GP Practice Mergers – property considerations

GP Mergers

The thought of beginning a GP practice merger can be a daunting one, but merging can create opportunities for surgeries and deliver a variety of benefits if planned effectively. Let’s take a look at these benefits and opportunities and the factors to consider from a property perspective, to help you plan a successful merger.

What is a GP Practice merger?

A GP merger is when two or more practices join-together to form a single practice.

The benefits of GP Practice mergers

Merging practices create a larger group and so enables the group to benefit financially from economies of scale, particularly with the procurement of goods and services. The ability to share facilities and or premises is another way in which merging can significantly help to reduce overheads. Workload can also be shared, possibly reducing reliance on locums and agency staff.

Being part of a larger entity also increases the opportunities for the surgeries to bid for contracts. Other benefits include; streamlining processes, such as back-office functions and developing centralised staff training and education.

Patients can also benefit from mergers, as practices have greater capacity, flexibility and can offer a wider variety of services compared to smaller practice.

Property considerations

As a starting point, consider whether your practices share the same culture and ethics before merging, this will go a long way towards the merger and future working relationship running smoothly. Next, ensure a combined partnership agreement is completed by all the merging surgeries and that this is drawn up by a specialist primary care solicitor.

To avoid major property issues during a merger we strongly recommend that surgeries neutralise their equity and liabilities at the outset of the merger. Meaning that each partners’ share is equal and thus avoiding any future bias, enabling decisions to be taken that benefit all parties equally. This avoids a scenario that would benefit one surgery and be detrimental to another, such as; one property closing creating a loss for one party and/or another property expanding creating a profit for another party.

In order to accurately equate property shares, each surgery should be valued to ascertain its current market value. Valuing GP premise is a specialist area and as such, we’d advise instructing a specialist primary care premises surveyor.

Once equity and liabilities are neutralised then an estates strategy can be implemented. There are many estates strategies open to surgeries during a merger, depending upon the circumstances of the parties involved. Factors to consider include, the profile of the estate now and what it would look like in 5, 10, or 15 years’ time, as it’s likely to be very different, for example, does the type of property fit into the profile of building in the NHS 5 year forward view.

In summary

There are many benefits to GP merges and some property challenges to overcome, but none that careful consideration, planning and engaging a specialist, primary care surveyors can’t overcome.

GP Practice merger consultation

If you have any questions regarding practice mergers or would like to book a free consultation please fill in the below form.

*Mandatory fields