Should a GP practice accept gifts and legacies?
Every now and then, a practice might be fortunate enough to be remembered in a patient’s Will or to receive gifts from grateful patients. Research has shown that the proffering of small gifts is relatively common place. Whilst it is obviously nice to be recognised for one’s good work, it does give rise to a number of professional and legal issues.
Professional issues
Good Medical Practice Guidance states that “You must not encourage patients to give, lend or bequeath money or gifts that will directly or indirectly benefit you.” However you “may accept unsolicited gifts from patients or their relatives” provided that it doesn’t affect the treatment you provide.
Whilst this appears to permit the receipt of unsolicited gifts and legacies, there is a big caveat. In each case, you must “also consider the potential damage this could cause to your patients’ trust in you and the public’s trust in the profession. You should refuse gifts or bequests where they could be perceived as an abuse of trust.” This is clearly a judgmental matter which will be easier to balance for a box of chocolates than for a £100k legacy.
Legal issues
The PMS and GMS Regulations are clear that practices must keep a register of gifts from patients or their relatives that have a value of £100 or more. You should record the name, the NHS number or address of the donor, the nature of the gift, its estimated value and the name of the recipient.
The next question which arises is how should the gift or legacy be shared?
To determine the answer to this question, you need to look at both the gift or legacy itself and the partnership deed.
For example, a legacy may be left ‘to the partners at the XXX Surgery’. So has the gift been left to the GP partners individually in equal shares, or left to the partnership to be divided between the partners in their respective profit sharing ratios? Was it intended for the partners in the practice at the time the Will was written, at the time of death or when the legacy is actually received? Alternatively, is it actually intended for the benefit of the patients and therefore shouldn’t be taken as income at all, but rather invested in healthcare within the practice area? Sometimes the intended purpose is clear because the donor has perhaps left a letter of wishes stating how they want the money to be spent or shared. Unfortunately, this is frequently not the case and a large legacy can often be a source of dispute between the partners.
Recommendations
Practices need to be careful about what gifts and legacies they accept and how these are recorded. The larger the gift, the more care needs to be taken.
Remember that this is, at heart, an ethical issue and whatever decision you make, would you be comfortable in justifying it in front of the GMC, or perhaps even a journalist?
For larger gifts and legacies, in addition to recording them in the gift register, we would recommend that you prepare a paper trail setting out your thinking behind the decision you took and any professional advice that you sought.
You would also be well advised to check what your partnership deed has to say about sharing of gifts and legacies to minimise the risk of future partnership disputes.
If you have any queries relating to legacies and gifts, or any other matter, then please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Does your professional indemnity insurance put you in breach of your employment contract?
GP practices and salaried GPs are advised to check the terms of their employment contracts if employed clinical staff are considering taking out “claims made” insurance, such as that recently offered by the MDU.
In a previous blog, we looked at the broader implications of claims-made insurance policies (Will you or your practice be impacted by the MDU policy changes?). However, another potential consequence, which we’ll be focusing on here, is how claims-made policies may inadvertently put salaried GPs in breach of their employment contract.
So, what exactly is the issue and what action should you take?
Current employment contracts
The ‘BMA Model Employment Contract’ states that “The practitioner will maintain full registration with the General Medical Council and membership on an occurrence based basis with a recognised medical defence organisation commensurate with your responsibilities”. (What is the BMA model contract and does it apply to me?)
This point is regarded as so important, that it is repeated in both the BMA model contract and in the BMA model offer letter. It is clear that the BMA negotiators assumed that all salaried GPs would be insured on an occurrence based basis – i.e. a policy that offers protection for any incident which occurs during the policy period, even if the claim is filed after the policy has ended.
Since all GMS practices, and many PMS practices, are required by their provider contracts to engage their salaried GPs on employment contracts that are ‘no less favourable’ than BMA model terms, it is likely that most salaried GP contracts will include a similar clause.
As a consequence, if a salaried GP moves to a claims-made indemnity policy, they may be unwittingly breaching the terms of their employment contract.
Our recommendations
As a first step, we would advise all practices and salaried GPs to look at their employment contracts and Staff Handbook, to see whether there is a requirement for employees to have an occurrence based indemnity policy.
If the requirement is included, practices need to have procedures to ensure compliance. The BMA model contract states that salaried GPs should provide “written proof and evidence of such membership”, so practices would be free to request this.
If there is currently no written requirement, practices should consider whether they are content to allow salaried staff to move to a claims-made contract or not, and employees should consider whether they wish to make the move. This is a question of understanding the risks involved, such as whether the employing practice is exposing itself to more risk by permitting claims made policies. All parties would be well advised to speak to a specialist IFA to fully understand this.
Practices which do not currently require occurrence based policies but wish to do so going forward will need to consider making changes to their employment contracts. We recommend that you always seek appropriate legal guidance before doing this.
If you are at all unsure about any of the issues we have covered here and how they might affect your practice, then please do not hesitate to get in touch.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Cheema vs Jones: The importance of an up-to-date Partnership Deed
Regular readers will understand the importance of keeping your partnership deed up to date. This is particularly true when new partners join, as this can easily supersede and invalidate the former partnership arrangements. A recent High Court case has demonstrated some of the risks.
The case of Cheema vs Jones
In this case, two GPs – who we’ll refer to here as A and B – entered into a partnership to provide medical services under a GMS contract. The terms of this agreement were set out in a Partnership Agreement which was signed in April 2016.
Shortly afterwards, A and B decided to admit doctors C, D and E into an expanded partnership, and it was agreed that this larger partnership would start on 1 July 2016.
Solicitors were instructed to prepare a new partnership agreement. However, before the terms could be finalised a dispute arose between A and B. Matters escalated and when B was prevented from seeing patients and refused access to medical records, B obtained a High Court injunction allowing him back into the surgery.
A, C, D & E then served a Notice on B dissolving the partnership. Their intention was presumably to exclude B, enabling the others to continue the practice without him.
The High Court agreed with A, C, D & E that a Partnership at Will had been created in July 2016, and the April Partnership Agreement was no longer relevant. They were therefore entitled to dissolve it by serving notice on B.
Consequences
Sadly, A, C, D & E’s High Court victory was pyrrhic. By dissolving the partnership they immediately put the GMS contract at risk since this was held by a Partnership which no longer existed. Within weeks the practice had been given notice by NHS England and a temporary contract to ensure continuity of care had been placed with another practice.
Key lessons
- When you are considering admitting a new partner to the practice, make sure you agree the terms of the partnership in advance. This can be either a Deed of Accession to the existing Deed, or by signing a new Partnership Deed.
- Always issue a comprehensive partnership offer letter to prospective new partners. This will set out the key terms of the appointment and help ensure the current partnership deed continues, at least in the interim. For more information see: Why is a partnership offer letter so important?
- Probationary periods are not relevant to the continuation of the ‘old’ partnership. Once a new partner joins, the old partnership arrangements fall away unless there is strong evidence to the contrary.
- It is always very risky to dissolve an NHS medical partnership. The contract and the future of the practice is immediately put at risk. Dissolution is such a draconian step it should normally only be undertaken as a last resort and with very careful contingency planning.
- Having an up-to-date partnership deed is your best protection in the event of a dispute. It can be invalidated in whole or in part for a number of reasons, so you should revisit it on a regular basis. For further information see: The dangers of having an out of date partnership deed
Our recommendations
The Partnership Agreement is a critical document for managing your practice and securing your future. Revisit it regularly, always use a solicitor who is experienced in Primary Care matters, and don’t rely on unregulated ‘advisers’ or borrowed templates.
For all your partnership matters, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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The importance of agreeing a break clause for your surgery lease
If you rent your premises, one of the key questions is when and how you can be released from your obligations under the lease. If for some reason you want to vacate your surgery premises, you will either have to wait until the end of the lease term, or rely on a break clause. It is, therefore, an important point to consider in the lease negotiation process.
What is a break clause?
A break clause is a provision within a lease that enables either the landlord, practice, or both parties, to end the lease early.
When one party to a lease tries to exercise a break clause they will often find the other party is reluctant to agree, as the landlord will be losing a valuable income stream, or the tenant will be left with the problem of finding somewhere else to practice. It is therefore vital that break clauses are negotiated well, drafted carefully, and are followed to the letter to avoid costly and protracted disputes.
Common break conditions
These may include:
- a fixed date or dates at some point in the future
- the right for a tenant practice to terminate the lease after a certain date, or
- the occurrence of a specific event that can act as a trigger.
As an example of the third type, a surgery lease would usually include a termination right in the event of the end of an APMS/GMS/PMS Contract, or the term of such a contract expiring without renewal. This should be linked with voluntary termination of the relevant contract, so a practice has some control.
The NHSPS standard lease contains a form of break option and does allow for voluntary termination. However, there may be other circumstances under which you wish to end the lease, so it needs some consideration.
How and when notice can be served
This will specify the form in which notice must be served, the method it must be served by, to whom it should be given and the timeframe within which it must be given.
One issue that can arise here is if the break clause notice period doesn’t mirror the notice period required to terminate the APMS/GMS/PMS Contract. This can lead to a practice having to pay rent after the contract has ended.
The NHSPS standard lease recognises this in principle, but it needs to be more fully addressed in the detailed drafting.
Break pre-conditions
These are the conditions which need to be met in order for a break to be achieved. They should be both clear and attainable. For example, practices may be required to be up to date with the annual rent and any other monies owed. Landlords also often want a break clause which requires full compliance with all the other terms of the lease.
Such conditions attached to Break options can be very difficult for a tenant to comply with. Even minor breaches can mean that the Break Option cannot be exercised, so such conditionality should be resisted where possible.
Recovery of any overpayments
Most leases require that payment of monies such as annual rent, service charges and insurance are made in advance. If a lease is terminated using a break option, then a surgery will not be entitled to a refund of any sums paid for the period after the break date – unless it has been specified in the lease.
The NHSPS standard lease includes a refund for rent, but not for service charges or other sums that may have been paid in advance.
Our recommendations
There are many commercial, legal and practical issues to consider when agreeing a break clause. And when it comes to exercising one, great care needs to be taken to ensure all conditions are followed to the letter, so it remains valid.
While the NHSPS standard lease is relatively well balanced, there are still important enhancements that need to be made, based on an individual practice and its circumstances.
When it comes to negotiating a lease – and with the importance that the drafting of that lease will have for a practice – it is always advisable to seek the advice of an experienced solicitor who can guide you through the process, while ensuring your interests are protected.
Other articles in this series which you may find useful include: ‘How to Successfully Negotiate a NHS Property Services or CHP Surgery Lease and NHS Property Services (NHSPS) standard lease
For more information about negotiating a lease, or any other related issues, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Can you challenge the CQC?
Despite increasing pressure being placed on frontline care teams, the Care Quality Commission (CQC) has revealed that GP practices are providing a consistently good quality of care, with 93% rated good or outstanding.
Practices are also significantly more likely to maintain their rating upon reinspection than other NHS providers.
But what if an inspection takes place and you disagree with its findings? What are your options for challenging the ratings given?
CQC inspections
All GP practices are subject to a comprehensive inspection by the CQC at least once every three years. This consists of inspectors collating information externally and then being on site for a day to observe. Further follow up inspections may also be undertaken, if a particular concern has been raised in a previous inspection.
Inspectors assess all practices on the following points:
- Are they safe?
- Are they effective?
- Are they caring?
- Are they responsive to people’s needs?
- Are they well-led?
They also look at how services are delivered to people in specific population groups, such as the elderly, people with long term conditions and those experiencing poor mental health.
‘Evidence’ will be gathered from multiple sources. This may include looking at feedback and complaints, assessing local and national data, speaking to service users and staff, and any insights gained through the onsite inspection. From this evidence, a report and ratings will then be produced.
When can you challenge a CQC report?
Draft report
A draft copy of the report will be sent to the practice and it is as this point that you will be invited to provide feedback on its ‘factual accuracy’.
At first glance, the term factual accuracy may suggest that you can only correct stated facts, such as the number of staff they have recorded. However, in reality this is your chance to challenge all inaccuracies in the report and its findings, including questioning the evidence base and how it has been construed to justify the conclusions drawn.
Time is short. You will only have 10 working days to review the draft report and submit any comments.
Published report
Once a report has been published, you can also ask for a review of the ratings if you feel inspectors did not follow the correct process and procedures. You must tell the CQC of your intention to do this within 5 working days of the report being published.
Drafting your response
While there may be things in the report that you disagree with or feel are unfair, that alone is not enough. Any challenge must be based on specific issues with the evidence and how it has been interpreted, or the process that inspectors have followed.
If you believe a report to be an unfair representation of the level of service you provide, then how you word your response is important.
- Your aim is to describe why the service provided does not justify the rating it has been given, in relation to the Provider Guidance descriptions. It is therefore important that you refer back to the specific items in the Guidance (available on the CQC website).
- Don’t worry about fitting your comments within the boxes provided on the form. It is more important that you lay out your case clearly, so feel free to write on a separate sheet.
- Show you understand the whole process and all guidelines by making reference to The Fundamental Standards, The CQC Provider Guidance and The CQC Enforcement Policy
- Always avoid including any comments that are emotive (‘this is completely unfair’) or just opinion, (‘it’s impossible with the funding we have’). You need to demonstrate how a different opinion could/should have reasonably been reached by looking at the facts more carefully.
Our recommendations
While it is true that many challenges are not upheld, it is by no means uncommon for challenges to succeed. The key is always in the preparation of the supporting documentation.
If you are unhappy, make sure your concerns are submitted within the deadline. This is difficult in itself as the deadlines are so tight.
We’d always recommend that you prepare fully for the inspection itself, and present the strongest evidence you can. Try to gauge at the inspection itself whether there are any concerns, since you will only have 10 days to respond once you receive the draft report and this is very little time to gather any additional evidence. Then, if you are faced with a report and ratings you feel are unfair and inaccurate, ensure you document your response in the right way.
If in doubt, ask for advice as quickly as possible from an experienced legal team, as they will be able to help you prepare your challenge, giving you best the possible chance of it being upheld.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Can you rely on your ‘green socks’ clause?
Making the decision to expel a partner is never an easy one and the reasons for doing so will vary widely.
Some situations will be straightforward. A partner may, for example, be found to be in clear breach of the partnership deed if there is an issue of gross misconduct. Unfortunately, less clear-cut circumstances are more common, such as a personality clash that is causing disfunction within the partnership and preventing it from operating effectively.
In these instances, a ‘green socks’ clause could be the answer. But can they be relied upon in practice?
What is a green socks clause?
A green socks clause is a clause that can be included in a partnership agreement, which allows partners to be expelled on ‘no fault’ grounds. Its name refers to the fact that the reason for expulsion could be as innocuous as wearing the wrong colour socks.
An example of when you may wish to use such a clause would be an under-performing partner. An under-performing partner can create unease in a practice, resulting in low morale amongst other partners and employees. Having the ability to expel such a partner, without having to rely on ‘with fault’ grounds, can be an attractive option and is often seen as an ‘easy’ way to resolve the problem.
Are green socks clauses legal?
For a green socks clause to be added to a partnership agreement, all partners must agree – which means there is no reason why it should not be effective in law. However, should an expelled partner decide to challenge their expulsion, the Courts will check that the correct process has been followed and that it has been carried out to the letter. They will also want to ensure that the process isn’t being abused in anyway, for example as a way to discriminate against an individual.
What can you do to reduce the risk?
Exercising a green socks clause is effectively relieving someone of their livelihood and their business, without explanation or rationale. For this reason, the courts will be very strict. Even the smallest deviation from the process is likely to invalidate the expulsion and expose the expelling partners to the risk of a counter claim. The Courts may also want to convince themselves that the underlying reason is not illegal (such as discrimination) so may well want to understand the expelling partners’ reasoning.
Remember that if the matter does become litigious, the process of disclosure will require that all evidence is released. This will include any emails, paper notes and other records however stored, as well as witness statements. If any of these hint at either a deviation from the process or an illegal reason, the Courts would take a very dim view. Given that tensions will be running high and the expelling partners are likely to generate a lot more correspondence than the sole partner being expelled, this can be a risky process.
For these reasons, it’s always wise to seek legal advice well before an expulsion is made. This can help you to ensure that you fully understand the process, and that emotions do not overrun in a way which could cause problems later on. You will also want to ensure that some documents are covered by ‘privilege’ and thus are not disclosable.
Our recommendations
A well drafted green socks clause can be beneficial on two counts. It can encourage all partners to carry out their duties conscientiously, and it can make it easier to take action against anyone who falls below the required standards.
However, they should not be seen as the ‘easy option’. A better starting point where there are problems is usually to consider whether a ‘with grounds’ expulsion clause can be used.
Green socks clauses are best avoided in two-man partnerships because they become too unstable. They should also be avoided in partnerships where two or more partners are closely related. This is because the relatives are unlikely to vote against each other, effectively meaning the green socks clause can only be used against the non-related partners.
It is good practice to ensure that unanimous consent is required to exercise a green socks clause – something which is often difficult to achieve – and to include a mandatory mediation process and cooling off period.
Exercising a green socks clause is a very drastic step to take and the decision should never be made lightly. If you are considering the expulsion of a partner, we strongly recommend that you seek legal advice as early as possible to maximize your chances of success.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Will you or your practice be impacted by the MDU policy changes?
The Secretary of State recently announced some planned changes to the medical indemnity scheme. The plans are still in the early stages and not expected to be implemented for at least 12 to 18 months, but it seems clear that the state will be playing a larger role in medical defence insurance in future, which should hopefully assist in controlling the spiralling costs.
In response, the MDU announced that it will move from an occurrence based policy to a claims-made policy. Their rationale for doing so was to reduce the cost of the premium. It is not yet clear whether other insurers will follow MDU’s lead.
To understand the consequences of the MDU’s announcement, it is necessary to be clear on the difference between the two policy types:
An occurrence policy protects you from any covered incident that occurs during the policy period, regardless of when a claim is filed – even if this is after the policy has been cancelled. This means that when you retire, you can do so safe in the knowledge that if a problem should ever arise from your time in practice, you will be covered. It also makes it easier to switch insurers, because a new insurer does not need to concern themselves with the risk associated with events that happened previously: they just need to understand where and how you will be practising in future.
A claims-made policy protects you from any covered incident that is claimed for whilst the policy is in force, regardless of when the actual incident occurred. When you stop paying the premium the cover stops, even if the incident occurred whilst the policy was in force. This means that when you retire (and stop paying your insurance premiums), you are not covered for any claims that may arise relating to your time in practice unless you buy “run-off” insurance. Such cover can be expensive, so make certain you understand how the premium will be calculated before signing up to the policy.
Switching from an occurrence policy to a claims-made policy is likely to save you money in the short term, since the occurrence policy will cover everything arising from the past, and an incident would have to both occur and a claim be made in the first year of the new claims-made policy for it to be covered. However, this ‘saving’ will likely catch up with you when you need to buy run-off cover to retire or move back to occurrence based insurance. The Government has stated that they do not currently plan to offer run-off cover in the state-backed scheme.
If you are considering taking out claims-made insurance, here are some things you should consider:
- Firstly (and most obviously) don’t let your existing professional indemnity insurance lapse until the new scheme is active and you have the policy in place.
- Look at your partnership deed – it may prohibit you from taking out claims-made insurance, and even if it is not prohibited, it probably doesn’t explain how to deal with the risks of a claims-made policy and in particular the risk that a retiring partner doesn’t buy adequate run-off cover. It is difficult to ensure a retired partner maintains run-off cover once they have left the partnership, which leaves the remaining partners at a risk of picking up residual liability in the unfortunate event of a claim being made (see our recent article on joint and several liability).
- Check the status of any clinical employees and sub-contractors – are they expecting to be covered by the practice’s medical defence insurance? They will most likely want to reassure themselves that they are covered for all their actions whilst employed, regardless of when a claim is received. This will need to be set out in employment contracts and locum agreements.
- If you’re considering merging with another practice, you will be well advised to investigate the type of insurance policies which have been and currently are in place, since claims-made policies will enable the risk to transfer from one practice to another. This is likely to significantly increase the amount of due diligence that practices should undertake before considering a merger.
Our recommendations:
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
- Discuss with insurance brokers whether there are opportunities for remaining within an occurrence-based insurance scheme until any government alternative is avalable
- If you are considering moving to a claims-based policy, seek legal advice on how this will impact your partnership agreement, employment contracts and other key contracts.
- If you do decide to stay on an occurrence-based scheme, then you should ideally ensure that all partners are obliged to do the same We would recommend seeking the help of specialist, professional advisers to help you navigate the changes to the medical indemnity scheme.
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Can a GP practice have limited liability?
As Primary Care changes, we are frequently asked about different business vehicles and in particular whether a GP practice can have limited liability. Choosing the right type of business vehicle for your GP practice is not always straightforward, and managing risk is likely to factor highly in the decision making process.In this article we look at the issue in more detail, explaining the different business vehicles and their potential implications.
Unlimited liability partnership
Most GP practices currently operate as unlimited liability partnerships. This means partners are “jointly and severally” liable in the case of any financial problems. Creditors and other litigants are free to sue all the partners in the partnership to recover their losses, regardless of who caused the problem. What is more, each partner is liable up to the value of the whole of the debt. This means that creditors are able to look to the personal assets of all of the partners until the debt is settled in full or there are no personal assets left. Although your partnership deed will specify how you share profits and losses between you, your creditors will have no regard to this and will typically simply look to find ‘the deepest pockets’.
Although unlimited joint and several liability can be a frightening concept, it has historically not been a major concern for GP Practices since the clinical negligence risks are mostly insured against. However, as practices have become larger and more complex, other risks have become important and need managing or protecting against.
Limited Liability Company (Ltd)
A limited company is the vehicle of choice for most businesses in the UK. A limited company is managed by directors and owned by shareholders. If a limited liability company is unable to pay it’s debts, it becomes insolvent. Creditors are not normally able to ask the shareholders or directors to contribute to losses, so liability is limited to the capital which the shareholders have introduced to the company, plus any other assets (such as retained profits) the company might hold. Importantly, the personal assets of shareholders and directors and generally protected from creditors.
GP practices are, in principle, able to operate as limited companies. However, the consent of NHS England is required to move the GMS or PMS contract to a limited company and they have historically been reluctant to agree. There are also regulatory restrictions about who can own a company delivering GMS or PMS services, which will need to be secured in the Company Constitution. Moving a practice from an unlimited liability partnership to a limited company is not a straightforward process, so anyone thinking of going down this route should always seek specialist legal advice first.
Another way limited companies can be used is to manage the largest risks in the partnership. For example, the surgery could be held in a limited company, while the practice is kept as an unlimited liability partnership. This is a reasonably common model for practices to adopt.
Limited Liability Partnership (LLP)
An LLP is an alternative legal structure that is commonly used by professional services firms, such as accountants and solicitors. It enables a business to operate with a partnership structure (where ownership and management are one and the same), whilst limiting the liability of the partners and protecting their personal assets. As with a limited company, it is a matter of public record how much capital each of the partners have put at risk.
We are often asked about LLPs since they superficially appear to be an obvious solution for GP practices, but they are unfortunately not permitted business vehicles for GMS or PMS contractors. If a practice were to be set up as an LLP, it would put these contracts, staff pensions, and much more at serious risk.
Other options for managing liability:
Insurance
One route partners may take to gain greater protection for their personal assets, is the purchase of specialist insurance. All NHS GPs are obliged to take out professional indemnity insurance against one of their biggest risks – professional negligence claims. The same approach can be taken to other risks to the financial wellbeing of the practice as well. Possible examples include life insurance, key man insurance, or mortgage repayment insurance.
Indemnities
As discussed above, to the outside world all partners are jointly and severally liable for the losses of the partnership. This can, of course , seem quite unfair so it is reasonably common for Partnership Deeds to provide that partners are responsible for the consequences of their own negligent or unapproved actions. These clauses are called ‘indemnities’.
Whilst fine in theory, the obvious problem with this approach is that if the individual concerned runs out of money, the other partners will still be exposed to the remaining debt. Also, it is often difficult to link a loss directly to the negligent actions of a single individual. More commonly, a problem is a result of a series of unfortunate events, where several people could have intervened, but failed to do so.
Our recommendations
Sadly, there isn’t a single, simple solution when it comes to managing liability in a GP practice. All the options we have detailed come with their own difficulties, and we are conscious that as healthcare becomes more ‘commercial’ it is also becoming more risky commercially.
We would always recommend seeking professional accounting and legal advice before making any decisions, to ensure you understand the full implications of the options which are available to you. The ‘right’ answer for your practice will depend on your individual circumstances and your appetite for risk.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Can a partner work outside of the practice?
The question of whether a GP partner can work outside of his or her practice, and under what constraints, is a common one. A survey by Pulse reveals GP partners have seen their pay drop by an average of 4%, so topping up earnings with private work can be an appealing option.
Typical scenarios include:
- A part time partner who wishes to work elsewhere in their remaining sessions
- A full time partner who wishes to work elsewhere during their annual leave
If you have a Partnership Deed
For practices with a Partnership Deed, it should clearly state what the agreed rules are, along with all associated obligations and restrictions. It should also make clear the implications of breaching such obligations, for example potential financial penalties and what may ultimately be grounds for expulsion.
A well drafted deed should include:
- A clause requiring that the partners need to give their approval for any outside work to take place
- Limitations on any such work, including the number of hours that can be done, the location, the type of work, etc
- The need to pool any unapproved outside income
- The need for any partner working elsewhere to pay back a proportion of their medical defence cover
- An obligation to act in the best interests of the partnership at all times
One area that can cause some confusion is when senior employees are called ‘partners’ – one example being a ‘salaried partner’. In these instances, you will need to refer back to the individual’s employment contract. (You can read more about the differences between a salaried and fixed share partner here – Salaried vs Fixed Share Partners).
What happens if you bend the rules?
Another area where partnerships can sometimes run into problems is when they have previously allowed partners to work elsewhere in breach of the Partnership Deed. In these cases, it is unlikely that these clauses can then be relied upon in the future.
The practice may be deemed to have varied the deed and it would be wise to seek legal advice on how best to move forward.
If you don’t have a Partnership Deed
If no deed is in place, then the answer falls to the 1890 Partnership Act. While the act itself has little to say on the subject of working outside of the practice, it does state that partners cannot compete with the partnership and must act in good faith at all times.
It is unlikely that these obligations would be breached by a moonlighting partner but it would need to be judged on a case by case basis. It would also be very difficult and expensive to try to enforce these obligations.
Our recommendations
The best protection for your business will always be to have a Partnership Deed in place that you can rely on and which clearly sets out all obligations and sanctions. If you don’t have a deed, or it is lacking, or out of date, then seek the advice of an experienced legal team.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Thinking of setting up a private GP practice?
There has been much discussion in recent years about the rise of private GP practices within primary care and it is a subject we are increasingly being asked about by our clients.
Setting up a private GP practice is a complex area and for anyone thinking of taking such a step, there are many issues that need consideration. The priority must always be to ensure compliance with the many regulatory barriers.
Here, we share the first of a series of blogs on this topic.
What are the rules?
The NHS regulations are very clear. A practice providing GMS, PMS or APMS list based services must not charge any of its patients for treatments – regardless of whether these treatments are available on the NHS or not. (There are a few limited exceptions to this rule, which most practices will be aware of).
Setting up a separate business vehicle (eg a limited company) to provide the services may appear a potential solution to this, but it is a risky strategy, as it is highly likely to breach the regulations.
So, what can you do to ensure you comply?
Set up a distance away from your NHS practice
It’s critical you have robust processes in place to ensure that none of your private patients are registered on a list where you are the contractor.
The easiest way to do this is to set up your private practice well away from your NHS practice area. You will still need to undertake checks, but the risk of being in breach will be greatly reduced.
Conduct thorough employee checks
You also need to undergo checks to ensure any GPs you employ or otherwise engage in the private practice, do not have an interest in an NHS list based contract. If they do, then you will need to extend your checks to cover these patient groups too.
One slightly grey area is where a locum GP is providing services for both an NHS practice and a private GP practice with overlapping patient lists. It’s certainly arguable that this breaks the rules, but as the regulations aren’t entirely clear it will depend upon the individual circumstances of each case.
Make sure patient records are kept up to date
Data Protection rules will prevent you from using your NHS practice list to run your checks. You will, therefore, need to ask each private patient to confirm where they are registered and then have steps in place to ensure these records are kept up to date.
Our recommendations
If you’re considering setting up in private practice, then bear in mind that the rules associated with this are complex and the consequences of getting it wrong are serious. That said, while the rules are strict, it is possible to put controls in place to ensure compliance. To help you navigate the process, we would always advise you seek the advice of specialist, professional advisers.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com