Healthy returns
By Robin Stride
Private practice incomes remain healthy and major business opportunities beckon for doctors who understand the changing market and take advantage.
That was the overwhelming message in this year’s keynote speech given to more than 100 private consultants and GPs at the Independent Doctors Federation’s (IDF) annual general meeting.
Many members were encouraged by the upbeat state-of-the-market analysis presented to the meeting by a leading adviser to specialists.
Based on latest tax return figures and discussions with independent practitioners, he revealed:
A further rise in self-pay – something he said most consultants have been ‘pretty slow’ to take advantage of;
Higher price potential in the self-pay market, if providing a quality service;
Predictions of higher fee levels following a drop in senior consultant numbers in private practice;
More beneficial closer working relationships with private medical insurers;
Increasing NHS spend in the private sector.
Ray Stanbridge
Independent Practitioner Today columnist and medical accountant Ray Stanbridge told doctors: ‘The gloom and doom merchants are wrong – unless people are over-declaring their income to the tax-man, which I doubt.’
He observed that with the NHS in continuing ‘turmoil’ and the private sector undergoing great change, real opportunities were developing for excellent independent medicine, although ‘the problem is that all doctors state they provide an excellent quality of service and, by definition, this cannot be true’.
Mr Stanbridge, of Stanbridge Associates, believed basic market economics meant the NHS could not exist long-term in its current form. It would always be in crisis, innovation would be stifled and it would try to reduce cost of supply.
The long-term solution was to reduce the supply of specific services and look at charges and co-pay. But services in the short term would be rationed and transferred to the private sector to try to cut costs.
He said although conflicts continued with some insurers, they now accounted for less than 50% of the market.
There was an impending shortage of supply of consultants, only those really interested in private practice would remain and insurers were reconsidering their strategies.
Mr Stanbridge forecasted that closer working relationships with insurers would increase quality and efficiency. He said senior insurer officials now recognised that one size did not fit all and they had to change the way they worked with providers.
This could potentially mean additional financial rewards for provider quality and clinical efficiency and for new products and services.
Giving what he called ‘a talk of hope’, he said growth in the number of consultant groups would be another bonus. Groups were achieving a ‘staggering’ 15%+ compound growth in income.
They could increase quality and business efficiency, subspecialise and provide cross-cover, reduce ‘cock-ups’ and cut costs – for example, by negotiating lower medical indemnity.
And they could also innovate, invest, develop and market self-pay services and improve practice management. He predicted a growth in professional managers running the practice as a business and also a decline in traditional secretaries.
Mr Stanbridge told the meeting at the King’s Fund, London: ‘I think we are going to see a lot more innovation in the next few years – there is money to be made.’
Despite Competition and Markets Authority rules, he reported consultants were investing in new technologies and methods of delivery. There was also a large increase in the number of private investors interested in ‘small-scale’ investment.
Mr Stanbridge said insurers were recognising new facilities that provided good and cost-efficient services.