The NHS is currently aiming to develop a new capitation-based formula for funding general practices in England. My view is that a revised formula won’t address the fundamental problem with the current method of funding primary care: the disconnect between workload and funding. All the new formula will do – no matter how well-designed – is shuffle money between general practices. Some practices will gain substantial sums, some will lose substantial sums; but most practices will see no major changes in their funding.
Capitation-based formulas for general practices are therefore a 20th century solution that the government is trying to continue to use in the 21st century. We need to move away from a capitation-based funding model to one based on actual workload as well as on capitation. Under such a model, any work done by general practices – whether generated through government policy, patient demand or transfer of work from specialist settings into the community – would be paid for at its full cost. There would then be no need for any ‘funding formula’. The more work a practice did, the more it would get paid.
This is how primary care funded in many other developed countries and results in improved access to primary care services. Critics of workload-based funding for general practices might argue it would dramatically increase costs as well as being administratively complex to administer. However, the alternative is the continuation of current trends, with worsening access for patients to primary care services; and an exacerbation of GP recruitment and retention problems.