations and minor urological procedures, and this has continued.

At the same time, compared to other specialists, we have noticed relatively little insurance company pressure on urologists’ fees. Overall, there has been little change in costs between 2017 and 2018, with one or two exceptions. We have noticed a rise in the cost of medical supplies/assistant fees. This is rather higher than we would have expected and is influenced by the increasing use by some large practices of assistants. This may have distorted our figures.

AVERAGE INCOME AND EXPENDITURE OF A CONSULTANT UROLOGIST WITH AN ESTABLISHED PRIVATE PRACTICE

We have noticed relatively little insurance company pressure on urologists’ fees

Staff costs show a very small decrease of £1,000, dropping from £19,000 to £18,000 on average.

This must be offset by the increase in consulting room hire, going up from £5,000 to £6,000 on average. Under Competition and Markets Authority (CMA) rules, consultants have to be charged the market rate for consulting rooms and secretarial services. Some room hire costs include an element of secretarial services.

Transferred indemnity

Professional indemnity/insurance costs have remained fairly consistent. Some consultants have transferred their business to new providers at lower costs initially, but most have retained the business with the traditional insurers. Other costs have remained steady, with the exception of ‘other’. This is primarily marketing expenses and we have seen a similar trend in other specialties.

The days of heavy expenditure on website and other marketing material seem to be over, and most consultants are now paying solely for website maintenance costs. This is the primary reason for reduction.

Overall, our prediction in 2018

The days of heavy expenditure on website and other marketing material seem to be over

Year ending 5 April. Figures rounded to nearest £1,000 (percentage is also rounded up)

Source: Stanbridge Associates Ltd.

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was that current trends were likely to continue, and this has come to pass.

We expect to see these trends continue from 2019 and 2020. There are some interesting groups of urologists, but, as a whole, this

specialty has not embraced the concept of coalescing as much as other specialties.

Groups have been shown to enhance incomes at the expense of singletons.

In a fast-changing market, apart

from group activity, other urologists have chosen to incorporate. Some have focused almost entirely on lower-margin Choose and Book activity and some are looking at the employment options with private hospitals.

All these factors create comparison difficulties for our survey. Note that our sample of urologists continues to be restricted to those who:

 Have either an old-style or a new-style contract;

 Have been in practice for at least five years;

 Have been earning at least £5,000 a year from private prac

tice;

 May be trading as a sole practitioner or as a member of a group;

 May or may not have incorpo

rated;

 Will continue to do at least some NHS work, meaning that they are not in full-time private practice.

 Next month: Anaesthetists

Ray Stanbridge is a partner with accountancy, finance and tax advisory medical specialists, Stanbridge Associates Limited

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 Don’t miss Tax For Doctors 2020-21 – a free guide by specialist medical accountant Vanessa Sanders, of Stanbridge Associates. Packed with useful information for you on pensions, expenses, companies, inheritance tax, and even divorce

 Juggling your cash flow in light of Covid-19. Accountant Susan Hutter has some useful tips

 Practising privileges – Hempsons’ lawyers Stephen Hooper and Simon Eastwood look at what to do when problems arise

 What you need to know if you ever have to undergo a GMC investigation. In the first of two articles, MDU medico-legal adviser Dr Ellie Mein explains that, although stressful, it is a survivable experience

 Brexit and data protection – what medical practices need to be thinking about as the UK exits the EU. Jane Braithwaite and Karen Heaton have some sound advice

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 Following a report of a death to the coroner, it may be necessary for a consultant or GP to attend an inquest. Dr Gabrielle Pendlebury, medicolegal consultant at Medical Protection, advises on what to expect and how to prepare

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 Start A Private Practice: The importance of planning ahead

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 Our motoring correspondent, Dr Tony Rimmer, reviews the Mazda 3

 What was happening in the world of independent practitioners ten years ago

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Giving voice to the private sector

INDEPENDENT PRACTITIONER

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The new president of the Independent Doctors Federation, private GP Dr Neil Haughton, reveals his plans and hopes for the organisation in the years ahead n See page 18

business journal for doctors in private practice

Make access to self-pay easy

The private healthcare sector needs to do much more to make it easier for patients to access. And clearing up price confusion would be a good place to start, argues Keith Pollard n See page 21

What are you doing to attract patients

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