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Tips for Small GMS Practices

Tips for Small GMS Practices

Legal Tips for Small GMS Practices

It is important for GP practices of two or three partners to be aware of the legal issues raised by the GMS contract when partners come or go.

A point not often appreciated is that if a partner retires from a two-partner practice then technically there is a dissolution, and this gives the LAT the right to declare the GMS contract at an end, and to put it out to tender. If your relationship with the LAT is good, it is a point they are unlikely to take - but LATs are not always a small practice's best friend, if you have a difficult relationship with your LAT then it is important to be aware of the correct steps to take.

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GMS Contracts and Partnership Deeds

Your GMS contract, if you have one, is with the partnership as a whole. The law says that you cannot have a one-partner partnership. This means if you go from two partners to one, then the GMS contract terminates.  However, there is a 'get out' in the GMS contract itself (at clause 26.3.1) - if both partners give at least 28 days' notice to the LAT beforehand, then the contract can continue with one partner alone. It is therefore extremely important that this notice is given in advance of the retirement, so as to prevent the LAT being able to put the contract out to tender.

Most partnership deeds require a partner to give six months' (or sometimes three months') notice to retire.   Sometimes a partner may seek to retire on shorter notice, perhaps on the grounds of ill health or incapacity or simply convenience. The temptation is to seek to 'do the right thing' by an unwell partner, or to make life easier by getting rid of a troublesome one - but if you do decide to accept shorter notice, it is important to service notice on the LAT first, and insist that the unwell/difficult partner remains a partner until the end of that notice period.

Partnership Disputes

The same issues arise when there are partnership disputes in two-partner practices. One partner may wish to expel the other for clear wrongdoing. Before doing so, he or she should consider whether that would dissolve the GMS contract and, again, risk the contract being put out to tender. This may mean a difficult choice between two significant evils. The LAT should be contacted to get a feel for their likely approach, and legal advice should certainly be sought.

Succession Planning

Succession planning is therefore all the more important for practices with fewer partners - and the partners may wish to have a succession plan for the disaster scenario where one partner 'goes under a bus'. Would the practice manager or a salaried GP be willing to become a partner for a temporary period?

Tips for Small GMS Practices

  1. All GP practices - but particularly small practices - should remember to notify the LAT of partnership changes in good time.
  2. If you are going to become a one-partner practice, make sure the LAT is given notice at least 28 days beforehand.
  3. If you are a two-partner practice, make sure you have a clear succession plan both for a) expected retirements and b) unexpected retirements.
  4. If a new partner is joining, make sure they sign the partnership deed (or a deed of adherence) on or before they join. Do not wait for the end of the probationary period - that is too late.

With offices in London, Watford, Bristol and Birmingham and lawyers based in Cornwall, we can deliver your legal needs on a national basis. For further information or to find out how our GP primary care team can help you, please contact Oliver Pool on 0117 314 5429.

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