We’re all in this battle together David Hare show how independent practitioners are supporting the NHS in fighting the Covid-19 pandemic P12
Cutting our ties to Europe
What leaving the EU and its data protection jurisdiction mean for you P16
We trace the surge in digital consultations experienced by the Trustedoctor platform P34
By Robin Stride
A new programme is being devised to encourage, advise and support private consultants as they deal with new ways of working and novel business models emerging in the months ahead.
The initiative, from the London Consultants Association (LCA), will be aimed at current independent practitioners and younger new entrants.
LCA chairman Dr Mark Vanderpump said: ‘We are keen to help existing consultants re establish themselves to continue to deliver expert care within the private sector postpandemic’.
He is heading the development of a programme building on existing offerings such as popular medico legal training sessions, which will now include some virtual sessions.
A mentoring programme for younger consultants is also underway. This will give new members access to established consultants in their own specialty to receive support during these testing times for independent practitioners’ businesses.
Full time private doctors are among the thousands of firms seeking Government loans to try and survive the pandemic.
Once lockdown is relaxed, the LCA plans to run evening meetings to specifically address consultants’
needs in a changing and untested environment.
It said consideration would also be given to new business models that allowed consultants to drive their own quality agenda and maintain their professional autonomy. The pros and cons of employment models will also be looked at.
Dr Vanderpump told Independent Practitioner Today: ‘The LCA is alert to the potential impact of this emergency on private practice.
‘We are optimistic that a new medical professionalism can be established to allow the NHS and private sector to work in a complementary and seamless manner for the benefit of patients.’
lists, will mean a selfpay upsurge.
Specialist medical accountant Ray Stanbridge commented: ‘There’s a huge pent up demand for private practice and even though it has been pretty awful for some consultants, I think it is going to boom away.
‘I think it is going to bounce back very strongly; it might even emerge stronger out of it. For independent practitioners now, it is a question of being positive. Some have been quite depressed, but economic cycles come and go. I’d advise them to be positive and trust in their own particular skills.’
n Far-reaching but unpredictable changes are likely for private practice, doctors and the NHS, with a potentially dramatic market shift n The major private practice pillars – doctors, providers and insurers –will need to adapt their approaches to thrive
n Close NHS and private sector working during the pandemic may augur further co-operation over and above what pre-existed, as NHS waiting lists inevitably rise
Although the international market will be severely hit by health and travel restrictions for the foreseeable future, the LCA expects this to recover as foreign patients seeking tertiary care return to the capital’s private sector expertise.
It believes it is therefore important that the sector maintains its profile and senior consultants return to practice.
The LCA considers that corporate medical insurance policies will be dropped by some small and mid sized companies who are struggling to make themselves profitable again.
But this, plus longer NHS waiting
A surge in selfpay patients who do not wish to wait for their turn on extended NHS waiting lists is also predicted by the Federation of Independent Practitioner Organisations (FIPO).
Private practice business expert Jane Braithwaite, writing in this issue – see page 5, said: ‘Private practice income has dropped to negligible levels in the last two months and, from a business perspective, this is devastating for many.
‘But things will get better quickly once private hospitals reopen and the lockdown is lifted. Private practice will see a rapid increase in activity levels.’
n More from FIPO on page 4
n Fixed fees and rising overheads may discourage young consultants from self-employed independent practice – but the LCA insists independence is essential despite the pressures
n Virtual meetings, particularly for multidisciplinary teams, have proved their worth in the private sector. But early feedback is that lengthy virtual clinics can be draining and less than satisfactory for consultants and patients, particularly new clients
n Nothing can replace in-depth face-to-face consultations and hands-on examinations, but e-checkouts and e-bookings may promote efficiency in some specialties
Source: LCA
TELL US YOUR NEWS Contact editorial director Robin Stride
Private care is more than just video consultations
The president of the Independent Doctors Federation, gives his view of the Covid-19 crisis and its aftermath P8
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Exactly what the shape each individual independent practitioner’s private practice will look like when we begin emerging from this pandemic is a vexing issue for many of our readers right now.
As the tragedy for Covid-19 victims and their families has unfolded in the UK, consultant and GP independent practitioners have been wrestling with some huge personal business issues.
Top of these, was the question posed by the Federation of Independent Practitioners Organisations (FIPO) in a story on our website that appeared after we published our page-turn issue last month: ‘Will private practice survive?’
Who would have dreamed less than three months ago that anyone would be asking such a thing?
Certainly not the full-time consultants in private practice who have been applying for the
Government’s pandemic business loans.
Nor the ones who are already worried about their tax bills.
Yes, we know the July payments are being delayed, but it is next January’s that are already worrying some.
Nor the doctors fearing insolvency.
Specialists’ representatives in the private sector observe that independent practice has almost totally disappeared. But in answer to the question ‘Can it survive?, we are confident it surely will, albeit with dramatic change.
To help you prepare and, where necessary, get back on your feet, we aim to keep you in touch with expert business advice, both in this issue and with constantly changing additional material on our website.
And do take advantage of Bupa’s new facility to show your availability to see patients (see story opposite).
Juggling your finances in a crisis
Independent practitioners have been keeping specialist medical accountants busy with business-related queries during the pandemic P14
Keep the cash flowing
The Covid-19 pandemic has brought a suprise surge of private doctors’ billing and collection inquiries. Billing expert Simon Brignall explains why P33
A unified hub for all your data
The Private Practice Register provides a single secure slot for doctors to upload and control all their practice data and supporting documents P36
Principality has potential for growth
Philip Housden reviews private patient activity for the NHS in Wales where income is up, but below the combined national average outside London P38
Lean on me, when you’re not strong
When there are falls in the stock market, hold your nerve and lean on your financial planner . . . and they will be your friend P42
PLUS OUR REGULAR COLUMNS Keep it HospitalsLegal: are stricter after the Paterson report
Essential legal guidance on practising privileges, now subject to more scrutiny by hospitals after Paterson P40
Start a private practice: Plan for when this crisis ends
Ian Tongue says now is the time to create a plan for setting up a business, as you’ve time on your hands P44
Profits Focus: Gasmen walking on air
Our unique benchmarking series looks at the financial fortunes of anaesthetists P46
Due to pressure on space, Mr David Sellu’s continuing story and our ‘Doctor On The Road’ feature have been held over
By Edie Bourne
Consultants who have already applied for national clinical excellence awards (CEAs) for the 202021 round have been disappointed to discover the scheme has been suspended.
The Government’s advisory committee on awards took the decision to defer applications because of the impact of Covid-19 on all NHS staff.
Patrick Convey, technical director at specialist financial planners Cavendish Medical, said: ‘It is not yet known when applications will reopen, but the committee has agreed that doctors whose awards
expire in April 2021 will not be disadvantaged by being unable to submit a renewal application. All current applications have also been saved.’
He believed many specialists would not have found time to complete applications or have them supported by employers, adding that it was totally appropriate for doctors to be focused on their clinical priorities during the pandemic.
Mr Convey told Independent Practitioner Today: ‘For some doctors who have been building a body of work to support their application for some time, there could be frustration on top of the
distressing and challenging situation they currently face.
‘In previous years, doctors have been concerned to learn that while the awards can be a well-deserved achievement, the impact on their tax liabilities can be surprising. As national CEAs are pensionable, they can increase the chances of breaching yearly tax-free pension savings limits known as the “annual allowance”.’
Any new local awards are nonpensionable, but can still impact the annual allowance calculation, as they increase consultants’ income.
Mr Convey continued: ‘Although this is a difficult time for those on
the front line, it is important for doctors to be aware of their tax position if they are able to do so.
‘There have been considerable changes to the annual allowance regulations, which have caused confusion – and can lead to issues in the long term.
‘While we do not yet know when CEAs will be re-introduced, they are likely to add to the already complex nature of medical finances.’
Consultants have responded positively to a Bupa request to use a new feature on its online Finder directory to help them manage patients’ expectations about their availability during the pandemic. As private hospitals work in partnership with the NHS to boost its capacity to manage Covid-19 patients, the necessary refocusing of resources is affecting consultants’ availability to offer private care.
To help consultants during the outbreak, Bupa has added a new feature to www.finder.bupa.co.uk so they can show website visitors if they are still accepting new patients and, if so, what type of consultation options they can offer – face-to-face, phone or video.
All consultants need to do is log in to their Bupa Providers Online account (www.bupa.co.uk/providers-online) and select ‘Update my Finder profile’ on the screen’s left-hand side.
Then they can tick to confirm their availability. Consultants can
log in to update the information whenever anything changes.
Bupa is using this information to update Finder, which has 70,000 visits weekly, to show consultants’ availability. The insurer will also use it to update its systems so that its member services advisers can inform patients when they call to pre-authorise care.
Dr Luke James, Bupa UK Insurance medical director, is pleased many consultants have already used this new feature. He said: ‘As hospitals start to take on more non urgent work now, this
The Federation of Independent Practitioner Organisations (FIPO) and Independent Doctors Federation (IDF) both support the initiative and encourage their members to use it.
FIPO co-vice-chairman Mr Ian McDermott said: ‘FIPO urges all consultants to update their availability on the Bupa Finder site ASAP to ensure that patients and referrers alike are aware of the ability of each consultant to still see patients during this extremely difficult time.
It only takes seconds for private doctors to update their profile to let patients know their availability during the Covid-19 crisis
will be invaluable for our advisers, Bupa patients and the wider public seeking treatment. We’d urge all those who have yet to update Finder to do it when they’ve a moment; it only takes five minutes.’
‘I’ve updated my own details on the site, and it’s very quick, easy and straightforward, and it took literally just seconds.’
IDF specialist committee chairman Dr Sean Preston said: ‘This is a very efficient way of reconnecting our members with their patients during these troubling times. Bupa’s support with this communication and nonpatient facing consultations is greatly appreciated.’
Twenty-five per cent of doctors in the UK have been off sick or in isolation, according to the Royal College of General Practitioners.
Dr D.J. Hamblin-Brown, former group medical director at Aspen Healthcare, is one of them.
Recently returned from running an acute healthcare business in China and not ready to return to his emergency medicine specialty, he was at the wrong end of his 50s and a long-time asthmatic.
As he could not work, he has setup www.doctorinthehouse.net, a pro-bono service established for all doctors – specialists as well as
generalists – along with allied healthcare professionals, to see patients for free.
He aims for this to be ‘a way to unburden even a small part of the NHS’ and is inviting any other doctors who cannot work at the moment but would like to contribute their time to consider signingup on the website.
Dr Hamblin-Brown believes there is a huge, pent-up demand for healthcare advice building-up behind the Covid-19 dam.
He said: ‘Many of the patients I used to see in the emergency department could be classed as
“worried well”. According to my A&E colleagues, this cohort has all but disappeared from many of our departments.
‘Most of this work is falling on already over-stretched GP services even as NHS 111 struggles to cope. [Waiting times are over six hours at the time of writing].
‘The tragedy is that this group of supposedly “low risk” patients contains a minority of patients who are dangerously sick.
‘Some of these are seeking help too late; reports and statistics suggest some are dying for lack of treatment.’
Dr D.J. Hamblin-Brown has set up a pro bono service to see patients for free and invites all types of healthcare workers to join his scheme
By Leslie Berry
Independent practice has almost totally disappeared as available resources are dedicated to coping with the threat posed by Covid-19.
It has been, as the chairman of the Federation of Independent Practitioner Organisations (FIPO) puts it, ‘unprecedented times for the provision of healthcare in the UK’.
But Mr Richard Packard says: ‘Private practice has stepped up to help with the national emergency and we must hope that as things improve, the co-operation seen between the NHS and private sectors will remain for the benefit of all patients.’
A position statement from the organisation produced for Independent Practitioner Today reflects on some major changes in how doctors are deployed, such as specialist trainees working outside their
disciplines to ease the pressures on the NHS.
‘For consultants, even if they had also practised independently, those with NHS contracts now concentrate on their salaried commitments, while those in purely private practice are for the moment cut off from their source of income,’ it says.
‘The Government is naturally cautious about relaxing current restrictions, but it seems now that the first peak of coronavirus infection has passed that some easing may take place in the near future.’
FIPO says this may mean restarting routine surgery. ‘Naturally, there will be a backlog to be dealt with, but some independent practice is likely to occur. This may well be by consultants in fully private practice rather than those working also for the NHS.
‘It may be, on the other hand, that the closer working of the two
sectors engendered by the pandemic will continue and in fact increase as routine provision of services resumes.’
The normal standards of governance, professional integrity and self-regulation expected of doctors by the GMC, royal colleges and other organisations will necessarily be maintained.
But what is not yet known, FIPO observes, is what different business models might evolve and new ways of working emerge to minimise contact.
The organisation believes some specialties will lend themselves to remote consultation better than others. But, in common with the London Consultants Association [see page 1], it thinks experience so far suggests that virtual clinics are time-consuming and draining, as each consultation takes longer, especially with new patients.
FIPO adds: ‘How patients will
accept this, doctors adapt to it and the private medical insurers respond in funding terms is yet to be known.
‘The various “fee assured” schemes that the insurers have in place may come under strain as many of the younger consultants are needed by the NHS to carry out waiting list initiatives.’
This, it points out, would leave only the non-fee assured available to provide services once things begin again.
FIPO predicts we might also find that the attractiveness to doctors of private practice due to increasing overhead costs and falling fees will deter many from either returning to independent practice or taking it up.
‘After all, doing a waiting list operating list when you want to with no need for secretaries and consulting room charges etc. may prove more desirable.’
Times have been tough, but begin the fightback by taking the opportunity now to secure the success of your private practice for the future. Jane Braithwaite offers ten tips
I BELIEVE IT is now time for doctors working in private practice and owners of private healthcare businesses to be more positive. The future of private practice promises to be positive and will bounce back much more quickly than other business sectors.
Compared to the hospitality sector, for example, we are in a relatively good position.
As we all know, the situation for our patients currently is not good. We have patients awaiting treatment, both on the NHS and privately, and as each day of the current crisis passes, the waiting lists get longer.
Patients are ignoring symptoms and, as I write, avoiding seeing their GP or consultant until the lockdown is lifted and this may well lead to longer-term problems.
Anyone involved in healthcare wants to avoid this happening and there has been a growing demand to open hospitals and clinics so we can start to address this.
Once this happens, we will enter an incredibly busy period as we treat patients as quickly as possible to avoid them waiting any longer than is necessary.
Private practice income has dropped to negligible levels in the last two months and, from a business perspective, this is devastating for many.
But things will get better quickly once private hospitals reopen and the lockdown is lifted. Private practice will see a rapid increase in activity levels.
So, what do we need to do right now to protect our private practices?
Here are my top tips for what to do now to ensure long term success:
1
Strong financial management . Scrutinise your finances to understand the impact on your income, review cash flow to determine what actions need to be taken to maintain a positive balance and subsequently act on costs cutting to ensure this is delivered. Invest in a finance system such as Xero to help you manage your finances more effectively going forward (see ‘Plan for when the crisis ends’, page 44).
2
Cost-cutting. It is worth negotiating with your suppliers regarding your outgoings including rent, business rates and service charges. Review your regular monthly outgoings and reduce unnecessary expenditure.
3
Invoicing and aged debt. Check that all patients in recent months have been invoiced correctly. Pull off your aged debt report and review in detail. Focus on ensuring these invoices are settled promptly especially by insurance companies and embassies.
4 Communication. Prioritise communication with patients and ensure they are aware of the services you can provide currently. Also communicate with your network of GPs and consultants who regularly refer to you, so they also know what services you can provide currently. Helpful and supportive communications will keep you front of mind and help to generate loyalty in the longer term.
If you are not currently sending out a monthly newsletter to your patients and/or referrers, this could prove to be a particularly good time to start.
5
Review your marketing strategy. Various studies over previous recessions give strong evidence that companies who continue to invest in marketing throughout a crisis, perform better in the short and longer term.
Their continued focus is proven to create a competitive advantage that is reported to last for two years after the crisis/recession ends.
6
Review your website. At the very least, update your website advising your patients how you are operating currently and how they can contact you. If you are prepared to take a more proactive view on marketing, you may want to invest significant time revising your website so that it serves as a positive and valuable tool for you in the future.
7
Social media. We know that people are spending time online more than ever; social media is continuing to increase in
popularity and this offers us a costeffective way to communicate with our peers and patients. This is a very sensible time to invest in your social media strategy. LinkedIn has been especially active over the last few weeks, so you may want to review your own LinkedIn profile to ensure it is up to date.
8
Content. Create content to use over the coming months as part of your marketing plan, including written articles to publish on your website and creating videos, although your choice of filming location may be extremely limited.
9
Telemedicine strategy. Many of us have embraced virtual consultations using phone and video, and popular opinion suggests that these ways of working will become more of the norm in the future, as patients like them. Now would be a good time to consider how you can use technology to benefit your patients in the future (see page 34).
10 Government support. Cost-cutting may need to affect your employees and if you have not already done so, then they may need to be furloughed utilising the Government’s scheme. You may also wish to apply for the Government loan scheme.
See ‘Cutting our ties to Europe and its red tape’, p16
Jane Braithwaite is managing director of Designated Medical, which offers business services for private consultants, including medical secretary support, bookkeeping and digital marketing
Care Quality Commission (CQC) inspections are on hold for now, but when they return, how many independent practitioners will try and achieve an ‘Outstanding’ rating?
According to the IDF’s adviser on CQC matters, when ratings inspections started last year, most asked: ‘How can I obtain Outstanding?’
But over a year on, although many doctors still want the top award, a growing group say: ‘Good is good enough’.
Many IDF members have found the ‘Outstanding’ rating not only hard to achieve but a big investment in time, reports Martha Walker.
Writing in the IDF News, she says: ‘The doctors and their staff have spent hours preparing for inspection, going through the key lines of enquiry (KLOEs) and ticking off the criteria considered outstanding, having two or three inspectors and
advisers spending eight or nine hours in the practice and in many cases being given the impression they would get “Outstanding”.
‘Then the report arrives rated overall “Good” but with no indication as to how they could have attained “Outstanding” or what needed improving.’
Mrs Walker adds: ‘It is easy to see why some doctors adopt the attitude “Good will do”. If doctors believe they have met the “Outstanding” criteria but judged not to have and the inspector can provide no constructive advice as to how to improve, then maybe the KLOEs need to be revisited?’
time needed to get there, she questioned what incentive there was for doctors when ‘Good’ was acceptable to many doctors and patients.
At the time of writing her report, only 3% of the independent sector had been awarded ‘Outstanding’ – the same as the NHS.
The IDF said it welcomed the opportunity to work with the CQC to develop clear effective criteria for what ‘Outstanding’ looks like.
Increasing numbers of consultants have been ‘delisted’ by the major private medical insurers in the last year, according to the chairman of the Independent Doctors Federation’s (IDF) specialist committee.
Dr Sean Preston said doctors were often given no warning and little transparency of the underlying process.
With it being unclear how to achieve ‘Outstanding’, and much
Mrs Walker adds: ‘Most, if not all, doctors do want to achieve an “Outstanding” rating. However, they need to know what is expected of them to do this. Otherwise a great many will feel that “Good” is good enough.’
IDF News editor Dr Greg Williams, a hair transplant surgeon, told members in his editorial that doctors were in for changing times in private practice.
He forecasted salaried private medicine employment would
become more common and USowned facilities opening in the UK would be looking for ‘the brightest and the best medical professionals that British medicine has to offer’.
He said it was likely that this would raise the bar for private
healthcare provision, delivering world-class cutting-edge healthcare in ultra-modern facilities.
The biggest issue for patients was the affordability of private care and it was the medical insurers’ responsibility to address this.
‘To my knowledge, the core data giving rise to any concern has never been shared,’ he told IDF members in his annual report. He paid tribute to Anne Coyne (right), consultant relationship manager for the Private Healthcare Information Network, who had helped broker difficult conversations with various insurers.
Dr Preston expressed the hope that improving IDF relations with insurers would make things less traumatic for members in future.
IDF president Dr Neil Haughton reported that regional recruitment events in Manchester, Birmingham and elsewhere had been disappointing. 39% of members were based outside London and he planned to hold more educational and social events outside the capital in the year ahead. Membership totals just under 1,500.
Private GPs are working with the NHS to improve information sharing about patients.
This follows a Care Quality Commission inspection report last year which said all doctors had a duty to share information with others providing care and treatment for their patients.
IDF GP committee chairman Dr Di Loudon said how this was done
in daytoday private general practice had proved challenging, as feedback from members showed.
She has been trying to find a cohesive way to progress from traditional forms of communications, such as paper, towards a simple digital pathway to integrate private and NHS GPs’ care.
She has been working with NHS England, NHS Digital and NHSX – a
new unit driving forward the digital transformation of health and social care – to ensure a more efficient way of transferring vital information to the appropriate doctor.
Dr Loudon reported: ‘Initially, we have decided to focus on prescribing as the type of data transferred, as the NHS already have an existing digital system for us to link with.
‘I am pleased to say that we are now at the final stages of that digital pathway and the last two hurdles to overcome are the tech and the governance. Interestingly the tech is nearly there, the latter will take more time.’
Her committee has asked the NHS to give independent GPs access to nhs.net and the summary care records.
By Leslie Berry
Healthcode has introduced new features to The Private Practice Register (The PPR), the online information hub for the private healthcare sector which includes more than 18,000 practitioner profiles.
The latest version, live since 5 April, comprises the following enhancements to the information contained in each profile:
Additional GMC information
– The PPR is automatically updated with data from the GMC list of registered medical practitioners.
Now even more detail is available, including doctors’ revalid
ation status, Designated Body, Responsible Officer (RO) and the due date for their annual retention fee.
Data protection – Practitioners can prove their compliance with data protection law to the hospitals where they hold practising privileges.
The PPR now includes the option to input their ICO registration number from the Information Commissioners Office, certificate expiry date, date of original registration and payment tier. Practitioners can also upload their ICO certificate to the system.
Visibility of private practice sites – Private hospitals where
Doctor business owners and the wider healthcare industry are being warned to remain alert to phishing attacks during the Covid19 pandemic and to maintain information resilience.
The British Standards Institution (BSI) warns that the greatest volume of attacks united by a single theme – Covid 19 – is currently taking place and with the continued increase in remote working, cyber attackers are using this opportunity to target businesses and their employees.
Several false web domains relating to Covid 19 have been registered and are being used to link to phishing and credential attacks.
In the UK, specifically phishing campaigns include BEC (Business Email Compromise) attacks whereby the attacker pertains to be a colleague or someone you know requesting a payment to be made.
These types of emails can also include ransomware and malware disguised as links to click on for further information on meeting notices or company updates.
Additional emerging threats cover attackers who are mimicking
charities, health organisations or business and financial supports.
BSI security expert Stephen Bowes said: ‘We are living through an exceptional time at present with many employers focused on their staff’s welfare and business continuity.
‘World events like Covid19 provide vast opportunities for cyber attackers to infiltrate companies and gain user data such as login credentials or financial information. We are seeing attackers increase their presence due to the crisis and with many of the global workforce now working remotely.
‘Most recently, Interpol has alerted healthcare institutions of targeted ransomware attacks that have the potential to lock them out of their critical systems.
Phishing is one of the highest causes for cybercrime and all online users, in work and at home, need to be alert, as cases of fraud are rising during this time.’
‘We want to urge employers and employees to remain vigilant and be aware of the increased risks and make sure you get your information from reputable sources.
practitioners hold practising privileges can now see the names of the other sites where they practise and their start date at each. But they will not be able to access details of what type of patients they see and in what capacity.
Healthcode’s head of external affairs and stakeholder engagement, Fiona Booth, said: ‘Despite the practical challenges presented by the coronavirus, Healthcode’s development team is continuing to work on ways to make The Private Practice Register an even more useful resource for everyone in the independent healthcare sector.
‘The enhancements to practi
‘Don’t get caught off guard by clicking on links in emails and report any suspicious emails to the IT department. If in doubt about the legitimacy of an email that is requesting a payment or specific action, we would advise that you contact the sender by phone to get verification first.’
The consulting services team at BSI provides a range of solutions to help organisations address challenges in cybersecurity, information management and privacy, security awareness and compliance.
For more information, visit bsigroup.com/cyberuk.
tioners’ profiles mean that insurers and hospitals in their network have the information necessary to maintain their recognition status and practising privileges.
‘For private hospitals, the additional information about their consultant community also supports the requirements of the Medical Practitioners Assurance Framework (MPAF), which was launched last year.
‘This is important because the Care Quality Commission has highlighted the MPAF as one way that hospitals can demonstrate the robust governance processes its inspectors expect to see.’
All about The PPR: see page 36
The Medical Practitioners Tribunal Service (MPTS) has postponed most hearings to allow its medical members to help respond to the Covid19 pandemic.
It said: ‘Patient safety is our top priority, so we will continue to review existing sanctions and consider new interim restrictions where necessary. These hearings will be heard over Skype or be considered by a legally qualified chair.’ By law, every tribunal must include at least one medical member. The MPTS has 145 and a few are continuing to work with it to make decisions.
All hearings scheduled to run until Monday 6 July have been postponed.
Medical defence organisation MDDUS is pressing the Government to speed up its response to the independent report into jailed surgeon Ian Paterson.
CEO Chris Kenny said the important patient safety recommendations in the report should be taken forward as quickly as possible despite the Covid19 crisis.
The USP of independent medicine is personalised – and excellent – care, which will become even more desirable after the pandemic. But how viable will our practices be?
Independent Doctors Federation president Dr Neil Haughton sees a long road ahead
IT SEEMS unlikely our routine will return to anything approaching normal for many months.
The situation may be marginally better by the time you read this, but I doubt it; our lives have changed possibly forever. Some of us have suffered severely from the virus and some have died.
Most have had our practices hugely impacted with reduced turnover and furloughed staff or been forced to close altogether.
The remarkable response of the NHS to the crisis and the willingness of private providers to supply hospitals, equipment and staff is a testament to the national spirit of co-operation and was an essential response.
It is also not the time to raise the plight of private doctors whose businesses might have been blighted in the same way as many other sectors.
Any profiteering has rightly been condemned and, as president of the IDF, I am mindful that my priority is supporting our members as much as we can and not publicly declaring how dramatically private medicine has been affected.
That stance will eventually become more relevant, but I doubt whether the future will be as secure as we anticipated earlier this year, so I wanted to consider the ways Covid-19 might affect our sector in the future.
We have no idea how long this will last and until herd immunity or a vaccine provides long-term protection, we may well be seeing cases for years to come. Patients are already wary of accessing healthcare establishments, with attendances at GP surgeries almost zero and A&E down by more than 20%.
Secondary care and specialist referrals are on hold and the elderly and patients with conditions that
need monitoring are advised to stay home; even new cancer referrals are at minimal levels.
My GP practice has gone from a busy community clinic to a Covid19 phone or virtual advice service within the last month, although a few patients are now drifting warily back. Staff have been off sick themselves or self-isolating and obviously revenue has been affected.
If this lasts more than a few months, then who knows how viable many of our practices will be.
I still worry about the virtual doctor many of us have become. Our work relies on nuanced observation that is only possible face to face, and the flow of the online conversation is stilted and loses hidden cues; we may be missing serious conditions and delaying treatment for cancers and heart disease.
They haven’t simply disappeared, and I am sure that when the fear of
physical engagement has lifted, then our practices will be busy again. People will always want access to excellent healthcare.
There is also a huge amount of mental health and anxiety that is being hidden away in isolation, postponed for now, that will need to be addressed eventually.
There will, of course, be positive developments in the response to Covid-19, just as the HIV epidemic in the 80s and 90s improved many aspects of medical care and patient empowerment.
Communication between NHS and the independent sector has long been an issue, highlighted by the recent Paterson report, but also now as some private patients have no NHS record, so NHS hospitals cannot access medical histories in a Coronavirus emergency.
All the arguments around governance have been rapidly addressed for the public good and patient safety. What was taking
months is being fast-tracked in weeks and I thank NHS England among others for facilitating this with the IDF.
It is also vital the private sector can update NHS records and we can view recent reports or results with consent. The technology is available and now the willingness is there as well.
Patients may also change their expectation of local NHS services and accept a phone call or virtual consultation instead of waiting the usual three weeks for routine appointments.
This may free up time for GPs to see day-to-day issues rather than patients clogging up A&E services with non-urgent concerns. Getting patients in the right place at the right time for their problem as the Care Quality Commission (CQC) highlighted in its annual report. The Government may well realise
the process of regulation through CQC inspection and rating is overly bureaucratic, expensive and inconsistent and could be streamlined if Treasury savings are required.
It seems unlikely that the NHS will be rewarded for its Covid-19 response with enhanced CQC regulation, which could have similar implications for independent practice.
Morale in NHS primary and secondary care has been rock bottom for years now, and the Government’s seeming inability to provide PPE for its staff will not be forgotten as the death toll rises, so staff will deserve and expect better treatment.
With such a massive downturn in GDP and a likely depression later in the year, it is inevitable that the independent medical sector will be hard hit.
No patients are coming from
I still worry about the virtual doctor many of us have become. Our work relies on nuanced observation that is only possible face to face
abroad to seek our world-class expertise and the insurers can hardly find consultants to refer to, let alone a hospital to provide treatment.
Patients are also wary of spending when their investments are so precarious. Healthcare is resilient, however, and even if the NHS receives the billions it needs to update its buildings and train new staff, a strong private sector will be essential to complement its offer-
ing and take at least some pressure off its services.
The unique selling point of private medicine is personalised – and excellent – care, which will become even more desirable in the future, as I fear technology will detract from individual care in the NHS.
That is not to detract from the current treatment of Covid-19 patients under extreme circumstances denied family visits and support, which I find especially moving.
I had intended to write an article on my recent experiences of private medicine as a patient, but as soon as my heart recovered from its bypass, I was flung straight into our Coronavirus response.
There was also the impact of Paterson on how information sharing between sectors must improve in the future, but that all seems so obvious now as global
events have taken hold and many fear for their lives.
The IDF itself is ‘working from home’ with still much to do and has hopefully provided a source of information and collegiate support for its members.
Changes made to our governance system are old news, but thank goodness they were implemented before this time of financial insecurity to enable our future.
One of our strengths is the networking we promote and, without this, we feel restrained, but rest assured we will be back on the scene as soon as safety and Government guidelines allow. I hope we will be in a better place very soon and I am sure we will come out of this stronger and more resilient in many ways. But, for the moment, stay safe and well.
See ‘Video consultations are starting to soar’, page 34
Last month, Philip Housden (right) reported an upbeat growth message for private patient units. Well, how quickly things can change. Here’s his round-up of the PPUs’ contribution to coping with the pandemic
In London, North West University Healthcare NHS Trust, based on the Central Middlesex, Ealing and Northwick Park hospitals, was one of the first to receive high numbers of coronavirus patients.
It transitioned the PPU – trust plus St Marks Private Healthcare –and allowed its staff and single ensuite rooms to be used for NHS patients.
Business development head David Osborne said: ‘The unit was initially used by patients awaiting the results of Covid-19 tests prior to being transferred to the appropriate hospital ward.
‘However, the unit itself quickly
became, and currently remains, a Covid-19 positive ward. The actions taken clearly demonstrate how the PPU has quickly and effectively responded to meet the needs of patients, the NHS and the local community.’
At Royal National Orthopaedic Hospital, Stanmore, Middlesex, the private care ward became the trust’s respiratory ward for Covid19-positive patients, primarily due to the single-room layout. PPU staff have worked there, supported by the wider trust.
Private patients – who fell into one of six protected pathways, including cancer, spinal cord inju-
ries, bone infections and urgent cases – were admitted onto NHS wards, but there were no elective surgery admissions outside the protected pathways.
Head of private care Eileen Scrase said: ‘In this time of uncertainty, as we all grapple with the greatest challenge of a generation, I am deeply humbled and very proud of all of the staff for the work they are doing.’
The Royal Marsden was ensuring cancer treatment continued while managing patients diagnosed with Covid-19.
Private inpatient areas at both its sites were identified as wards in which to contain Covid-19positive cancer patients due to their layout and hospital location.
Spokesman Shams Maladwala said: ‘We have also been leading a cancer surgery hub, in collaboration with University College London Hospital and Guy’s and St Thomas’ and private providers, to co-ordinate cancer services across London to ensure patients continue to receive the surgical treatment they require during the pandemic.
‘This will maximise available
capacity and expertise to relieve the pressure management of the Covid-19 pandemic places in the NHS.’
Royal Free’s PPU was not admitting private medical and surgical patients to the 12th floor of the hospital in Hampstead.
Some urgent and essential private outpatient activity took place in its Lyndhurst Rooms and at Hadley Wood Hospital outpatient facilities. But wards were totally utilised for Covid-19 patients.
Most PPU employees based in administrative positions were redeployed to Covid-19-based roles across the trust and also at the Nightingale Hospital at the Dock land’s Excel Centre and all PPU clinical employees were caring for pandemic patients.
Across the capital, it was a similar story. At Guy’s and St Thomas’, all facilities had, as I write, been handed to NHS services to support the Coronavirus response and trusts gave PPU beds to NHS needs and the clinical staff for NHS patients.
The South-east Portsmouth Hospitals Trust’s 13-bed Harbour Suite PPU was originally designed as an infectious disease ward, with negative pressure single ensuite rooms –which significantly reduce the risks associated with aerosol generating procedures.
So the PPU was perfectly set up to take Covid-19 patients requiring non-invasive ventilation (NIV). The floor layout enabled an increase in beds to 20.
Private patients nurse director Steve Thomas said: ‘PPU staff, due to their work with bariatric patients and the range of private
patients they would care for with extended comorbidities, are highly skilled in looking for early signs of the deteriorating patient.
‘They are central to the trust response and working closely with the respiratory clinicians and nursing teams are also now based on the PPU ward and supporting 24/7.
‘Our PPU is the trust’s front-line ward for NIV patients and staff have all done incredibly well and are proving to the whole trust they are an amazing team.’
Epsom and St Helier’s head of private patients, Romi Appanah, said the 20-bed Northey Suite was chosen to isolate Covid-19suspected or positive patients, so the unit stopped all private activities two months ago.
A few private inpatients not ready for discharge at the time were moved into single rooms to another ‘clean’ surgical ward until discharged.
PPU nursing staff remained on Northey to look after the NHS patients.
Since then, other wards were needed to contain the surge of suspected or confirmed pandemic patients and Northey ward became a low-acuity Covid-19 area before a temporary closure following a drop in A&E attendance and a nursing staff shortage.
PPU nurses worked on other wards and administrative staff
At the Royal National Orthopaedic Hospital, the private ward became the respiratory ward fo Covid-19 patients
worked from home and also assisted with other admin duties around the hospital, including covering ward clerking.
The 16-bed Michelham Unit at Eastbourne General Hospital closed and was being used as a cohort area for potential Covid-19 patients.
Both the 16-bed Chichester Suite at Chichester and the five-bed Downlands Unit at Worthing Hospital closed for private patients, with resources made available for pandemic demand.
Private manager Sarah Porter said the Parkside Unit PPU in Taunton, Somerset, was being used for surgery, mainly vascular, that was still being admitted to Musgrove Park Hospital. But all private work was closed for the foreseeable future.
Administrative staff were redeployed to Covid projects, including co-ordinating staff accommodation for those needing to isolate from family members and setting-up a pop-up shop for staff.
Gloucestershire Hospitals redeployed some staff and was still offering a limited private service including chemotherapy and urgent cardiology cases.
The eight-bed ward at James Paget Hospital, Great Yarmouth, was closed, but as all rooms were ensuite, it was used as a showering/ changing facility for staff. PPU staff were redeployed and equipment and stock supported the trust. Four private consulting rooms were closed and made available to the remote consultation team.
The Midlands
South Warwickshire NHS Foundation Trust’s interim clinic manager Pauline Salmon said the Grafton Suite at Stratford Hospital saw its last private patient mid-March. Treatment, ophthalmic and consulting rooms were rehousing Warwick Hospital’s oncology department. This enabled a separate building at the front of the hospital to be used for Covid-19 reception.
The North Newcastle-upon-Tyne Hospitals closed its five-bed Park Suite to private activity, with the nursing staff now supporting colleagues in other units.
Harrogate and District NHS FT in Yorkshire temporarily suspended services out of the ten-bed Harrogate Harlow unit to enable teams to support the wider trust at Harrogate District Hospital.
Private services manager Beth Barron joined the trust’s incident co-ordination centre, which was supporting the set-up of the new NHS Nightingale Yorkshire and Humber hospital at Harrogate Convention Centre, officially opened on 21 April by multi-million-pound pandemic fundraiser Capt Tom Moore just before his 100th birthday.
There is much opportunity, as well as risk, to the PPU sector in the coming months.
Clearly, the 2020-21 financial forecasts are going to be missed, costing the NHS approximately £60m a month.
But many managers have shared how they expect PPU services to be different when private practice is re-instated.
As this round-up demonstrates,
these managers and their teams now have many positive examples to share with chief executives and exec teams about the valuable contribution that PPUs play.
They provide more than 1,200 beds and the revenues enable the employment of several thousand staff – capacity and skills that would not be there if PPUs made no surplus.
But only trusts with PPUs have
had the benefit of these flexible resources, able to be re-purposed for the crisis.
It is unclear when these resources will be returned to support private care. But, when they do, they will be needed, as there will be a great deal of pent-up demand for healthcare and with waiting lists and access times at all-time highs, demand for private healthcare will be strong.
The Coronavirus crisis has demonstrated the value of 24/7 critical care back-up – and this, too, may lead to a greater understanding of the patient safety benefits of private care in the NHS setting – and an expansion of PPUs into many more trusts.
Philip Housden is managing director of Housden Group: www.housdengroup.co.uk
All for one and one for all – David Hare shows how independent practitioners are supporting the NHS in battling the coronavirus pandemic
IF THERE was ever any doubts as to the vital role that the independent health sector plays in delivering healthcare to the nation, then the onset of the coronavirus should well and truly have put these to rest.
I’m proud to say that both independent health providers and practitioners have truly stepped up to the plate and are working hand in hand with the NHS to ensure the health system is doing all it can to tackle Covid-19.
Recognising the need to drastically increase its bed, workforce and ventilator capacity, the NHS announcement at the end of March was a historic deal with independent hospital providers –brokered by the Independent Healthcare Providers Network (IHPN).
It has put virtually all the sector’s inpatient capacity at the NHS’s disposal over the last few difficult weeks and for many ahead.
Critically, this means 20,000 extra staff, including more than
10,000 nurses and 700 doctors are being deployed flexibly between NHS hospitals and the private sector according to local demands on services; as well as an extra 8,000 beds and, crucially, an additional 1,200 ventilators.
These extra resources are being put to use treating not only patients with coronavirus, but also with other urgent conditions such as cancer.
While there were calls from some quarters – notably Labour and the unions – for the NHS to ‘requisition’ this capacity, there was a recognition on all sides that, as employers of thousands of staff, independent hospitals will need to be reimbursed at cost for this work to ensure staff can be paid for and equipment can be procured.
In what is a full-scale national crisis, however, the sector has made clear that making money is not its objective, with no profit to be made from this work, and the use of open-book accounting and
independent verification to ensure taxpayers are getting a fair and transparent deal.
And for the many thousands of staff working in the sector, who are simply going above and beyond to deliver care in the most challenging of circumstances, we have successfully ensured that they are included in the Government’s definition as a ‘key worker’ and all will reap the benefits this brings.
As part of this, we have also been working hard to ensure that access to key training, particularly around personal protective equipment (PPE), is fully aligned between staff in the NHS and independent sector.
Equally, it has been assured that everyone involved in the delivery of NHS services during this time is covered by indemnity arrangements in respect of clinical negligence under schemes operated by NHS Resolution. And they are also covered by the insurance arranged by the hospital operator and/or indemnity arrangements under
schemes operated by NHS Resolution in respect of employer’s liability.
These are utterly extraordinary times, and there can be no doubt that coronavirus is going to have both devastating human and economic costs for the country.
But Independent Practitioner Today readers should be reassured that we are working with independent sector providers collectively and individually to ensure their workforce is fully protected and that providers have the confidence that their business will get through this unprecedented period.
And, most of all, we want to thank all those working in the sector for stepping up to the plate and for working hand in hand with the NHS to get through this most challenging period.
David Hare (right) is chief executive of the Independent Healthcare Providers Network
Independent practitioners have been keeping specialist medical accountants busy with business-related queries during the pandemic. Julia Burn addresses some key issues
EVERYONE’S FINANCES are up in the air due to the pandemic but in uncertain times like these we must manage them as carefully as we can so that we all come out of this in the best shape possible.
The Government has announced various schemes to help individuals and businesses (see www.independent-practitioner-today.co.uk) and many consultants and GPs will fall into one of these.
One example is the option to defer tax payments, including both direct taxes and VAT.
Any self-employed taxpayer with a personal tax payment due on 31 July 2020 will automatically have their due date for payment deferred until 31 January 2021.
And UK VAT registered businesses who have a VAT payment due between 20 March 2020 and 30 June 2020 have the option to defer that VAT to a later date.
HM Revenue and Customs (HMRC) will not charge interest or penalties on any amount deferred in either scenario. Both schemes will assist those who are struggling with cash flow in the short term.
In addition, HMRC is focused on the fact that many taxpayers will need Time To Pay (TTP). Hopefully that will mean it is possible to agree something sensible should cash flow be a problem. However, all taxpayers do need
to bear in mind that tax liabilities are only deferred, not extinguished and, to take advantage of TTP, they will need to be able to provide information that demonstrates why they need TTP, the impact that Covid-19 has had and will need to be able to present a plan for repayment.
That plan will need to include:
Explanation of the financial hardship – for example, the temporary halt on private patient appointments or non-essential surgery;
The proposed time scale for deferral of the tax;
Why the payment plan is affordable. This could be based on either future anticipated income or – for example – the proceeds of selling an asset;
Explanation of the impact of the interaction with other debt financing; that is to say, being able to make appropriate payments on both;
Provis ion of evidence to show that costs are being well managed.
For independent practitioners, that will probably mean provision of management accounts and preparation of a cash flow forecast.
You may also be asked to show the level of cash reserves. Individual taxpayers are likely to need monthly income and expense statements and a statement of personal assets and liabilities.
The longer the period being requested for TTP, the more evidence HMRC is likely to require.
Since nobody knows how long the impact of Covid-19 will last, it may be necessary/possible to renegotiate TTP if the original agreement cannot be met.
If that turns out to be the case, taxpayers should always notify HMRC of the difficulty as soon as possible and before missing a payment.
HMRC is also suspending compliance checks and some inquiries into taxpayers’ affairs.
While this may appear to be welcome news, it may not be as helpful as it sounds, since doctors are likely to continue to be extremely busy even after the current crisis, due to the backlog of nonCovid-19 cases, which are currently building up.
Furthermore, if tax is due, it will
The level of juggling required in this unprecedented situation extends far wider than just tax
remain due even if an inquiry is not completed for some months. So it may be helpful to find out now what is owed and take advantage of the fact that there are more HMRC staff focused on TTP for those who need it.
This is therefore a good opportunity for practitioners to make sure their ‘house is in order’. But tax is just one part of the jigsaw. The level of juggling required in this unprecedented situation extends far wider.
Remember: ‘Cash is king’! You need to determine what is your essential cash spend today, tomorrow and next week. You may want to consider cancelling direct debits, standing orders and, effectively, turning off the taps to ensure you can keep cash reserves.
Payment terms should be reviewed for all key suppliers and lenders. Banks and hire purchase companies will want a dialogue with their customers and have publicly stated they are open to supporting them. Payment holidays and relaxation of covenants should be discussed with your lender.
Many landlords will be expecting their tenants to be asking for rent reductions for practices that cannot open. Given the prospect of a vacant building, a rent payment holiday may well be acceptable to them.
Chase any outstanding debtors as hard as you can, and if you do allow extended payment terms to your clients, consider asking for payment up front, if circumstances dictate.
Julia Burn is a senior manager at Blick Rothenberg
In the turmoil over the Covid-19 pandemic, we may have forgotten that we’re in the process of leaving the EU and therefore its data protection jurisdiction. Jane Braithwaite (right) and Karen Heaton (far right) outline what it means for your practice
side their control, such as Brexit. The UK left the EU on 31 January 2020 and is now operating under the terms of the Withdrawal Agreement between the UK and the EU. This agreement runs until 31 December 2020.
Unless there is an extension to the Withdrawal Agreement, the UK will either leave with or with-
will be and what it might mean for data protection.
At Data Protection 4 Business, we believe that the preparation and analysis for most scenarios regarding data protection remains the same. Therefore, we are going to discuss the pragmatic steps your practice can take now without remains the same ➱ p18
1
Answer the questions above. Understand where your data is, who processes it and why, whether you offer services to UK only or EU individuals. Then decide what needs to be done next.
2
Update references to new UK data protection laws. This is likely to be privacy notices, policies and contractual agreements in place with organisations you share data with, send it to or receive it from. Often contractual changes can be done using a signed addendum to the contract.
3
Where your practice receives data by way of a transfer from an EU-based company, that EU company must ensure that the transfer of data to the UK, as a ‘third country’, is legal. This is because – in our scenario – the UK may not be recognised as ‘adequate’ by the EU regarding data transfers on 1 January 2021. There are a number of ways this can be handled, but it will require some analysis on a case by case basis, before the necessary contractual changes can be determined. The nature of the contractual updates or changes that are required will depend on the nature of the data processing done between your practice and the other party.
Seek assistance from a data protection professional or lawyer if needed.
4
Consider whether you need to appoint an EU representative if you offer services directly to EU individuals. Equally, for practices in the EU who offer services to UK individuals, you may need to consider whether to appoint a UK representative. Even today, for non-EEA (European Economic Area) organisations selling goods or services into the EEA, an EU representative is required if they do not have an organisation in the EEA.
5
Make sure the person responsible for data protection in your practice has the information and support to help them through these changes. If your practice has a significant EU or global offering or uses companies outside the UK, then this is especially important and you may want to consider outsourcing the Data Protection Officer role to keep on top of the changes.
Even if your practice is UK-based, it is likely that UK and EU data protection regulations will diverge over the coming years, so someone will need to keep track of those differences.
In previous articles, we have discussed the importance of knowing your data, mapping the processes or activities the practice undertakes using personal data and understanding which other companies your practice may outsource to (data processors).
Your practice may even share data between other medical professionals when offering specialised services. This data sharing is often governed by a Data Sharing Agreement between data controllers.
We have also talked about cookie consent management and some pragmatic steps practices can take to make sure their websites are compliant.
For those who have implemented a cookie consent management pop-up tool, this will pay dividends now.
Why? Because, individuals in the EU who are using your website will be required to consent to your
use of the cookies before they are set.
Now that we have posed some questions, look at what may need to be done next – see box on page 17.
Bad news, good news
In short, changes are coming even if there is an extension to the transition period. At some point, the UK laws will separate from the EU GDPR even if there is an ‘adequacy’ decision. So, it just makes sense to prepare.
The good news is that the changes need not be onerous, but they cannot be ignored, especially when medical data is concerned.
Knowing your data is absolutely fundamental – without that, medical practices run significant risks of being noncompliant with the data protection regulations and may increase the risk of fines. Try to make data part of your practice culture.
The good news is that the changes need not be onerous, but they cannot be ignored, especially when medical data is concerned
If you have not already, engage a data protection professional, subscribe to information sources like the ICO (www.ico.org.uk). Or contact us, we are happy to help.
Jane Braithwaite is managing director of Designated Medical, which offers business services for private consultants, including medical secretary support, book-keeping and digital marketing.
Karen Heaton is the founder of Data Protection 4 Business which offers consultancy services in data protection, as well as online training, outsourced Data Protection Officers, outsourced EU and UK Representative Services 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.
A look back through our journal’s archives of ten years ago reveals that although times change, some issues are not so new
Private practice advisers were urging independent practitioners to act swiftly to stop further losses of fees amounting to thousands of pounds.
Accountants were recommending doctors to review their charges because so many practices were undercharging.
The worst examples were in London where shocked specialists were warned they commonly worked for less than those in Glasgow.
Accountant Martin Murray told doctors at the BMA’s annual private practice conference – sadly a victim of the pandemic this year – that consultation charges in the English capital were ‘woefully low’.
He said fees for initial consultations over the border were £180-£210 and sometimes £220. For follow-ups, the common fees were £140, £160 and £180.
But Mr Murray, of Sandison Easson, revealed: ‘A lot of people in London are charging less than that. Prices are as low as £130 for initial and £90 for follow-up consultations.’
A spokesman for the BMA private practice committee said: ‘We can’t advise people to charge more; it would probably be anticompetitive.
‘But people should take careful note and review their charges regularly, because there is no point in being in practice if you are not making a profit.’
Independent practitioners were granted an ‘application window’ until September to submit applications for registration with the Care Quality Commission (CQC).
We announced that the CQC was overseeing a new system of registration, which brought the NHS, independent healthcare and adult social care under a single set of essential standards of quality and safety for the first time.
Doctors’ defence bodies ruled out fee discounts for holders of a new quality assurance mark for injectable cosmetic providers.
The advent of the independent Healthcare Advisory Services’
register was cited by a dentists’ defence body as one reason for a new subscriptions deal.
But defence bodies argued that subscriptions reflected claims experience and they would not expect quality mark membership to affect doctors’ premiums.
Private doctors who had come forward to register under the HM Revenue and Custom’s Tax Health Plan were being advised to act immediately to ensure their disclosure, tax, duties, interest and penalties were paid by the 30 June deadline.
Tax adviser Gary Ashford warned: ‘I have seen many instances where there has been a mad rush in the run-up to the deadline and the time required to prepare a disclosure has been completely underestimated.
‘Requests for duplicate information always take longer than you expect. As all medical professionals will recognise, a lastminute rush job could have dire consequences.’
Solicitors were urging private doctors to beware of new fines of up to £500,000 for any serious data breach.
We reported that the Information Commissioner had new powers to impose ‘civil monetary penalties’, in amendments to the Data Protection Act 1998.
Until then, practices which lost patient data only faced limited sanctions such as an enforcement notice or, in limited circumstances, a criminal prosecution.
Day-case centre The Guildford Clinic, opened by a large group of consultants just 11 months previously, was holding talks about its future.
Nuffield Health, with a hospital next door, said it was working with the group to explore the possibility of bringing the clinic under its wing.
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Independent Practitioner Today’s latest guide aims to help you cut through the complexities of tax legislation with sensible advice and tips to help you maximise your take-home cash and get set for a secure future.
Email vanessasanders@stanbridgeaccountants.co.uk
Website: www.stanbridgeaccountants.co.uk
THE BIGGEST and most welcome news is the change to the pension limits. This remains a complex area, but in summary:
Tax relief is given by reference to contributions or pension savings’ growth in the tax year – depending on the type of scheme to which you are contributing – but the amount attracting tax relief is capped at a maximum known as an annual allowance.
This can be confusing if calculating unused annual allowances to carry forward. Alterations to pensionable pay also cause particular problems for consultants, as the growth may fluctuate wildly when
new salaries, pay adjustments or merit awards affect pension pots.
The pension annual allowance –currently £40,000 – is the maximum amount of tax-relieved pension savings which can be accrued in a year.
However, for those on higher incomes, the annual allowance is reduced by £1 for every £2 when an individual’s ‘adjusted income’ exceeds £240,000, to a minimum annual allowance of £4,000 – previously £10,000.
Adjusted income is primarily net taxable income plus pension savings’ growth. The downward tapering potentially applies to an
individual with threshold income – taxable income from all sources – above £200,000.
This is an increase on these thresholds of £90,000 and should cover the vast majority of cases where hospital doctors earn income from an NHS source only, and whose pension savings’ growth is below £40,000.
There is a change to the minimum annual allowance. The minimum level to which the annual allowance can taper down will reduce from £10,000 to £4,000 from 6 April 2020. This reduction will apply to individuals with adjusted income exceeding £300,000.
The NHS should send out employer statements which detail pension growth. It is essential to keep an eye out for these and to pass them on to your tax adviser, as there is a tax charge arising if thresholds are exceeded. Each consultant will only know whether the thresholds have been exceeded once their overall tax position for the year is quantified. Doctors should not take drastic action and leave their pension scheme without taking advice, because often it is a case of the scheme reward still remaining valuable, maybe just not as valuable as in the past.
Intermediaries and IR35
Recently, many hospital doctors will have received letters from the private hospitals and other firms who contract with them, asking for specific details about how they operate.
This is in readiness for the requirement to assess all individuals offering services through their own limited companies.
The changes to the off-payroll working rules, commonly known as IR35, which came into effect in
April 2017 for the public sector, are to be extended to the private sector. The date for implementation was originally to be April 2020; however, with the Covid-19 interruption, this move has been postponed until April 2021.
Draft legislation has been issued mirroring that already in place for public bodies, so this reprieve is likely to be short-lived.
In January 2020, the Government announced a review of the
implementation of reform to address concerns from affected businesses and individuals.
In light of the reduced help available to these off-payroll workers during the current Covid-19 crisis, there may be some radical changes of attitude, as the livelihoods of those operating this way are not covered by any of the legislative assistance such as furlough leave or self-employment, demonstrating they are definitely not employees.
The current Government position is that the proposed changes will go ahead, but:
Businesses will not have to pay penalties for errors relating to offpayroll working in the first year, except in cases of deliberate noncompliance;
There will be a legal obligation on taxpayers to respond to a request for information about their size from either the worker or the contractor.
Current intermediaries legislation and off-payroll working
Off-payroll working rules apply where an individual (the worker) provides their services through an intermediary – typically a personal service company (PSC) – to another person or entity (the contractor).
The contractor will be required to make a determination of a worker’s status and share that information with the worker. If the worker is deemed to be under IR35 rules, the contractor paying the fees to the PSC will be required to make deductions for income tax and National Insurance contributions (NICs) and to pay employer’s NICs.
Many locum doctors were taken by surprise when confronted with greatly reduced hourly rates for agency NHS contracts when legislation was introduced in April 2017 making public bodies who engage such workers responsible for deciding whether the individual was, in fact, a pseudo-employee.
While the rules state each assignment should be assessed on its unique facts, the NHS tends to err on the side of caution when assessing its relationships with workers and basically now
employs (primarily through agencies) locum doctors as workers.
This means the cost of employment is being passed on to the worker. This consists of employers’ NI at 13.8%, employees’ NI at 2-12% and PAYE at the individual’s rate of tax applied via a notice of tax coding from HM Revenue and Customs (HMRC).
These contracts usually carry no rights to pension, sickness or holiday pay, and although many of you will be familiar with the headline case of online taxi-hailing service Uber, which is being forced to consider its employment status for the accrual of employment rights, there is no parallel in the tax system; you are either self-employed or employed.
Proposed legislation means that accountability for deductions is being extended to the private sector. Small businesses will not have to comply and, thankfully, HMRC has stated it will not look at retrospective action if a worker now decides they should have been complying with the IR35 legislation since its original inception in 2000.
A small company is one which meets two of these criteria: Annual turnover is less than £10.2m;
Doctors employed as locums using offshore intermediaries – not employment agencies – who exploit the tax system to reduce their own costs are likely to face a tax liability
Digital record-keeping should be considered to assist all businesses to maintain adequate records.
HMRC can charge up to £3,000 a year if your records are ‘inadequate’ and many advisers are assisting with the transfer over to digital software packages before it is necessary to help iron out any problems.
Unfortunately, there is no legal definition for adequate records, but certainly you will need the following:
Receipts for all expenses;
Credit card statements;
Bank account statements – preferably a dedicated account for business;
Invoices;
Mileage log;
Clearly defined dividends rather than withdrawals of ad hoc cash.
If you are found wanting, you can be fined up to £3,000 for inadequate records to support your tax disclosure. Ask your accountant to perform a health check and to help with how your records are maintained.
No more than £5.1m on balance sheet;
Employs 50 or fewer employees.
Umbrella companies and locums
Doctors employed as locums using offshore intermediaries – not employment agencies – who exploit the tax system to reduce their own costs are likely to face a tax liability.
If you work through umbrella companies that abuse tax reliefs on travel and subsistence, they can easily disappear, leaving you in the firing line. Abuse of the ‘wholly and exclusively for the purposes of the trade’ rule has long been a bugbear of all professionals.
There are a myriad of tax cases examining what constitutes the deductibility of expenses.
For example, in the Samadian case, the court ruled that travel between habitual workplaces and home has a dual purpose and thus restricts considerably the definition of a tax-deductible business mile.
Digitalisation is now in place but currently only for VAT-registered businesses, and the plan for other taxes has been postponed.
HMRC now has access to massive amounts of data from employers, banks – overseas included – and share dealings and uses this knowledge to open aspect inquiries looking at specific items on a tax return.
For example, if you moved jobs during the year and were issued with a form P45, check whether you received any further payments on a late payslip, as these will be picked up by HMRC under ‘Real Time Information’ reporting but may not have been reported by you on a tax return.
Penalties are charged on errors between 0% and 100% of the tax mis-stated; this could mean even if you have paid them too much. If it can be shown that you were in any way negligent, then the penalties start at 30%.
If you are a doctor, then the bar of compliance is higher than for, say, a manual worker, as you are expected to understand what you are returning on your self-assessment form or if you do not to take proper advice.
Do not forget that the relationship is between you and HMRC, not between your adviser and HMRC.
If you do not understand an entry on your return, the onus is on you to seek an explanation.
Incorporating your business into a limited company is planning for future growth; it is not entering into a tax avoidance scheme.
After much discussion, HMRC concluded there are no issues with a company offering professional services.
The company must, however, be operated properly with the veil of incorporation descending over the business assets, with income and expense transactions being separately identifiable from you as owners of the business.
This is an important matter to consider when looking at future growth plans, for indemnity protection and controlling cash flows. Are your records up to scratch?
Corporation tax rates were to be reduced to 17% by April 2020, but they are now going to remain at 19%.
However, small business owners are facing increased taxes on dividends and restrictions to pension contributions.
This has had an effect on those of us who have grown a business; as the personal reward is reduced, the incentive to work harder disappears.
The changes
Tax-free dividend allowance is £2,000;
Dividends above this level will be taxed at:
❍ 7.5% (basic rate);
❍ 32.5% (higher rate);
❍ 38.1% (additional rate).
For those independent practitioners who have incorporated, there are still distinct advantages.
For example, to name but a few, these advantages are:
The limited liability;
Evening out profits over periods of uncertain times and changing rates of personal taxation;
Allowing investment within the corporate environment;
Sharing the family business.
Shareholders with access to basic-rate bands, which are up to £50,000 from 6 April 2020, remain in an efficient position because of the £2,000 tax-free allowance, a full personal allowance (of nearly £12,500 at 0%) and the 7.5% dividend tax. Students tend to be in this bracket.
A higher-rate taxpayer will pay tax at 32.5% on any dividend income in excess of the basic rate threshold and an additional-rate payer will be taxed at an eye-watering 38.1% rate, but both receive the tax-free dividend allowance.
Creating a family company allows the distribution of profit reserves on a reasonable commercial basis to all shareholders and, provided this is not artificially manipulated to gain a tax advantage rather than as a genuine
reward to investors, profits can be shared, making the most of any lower rates of tax available.
Salary packages have to be commercially justifiable, not merely when considered in isolation, but as part of a total reward package.
Reward includes all items stemming from participation in a small owner-managed business, including salary, pension contributions, benefits in kind and dividends that are typical for professional service companies.
While shareholdings alone are not subject to commercial justification, a court would be allowed to compare who takes what size of reward and review whether the primary reason appeared to be to gain a tax advantage.
For example, consider the following circumstances:
Spouse 1 generates the fees for the business by providing the medical service. Spouse 2 supports this provision by carrying out all of the administrative tasks associated with the business.
Spouse 1 has another income source from an NHS employment, meaning any reward they receive is subject to tax at the highest rates.
As directors, both spouses decide on a minimum salary to review what other forms of reward they could take depending on the prof-
itability of the company throughout the year. The best way of achieving this is considered to be by way of dividend.
Spouse 1 is the controlling shareholder by virtue of the fact he or she is the primary decisionmaker and income-generator. In commercial terms, this should mean that he or she holds more than 50% of the share capital, regardless of class of shares. This ensures other family members cannot gang up and take over the business in the event of disputes such as during divorce. Hence, the controlling shareholder would always receive the majority – albeit small – of the reward from dividends.
Advice is received suggesting that Spouse 2, who does not work outside of the family company, should consider their pension arrangements.
As this Spouse 2 does not have the benefit of the NHS pension, they may have available annual allowances of £40,000 – if their total taxable income does not exceed £200,000 – and, understandably, the directors may consider making pension contributions from the company as the employer of Spouse 2.
Spouse 1, however, is subject to restrictions on their pension annual allowance because of the growth on the NHS scheme of which they are a member and so
does not want a pension contribution.
The questions to ask can be condensed into the following:
➠ How can a total reward package for an administrative non-fee-earning employee be commercially justifiable if greater than that of the fee-earner and controlling shareholder – when compared to that of Spouse 1?
➠ Would Spouse 1 be content to provide the same package to someone totally unconnected to them?
➠ Is the action wholly and exclusively for the purposes of the trade?
Different advisers will have differing opinions and doctors need to ensure the advice they take is backed up by indemnity and expertise.
Be careful to follow commercial principles when considering reward packages, as HMRC may require commercial evidence of the amounts paid for salaries, benefits in kind and pension contributions plus dividends where there is an imbalance between connected persons. There are many tax cases considering commerciality and business owners should be ready with a robust response.
Dividends do not have to be paid out in the year in which the profits are earned, unlike the profits of a sole trade. If the company did not pay out all of its profits, this is acceptable, as it allows for future planning such as to ensure continuity of the business in the event of a downturn.
Or if the trade wished to invest in some equipment or a property, or stocks and shares, then the company could still declare a lower amount, say, £150,000 of dividend, but keeping the lower earner under the additional-rate tax limit.
This could be used to manage personal taxes when faced with more punitive rates of tax. This flexibility is not available within a sole trade, because the individual pays taxes on the profits as they are earned at the rate of tax applicable during that period.
As you can see, the effects are not disastrous. You can leave some of the profits as reserves in the company to invest in the longevity of the company. These reserves can be maintained in the lower tax
environment and invested for future growth.
The company can continue beyond its natural trading life and the growth and income distributed when you and other shareholders are not paying such large percentages in personal tax – for example, when you retire. It is important to remember that a reasonable rate of return in the form of dividends to shareholders is necessary if the trading company is profitable.
The use of a company is particularly helpful when there are fluctuations in trading income, as profits are not subject unnecessarily to differing rates of personal taxation and NI. There are also other potential shareholders to be considered: do not forget anyone can own shares in their own right, provided they are at least 18 years old.
Some doctors may still be considering disincorporating their business. This is possible, but you cannot access Entrepreneurs’ Relief if you intend to carry on the same or a similar business.
A business continuing essentially the same trade is known as ‘phoenixing’. If your business has valuable goodwill, then you will need to buy this before you can continue the trade in another form.
If you decide to dissolve your company, you need to ensure you are seeking clearance from HMRC before you treat the return of funds or assets to shareholders as capital. If you have used your company as a ‘money pot’ to protect the trading profits at the lower corporation tax rates and not paid out a reasonable return in the form of dividends to shareholders, you are open to an accusation of tax avoidance.
If your company holds more than £25,000 on its balance sheet, it will need to appoint a liquidator. The liquidator does not provide advice; they take instruction from you. If the intention to close your company and withdraw the funds or assets at a lower rate of tax by turning income into capital, then this may be viewed as aggressive tax avoidance.
HMRC can investigate such action and the directors would be held responsible as individuals even if the company is dissolved.
Can you pass the wholly and exclusively test?
Section 34 of the Income Taxes, Trading and Other Income Act states that:
(1) In calculating the profits of a trade, no deduction is allowed for:
(a) Expenses not incurred wholly and exclusively for the purposes of the trade or;
(b) Losses not connected with or arising out of the trade.
(2) If an expense is incurred for more than one purpose, this section does not prohibit a deduction for any identifiable part or identifiable proportion of the expense which is wholly and exclusively for the purposes of the trade.
As a self-employed individual, or indeed as a company, there are many deductions from profits that are allowable, as the rule to be applied is that the expense must be ‘wholly and exclusively’ but not ‘necessarily’ for the purposes of the trade being carried on.
This is very different from the test applied to employees claiming deductions from their earned salaries.
Some of the tax-saving deductions are as follows:
Employing family members –see below;
Private secretarial fees – but beware of those who you think are self-employed. See below;
Costs of meetings – do you have an agenda or are you just having lunch?
Uniforms – when are clothes allowed?
Motoring expenses – when and what?
If HMRC disagrees with your claims and seeks to adjust these, let me remind you that the onus is on you as the taxpayer to provide the evidence to substantiate your claim.
You are guilty until proven innocent. However, the burden of proof is only on the balance of probabilities, not beyond reasonable doubt.
Not everyone has a personal allowance now: if your taxable income exceeds £100,000, you will lose £1 for every £2 over. But some can still benefit from a 0% rate of tax: they are family members who may not be higher earners and who could be paid tax-efficiently for doing work for you.
This can range from your spouse answering the 24-hour emergency calls, taking cheques to the bank or debt-chasing, to your teenage child setting up spreadsheets or following any blogs about you on social media websites. Whatever job they are doing, make sure that it is appropriate for their level of experience.
Beware; you must pay them as an arm’s-length transaction. Basically, you should be able to justify the amount paid as if to an unrelated employee.
For example, how much would a 24-hour phone answering service cost; or a debt collection service or even following bloggers on we bsites or Twitter, ensuring your name is not besmirched without response? Ask your employee to keep a timesheet of activities undertaken over a specimen period of time as evidence of their work.
Also make sure you actually pay them the amount stated on the payslip, otherwise no deduction is allowed.
This is particularly important now, as all employers are required to operate under Real Time Information, which aims to ensure that all employees have their actual data processed and provided to HMRC at the end of every month.
This includes students who work regularly for you.
You should also have at least a basic contract of employment demonstrating that you acknowledge your responsibilities as an employer. You may also need employers’ liability insurance. Speak to your accountant.
You may also be forced to offer your employees a workplace pension, which could be a useful tax relief when considering a salary package for your employees.
The rules here are complex and must be continually monitored and records maintained. This is for all employers, not just those operating a business, so think about taking advice if you employ domestic staff as well.
On another note – but using the same premise – you can also utilise capital gains tax exemptions by ensuring that any capital assets you own are shared with your spouse or civil partner.
As there are annual exemptions available on capital gains of
around £12,300 per individual for each tax year, this is a significant potential saving. However, if you are owning property jointly, then make sure that there is evidence to support the transfer of land to both parties in writing.
For example:
➲ Write a letter to your spouse or partner telling them that this is what you have done and have it witnessed and dated;
➲ Change any mortgage or loan documentation to incl ude them on it;
➲ Alter the title deeds to show that you both own the property. Check your tenancy status – joint or in common;
➲ If you own it jointly, then ensure you are retu rning any income in the specified proportions on your individual tax returns. If you wish, you may vary this percentage ownership – the default for married couples is 50% each – but a form is required to be submitted to HMRC and this may cause issues with inheritance because it may change the nature of the tenant ownership.
Watch out for minor children, however. They can earn money from a job and this remains their own, but anything you give them which earns £100 or more a year will have to be reported on the parental tax returns. This includes ownership of any shares on which dividends are being paid out if the initial capital was provided by you or if the benefits of which are passed onto you.
However, a gift from grandparents is not caught by this restriction and individuals can give away up to £3,000 a year each year without it affecting their estate for inheritance tax (IHT), so any birthday or Christmas presents of shares can be used to fill up their allowances.
When contracting anyone else’s services, you need to consider their status from a practical perspective. There is a difference between employed and selfemployed which is governed by the facts of reality rather than by what you agree.
It is therefore important for you to understand that with selfemployment there are a number of practical aspects which you need to consider:
Do they provide their own equipment or use their own premises?
Do they do the work in their own time or do you prescribe when the work is done?
Do they take any financial risk? For example, if the job is not satisfactory, do they have to correct it at their own cost? Do they charge a fee regardless of time spent?
Can they offer a substitute or carry out work using their own staff?
Do they carry their own insurance?
Do they provide services for others?
In fact, HMRC has a toolkit which helps you assess the status of people with whom you work. If you decide to use this, then you could be asked if you have taken the findings and applied them; so beware before using any such tools, as their provenance may
There is a difference between employed and self-employed which is governed by the facts of reality rather than by what you agree
skew in favour of a pre-determined result.
Many things point to employment or self-employment. HMRC would like everyone to be employed so that they can collect tax through PAYE and no expenses would be allowable.
However, there are a few things you can put in place to help yourself:
A contract for services which states that the subcontractor is responsible for their own tax and NI;
Do not pay holiday, sick pay or bonuses;
Do not pay the same amount regularly; pay by job done or each report written;
State that you are not in a master-servant relationship;
Ensure they use their own equipment and their own time.
If you are found to be an employer, then HMRC expects you to pay over the tax and NI due. To calculate this, it will gross up the amount you have paid for both tax and National Insurance, plus they will add on employer’s NI and charge interest and penalties. It will also seek to go back for as long as this relationship has been in existence. This could prove very expensive indeed. So protect yourself as far as possible.
Meetings
Entertainment is never an allowable expense for tax purposes. If you are having a meeting which includes refreshments, then
ensure that you have an agenda or maybe have a quid pro quo arrangement where you pay one time and they pay the next. Also, be reasonable. If you meet on a Sunday lunchtime and are accompanied by your spouses and children – ‘Happy Meals’ are a give-away – then this is unlikely to be classed as a meeting.
If, on the other hand, it is a drink after work or a lunch mid-week for a few of you in the department to discuss setting up a limited liability partnership, then there is no reason why this will not be allowable.
There is a tax case (Mallieux v Drummond) which governs the deductibility of clothing and tests the wholly and exclusively rule. Basically, clothing is never allowable as a deduction for tax, as it is to keep you warm and decent. The only time when it is possible is if it could be described as a uniform. Hence, if you are going to buy an Armani suit, you may want to ensure that it has a label with the name of your private practice emblazoned on it somewhere.
On the other hand, dry cleaning due to the type of work you do may well be allowable as a tax deduction, so if you do not like ironing shirts, a laundry service for work clothes may be a possibility, as it is arguable that you do not have to be clean and fresh in society, but do have to be as a doctor.
If you wear them for your NHS consultant post, make sure you
Clothing is never allowable as a deduction for tax, as it is to keep you warm and decent. The only time when it is possible is if it could be described as a uniform
adjust the claim for private use to avoid duality of purpose.
The Upper Tier Tribunal ruling on the Samadian case outlines some basic agreed rules for motoring expenses. The tribunal agreed with HMRC’s very strict view disallowing any claims for consultants’ travel between home office base and other business bases where attendance was regular and predictable.
This would include the following:
Travel from home office to private hospital;
Travel from NHS employment to private hospital;
Travel from private hospital to home office.
This is because the taxpayer is not expected to fund lifestyle choices such as the fact that you may wish to live in Scotland but work in London. The journeys above have a dual purpose – to allow you to live away from work.
HMRC and the courts believe that while your home office does count as a workspace and hence attracts a deduction for apportioned home costs, there can be no deduction for the travel to and from this business base if it is habitual.
You can, however, claim for the following:
Travel between private hospitals;
Emergencies – as not habitual;
Visits to patient at home;
Courses and conferences.
When keeping records – which you are required to do – be mindful of the case of Dr Jolaoso v HMRC, where the motoring expenses were restricted on the grounds that Dr Jolaoso had not provided any evidence to support his claim. I therefore urge you to keep a mileage log in your car demonstrating the following:
Date of journey;
Start and destination points;
Mileage log and if having to take an unusual route, a note why – e.g. M25 shut – as HMRC uses Google to substantiate mileage claims;
Brief reason for journey;
Odometer reading at the start of each financial year.
To calculate the costs, you can then deduct the business proportion of the total costs of the car including:
Fuel;
Insurance;
Repairs and servicing;
Cleaning;
Road Fund licence;
Breakdown cover;
Capital allowances on the capital cost.
Or just apply 45p per mile to the business journeys and deduct this instead.
Also, if your spouse is working for you, do not claim a proportion of their motor vehicle; pay them 45p per mile for its use, otherwise you could find that you are charged for a benefit in kind on the provision of a car for an employee.
Unfortunately, as an employee, the rules for deductions against
Company cars have long been a target of the Government and every year we have seen tax consequences for any vehicles, other than electric, becoming increasingly punitive
All zero-emission cars will attract a reduced percentage of 0% in 2021 and 1% in 2022, before returning to the planned 2% rate in 2023;
For cars registered before 6 April 2020, the current test procedure will continue to apply and there are no further changes to percentages previously set for 2021. These rates will be frozen at the 2021 level for 2022 and 2023;
employment income are generally much stricter, as there is a requirement to be wholly, exclusively and necessarily incurred in the performance of the duties of that employment.
Company cars have long been a target of the Government and every year we have seen tax consequences for any vehicles, other than electric, becoming increasingly punitive. The issue is the ‘green-friendliness’ of the vehicle and the necessity for having the car, which is viewed as a perk and taxed as a benefit in kind.
The only type of car which has any tax efficiency now is an electric vehicle and many doctors are investing in such cars.
The Government announced in Budget 2017 that CO 2 emissions for cars registered from April 2020 will be based on the Worldwide Harmonised Light Vehicles Test Procedure (WLTP). Draft legislation has been issued to amend the previously planned benefit percentages for 2021 through to 2023:
For cars first registered from 6 April 2020, most rates will reduce by 2% in 2021 before returning to planned rates over the following two years, increasing by 1% in 2022 and 1% in 2023.
This might be a good idea if you have teenagers who drive. It is unlikely you could transfer the benefit to them as employees, however, as their salary package including the car would need to be commercially justifiable for what they did for the business.
If you use your own car, then you can claim up to 45p per mile from the company for the first 10,000 business miles travelled and 25p per mile thereafter. If you travel 10,000 miles, this could be £4,500 in your pocket with a corporation tax deduction for the company to boot.
Don’t forget this applies to all employees, not just to your own business travel. Hence, all those trips to the bank and to ferry paperwork around can be claimed by your employed spouse, for example.
All that is required is an expense claim (mileage log) for a company and a mileage log of business miles and a note of total mileage to calculate a business proportion.
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If you are a sole trader, then a reasonable proportion of the costs of any communication tool is an allowable deduction. HMRC expects you to be able to identify business calls from private, but this may not be possible over a whole year, so it may be worth looking at one month and doing an example split. Pick a busy one.
A mobile phone provided to an employee is still a tax-free benefit – although you can now only have one per employee. And the value of the salary package still has to be justified, so watch for those teenage data surfers.
The following rules apply:
1. A policy must be in place stating that the employee’s personal use of the phone will be limited and incidental;
2. The contract must be in the name of the company – although the name of this could be as part of the address line, as having a business contract could be cost-prohibitive for smaller companies;
3. The company cannot foot the bill of personal mobiles without there being a tax and NI cost and a benefit form to fill in at the end of the tax year, so beware;
4. Free calls on a contract phone will be assumed to be the line rental and so cannot be claimed back if value not exceeded.
Ordinary phones can also be provided, but similar rules apply. For instance, they must be: Limited personal use;
In the name of the company, not the individual;
If in the name of the individual; only the cost of business calls can be reclaimed;
The cost of any line rental is the liability of the individual, as the ‘wholly and exclusively and necessarily’ rule for employees does not allow apportionment.
This also applies to use of the internet.
Subsistence and incidentals
As a sole trader, you cannot really claim for subsistence, as the expense cannot be deemed to be for the trade but for your comfort and sustenance.
However, HMRC is more relaxed about this and will allow a reasonable amount of drinks or food if you are away from your normal routine or having a meeting or have gone on a course.
When employees work away from their normal base, a subsistence amount can be paid – for example, when they are on a course at home or abroad or if required to work a particularly long day. This does not include NHS work, however.
The company needs to look at how much is reasonable to pay by collecting actual receipts for reasonable period of time and then agreeing with HMRC how much can be paid.
Round-sum amounts always have to be agreed with HMRC in the first instance, otherwise they will be taxed as if employment income.
Some offshore companies set up umbrella companies allowing large deductions to be made from contractual fees particularly in the locum market.
Do not be fooled; this does not cover you if you are claiming outside of the letter of the law and if HMRC decides to investigate, you will be found wanting.
Seek onshore professional advice from a qualified accountant carrying professional indemnity insurance.
The basic rule is that an employer can now provide trivial benefits such as a bunch of flowers, a box of chocolates or a meal out without having to disclose the amounts via a form P11D and which do not attract tax or NI for either employer or employee.
The employer will also be entitled to claim income tax or corporation tax relief on the cost.
These are the key conditions:
The cost is £50 or less to provide;
It is not cash or a cash voucher –so gift cards from John Lewis would work;
It is not a reward for their work or performance;
It is not part of the terms of their contract.
The legislation imposes no limit on the number of trivial benefits an employer may provide except, of course, for directors or officeholders of ‘close’ companies. They are restricted to trivial benefits worth no more than £300 in total in a tax year. A close company is a limited company with five or fewer shareholders. This limit also applies to benefits to associates of those directors.
As ever, HMRC provides many examples for such a trivial benefit and I have included this one below, as it shows the complexities of trying to avoid tax on even £50.
Company O gives bottles of wine, each costing £30, to a director, to his wife, who is a former director, and to their daughter on their birthdays.
The daughter is not an employee or office-holder of Company O, so the cost of her bottle of wine is apportioned between her father
(a current director) and her mother (a former director).
In respect of the daughter’s gift, £15 (£30 ÷ 2) is allocated against the father’s annual exempt amount. The balance is allocated against the mother’s annual exempt amount under the amended employer-financed retirement benefits (EFRBS) regulations 2011.
Suppose, during my weekly shop, every so often I buy five £30 bottles of champagne to give to each of my employees.
If I take them into the office and say ‘Good morning, chaps. We are doing really well this month by hitting all our targets, so here’s a bottle of champagne to say thank you’.
That would be a reward for services and so would attract tax and NIC.
But if I were to say ‘The sun is out, the sky is blue. I’m in a super mood and this is for you!’ – then the champagne would be a trivial benefit.
Staff parties – which may include partners or friends and family –and events for all employees are tax-deductible and exempt from tax and NI contributions and reporting only if the following conditions are met:
It is an annual event, such as a summer barbecue or an end-ofyear party;
The event is open to all employees;
The cost per head of those attending the event is no more than £150.
You can also spread the cost across more than one event, but if the total cost exceeds the threshold, all of the cost will have to be taxed as this is not an allowance.
As a sole trader working from a home office, there are only two ways to claim a deduction for costs:
Using simplified expenses by the hours worked between £10 and £26 per month or ;
A proportion of your costs of providing that home – calculated in the same way as below, but with an adjustment for personal use to avoid capital gains tax (CGT) issues on eventual sale.
Employees required to work
An employer can now provide trivial benefits such as a bunch of flowers, a box of chocolate or a meal out . . . which do not attract tax or NI for either employer or employee
As a director/owner, the company can rent a space off you. This can be done by using a simple licence granted to the company to allow them to operate within your home, making use of various facilities such as kettles and toilets; but not leasing a specified area – which would create CGT issues. A licence gives them the use of a space, not an interest in it.
from home can claim a homeworking allowance of £6 per week with effect from 6 April 2020. This may be a little extra you can give to a secretary in your employ if she/he has to work from home. You do need to have something in their contract to say this is the case, however.
The householders then charge a rent for this licence – usually the husband and wife or civil partner. This income is then put onto their individual tax returns as rental income with deductions for the costs (see ‘Home sweet home’ on the next page).
For this, the company receives a deduction against corporation tax and you get to fund that part of your home you are providing as an office.
An employee is allowed to borrow up to £10,000 from their employer without incurring a benefit in kind.
The loan must eventually be repaid or written off. At the point of write-off, there would be a taxable benefit.
If you are a director/shareholder, you may still borrow the funds, but you must ensure that your
loan account with the company never exceeds the £10,000 or the deemed interest will be a benefit.
Also, the loan must be repaid by nine months after the company year-end to avoid tax at 32.5% being payable thereon for the duration of the loan, even if it is repaid and re-issued within a certain time limit. This is known as s455 tax (CTA 2010).
From the fiscal year 2018, any nondomiciled individual resident for 15 years out of the last 20 will be deemed domiciled for all UK taxes.
Once deemed domiciled, an individual will need to leave the UK for at least five consecutive tax years, and this includes UK residents who wish to alter their sta-
tus. This applies after 6 April 2017. If you have returned to the UK and your original status was as UK domiciled, you will re-acquire that status as soon as you acquire a UK residence, regardless of your intention to remain.
Those who own property also come in for a battering:
Advice on how to avoid paying out even more on your property. Everyone is aware that your home, otherwise known as your principal private residence (PPR), is free from capital gains tax (CGT). Individuals can only have one PPR for which they can claim exemptions at any one time and married couples or those in civil partnerships can only have one between them.
You may think this odd after the debacle over the MPs changing their minds constantly over where they live; but this is allowed. If you have more than one property, then you can elect for one of them to be your PPR. You can then reelect if circumstances change.
You may wish to make the elections because there is a ‘free’ period when a property has been your PPR for any time during your ownership. This free period is the last nine months of ownership, slashed from 18 months with effect from 6 April 2020. There are no changes to the 36 months that are available to disabled persons or those in a care home.
For example, you buy a property to live in and stay there for two years. You then have to move, but cannot sell the first property. You decide to let this out.
You then elect to have your PPR at your new home and this must be done within a specified period. You can now sell the rented property within nine months and pay no CGT.
Lettings relief has been reformed so that it only applies in those circumstances where the owner of the property is in shared occupancy with a tenant. Hence, all of those who have lived in their rental properties may wish to reconsider plans for sale and build in the need for calculations of CGT.
Legislation has been enacted to change reporting obligations for residential property gains chargeable on UK-resident individuals, trustees and personal representatives.
Also introduced is a requirement to make a payment on account of the associated CGT liability. For disposals made on or after 6 April 2020:
A tax return is required if there is a disposal of UK land on which a residential property gain accrues;
CGT is required to be computed on the reported gain in the tax return.
The return needs to be filed and the CGT paid within 30 days of the completion date of the property disposal. The new requirements do not apply if a chargeable gain does not arise – for example, where the gain is covered by PPR relief.
Higher rates of 18% and 28% apply for chargeable gains on residential properties with the exception of any element that qualifies for Private Residence Relief.
The CGT annual exemption rises from £12,000 for 2020 to £12,300 for 2021.
Anyone can rent a furnished room in their own home while they live there for residential purposes – so not your office.
Provided you receive less than £7,500 in rent, no tax is payable. You do have to put up with a tenant, however.
The relief is shared by the number of people whose home is being shared.
This is an extremely valuable relief to be allowed and applies whether you operate as a sole trader or through a limited company.
Although the way you let it is different, the expenses you are allowed to claim are the same:
Mortgage interest or rent;
Council tax;
Utilities;
Insurance – but tell the insurer that you work from home;
Water rates;
Cleaning ;
Repairs and redecoration.
But not gardening, unless you
have clients wandering the lawns, in which case you need separate insurances, as clients are visiting your premises.
You add up all of these expenses and then look at what proportion you use for business. For example, if you have an eight-roomed house and you use one as an office, then the percentage of costs would be 12.5%.
However, it is essential that you do not use it exclusively for business. This is where the private use adjustment comes in. Put the cat or the kid’s musical instruments in and make a small add back for that. This avoids potential conflicts with CGT.
Mortgage interest is to be restricted. Currently, mortgage interest is deducted as an expense before the rental profits are charged to tax. Thus tax relief is given the marginal rate of tax. So, for higher-rate taxpayers, this is at 40%.
Mortgage interest relief has been restricted to the basic rate and given as a tax allowance, not as a deduction before arriving at a taxable profit The change was introduced from April 2017 by 25% of finance costs available as a basicrate deduction over the following four years.
For those of you heaving a sigh of relief or suppressing a sob as you wave off your university-headed offspring, the loans available to them are based on the household income and are to be repaid as the student reaches earnings of:
➫ If you have a Plan 1 student loan: Income exceeds £364 a week or £1,577 a month before tax and other deductions;
➫ If you have a Plan 2 student loan: Income exceeds £494 a week or £2,143 a month before tax and other deductions.
Considering the average earnings of graduates tabled in the Sunday Times University Guide, this repayment should be immediately, so you may wish to consider alternative funding via employment or shareholding ownership (see above).
If you have adult children whom you want to assist with buying a property or giving them somewhere to live while at university or starting a new job, then look at the use of a trust.
Simply speaking, you can put down a deposit into a trust, the trust then takes out a mortgage –usually with you acting as a guarantor – and names your offspring as the beneficiaries.
Your son or daughter could then live in the property as their PPR and, when it is time to sell, the trust can claim the PPR exemption.
The trust can also let out any spare rooms in the property. But it would have to return the income, less allowable expenses such as the mortgage interest, and pay tax on it.
Alternatively, your son or daughter could rent out a room and not pay tax if the rent was less than £7,500. However, asking a young adult to play landlord may be an issue, as the legal requirements can be onerous.
You can also own the property as tenants in common with your child, allowing some of any capital gains to be mitigated.
But transferring the whole of the property into their sole ownership can have consequences if they are made insolvent or marry and divorce.
But those who want to leave their homes…
There is to be an additional nilrate band (NRB) for those leaving an interest in residential property which was their PPR to direct descendants.
There will also be some flexibility built in where people have chosen to downsize before their demise, but this is subject to consultation.
The amount of the additional NRB will be the lower of: The value of the interest in the property after mortgage charges; The ‘maximum amount’ of the band.
The band is to rise at a rate of £25,000 a year between 2018 (£100,000) to 2021 (£175,000) and thereafter linked to the Consumer Price Index. The existing NRB of £325,000 will remain frozen until 2021.
There is a restriction for those with more valuable estates. The new allowance will be removed at the rate of £1 for every £2 of the total net estate before allowances and exemptions (e.g. Business Property Relief) exceeds £2m. There are also to be anti-avoidance measures in place primarily around nondomiciled individuals using other vehicles to own their properties.
Business CGT relief
There are two specific types of disposal which potentially qualify for a 10% rate up to a lifetime limit for each individual:
Entrepreneurs’ Relief (ER)
This is targeted at directors and employees of companies who own at least 5% of the ordinary share capital in the company, provided other minimum criteria are also met, and the owners of unincorporated businesses, including partnership disposals.
The lifetime limit is reduced from £10m to £1m for ER qualifying disposals made on or after 11 March 2020. There are special provisions for disposals entered into before 11 March 2020 that were not completed by that date.
Investors’ Relief
The main beneficiaries of this relief are external investors in unquoted trading companies who have newly subscribed shares. Investors’ Relief has a lifetime limit of £10m, but the lifetime limit position for ER was changed in the Budget.
Husbands and wives now have transferable nil rate bands for inheritance tax if one death does not use it all. This is worth around £700,000 in total
There are a few simple planning steps you can take involving small amounts of money to avoid inheritance tax, but as we know, every little helps.
£3,000 exemption
Each individual can gift up to £3,000 a year which is ignored when valuing an estate for inheritance tax (IHT). If grandparents can give this away, the parents’ tax trap does not come into play. But you cannot collude and as a parent give it back to the grandparents.
You could also use this exemption to set up a bare trust to hold small amounts of assets, such as a few shares each year which could be built up over time, ready for things like university fees.
As a parent, you can gift up to £5,000 each as a wedding gift without it forming part of your estate for IHT. Grandparents’ gift limits are halved at £2,500 and anyone else can give £1,000. These gifts are in addition to the £3,000 exemption mentioned above.
If you have a large enough annual income, then you are, of course, allowed to spend it as you wish.
This means that you can give money away which will not form part of your estate if it:
Does not affect your standard of living;
Does not deplete your capital resource;
It is a regular feature of your expenditure – for example, a commitment by grandparents to pay school fees.
Potentially exempt transfers (PET)
You can always give away anything you like and if you live seven years, then the value of the gift will fall out of your estate entirely.
The rule is, however, that you must actually give the asset away. You cannot keep using it, otherwise there will be a tax charge known as a pre-owned asset tax (POAT).
IHT nil rate band
Make sure you use this wisely. The amount usually increases each year and people often use this nil rate band in association with trusts for their descendants.
Husbands and wives now have transferable nil rate bands if one death does not use it all. This is worth around £700,000 in total.
It is estimated that around 70% of the public do not hold a will. To date, even if you get it all wrong, your beneficiaries can still agree to alter your will if they apply for a deed of variation within two years of the date of death.
However, there is to be a review into these deeds of variation – a legal document allowing a change to a will after death to redistribute assets – to reduce the avoidance of inheritance tax.
DO NOT TRY ANY OF THIS WITHOUT TAKING PROFESSIONAL ADVICE
All of the above are simplified explanations of some complex matters. If you get it wrong, you will be subject to penalties on the adjustments to your figures and interest on the tax lost to HMRC. These can add in excess of 100% to the overall figure in severe cases and inquiries can stretch back over many years.
This guide is produced for general guidance only. As each individual’s circumstances may vary considerably, professional advice should always be sought before taking any action. No responsibility is accepted by the author or the publisher of these guidance notes for actions taken or refrained from being taken as a result of reading this guide.
Tax legislation and interpretation change continuously and hence any guidance is only accurate at the time of going to press.
No investment advice, either financial or legal is given with this guidance. Should you require such advice, please contact a suitably qualified professional adviser.
We do, of course, care about you and the success of your business, hence these disclaimers are there for your protection.
The guide is therefore without express or implied warranty and both the author and the publisher cannot accept responsibility for any direct, indirect, special or consequential or other losses or damages of whatsoever kind as a result of using this guide.
The business journal for doctors in private practice
Editorial director Robin Stride
Email: robin@ip-today.co.uk
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The Covid-19 pandemic has brought a surprise surge in private doctors’ billing and collection inquiries. Simon Brignall (left) explains why
TO SAY that the Coronavirus crisis is proving challenging to many businesses is an understatement.
Staffing issues and cash flow difficulties are common worries to many business owners and the independent healthcare sector is no exception. As I write this, the situation is changing daily, but I thought it would be beneficial to give some insight into what Medical Billing and Collection (MBC) has experienced so far. Most companies have a disaster recovery plan and we responded to the developing situation by ensuring it was enacted promptly. The fact that our software and systems are cloud-based, as is our VOIP (Voice Over Internet Protocol) phone system, meant we could adapt to remote working without any drop in our service levels.
We partner with more than 1,200 private providers and we are seeing a disparity in the way their practices are being impacted. The situation can vary widely due to specialty, location and the type of patient they treat.
What has been most surprising is the number of inquiries we have continued to receive from all sectors of the market, including groups as well as independent consultants. These have been from practices wanting to use this time constructively and address the long-term issues they were facing in this area but previously had struggled to find the time to solve the problem. We have also had many approaches from practices where the advantages of outsourcing have been clearly illustrated to them in the current environment.
Inquiries have come from a range of practices and a range of sizes, from very active consultants and several large groups covering a range of specialties to specialists who have recently started as independent practitioners.
The common theme I hear is ‘we have been meaning to look at our billing issues and now seems the perfect time to get this put in place to ensure the practice is ready for when the sector is allowed to start to return to normal’.
With more practices joining us, we have had the opportunity to review them, highlight the specific problem areas and put steps in place to resolve these.
Here are some of the most common issues we have come across:
Issues around pricing that have resulted in lost income;
Delays in invoicing and chasing, leading to large outstanding debts;
Lack of a 24/7 solution to allow patients to settle their invoices;
Increasing cash flow issues due to the above.
And here is an insight on what we have been doing to help:
➠ A group of surgeons we are currently taking on board had built up considerable bad debt.
The group was also having difficulties supplying reliable financial reporting to each consultant of their activity and accurately calculating the distribution of funds.
We were able to solve this, as at MBC we load all outstanding debt onto our system as backlog so that we can differentiate between new invoices and those raised previously by the practice.
We have been able to provide access to our software at either the
group or consultant level. This enabled each consultant to utilise an array of financial reports, including specific reports on their backlog to allow them to monitor our success at collecting these funds.
We now supply the group with a simple ‘payment received’ report, broken down by consultant, which allows them to have a transparent and accurate process for distributing funds.
This means that as we resolve their aged debt issue, these additional funds are identified and distributed correctly.
➠ I have had inquiries from consultants who specialise in mental health, who have adapted to remote consultations with their patients but were having issues around the invoicing of their self-pay patients.
At MBC, we invoice all self-pay patients by email with a link to a card portal that enables the patient to make payments 24/7. Patients are also able to easily pay multiple invoices at the same time, which is important due to
the repeat nature of consultations in this field.
And we also implemented a system to collect payment in advance of the treatment that was tailored to the specific needs of the practice, resulting in much better cash flow without alienating the patients.
My advice to independent practitioners now is to use any spare time you may have to review the billing and collection of your practice and implement any changes required.
We are here to help and would be happy to provide the assistance you need to ensure your practice is in the best possible shape as we emerge from the current crisis.
On a personal note, I hope you and your families stay healthy and safe during these unprecedented times and, along with the rest of the nation, we would like to thank you all for your contribution in fighting this virus.
Simon Brignall is business development director at Medical Billing and Collection, providers of medical billing services to the independent healthcare sector
The Coronavirus spread has led to a surge in demand for digital consultations in specialist healthcare.
Independent Practitioner
Today traces the trend being experienced by the Trustedoctor platform
THE GLOBAL spread of Coronavirus is leading to a surge in demand for digital consultations with specialist doctors in private practice.
Patients over 65 account for most patients needing to see cancer or other chronic disease specialists and they are also the group most at risk of being severely affected by Coronavirus.
Conducting follow-up consultations online via a secure platform without the need to visit a hospital is a key route to avoiding infection and keeping people in this age group safe.
Patients concerned about infection are increasingly asking for digital consultations instead of having a face-to-face appointment and specialist doctors are turning
The video consultation platform can have many doctors online at the same time as well as having the ability to view scans with the patient
to digital platforms to meet this demand.
Prof Sotirios Bisdas, associate professor of neuroradiology at University College London and lead consultant neuroradiologist at The Nat ional Hospital for Neurology and Neurosurgery, University College London Hospitals NHS Trust, found out about one platform, Trustedoctor, from a patient who asked him to use it in order to be accessible online.
Trustedoctor, which offers video-consultations between patients’ and their chosen specialist, says it has seen the number of doctors wanting to use its service soar in the past three months.
Particularly welcome
Former president of the British Thyroid Association, Dr Mark Vanderpump, who has been using the Trustedoctor platform, says: ‘The online service is proving par-
Insurance companies are understanding the importance of video consultations in a modern age and those that do not currently cover this are reviewing the stance on reimbursing the costs
ticularly welcome during this time of anxiety about travelling while the Coronavirus is among us.
‘Access to timely and expert medical advice is key to overall patient wellness, but this can be a challenge if you are unwell, have tricky transport links or live in a different country to your preferred consultant.
‘This was one of the main drivers for offering a secure and easy-to use e-consulting platform for my patients. It has transformed the ability to advise anyone who doesn’t actually require a physical examination and patients have responded very well to this new technology.’
Lukasz Rzeczkowski, co-founder and chief development officer at Trustedoctor, told Independent Practitioner Today that the spread of Coronavirus was fast-tracking this game-changing technology into the public’s consciousness, but it was the doctors themselves who were driving up demand.
This, in turn, was improving accessibility to patients both in the UK, where senior NHS staff now believe 70% of all follow-up consultations could be conducted online.
Mr Rzeczkowski reports: ‘We have tripled the amount of doctor sign-ups month-on-month from January to February. We have, right now, more than half a thousand individually selected special-
Lukasz Rzeczkowski, co-founder at Trustedoctor, said that the spread of Coronavirus was fast-tracking this gamechanging technology into the public’s consciousness, but it was doctors themselves who were driving up demand
ists on our system and, as of now, I’m getting constant emails from people wanting the facility.
‘Our platform offers a structure that can save doctors time by offering a digital one-place solution for all their digital engagements including video consultations, second opinions and follow-ups.
‘Unlike most online platforms, which only offer a report from a specialist doctor, patients can discuss the findings, challenge them and then follow-up. They can even invite their GP or family members to the conversation.’
Established in 2016, the Trustedoctor platform and service has been designed with the help of specialist consultants around the world following one of the founder’s experiences seeking cancer treatment.
It offers consultations in multiple specialist areas including cancer –both oncology and surgery – cardiology, gastroenterology and orthopaedics. The technology has proved popular among individual doctors, NHS private patient units and private hospital chains.
Trustedoctor operates in six countries, but its main focus is the UK, particularly private healthcare services in London.
Access to digital, video-based services is a natural step from the progress made by GPs using online platforms.
While the use of online consultation platforms is now prevalent among GPs, many secondary care
specialist doctors have yet to embrace this new technology.
But with the emergence of the Covid-19, the advantages of carrying out consultations remotely is becoming increasingly clear and 2020 looks set to be the year online consultation services take off in specialist care.
Mr Rzeczkowski says: ‘Nowadays, most specialist care appointments are physical rather than virtual ones, meaning patients will have to travel to receive care. But we simply believe that your postcode should not limit your options when it comes to healthcare.’
Private medical insurance companies are giving encouraging signs, according to Samantha Kane from Independent Practice Services, which provides practice management for consultants’ groups.
She says: ‘In light of the current Covid-19 situation, insurance companies are understanding the importance of video consultations in a modern age and those that do not currently cover this are reviewing the stance on reimbursing the costs.’
The digital platform is also helping patients from abroad who want quick access to specialist medical expertise.
Mr Rzeczkowski says they often have not been able to get the treatment they need in their home country or they feel let down by the quality of services available to
them or just want to explore their options.
At the private patient unit at the Chelsea Westminster Hospital, the service is being established for international patients.
Paul Goodrich, executive board member and managing director for private care, says: ‘Trustedoctor enables expert opinions between clinicians and directly with patients, without borders.
‘This will also showcase the specialist areas of the hospital, which includes orthopaedics, paediatrics, burn & trauma, maternity, assisted conception and much more.’
Dr Taff Edwards, from the Royal London Hospital NHS Trust, calls the platform ‘a game-changer’ for the sector: ‘This will definitely become a standard for patient-todoctor interactions in the future.
‘London is a highly respected medical hub and international patients need to establish trust with their designated physicians before they make their decisions about treatment options.’
London-based patient Sarika Dhamija said: ‘Having used Trustedoctor for two years or so now, I am really impressed with the reliability and value of the platform to help me connect with physicians across the UK – and all over the world – for cancer.
‘I find it very helpful and convenient to have video conferences with two or more doctors to offer me the best advice throughout the cancer journey.’
The Private Practice Register (The PPR) has taken off as a useful resource for independent practitioners to upload and control all their practice information and supporting documents in one secure place. Healthcode’s managing director
Peter Connor (right) outlines its advantages
DATA ERRORS can have serious consequences for your private practice.
Whether it is an incorrect address that leads to a missed delivery or the wrong digit in a bank account number that results in a payment going astray, inaccurate data can be exasperating and costly.
And, of course, you then have to spend valuable time chasing offending companies and correcting mistakes.
If you are a consultant, it is incumbent on you to ensure that private medical insurers and hospitals hold accurate data about your practice and professional credentials.
However, until a few years ago, the process of submitting this information to each organisation was time-consuming and repetitive for anyone just starting out in practice. And a change in details later usually meant contacting everyone in turn to update them.
It was an administrative treadmill that technology is supposed to eradicate.
One-stop shop
This was the thought that first inspired and motivated Healthcode to create the Private Practice Register (The PPR) in 2016.
We wanted to use our expertise in online technology to develop a directory where every independent practitioner could upload and control all their practice information and supporting documents in one secure place.
It would then be far quicker and easier for practitioners to maintain the accuracy of this information and make it accessible to organisations that needed to know.
Initially, The PPR provided a free ‘one-stop-shop’ service for consultants and other independent practitioners to apply for insurance companies’ recognition, but it has evolved into an important information hub for the private healthcare sector.
Today, more than 18,000 practitioners use The PPR to control the data on their profile and, through this platform, they can connect to the major insurers
and more than 300 hospital providers, ensuring all these stakeholders have the same accurate picture of their current practice, including:
Personal and contact information, including billing and payment details;
Specialties and qualifications, including procedures and treatments;
Areas of special interest;
Confirmation of membership with regulatory bodies;
Practising privilege history;
Due diligence registration information.
Alistair Mace, an ENT consultant with a thriving practice in Harley Street and across north London, was attracted to The PPR’s time-saving appeal. He says:
‘I get emails from about ten different private hospitals and clinics asking me to send them various things like my indemnity certificate.
‘It’s not particularly onerous to attach and send the files, but it takes about ten minutes to respond to each email and when you work in a lot of different hospitals and different clinics that adds up to quite a bit of time. It makes sense for this kind of information to be accessible in one place.’
What really distinguishes The PPR from other databases and directories is that consultants on the register retain ownership and control of their own profile themselves.
Healthcode does not update or amend information on The PPR. It is a consultant’s responsibility to input the data through Healthcode’s secure portal and, in the interests of their practice, to ensure that it is accurate and up to date so organisations have the right details.
More than 40% of practitioners on The PPR made amendments to their profile in 2019.
To protect individual privacy rights, access to data on The PPR profile is restricted to authorised organisations within the consultant’s network for specific purposes. Insurers have read-only access to the data necessary to recognise a consultant or to validate bills. Subscribing hospitals have access to the data required to manage consultant practising privileges.
This is read-only, but with the limited authority to correct inaccuracies concerning a consultant’s work within their own organisation, such as their practice hours and start and end dates of practice. When this happens, the consultant is automatically notified so they can either confirm the update or contact the hospital.
The PPR is secured using 2048bit certificates and only accessible via encrypted network connections. User data is stored within a private dedicated infrastructure physically located in the UK, rather than in a cloud in an unknown location.
A back-up copy of the data is taken daily and securely stored in a separate UK-hosted disaster recovery facility. Access to accounts is controlled by log-in ID and password and we prompt users to change their password every 90 days.
While control and convenience for practitioners was the original impetus behind The PPR, there is now a pragmatic case for it too.
The Paterson scandal has cast a shadow over everyone in the private healthcare sector and the onus is on us all to put our house in order to reassure patients, rebuild public trust and demonstrate the high-quality care provided.
The PPR gives us a head start by supporting transparency and appropriate information-sharing across the sector, which assists
effective clinical governance within hospitals, demonstrating how seriously we take patient safety.
From a consultant perspective, it makes sense for the hospitals where you practise to have embedded measures to improve oversight of practising privileges rather than risk being exposed to potential reputational damage because malpractice has occurred.
For example, The PPR supports the Medical Practitioners Assurance Framework (MPAF), which the Care Quality Commission has said will help hospitals to meet its ‘Well Led’ key line of inquiry.
Equally, it must be in consultants’ interests to have an efficient means to prove that their own practice is safe and of a high standard.
Looking ahead, Healthcode is committed to enhancing the information contained on each practitioner’s profile so that it provides a complete picture of their practice on a need-to-know basis.
New updates include the name of consultants’ designated body and Responsible Officer for revalidation and sets out their scope of practice.
Scope-of-practice data is imminent for consultants’ private practice and we are working with NHS Digital through its Data Access Request Services (DARS) to extend this to consultants’ NHS practice. Ultimately, consultants will be able to apply for practising privileges through The PPR.
The PPR . . . supports transparency and appropriate informationsharing across the sector, which assists effective clinical governance within hospitals, demonstrating how seriously we take patient safety
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
Reaping the benefits
I’m proud of The PPR, not just because it has become the definitive primary source of practitioner data across the sector but also because it epitomises our approach to technology.
We have always used our expertise and knowledge to develop interoperable solutions which benefit the private healthcare sector as a whole, not just those organisations with the biggest IT budgets.
As an online platform, consultants only need an internet connection to take advantage of The PPR’s advanced features and ensure accurate information about their practice is visible to the right people.
And as we continue to develop The PPR, I believe they have nothing to lose and much to gain by signing up.
The Association of Independent Specialist Medical Accountants is a national network of firms advising over 3,700 medical practices across the UK. For some of the best advice available on accounting, taxation and pensions, visit our website and find your nearest AISMA accountant. aisma.org.uk
IN WALES, the NHS is organised into eight health boards which manage all healthcare services, not only hospitals, and there is one hospital services trust: Velindre Cancer Centre.
The published annual accounts of these nine organisations have been used in this article.
In Wales, total private patient revenues are £8.4m, up 5% from £8.0m over the past two years. This represents a steady 0.17% of the total revenues and is on a par with the lowest-performing regions in England, and well below the combined national average outside of London in 2018-19 of 0.46%.
However, this under-represents the true level, as a like-for-like comparison is difficult because the equivalent of NHS trust revenues are not separately reported by health boards.
Leading the way is Swansea Bay University Health Board, responsible for the Swansea, Neath Port Talbot and Bridgend areas, with a population of nearly 400,000.
Morriston Hospital, Swansea, with around 720 beds, is the regional acute tertiary hospital for south-west Wales, providing specialist services including the Welsh Centre for Burns and Plastic Surgery, supporting not only south and mid-Wales, but the southwest of England and one of two cardiac surgery services in Wales.
The trust provides a range of private patient services including management of the Bridgend Clinic, a nine-bed PPU opened in 1997, located mid-way between
Cardiff and Swansea. The health board reported private patient revenues of £3.8m in 2018-19, 1.2% up on the previous year and representing 0.43% of total revenues.
New cancer centre
Velindre NHS Trust is a specialist cancer treatment centre, located on the outskirts of Cardiff City Centre and providing cancer services to over 1.5m people across south-east Wales and beyond.
In late 2017, the trust gained planning permission to build a new state-of-the-art Cancer Centre in Whitchurch, Cardiff, to be open by 2022-23.
The trust is also developing plans for a radiotherapy satellite centre to be located at Nevill Hall Hospital in Abergavenny, Gwent, and has longer-term plans to open outreach units across south-east Wales. The trust’s private patient revenues are £2.1m, up 1% on 2017-18.
In Cardiff, NHS private patient services are delivered from both University Hospital of Wales and the University Hospital Llandough. The trust does not have a dedicated PPU, but revenues across all departments grew 12.5% and £224k in 2018-19 to reach £1.05m, 0.12% of total income.
In Gwent, the population of
600,000 has acute hospital services provided from the Royal Gwent in Newport and also Nevill Hall Hospital, Abergavenny, where the other NHS-run PPU is located: the three-bed Glan Usk Unit, opened in 1995.
This presently offers a limited midweek inpatient and day case. All private inpatient procedures that need longer than an overnight stay are transferred to NHS specialty wards. Revenues from private patients in 2018-19 were £408k, down 24% from £539k the previous year.
Betsi Cadwaladr University Health Board is the largest health organisation in Wales and provides acute hospital services for a population of around 676,000 people across the six counties of north Wales – Anglesey, Gwynedd, Conwy, Denbighshire, Flintshire and Wrexham – as well as some parts of mid-Wales, Cheshire and Shropshire.
Total private patient revenues across the three main hospital sites in Bangor, Bodelwyddan and Wrexham were £911k, up 11% in 2018-19.
Earnings elsewhere in the three other remaining health boards amounted to only £84,000 in 2018-19.
South Wales in particular is a developing region for private patients and the independent sector has recently invested in significant new facilities, such as the
There is potential for NHS growth in the sector, if there is the political appetite to support such growth
Rutherford Cancer Centre in Newport and the rebuilding of Sancta Maria Hospital in Swansea, due to open in late 2020 at a cost of £16m.
There is potential for NHS growth in the sector, if there is the
political appetite to support such growth.
Next month: Scotland
Philip Housden (right) is a director of Housden Group
Stephen Hooper (right) and Simon Eastwood (far right) give some essential guidance on practising privileges for independent practitioners
MOST DOCTORS who have a private practice will have an arrangement agreed with a private service provider, commonly a large organisation which operates several private health facilities.
That service provider allows the individual doctor to have practising privileges at a venue, generally a private hospital where healthcare services can be provided to the public.
In general, doctors in private practice apply for privileges to be granted at a facility, subject to suitability checks, history and appropriate defence cover.
These arrangements are, of course, extremely important to many practitioners, not least because of the income that can be generated.
It is also important for the service provider, which invests large sums of money in establishing facilities; and without doctors providing the individual service, those facilities would, of course, not be operational.
So it is an arrangement of mutual benefit. But the dynamics of the arrangement are such that it is rather different to the employer/ employee relationship most hospital doctors will experience, when working with NHS trusts.
In the trust context, there are clear government and employment principles, as well as clearly defined regulations applicable in the event of any dispute, and safe-
guards in place to ensure fair procedures are applied.
Similarly, private practice is subject to regulatory oversight by bodies such as the Care Quality Commission and the GMC. However, where a professional conduct issue arises in the context of private work, it is very much a matter between the service provider and the individual practitioner to resolve.
The framework for resolving disputes largely depends on the contractual documentation between the service provider and the individual practitioner, and the terms of those contractual arrangements are very much a matter for the individual service provider.
Generally, practising privilege arrangements are overseen by an internal committee or body, who make the key decisions regarding the appointment of practitioners, or in terms of ongoing review and problem/dispute resolution.
The framework within which disputes are managed can vary widely from organisation to organisation and often the safeguards and rights afforded to NHS practitioners working under the umbrella of a trust are notably absent from the internal management processes of private service providers.
From the individual practition-
er’s point of view, it is vital that early advice and assistance is obtained when any professional conduct issue arises in private practice, as it would be in any other context.
The lessons of the Paterson case are likely to be very much in mind for any managers investigating private practice conduct issues and therefore it is in the interests of independent practitioners to have the benefit of support and guidance from someone experienced in dealing with private practice providers in this context.
Perhaps the most vital aspect of engagement with a service provider, when any suggestion of misconduct arises, is to ensure fairness of any investigation and procedure.
The hope would be that the matter can be resolved to mutual satisfaction without long-lasting impact on the practitioner’s right to practise and privileges at that service provider.
The lessons of the Paterson case are likely to be very much in mind for any managers investigating private practice conduct issues
‘Fairness’ is a difficult concept to define and the frequent absence of safeguards within providers’ disciplinary procedures can make it difficult to protect the practitioner’s best interests.
In the present climate, service providers, following on the experience of Paterson, are likely to treat any potential conduct issue seriously.
And, indeed, with a perception of the need to protect the public, they are likely err on the side of caution in making any decisions.
The individual practitioner may therefore be in an extremely difficult position, necessitating objective advice and support during an extremely stressful period.
So the key message is to engage and seek support at the earliest opportunity and, if possible, liaise with the service provider to try and resolve matters by dialogue if at all possible.
It can be difficult to resolve the situation after disciplinary action is taken – sanctions imposed can be draconian, with rights of appeal often limited and difficult to take advantage of.
Privileges suspended
It is not uncommon for practising privileges to be suspended during the course of an investigation. Therefore, efficient investigation and early engagement are likely to be in the interests of both service provider and practitioner in achieving the earliest possible res-
olution with full information obtained as required.
Practitioners should also bear in mind the potential for any issue arising in the private context to be referred to the GMC.
That itself is a good reason to ensure proper advice is taken at the earliest opportunity, given the potential implications both in regard to the private arrangements, and fitness to practise entitlement generally.
Overall, private practitioners should not be fearful of the arrangements they have with private service providers.
But as the reality of the world after Paterson becomes clearer, it is advisable to keep in mind the potential for investigation if issues arise, be prepared to take early advice and engage as necessary.
Stephen Hooper is an associate and Simon Eastwood a senior legal consultant at Hempsons Solicitors
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:
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Regulatory requirements and investigations
Rourke
When there are falls in the stock market, lean on your financial planner . . . and they will be your friend. Patrick Convey (right) reports
INVESTORS WHO have experienced strong investment markets since the Credit Crisis over a decade ago may have forgotten, or never experienced, the pain – and even fear – that such downfalls can induce.
When falls occur, how investors behave will have a great bearing on the longer-term outcomes they will experience.
It is important to remember that equity market falls are an inevitable part of the process of building wealth through equity ownership.
However, putting market falls in perspective and learning to survive them can be challenging.
• 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
Sometimes it helps to remind ourselves why investors deserve positive returns from equities –ownership stakes in companies –and bonds – lending their money to governments and corporations. It is because the outcome that they will receive from their investments is uncertain.
The future dividend stream from equities is, intuitively, far less certain than the contractual payment of coupons (interest) and return of principal at the maturity date of a bond.
The greater the uncertainty of the outcome, the more an investor needs to be compensated with higher returns.
The market’s view on the ability of a firm to deliver dividends can have a large impact on the price of a share, leading to share price volatility. The market’s view is influenced by multiple factors, such as management strength, strategy, competition and the state of the economy, plus its perception of risk.
Those who need support should lean on their adviser –that is what he or she is there for
If returns went up year in, year out, there would be no uncertainty of outcome and investors would be lucky to generate a return much higher than inflation. Longer-term investors should embrace – and learn how to survive – this shorter-term uncertainty, as it is the basis of strong longer-term equity returns.
Hanging in there
For example, if we looked at the monthly returns of global equities from January 1999 to February 2018, we would notice that markets were very volatile on a monthly basis. There were almost as many ‘down’ months as there were ‘up’ months.
Also, the process of ‘hanging in there through thick and thin’ was
worth pursuing; £100 invested in January 1999 more than tripled in value by the end of February 2018. It would be wonderful if someone rang a bell to tell investors when to get out of the market and rang it again to tell them when to get back in; but it is evident that picking the month, or even year, to do so is well nigh impossible.
On the other hand, even if you had ‘got it wrong’ and invested at the very height of the market, say just before the Tech Wreck (200003) and the Credit Crisis (200709), your £100 would still be worth £232 (4.9% a year) and £227 (8.3% a year) respectively at the end of February 2018. The key message is to remain invested.
It can be unsettling to look at the value of your portfolio too often. Even the data you see at a progress meeting with your adviser – for example, six monthly or annually – is largely noise and your portfolio is likely to be down on one in three visits to see them.
Fake news and true bear markets
Those participating day to day in the markets or commentating on them (‘Billions of pounds wiped off UK shares’ etc.), risk failing to see the wood for the trees and tend to induce feelings of panic, concern and sometimes even hysteria over short-term falls.
Much of the time the doom mongering is overdone. In every year, there will always be periods when markets fall below their highpoint.
If we listen to this noise, we would spend most of our time being afraid of markets instead of embracing them.
Generally, investors should expect a down market one in every three years or so. Look at 2009, as an extreme example; during the calendar year, the global markets suffered a loss of nearly a quarter of their value yet finished the year up almost 20%.
Selling out and missing the rise would have been extremely costly. Likewise, in 2016, the market fell almost 10% during the year, but ended up over 28%.
If investors panic when markets fall – perhaps switching into cash – they may inevitably suffer financially and emotionally on many occasions, when staying invested
1
2
3
4
Embrace the uncertainty of markets – that is what delivers you with strong, long-term returns.
Do not look at your portfolio too often. Once a year is more than enough.
Accept that you cannot time when to be in and out of markets – it is simply not possible.
If markets have fallen, remember that you still own everything you did before – the same number of shares in the same companies, and the same bonds holdings.
5 A fall does not turn into a loss unless you sell your investments at the wrong time.
6
Falls in the markets and recoveries to previous highs are likely to sit well inside your long-term investment horizon – that is to say, when you need your money.
7
The balance between your growth (equity) assets and defensive (high-quality bond) assets was established by your adviser to make sure that you can withstand temporary falls in the value of your portfolio, both emotionally and financially, and that your portfolio has sufficient growth assets to deliver the returns needed to fund your longer-term financial goals.
8
Be confident that your boring defensive assets will come into their own, protecting your portfolio from some of equity market falls. Be confident that you have many investment eggs held in several different baskets.
9
If you are taking an income from your portfolio, remember that if equities have fallen in value, you will be taking your income from your bonds, not selling equities when they are down.
10 Your adviser should be there – at any time – to talk to you. He or she can act as your behavioural coach to urge you to stay the course.
would have been the right thing to do. Responding to short-term market noise is to be avoided at all costs.
On some occasions, these falls can continue from one period to the next, turning from short-term noise into bear markets, some of which can be emotionally nervewracking.
The trouble is that by the time you can see that it is more than a very temporary downturn, it is too late.
Remarkably, and sadly, US investors in equity mutual funds made record withdrawals coinciding with the bottom of the markets during the Tech Wreck and Credit Crisis. Buy high, sell low is a strategy that guarantees wealth destruction.
Owning equities in portfolios is not easy. Yet, the very nature of the uncertainty of outcomes is why decent returns can be expected from owning them. Markets will
fall and, when they do, you should rely on the structure of your portfolio to see you through.
Investors who have fortitude, discipline and patience will fare best. Those who need support should lean on their adviser – that is what he or she is there for.
Patrick Convey is technical 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.
It is always sensible to have a plan when it comes to setting up a business, but often it is left until you are time-poor – which can make it more of a challenge, warns Ian Tongue (left)
WITH THE current Coronavirus crisis, it is more important than ever for you to have a plan for your business, whether you are just starting out or re-activating your practice following the lock-down period.
This article looks at some of the key areas you should be considering.
At the time of writing, we have a lockdown in place and the private hospitals have cancelled most private work as the result of the Government requiring the capacity within the private hospitals.
This is for a minimum of three months, but is anticipated that it may be extended either because of escalation of the pandemic or to help reduce the NHS waiting list times following the cancellation of elective surgery.
Many consultants are able to offer online consultations to maintain the patient contact, but it is not clear at the time of writing how much insurers may pay for these types of patient contact, so such consultantions may in part be to reassure patients and line up future operations or procedures with them.
It is also important to inform your insurer that you are carrying
out online consultations to ensure you are covered for patient contact in this way.
One area that continues is medico-legal work, but the inability to physically examine a patient will inevitably lead to delays in being able to finalise reports and raise fees.
It may, however, give you a head start for when the lock-down measures are eased, as some of the work may have been completed in advance of physical consultations.
When the pandemic eases and NHS operations and procedures recommence, it is not clear how the private sector may be involved to deal with reducing the NHS waiting lists, but there could be significant demand in the private sector and/or additional work through the hospitals.
Understanding how the private medical sector will return following the lockdown will be a key planning tool to establish or reestablish your private practice.
The trading structure adopted for your private practice is very important and the most common options are either self-employment or a limited company.
Due to the pension annual allowance charges, which most consultants carrying out private
work have suffered, the limited company option became the favoured option for the majority. However, your individual circumstances need to be considered by an accountant and appointing an accountant with knowledge of the medical sector is a key part of the making this choice.
There were changes to the pension annual allowance charge in the March 2020 Budget that will benefit many, but it is likely that the limited company structure will remain the favoured option for most, particularly if you have a spouse who is a low earner.
With the current pressures on cash flow from the reduction in the availability of private work, a company can be more flexible in terms of when tax is paid and can allow you to have flexible access to the funds. With planning, this can help you manage your cash flow and tax position.
It is often the case that the quality of your secretary can significantly affect the profitability of the practice and make your life much easier. At present, many secretaries that are employed will be ‘furloughed’ by their employer under the coronavirus employer support scheme.
Some consultants nearing the
end of their career may take the break in work to wind down their practices – which will result in some of these secretaries becoming available in the future.
Speaking to colleagues and understanding their position can often result in an opportunity presenting itself. Likewise, we may see situations where a consultant may take longer to re-establish their private practice and they may be happy to share resources to reduce their cost base.
Planning ahead to have quality secretarial assistance is vital to any successful private practice.
It may also be possible to employ family members if they have a role in the business, which can also be very tax-efficient.
Where you employ an individual, it usually requires you to maintain a PAYE scheme and you should discuss this with your accountant well in advance of offering someone a job.
Often there are few start-up costs for a private practice, but, depending on your specialty, you may need to invest in equipment. You may also be asked to work in a group and this may require some form of investment.
You will be able to plan for these costs and it is important to understand the tax and practical implications of significant capital investment or joining a group, so discuss these with your accountant.
Usually, the most expensive cost in a private practice is your professional defence cover. You will be asked for your projected earnings, so having an idea of your likely level of income is essential.
This does not have to be accurate and a best estimate is fine. However, to ensure that you are fully covered, it is important to notify the insurer or defence body if you will earn more than anticipated. This will ensure you are paying the appropriate premium and are fully covered. Your accountant should be able to assist you in forecasting your earnings.
When starting out in private work, your business will need to be registered for tax and you have respon-
sibilities to maintain adequate records to disclose your earnings to HM Revenue and Customs.
Meet with an accountant at the earliest available opportunity. This can be done via the various online tools if social distancing is retained for an extended period.
They should explain how to run a private practice and this is where a medical specialist can add a lot of value.
There are many nuances related to the medical profession that affect your tax or pension position, so taking the time to discuss and understand these early on will be a sound investment of your time and money.
You will need to consider the accounting system that is adopted and often electronic packages can pay for themselves in a short space of time. Some have accounting functionality and others require bolt-on products.
Prior to the commencement of
your private practice, you are unlikely to have been in a position where you need to ensure you are paid for the work performed.
Private practice is like any other business and you need to ensure you are paid for the work you perform. Chasing debts and ensuring payment is made is a key part of the business and often part of the secretary’s role.
There are several areas where robust planning will ensure you are best placed to have a successful private practice, particularly in these unprecedented and restricted times.
Engaging a medical accountant who can assist you in planning ahead is a key part of this process.
Next month: Benefits in kind explained
Ian Tongue is a partner with Sandison Easson accountants New sessions are available for independent private practice on Saturdays.
We are a leading private outpatient clinic and we are inviting new applications for practising privileges for our extended opening hours on Saturdays.
Anaesthetics continues to be the specialty most in thrall to market forces. But this has been no bad thing for profits in the 2017-18 tax year, says accountant Ray Stanbridge
ANAESTHETISTS’ GROSS incomes between 2017 and 2018 rose by £5,000 on average, or 5.4%, going up from £92,000 to £97,000.
Costs increased at a slower rate, but have shown an increase on average of 2.8%, from £35,000 to £36,000.
As a result, taxable profits have increased between the two years by 7%, jumping from £57,000 to £61,000. Operating margins have shown a slight increase from 62% to 62.9%.
There are large variations in income patterns, but as we
reported last year, incomes tend to be higher in London and the South-east.
Those who are members of groups tend to enjoy higher incomes in private practice than those who are singletons.
Groups increasing
Where a local anaesthetist has a monopoly or quasi monopoly in a local given area, his or her income can be much higher than shown in our survey.
Again, we have found problems in recording consistent trends.
AVERAGE INCOME AND EXPENDITURE OF A CONSULTANT ANAESTHETIST WITH AN ESTABLISHED PRIVATE PRACTICE
Expenditure
Anaesthetic groups continue to grow in number. Other anaesthetists have restricted themselves to ‘Choose and Book’ work.
Yet others have chosen to trade through limited liability companies, where tax rules can be attractive.
And anaesthetists’ incomes can change rapidly if they fall in or out of favour with a given surgeon.
Having pointed out many caveats, our benchmarking here still attempts to record what an average anaesthetist in private practice earns and what his or her cost structure is.
What then are the reasons for these changes?
Rising demand
Recent reports from market analysts LaingBuisson suggest that the private practice market has recently shown some increase from a period of stagnation.
As a service function, demand for anaesthetists rises or falls in line with the market. In addition, the growth in the self-pay market has helped to increase fees in an ongoing climate of insurance company pressure.
Nonetheless, a well-structured anaesthetic group has shown that it can, to some extent, defend its members’ incomes against pres -
Anaesthetists’ taxable profits have increased between the two years by 7%, jumping from £57,000 to £61,000
sure from both insurers and hospitals.
We would normally expect these trends to continue through 2020 – although, at the time of writing, the Corona-19 virus is having a significant impact on the private practice market.
There have been a small number of changes in costs between 2017 and 2018.
Costs stay constant
Staff costs have shown a small increase, though as we have previously advised, there is a correlation between the growth in personal allowances and incomes of family members of an anaesthetic business.
Professional defence costs have shown a modest rise. General anaesthetists have not been quick
Year ending 5 April. Figures rounded to nearest £1,000 (percentage is
rounded up)
Source: Stanbridge Associates Ltd.
to take up the alternative offerings now available.
There has been some increase in use of home costs, compensated by a fall in office costs. On balance, costs have remained fairly constant.
Accounting /legal costs seem on average to have shown some decrease for reasons that are not immediately obvious.
Subject to the outcome of the Covid-19 virus pandemic, we would expect that in 2020 anaes
thetists’ incomes and taxable profits would, at worst, remain stable and, at best, show some small growth.
As repeated on many occasions, our survey is not statistically significant.
To qualify for entry to our survey, anaesthetists must:
Continue to work in the NHS and not be in full-time private practice;
Hold either an old-style or a new-style contract within the NHS;
Have been in private practice for at least five years;
Be seriously interested in pursuing private practice as a business;
Have generated a gross private practice income of at least £5,000 in the year to 5 April 2018;
May or may not have incorporated their business or become members of a formal or informal group.
Next month: Oncologists and dermatologists
Ray Stanbridge is a partner with accountancy, finance and tax advisory medical specialists, Stanbridge Associates
Make sure you don’t miss our next issue, published on 18 June. Look out for our brilliant new series: The Guide to Delivering Superior Patient Experience in Private Practice.
Jane Braithwaite has designed this series to give independent practitioners the knowledge and tools needed to enhance patient experience before, during and after care.
It will be packed full of information that will, hopefully, prompt you to either start or refine your patient experience strategy. She begins by clarifying what we mean by patient experience and why it matters.
In future articles, she will explore this in more detail, including:
❍ How to get started with your strategy;
❍ How to put patients first;
❍ Engaging and inspiring your team through to measurement;
❍ How to continually drive change and further enhance patient experience.
Following a report of a death to the Coroner, it may be necessary to attend an inquest. Dr Gabrielle Pendlebury, medicol-legal consultant at Medical Protection, advises on what to expect and how to prepare
Medical and Dental Defence Union of Scotland boss Chris Kenny hits out at the UK Government consultation looking to bring medical indemnity into a regulated environment, claiming it is a clear risk to a model which has served doctors well, particularly during the pandemic
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Ten legal issues arising from Covid-19. Every sector of the economy in the UK and abroad is facing unprecedented challenges arising out of the current Covid-19 pandemic – and the private healthcare sector is no exception
We consider some of the legal issues that you may be facing in the current climate and how you might be able to respond to them.
Hempsons solicitor Kirsty Odell advises on these areas:
❍ Patients – treatment issues and video conferencing;
❍ Employment – staffing and the self-employed;
❍ Contracts – contract delivery, signing of contracts;
❍ Property and insurance – eviction, buildings insurance and building interruption insurance;
❍ Personal – wills.
Our ‘Start A Private Practice’ slot explains what you should know about benefits in kind
Our PPU series takes a look at how these private NHS units have been faring in Scotland
Plus all the latest news and views affecting you in private practice
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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
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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
Jane Braithwaite shows you how to choose the right marketing strategy to attract new patients and grow your practice
n See page 26
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