NHS 10 Year Plan: Financial and operational implications for PCNs and GP Practices

The government’s NHS 10 Year Plan represents the most significant restructuring of primary care since Primary Care Networks (PCNs) were introduced in 2019. For PCN managers and GP partners, understanding the financial implications is crucial for strategic planning.

The Neighbourhood Health Service Shift

The plan creates Neighbourhood Health Services operating at 50,000 patients, with funding explicitly shifting from hospital to community care over the next three to four years. PCNs below this threshold may face pressure to merge – a process typically requiring 12-18 months and careful financial planning around integrated funding streams.

New Financial Models

Two new contracts launch next year, encouraging GPs to work across larger geographies. More significantly, the plan moves away from block contracts toward outcome-based payments, introducing “year of care” payments from 2026- 27. This value-based approach requires strong data collection capabilities to demonstrate patient outcomes and population health improvements.

Federation Opportunities and Risks

GP federations are positioned to become Multi Neighbourhood Providers serving 250,000+ populations, offering shared back office functions and digital transformation support. However, many administrative services fall outside VAT exemptions, creating substantial new costs unless structured through compliant cost sharing arrangements. Early specialist tax advice is therefore recommended to ensure you get the necessary support.

Productivity and Sustainability Pressures

The NHS must achieve 2% year-on-year productivity improvements over three years, while deficit funding ends entirely. The service aims for surplus by 2030, putting pressure on practices to ensure efficient delivery and robust financial planning.

Digital Investment Requirements

The commitment to lead global healthcare AI adoption demands significant investment. However, promised time savings and decision making support should deliver returns. The plan requires NHS organisations to reserve 3% of annual spend for transformation investments, providing a framework for this planning.

Strategic Priorities

PCN managers and GP partners will need to assess current population size against the 50,000 threshold, evaluate financial sustainability under value-based payments when details of these calculations are shared, and consider federation participation where appropriate.

The scale of change cannot be underestimated. While presenting opportunities for forward thinking practices and potential early adopter funding and shaping opportunities, it demands careful financial planning to navigate successfully which means that knowing your finances now is more crucial than ever.

Those who prepare early and seek appropriate professional guidance will be best positioned to thrive in the new landscape. Speak to our experts today to ensure compliance whilst maximising transformation opportunities