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PCN money and fair distribution

fair equitable PCN Ben Gowland
By Ben Gowland Director and principal consultant of Ockham Healthcare
8 February 2023

There is an unspoken rule in general practice, particularly within PCNs, that any distribution of resources needs to be equitable. Whatever the issue, the number one priority is almost always that distribution has to be fair. And by fair, we mean even across practices. But is this rule working against rather than for general practice?

It is very common right now for practices across a PCN to be demanding to see the split of how PCN resources are allocated to check whether it is equitable. For example, has ARRS funding been distributed equally across practices?  Is each practice receiving its fair share of additional roles? Is the PCN funding being deployed in a way that benefits each practice equally?

The assumption behind these questions is that these resources should be evenly distributed across the member practices. But should they? Is this a sensible way of deploying them?

Is it fair?

The ‘is it fair’ approach has already started to cause a number of problems. 

For example, some PCNs are struggling to spend all of their ARRS allocation. This is because there are practices reluctant to take on the supervision and training requirements of the new roles, or they don’t have the space to accommodate them.  However, because we are so fixed on equitable shares, we are loath to allocate the unspent share to another practice.

Vaccination centres (and the resulting financial flows) have also caused challenges in many PCNs. The vaccination centres were set up quickly, and one or two practices within a PCN often ended up doing the lion’s share of the work. But down the line, when the funding arrived at the PCN, arguments ensued that its distribution was not equitable, despite the huge differentials of work by practices when it came to delivery.

The Investment and Impact Fund (IIF) indicators generally work on overall PCN performance rather than individual practice performance. So, each practice has to pull its weight, or the PCN as a whole will lose out. 

Many PCNs have struggled to manage individual practices that have failed to achieve the indicators. They consistently rely on each practice doing their fair share and rarely look at differential delivery solutions by practice based on overall capability (because how would this be fair?).

Learning from start-ups

As PCNs move further into delivery with things like enhanced access, these problems worsen. 

If a doctor cancels a clinic in the enhanced access service at short notice, whose responsibility is it to step in?  Is this responsibility spread equally across the practices, or does it sit with one or two lead practices?  The latter is more workable; the former is more equitable. So, do we go with the former despite the operational challenges this creates simply because we are so attached to the principle of fairness?

There is an interesting analogy here to private start-up companies.

In start-ups, the initial founders have to determine how to apportion the equity of the company between themselves.  The default option is to share it on an equal basis on the grounds that this is the fairest method. 

However, research has looked at this more closely, as reported in a Harvard Business Review article The Very First Mistake Most Startup Founders Make. The researchers noted the length of time that founding teams spent discussing their equity splits. Some split quickly, neglecting to have a serious dialogue about personal uncertainties and expected contributions. Others had a longer, more robust dialogue and ended up with unequal shares. It is the latter who fare better.

Individuals bring different expertise, energy, capacity, capability and leadership to an enterprise. As a result, they differentially impact how successful the enterprise can be, and it works better when this is reflected in the equity split.

All practices are not equal

The same applies to practices within a PCN. All practices are not equal. All practices do not contribute equally to delivery. All practices do not gain the same value from the additional roles – for some, they are more of a burden, whereas for others, they are invaluable. All practices are not equally capable of responding rapidly to urgent requests or ensuring additional resources are secured.  So should the allocation of PCN resources reflect this?

The advice in the Harvard Business Review article is to develop an agreement on the split of resources over time, based on the commitment, time and record of delivery each founder brings. 

So, if a couple of the practices will take on the majority of the enhanced access delivery, they should receive the majority of corresponding resources.  If one practice has to over-deliver against IIF targets so that the PCN can meet them, it should receive more resources in return. If some practices find the ARRS roles invaluable and some a burden, skew the distribution to where it is most wanted and make sure the money is spent.

This is all much easier to say than do.  The principle of equity and fair share is so hard-wired into general practice that even when it is logical to go against it, it is still difficult. Practices are currently moving from one PCN to another across the country because of perceived unfairness. 

But for PCNs to really thrive and best serve their practices, this is a barrier they may well need to overcome.

Ben Gowland is director and principal consultant at Ockham Healthcare, a think tank and consultancy. He was an NHS chief executive for eight years and has also been a director of Croydon Health Services NHS Trust. He established Nene Commissioning, first as a PBC organisation and then as one of the largest CCGs.

A version of this article first appeared on sister title Pulse PCN

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