General Medical Practices

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The General Medical Practices industry is composed of over 60,000 medical practices that provide primary care to Britons. The industry is overwhelmingly dominated by publically funded practices, with private practices making up only 3.5% of industry establishments. During the past five years, the industry has undergone a shakeup as the government cut funding for GPs in real terms and instituted a number of changes to how practices are funded and administered. As a result, industry revenue is only expected to manage to grow at a compound annual rate of 0.5% during the five years through 2014-15 to reach £21.9 billion. This includes estimated growth of 0.3% in the current year.

GPs have struggled to cope with rising demand for their services from a growing and ageing population. To make matters worse, falling funding has constrained their income and operating costs have increased, leading many GPs to consider early retirement or more secure jobs in hospitals. The government has responded by encouraging private operators to enter the industry. This has helped the industry record growth and relieved some of the pressure on the system. However, it is also driving a trend towards consolidation as less efficient GP-owned partnerships merge or exit the industry and are replaced by larger, private operators.

Pressure on GPs is expected to intensify during the next five years as the ageing population and rising incidence of chronic illnesses increases demand for GPs' services. Meanwhile, public spending on primary care is likely to decline, while operating costs continue to rise. As older GPs retire or change jobs, the industry could struggle to replace them as younger doctors opt for hospital jobs instead. The government will continue to offer incentives to private operators to encourage them to enter the industry. GPs are expected to embrace technology as a means of boosting productivity and meet demand for their services. Small, inefficient partner-led practices are likely to make way for large, privately operated multidisciplinary clinics. Over the five years through 2019-20, industry revenue is estimated to grow at a compound annual rate of 0.4% to reach £22.4 billion.