Understanding PCNs: Structure, funding and accountability

A Primary Care Network (PCN) is a collaboration of GP practices working together to provide primary medical services at neighbourhood level. These networks are not separate entities but a collection of practices. Each PCN must have a network agreement, a clinical director and a nominated payee.

Initially, PCNs were established under a five-year contract introduced in 2019/20. However, due to the most recent government election, this contract was extended by an additional year, now running through to 2024/25. From 1 April 2024, there’ll be a single overarching specification that sets out the core missions and purposes of a Network.

On average, most PCNs cover between 30,000 to 50,000 patients, although some networks cover over 220,000 patients. As of September 2023, there were 1,271 PCNs in England, according to NHS Digital. Of these, 1,236 practices recorded staff data, with a headcount of 25,259.

The government’s aim for PCNs was to increase the workforce by 26,000 by the end of the five-year contract. In May 2023, they announced that they’d actually increased the workforce by 29,103 (FTE).

Originally, funding was paid to one practice, the lead practice, which would then distribute the amounts to other members. This may still be the case, but now there is an option for the funds to be paid into a separate bank account held on trust for the Network. Regardless of how it’s received, the funding needs to be separated from the lead practice’s funds to ensure transparency.

When PCNs started in 2019/20, they were funded through Core Funding, Clinical Director Funding, Enhanced Access and two ARRS roles (Clinical Pharmacist and Social Prescribers). Now, the funding structure has expanded to include Core Funding, Enhanced Access, Leadership & Management, Capacity & Access, Care Home Beds, Local Improvement Plan and several more ARRS roles.

Funding of Primary Care Networks (PCNs)

Please see below the network funding for 2024/25 (per annum):

• Core Funding*:                                                            £2.967 per patient**
• Enhanced Access (replaced extended hours):          £7.975 per adjusted population***
• Care Home Premium:                                                 £127.20 per bed.
• PCN Capacity & Access Support:                              £3.248 per adjusted population
• PCN Capacity & Access Improvement:                      £1.392 per adjusted population
  
  

*Core funding now incorporates Clinical Director and PCN Leadership & Management funding.

**Of the £2.967 per patient, £2.242 will be multiplied by the PCN registered list size as at 1 January 2024 and £0.725 multiplied by PCN adjusted population as at 1 January 2024.

***‘Adjusted population’ is a weighted population figure derived from the ICB primary medical care allocation formula. This figure is calculated periodically and published to the PCNs. Other income streams include the Investment and Impact Fund (IIF). The amounts received have been significantly reduced in recent years as more funding has been transferred to the capacity and access. From April 2024, maximum points available dropped from 262 to 58., each point being paid at £198 (subject to list size and disease prevalence adjustments). The number of indicators under the IIF has also reduced from five to two.

The Additional Roles Reimbursement Scheme (ARRS) provides workforce-based funding, covering 100% of the costs (gross + employers national insurance + employers pension), up to a maximum limit.

Some of the roles covered under ARRS, with the annual maximum reimbursable amount per role include:

• Digital and transformation leads:        £68,315
• Clinical pharmacists:                           £62,340
• First contact physiotherapists:           £62,340
• Physician associates:                         £60,401
• Pharmacy technicians:                       £40,159
• Social prescribers:                              £40,159
• Health and wellbeing coaches:          £40,159
• Care co-ordinators:                             £33,396
• Nursing associates:                            £33,396
• Trainee nursing associates:               £29,649

Accountability

When the lead practice receives the funding, it needs to be separated from their own funds and any income or expenses of the PCN must be recorded separately. This ensures transparency and allows all PCN members to see available funds at any given time. The PCN will also need a set of accounts prepared separately from those of the member practices. This is necessary to calculate any surplus, which will then be distributed among the members. Ideally, the PCN accounts should be prepared to the 31 March to align with the NHS and tax year.

Individual practices are required to report their share of PCN income in their own year-end accounts, since the income is taxable whether it has been paid out or not. It will also be pensionable for those within the NHS pension scheme. It’s important to make sure that the PCN income included in their accounts is solely theirs to avoid overpaying tax.

We recommend using accounting software such as QuickBooks or Xero. This helps maintain detailed records, provides an audit trail for all members to view, and simplifies the preparation of PCN accounts.

Need help?

If you need assistance with software choices or support in using the software, please get in touch with your usual Larking Gowen contact. Contact details can be found on the Our People section of the website. You can call 0330 024 0888 or email enquiry@larking-gowen.co.uk.

Jack Mulligan