Full of promise? General practice premises policy reviewed

NHS England published the outcome of its premises policy review on 27 June. The review follows the publication of the final report of the GP Partnership Review in January which called for action to support GP partnerships around property ownership and to mitigate the personal risk associated with being a lease holder and also more broadly, in the context of the Naylor report on NHS property and estates and why the estate matters for patients.

But does this review represent a major shake-up of GP premises ?

Rob Day our primary care expert looks at the outcome of NHS England’s policy review and some of its key recommendations.

De-risking leases in strategically important estate

In line with the findings of the GP Partnership review, NHSE suggests relieving GPs of the burden of holding leases by assigning them to NHS bodies or other entity, where their length and liabilities prevent the “healthy renewal of partnerships and the estate is of strategic importance”. But any offer to stand behind a lease would only be made for estate which has been identified as having “ongoing importance for delivery of services” and would be offered as a “last resort only”.

The devil will be in the detail, and it is hoped that the opportunity is taken to ensure that this detail will both distinguish and indeed support new and existing lease arrangements.

If we look at new lease arrangements (in particular those arising from new developments), there is often a stand-off between primary care providers who are nervous about the substantial, and in many cases, personal liability that may arise from the long leases that developers require in order to realise their investment. This can be exacerbated when the primary care providers take any element of grant funding which (amongst other things) attract minimum use periods and a linked obligation to repay a proportion of the grant funding, if that minimum use period is not satisfied. With this as a backdrop, and in cases where premises are recognised as having ongoing importance, it would seem a logical and necessary step for primary care providers to have the ability to secure the comfort that NHSE will stand behind the lease liabilities in cases where they cease to hold a core contract until a new provider is found to take an assignment of the lease. The taking of head leases by NHS bodies seems a plausible alternative, but any subsequent sublease arrangements between the NHS body and primary care providers must be sensibly set so as not to undermine stability.

As for existing lease arrangements, the criteria that must be satisfied for the lease assignment to take place will need to be clear to protect primary care providers with existing lease arrangements and to ensure strategically important premises remain in use for NHS purposes. This aside, for the solution to work, where the relevant criteria is satisfied, then it should be an absolute outcome that the lease will be assigned. Indeed, there is a distinction between NHSE requesting that an NHS body take a lease and that NHS body being under obligation to accept that request. For the solution to work the NHS body must be tied into the arrangements.

Property ownership as part of the partnership model

NHSE expect that over time more practices will adopt a model where the choice to own premises is separated from that to become a partner in their partnership agreement, something that the review considered could support the future development of the partnership model in general practice. The Review suggests that NHSE would support such a shift but goes onto say that where the NHS is investing capital in general practice premises owned by GPs, the NHS will wish to seek assurances on a number of matters, not least that “the documented arrangements adequately record and protect NHS England’s investment”.

The Review does not delve into detail as to what these assurances could be, but if we consider the Premises Cost Directions they are likely to cover rent abatement, minimum use periods (for primary care purposes) and the repayment of sums invested in the event that the premises cease to be used for primary care purposes. Any such assurances do, however, need to be balanced. Yes, there is an need to protect NHS investment, but this should not be at the cost of undermining the practices that will ultimately deliver the services. Perhaps the solution will be similar to that associated with “de-risking leases”? In short, the property owners could commit to making the premises available for use by primary care providers during agreed minimum use periods. It will be interesting to see how this develops.

Professionalisation of property ownership and management

NHSE recommends clearer guidance on the expectations of owners and occupiers around maintenance and standards. The review would like to see guidance which clearly sets out the various roles in estate ownership and their associated responsibilities, including what is reimbursed under the Premises Costs Directions. It could include a breakdown of the different funding opportunities (eg rent reimbursement, business as usual capital and transformation funding) and their intended use.

This appears a subtle way of saying that while NHSE will issue guidance on who should be responsible for what in property arrangements (particularly arrangements where primary care providers lease premises), this falls somewhat short of recognising the need to create a solution to the well-publicised issues that have been caused by the increase in charges seen by primary care providers (particularly in respect of service/ FM charges).

New models and Premises Cost Directions

This includes pilots for network level premises reimbursement arrangements, which will give networks greater autonomy to manage and minimise their costs relating to estates across their premises. This model of premises provision in which the NHS directly bears the costs of premises in multi-use new build premises, “removing the need for bureaucratic premises reimbursement systems, promoting integration of service delivery and optimal use of space”.

But the Review highlights that the current PCDs are “simply not fit for purpose” when it comes to supporting primary care networks, who will need to plan how they will use their available estate across their patch and will need to have a greater opportunity to manage their estates costs at scale.

Where next?

We will have to wait and see how the review is taken forward: while much will depend on funding and the Government’s future spending review, if we are to address some of the fundamental issues facing primary care estate,then a concerted effort supported by dedicated funding will be needed to develop and implement the necessary solutions.

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Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.

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