With the prospect of greater independence, more control over the way you operate, and a more established professional presence in the local community, starting a GP surgery feels like a natural next step for many experienced medical professionals.
If you’re moving from the NHS to the private healthcare sector, it also means an escape from the strict targets and rules imposed under the Quality and Outcomes Framework.
That said, it’s also a big learning curve. Private clients might be more challenging, with higher expectations of your service than the clients you’ve worked with before. What’s more, setting out on your own means you’ll be taking on an entirely new role – that of a business owner.
Your surgery needs not only to cover its costs but make a profit too, and you’ll be responsible for making sure it does, from creating a business plan and measuring progress to keeping on top of your cashflow and finances.
What’s your plan?
First of all, it’s a good idea to spend some time thinking about what you want to get out of running your own surgery, and weighing up the pros and cons.
There’s the benefit of being able to make your own decisions about how you run it, as well as the value you could build up by establishing your surgery over time. You might plan to sell it eventually and retire on the proceeds, or maybe you’re thinking of turning it into a family business and handing ownership over to the next generation.
Either way, don’t put off thinking about this until closer to the time. Having an exit plan even when you’re just starting up will help you to set goals and understand what you’re working towards.
Don’t forget to consider your personal financial circumstances, too, and how they’ll change when you set up your own surgery.
For example, you might not be able to continue with your NHS superannuated pension and will need to consider private options.
With that in mind, you’ll need to create a business plan much as you would with any other kind of business.
That includes doing your research on the market for healthcare services where you are, drawing up financial forecasts, setting out operational plans, and so on.
Choosing a structure
Structuring your business as a GP can be complicated, with several options to choose from depending on how you’d prefer to operate and how many people you’ll be working with.
If you’re going to be practising on your own, without any partners, you might decide to set up as a sole trader – also known as a ‘single-handed GP’.
If you prefer the flexibility of working by yourself, this could be a good option, but bear in mind that it means you’ll be solely responsible for providing appropriate premises, bookkeeping, and if you decide to take on staff, managing them and meeting your obligations as an employer.
There’s been a downward trend in the number of single-handed GPs in recent years, which nearly halved between 2002 and 2013.
This is in part because many GPs have found it more efficient and profitable to work in partnership with other professionals.
If you are planning to start your surgery with partners, you might choose to do so by forming a limited liability partnership (LLP).
This structure is similar in some ways to a traditional partnership and in others to a limited company – both of which you can read about in our blog post on choosing a business structure – but in summary, it means each partner will pay tax on their share of the business profits, but has limited liability for any debts.
And if you want to join up with even more GP organisations, the ‘super partnership’ structure has become increasingly popular, which allows multiple partners and practices to work within the same entity.
Your other options include forming a cooperative, a not-for-profit organisation, or a community interest company. Whichever route you go down, it’s always best to take professional advice and make sure your choice of structure meets your needs.
Regulation for a GP surgery
All new practices must register with the Care Quality Commission (CQC) before opening. This can be a lengthy process, with various pieces of preparation work and interviews required, which can take three months or more to complete.
Once you’re registered, you’ll be subject to regular inspections, and the CQC will review information it holds about your practice annually.
One of the CQC’s fundamental standards requires practices to ensure any complaints are appropriately investigated and appropriate action taken is taken in response, so you’ll need to set up a complaints policy.
Managing your finances
To return to our earlier point, setting up your own surgery means becoming a business owner, and a big part of that is making sure your books are balanced.
You can do this before you start with a financial forecast.
Estimate as best you can the cost of your premises, tax, and any staff you hire, as well as your own salary, and compare that total to the income you expect to get from client fees. Does your income cover your expenditure?
You might need to be prepared to invest in the business to begin with, either with external finance or your own money, if it won’t be possible to cover your costs right away.
And make sure you have a system in place right from the start for recording your financial data and keeping accurate accounts.
You’ll need to do this to meet your tax and reporting obligations, but it’s also valuable for keeping an eye on your cashflow and staying on track to meet your goals.
As specialist accountants for medical professionals, we can help you to start and grow your GP surgery.