General Practitioner surgeries are unique businesses, being a private business offering a public function. The assumption tends to be that GPs are employed by the NHS, but that is usually not the case. GPs are, most often, private businesses (either companies, partnership or sole traders) who have NHS funding.
This means that GPs have the same issues regarding succession planning that other businesses have but with a unique problem. For example, if a shopkeeper decides to retire, they can do so. Another shop may open in their place or their customers will shop elsewhere. However, this is not the concern of the shopkeeper who can make their own decisions as to what to do with their business and go about their day. For GPs this is not necessarily the case. Providing primary healthcare is an important public function. It is essential that everyone within the UK have access to an NHS funded GP, and GPs usually feel that they bear a responsibility to ensure that this happens.
Can a GP surgery just close?
Yes and no. GPs cannot be prevented from retiring if they wish to do so, but there are considerations to take into account and appropriate notice must be given. A GP can retire but they cannot simply decide to close the doors of their practice and leave the patients to fend for themselves.
In many cases, this won’t be a concern when an individual GP retires. Many GPs are part of large practice groups, which are often limited companies. If a GP is considering retirement, the practice will seek to employ a replacement or their patients will be covered by the other GPs within the practice.
Smaller GPs, for example in small towns and villages, might be partnerships with two or three doctors operating from one practice. The situation here often depends on the partnership agreement but if there is not one, the partnership is dissolved, and the retiring partner’s capital is returned to them. The remaining partners might elect to continue the business without the retired partner, or to bring in a new partner. Again, this would not usually affect the patients of the practice.
However there may be cases where continuing the GP practice may not be possible. For example, once the retiring partner’s capital investment has been returned to them, the remaining partners may not have the funding to enable them to continue. GPs within such a practice might be a similar age and decide to retire at the same time, leaving no partners to continue the business. Often in small rural villages, there might be a single GP operating their own practice. When that GP decides to retire, there may not be anyone available to take over from them.
So, what happens to the patients?
When a GP retires, the local medical committee (in England, this is NHS England) helps to manage and facilitate their retirement. GPs must give notice of their intention to retire to NHS England to terminate their GMS Contract/PMS agreement. NHS England will put the practice out to tender (i.e. look for someone to take over). If that is not possible, the list of patients is ‘returned’ to the local medical committee and is either reallocated to another practice, or may be dispersed.
Reallocating patients simply means that the patients will go to another local GP practice. However, often practices will not have the staff or resources to take on another practice’s entire patient list. In this case, the patients may be reallocated to a number of practices or the patient list may be ‘dispersed’ and the patients asked to re-register at other local practices.
What happens to the staff?
Most GP practices will have staff other than the GPs themselves, including nurses and administrative employees. TUPE applies to GP practices as to any business.
TUPE applies where there is a ‘relevant transfer’ as defined within the Regulations. In most cases the transfer of the patient list would be a business transfer, meaning a transfer of a business, undertaking or part of a business or undertaking where there is a transfer of an economic entity that retains its identity after the transfer. Where the patient list is transferred to another practice, it is likely that there is a relevant transfer and TUPE may apply.
For both the retiring GP practice and the practice taking over the patients, the application of TUPE triggers a requirement to inform and consult with staff about the transfer.
If the patient list is dispersed, there is no transfer of an economic entity and TUPE is unlikely to apply. In this case, the retiring GP should be aware that their staff are normally redundant and should factor in redundancy costs as part of the costs of their retirement.
Many GPs will not realise their potential liability on retirement. It may also be frustrating that such liability is somewhat outside of the control of the GP, because NHS England take control of deciding how the patients should be dealt with. However, failure to understand employee rights and/or the application of TUPE can lead to substantial employment claims.
Allan Janes have previously advised GPs in respect of their retirement obligations, including advising in respect of the TUPE process. If you have any queries regarding TUPE or other employment issues arising from the closure of your GP practice, please call Charlotte Braham on 01494 893529.