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Professional Expenses Plan for Practices

Professional Expenses Plan for Practices

  • Provides a regular monthly income to your practice if an employee becomes unable to work due to illness or injury
  • The money can be used to cover either a proportion of the fixed costs of running your practice, or the costs of paying a locum or someone else to carry out the individual's normal duties
  • Safeguard your business from significant and unexpected costs
  • Potential to enjoy tax relief on the premiums

If you are a GP, recently announced changes to NHS England's contract for GPs will guarantee reimbursement of at least part of the cost of hiring a locum. But will it be enough...?

Summary
This plan is designed to be taken out by a practice that is a limited company, LLP, PLC or Scottish Partnership.  Where single-handed practitioners, or partners in an ordinary partnership wish to insure themselves, we have a separate plan called the Professional Expenses Plan for that purpose.

Protect your business

What would happen to your practice if one of your most valuable and influential people suddenly couldn't work due to illness or injury?

Not only would you be concerned for that person's welfare, you would still have the responsibility of continuing to run your business effectively and efficiently. Regardless of the number of clients or patients you have, you still need to cover the fixed costs of your business. You may even need to find a replacement in order to continue to provide a service for your clients. However locum costs can easily mount up and put pressure on your business's finances.

Even if you are a GP practice, and are able to get reimbursed for the locum costs from NHS England, the payment is unlikely to cover the costs in full, leaving your business with a significant bill that has to be paid.

Your profitability as well as your reputation could be seriously affected if you struggle to meet your clients' or patients' needs.

This is where the Wesleyan Professional Expenses Plan for Practices can help your business.

What is the Wesleyan Professional Expenses Plan for Practices?

The Wesleyan Professional Expenses Plan for Practices provides a regular monthly income to your practice if a valued member of the team becomes ill or suffers an injury that stops them from working.You can use it to cover either:

  • a proportion of the ongoing fixed costs of running your practice or firm, or
  • the costs of paying a locum or someone else to carry out the individual's normal duties.

How can the plan benefit you and your business?

The Wesleyan Professional Expenses Plan for Practices has a number of benefits. For example, it means that you don't have to find additional finance to cover your fixed expenses, to pay a locum or to make additional payments to your existing staff to help you continue to run the business.

With the help of your Wesleyan Financial Consultant, you can structure the plan to suit the needs of your business. At the start of the plan, you decide:

  • the amount of cover you need
  • how soon you want us to pay the practice after your team member becomes unable to work
  • how long you want the benefit to be paid for, either 26 or 52 weeks
  • how long you want the cover to last, the plan end age
GP contract hanges

NHS improvements to GP contracts don't fully address the cost of locum cover

In early February, NHS England announced a number of changes to GP contracts, one of which is to guarantee that they will reimburse the cost of hiring a locum to cover a GP's sickness absence.

From 1 April, 2017, they will pay up to �1,734.18 per week for the first 26 weeks of absence (except for the first two weeks), reducing by 50% to �867.09 from week 27 to week 52. This replaces the previous arrangment which was disrectionary and based on out-of-date eligibility criteria.

The good news is that at least part of the cost of hiring a locum will now be met by the NHS - but only part of it.

Going forward, you may not require as much cover under your Locum Insurance policy to meet your liability to provide a locum in respect of GP absence.

According to the BMA, this change "... should reduce locum insurance cover expenses, and enable practices to offer better sickness absence terms to salaried GPs."

Who covers the shortfall?

GPs will still usually be responsible for covering the shortfall. Depending on the resources available among colleagues to help fill the gap, and taking into account local rates for hiring a locum, there is likely to be a significant financial liability that still needs to be met.

Typically, the cost of covering eight sessions per week is around �2,800*, but, with regional variations, can be as much as �3,600. Sometimes even more.

However, it does not change the potential need to cover salaried GPs and other practice staff for sick pay and for other associated costs involved in paying for replacement staff, or extra hours worked by colleagues, in the event of their sickness absence.

The reduction in locum insurance costs may in fact enable you to broaden the cover you are able to provide for the practice, without increasing your premium. At the time of writing, details such as the exact nature of payments and timing of reimbursement to practices is not totally clear.

The NHS have said that they are working with the General Practitioners Committee of the British Medical Association (BMA) to develop more detailed guidance. They have not said when this will be forthcoming, but we are in close contact with the BMA.

If you are considering amending or cancelling an existing policy with us in light of these changes, we recommend that you take advice before doing so.

Please contact your Wesleyan Financial Consultant or contact us direct by using one of the methods above.

*Medeconomics Survey of GP Locum earnings UK, October 2016

Advantages for you

Safeguard your business from significant and unexpected costs

Finding funds to cover your ongoing fixed expenses or the cost of securing a replacement when an ill or injured member of the team is unable to work, can put a strain on practice finances.

The Wesleyan Professional Expenses Plan for Practices could help safeguard your business against your significant costs or the unexpected costs of having to employ a locum so you can manage costs more effectively.

Even if you are a GP practice, and are able to get reimbursed for the locum costs from NHS England, the payment is unlikely to cover the costs in full, leaving your business with a significant bill that has to be paid.

Keep generating revenue for your business

Regardless of the number of clients you have, the practice's fixed expenses such as your rent, insurance and heating must still be paid even if a key individual is not able to work. The plan can cover fixed expenses or help the practice pay for a locum who can continue to generate revenue.

Protect the reputation of your practice

Having to rearrange or, worse still, cancel appointments with your clients or patients because someone has become ill or has an injury that stops them from working, could be upsetting as well as inconvenient. For some, it can be difficult to find new clients or patients, let alone trying to keep them. It can take just a few discontented patients or clients to damage your reputation, which may have taken time and effort to build up.

The plan enables you to cover the costs of paying a locum or someone else to carry out the absent person's normal duties, allowing you to provide a continuous service with little or no disruption.

Tailored for your business

You decide which individuals are to be covered. There are also options to suspend or reduce cover to take account of breaks in their career, for example through maternity or paternity leave.


Choose when you want the benefit payments to start


At the start of the plan, you can decide when we start paying the practice that best suits your business requirements. Assuming we're able to accept the claim, we can pay out after zero, four, eight, 13 or 26 weeks.

Unlimited claims

There is no limit to the number of claims the practice can make. Each claim will be considered in line with the plan's terms and conditions, but a claim would not be refused just because a previous claim had been made. What's more, making a claim will not affect the premiums you pay in the future.

Potential to enjoy tax relief on the premiums

Premiums are normally treated as a business expense, so the practice can deduct them from profits before calculating tax. This means tax is paid on a lower amount. Note, however that if the employee being insured owns a significant share of the business, HM Revenue & Customs (HMRC) may not allow tax relief on the premiums. You should check this with your local inspector of taxes.


Continue to meet NHS or other contractual commitments


Hitting targets can be difficult at the best of times, but a lack of resource due to the illness or injury of a vital team member can make it an even greater challenge. The plan can enable resources to be put in place so the practice can continue to meet its contractual agreements.
Important information
Please use the link to the Key Features document of the Professional Expenses Plan for Practices for important information about this product.


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