Jim Pink is a GP at Llanishen Court Surgery, Cardiff.
Matthew Jones is a GP at St Isan Road Surgery, Cardiff.
Since April 2004, the bulk of funding for GP surgeries in Wales is via the global sum in the General Medical Services (GMS) contract.1
The income an individual practice receives is based on a formula developed by Roy Carr-Hill in the early 2000s, which was designed to adjust funding for practices to account for varying clinical workload.2
On a basic level, practices with an older, sicker population should receive more funding per patient than those with younger, healthier patients, who in theory need to visit their surgery less frequently. Those practices with more challenging populations should be able to employ additional staff to meet the expected additional demand.
“The premise of this formula is very reasonable and fair. Sadly, it doesn’t always work, partly due to at least two anomalies in the formula.”
The premise of this formula is very reasonable and fair. Sadly, it doesn’t always work, partly due to at least two anomalies in the formula. To understand this, we’ve had to employ a fair degree of nerdery as the formula is as complex as it is opaque.
Fundamentally, the formula produces a ratio whereby a practice’s actual patient population is ‘weighted’. If a 10 000-patient practice has a ratio of 0.9, the practice is funded for 9000 patients, whereas if the ratio is 1.1, the practice is funded for 11 000 patients. The formula can be expressed as:
Weighted population = practice list size × age and sex index × care homes index × market forces index × turnover index × additional needs index × rurality index3
The core funding a practice receives is the product of the cost value per patient (currently £125.20 in Wales)1,4 and the weighted population.
Absurdity number one: the additional needs index is 25 years out of date5,6
This surrogate marker of population need is based on the standardised mortality rate for those aged under 65 years (based on the 2001 census) and standardised limited long-standing illness (SLLI), based on the self-reported 1998 General Household Survey. These results were then aggregated to an electoral ward to estimate the additional needs of this population.
These data have not been updated since. Any housing development in that electoral ward since 2000 will be ignored in the additional needs index. The index takes no account for deprivation, nor the plethora of patient-level data (disease registers, polypharmacy, hospital admissions, frailty, lifestyle factors, home visits, and multi-culturalism) that far more accurately predict healthcare utilisation. When the Carr-Hill formula was developed (when some practices were still using paper records), these data would have not been readily available. They are now.
“The index takes no account for deprivation, nor the plethora of patient-level data that far more accurately predict healthcare utilisation.”
Absurdity number two: overlooking fixed costs
Let’s assume that the formula is accurate in predicting clinical need (ignoring for now the highlighted issues with the additional needs index and the absence of robust evidence supporting other indices such as rurality), The funding differential between two practices should be spent on employing additional clinical staff to meet this demand. However, in Wales, the Carr-Hill ratio is applied to the whole global sum, not just the clinical staff expenses.
An average practice of 10 000 patients will have similar non-clinical costs to another, whether being funded for 9000 patients or 11 000 patients, as there is no discount for utilities, equipment, and non-clinical staff, for example, for lower funded practices. Fixed costs such as these make up approximately 55% of practice expenses.7,8 The remaining funding can be spent on funding clinical appointments. When fixed costs are considered, a 10 000-patient practice with a ratio of 0.9 has 28% less to spend on clinical care than an ‘average’ practice (ratio of 1), which roughly equates to 115 fewer GP appointments a week. This differential increases with every GMS funding uplift, and comparing practices with a ratio of 0.9 with those with a ratio of 1.1 or more reveals even more eye-catching results (250 fewer GP appointments per week).1,4
To justify this significant and, on the face of it, implausible difference between practices we need to be very confident that the modelling is accurate, evidence-based, up to date, and transparent. Sadly, the Global Sum Allocation (Carr-Hill) Formula in Wales is none of these and its continued use in our complex, evolving, data-rich digital world is unjustified and absurd. Surely it is time to rethink and recalculate how we fund GMS practices, the bedrock of the NHS in Wales.
References
1. British Medical Association (BMA). Welsh GP contract 2024/25. 2025. https://www.bma.org.uk/pay-and-contracts/contracts/gp-contract/welsh-gp-contract-202425 (accessed 14 Jul 2025).
2. Rhys G, Beerstecher HJ, Morgan CL. Primary care capitation payments in the UK. An observational study. BMC Health Serv Res 2010; 10: 156.
3. Welsh Government. Annex B — global sum. 2023. https://www.gov.wales/sites/default/files/publications/2023-03/atisn17309doc1.pdf (accessed 14 Jul 2025).
4. Miles J. Written statement: General Medical Services Contract reform for 2024-25. 2025. https://www.gov.wales/written-statement-general-medical-services-contract-reform-2024-25 (accessed 14 Jul 2025).
5. Kaffash J. The Carr-Hill formula is getting old. Pulse 2024; 22 May: https://www.pulsetoday.co.uk/views/editors-blog/the-carr-hill-formula-is-getting-old (accessed 14 Jul 2025).
6. Royal College of General Practitioners. Review of GP funding formula ‘long overdue’. 2025. https://www.rcgp.org.uk/News/car-hill-formula-response (accessed 14 Jul 2025).
7. BMA. Focus on: Welsh GMS Contract financial uplift 23/24. 2024. https://www.bma.org.uk/media/coojzxkn/bma-focus-on-contract-financial-uplift-2324.pdf (accessed 16 Jul 2025).
8. Roberts N. Exclusive: GPC bid to take half of practice funding out of Carr-Hill formula. GP Online 2014; 6 Jun: https://www.gponline.com/exclusive-gpc-bid-half-practice-funding-carr-hill-formula/article/1297683 (accessed 16 Jul 2025).
Featured photo ‘Red dragon sculpture on top of the Cromlech at the Welsh Memorial Park, Ypres’ by Rickfive. Re-used under license CC BY-SA 4.0.
