Over the past ten years, I have followed disruptive enterprise take significant market share in the retail space. Starting with Amazon, I foresaw their growth and expansion as both a Trojan horse for manufacturers, but also a threat to distributors and retailers. Ten years on, and the growth of Amazon globally has set the new standard for convenience.
I was Chair of an organisation that completely revolutionised even the forward thinking click and brick model, to a purely online subscription-based service, a business that was sold earlier this year as a technology business, taking a double digit multiple in earnings.
I have spent the last couple of years year developing the largest single patient GP practice in the UK (Octagon Medical Practice) as well as being a Director of At Scale. In those roles, I have acquired a lot of understanding on the nuances of the NHS and Primary Care. But I have also been most vocal in flagging the new kids on the block that will change the way we engage with our GP’s. Not within tens of years, but within the next ten years.
It’s ironic that as President Trump and PM Boris Johnson jockey for position on a trade deal placing the NHS on and off the table, this UK owned disrupter has already begun its journey to become the Amazon of Primary care. Of course, the conservative (with a small c) organisation that is the NHS, would never countenance such a bold and radical prediction! Yet looking at the evidence, the creep has already begun, and the mood music is changing.
Babylon started its journey in 2013 and was founded by Dr Ali Parsa, a British-Iranian healthcare entrepreneur and former investment banker. Initially available only in London, Babylon set its stall out to challenge the tradition of Primary Care in local partnership owned GP Practices, with an online offering that smartly took new patients online and off the lists of the Patients registered GP.
Currently, funding for GP’s is contracted via NHSE and the local commissioning body. Practices receive a set amount per patient registered and can earn additional funding for other services delivered. But it’s the core contract of capitation that allows Partner GP’s the ability to pay wages and earn a profit to draw upon (remembering Partner GP’s don’t earn salaries).
Babylon is smart, it draws patients in with a free to download App, free access to medical questions and health checks. It then offers a paid for service, the convenience of a same day consultation (usually within 2 hours), costs £10 per month, and has unlimited GP appointments and free prescription deliveries. Great ….. if you can afford a tenner a month, happy days. Interestingly, many of the GP’s that undertake video conference consultations are also “regular” GP’s on their day off. Remember my earlier comment about the Amazon impact on manufacturers and distributors?
Next came GP at Hand, a service that’s free. Patients de-register from their existing GP and make contact either via the App, online consultation, or via one of its Practice locations. The move to provide “traditional” premises is a smart one, as it attracts the traditional patient who prefers to see a GP fact to face. The model proved to be popular with Government, when Matt Hancock the Health and Social Care Secretary stated in the Telegraph on 12th September 2018 , that the App based provider should be available to all.
In broad terms, it is difficult to argue with his sentiments, the online access for Patients would significantly reduce wait times, ease pressures on crumbling Practices, and reduce the long wait times we see in the news almost weekly. The big problem for traditional GP’s in this disruptive technology, is cost and legal structure.
A GP Practice is essentially a small enterprise, a clinical corner shop, that has a set number of patients in a given area (remembering GP practices have boundaries so cannot by contract, take patients outside their boundary), they are forbidden from advertising their services under the contract, and can only see patients registered with them (unless the patient is a temporary resident e.g. on holiday). Most GP Practices have a legal structure of Partnership, with no limited liability and is, therefore, commercially exposed.
A second challenge is one of cost. A GP Practice earns a relatively small profit for which it pays its Partners. Unlike most other professional partnerships, they cannot go out and recruit new business, their boundaries both in terms of patient numbers and income is fairly fixed with little room to manoeuvre. Remembering my reference to Babylon, its recruitment of new patients and services is boundaryless, its ability to invest, is as good as its team is in persuading inward investment.
And readers may be interested to note that on August 2nd 2019, Babylon successfully raised $550m and valued its business at $2bn.
Babylon now offers direct consultations in Birmingham and London, after its initial plan to open locations in Birmingham were blocked, and it already offers consultations in Rwanda and is expanding its reach to Canada, the USA and the Far East.
So, where does this leave the local GP service in the future?
Government roll out of PCN’s (Primary Care Networks) is well intentioned and seeks to accelerate the focus on the need for Practices to work at scale. But given the example of Babylon’s fund raising, are PCNs set to fail? My own experiences of developing and setting up Octagon with Partner GP’s who have owned and run their own Practice has been interesting. In order to meet the challenges, I identify above by working together at scale without real collaboration is not going to happen. I get that it offers at scale operations to utilise workforce sharing and funds new skills in General Practice such as Social Prescribers and Pharmacists, but is this window dressing or deckchair reorganising while in the background, companies such as Babylon and GP at Hand are set to eat Primary Care GP’s for lunch?
And it doesn’t end there. Samsung Galaxy now have the Babylon App pre-installed. Amazon, through its Alexa system now offers “NHS advice” (a Trojan horse if ever there was one), once embedded and information is provided, the opportunity for Amazon to offer that convenience of care, takes it one step closer to a Babylon copy.
I take my hat off to Babylon et al. The disruptive technology is being delivered in many sectors, and healthcare is a lucrative one, we are all living longer, and as we age our problems become multiple and acute. But I do fear for local Primary Care, unless it embraces change and technology (and there is absolutely little evidence to show it ever will), it will wither and die, more and more Practices are handing in their contracts as Partners retire or fail to make ends meet.
The culmination of all of this is simple. Patients who love technology and that are generally “well” will embrace it. Patients who want the convenience of mobile care, will embrace it. All of these patients come off the GP list, thus losing capitation income (and don’t forget, generally “well” patients cost the GP very little to look after), this leaves complex Patients with multiple and long-term needs, underfunded. And Practices go under.
So, what can Primary Care do? Well I would start by understanding the nuances and reality of what I have outlined. If you understand the future reality, you will have a better chance of being part of the future. And if I have one ask of NHSE and the wider Government it would be to think about how they can even up the playing field just a little, take off the shackles. To allow merging and forward-thinking Practices like the one we have created, to grow at scale, create surpluses to invest in technology. And to support people to create a better mixed supply economy able to better support a growing population with dedicated care based on the ethics of the Hippocratic Oath and not the mighty dollar.
If you want to discuss these issues further and want some advice about what you can do about being part of the future, drop us an email at email@example.com and we can arrange to speak to you.