Financial management for private GP practices

Many doctors are excellent clinicians but reluctant business managers. That is understandable - you trained to treat patients, not to chase invoices. But financial health is what allows your practice to exist, and getting the fundamentals right is simpler than most people assume.

Pricing your services

Pricing is part science, part market positioning. Start by calculating your true costs:

• Premises costs (rent, utilities, rates, insurance)
• Staff costs (salaries, NI, pensions, training)
• Clinical consumables and equipment
• Technology costs (clinical system, payment processing, communications)
• Professional costs (indemnity, GMC, RCGP, accountant, solicitor)
• Marketing and patient acquisition

Add these up, divide by your realistic patient capacity, and you have your minimum consultation fee. Most private GPs in the UK charge between 150 and 300 pounds for a standard consultation, depending on location, duration, and specialisation.

Common pricing models include:

• Per consultation - simple, transparent, but variable revenue
• Membership or retainer - predictable monthly income, higher patient loyalty
• Hybrid - base membership fee plus per-visit charges for additional appointments
• Procedure-based - separate pricing for minor surgery, vaccinations, medicals

Whatever model you choose, be transparent. Publish your prices clearly and ensure patients understand costs before treatment. Unexpected bills damage trust and generate complaints.

Cash flow management

Cash flow, not profit, is what keeps a practice solvent. Key principles:

• Collect payment at the point of service wherever possible
• Invoice insurance companies promptly with complete documentation
• Chase overdue invoices systematically - do not let them drift
• Maintain at least three months of operating costs as cash reserve
• Separate business and personal finances completely

Integrated payment processing makes a significant difference here. When patients can pay by card at the end of their consultation, or click a payment link in their invoice email, you get paid faster and spend less time on administration. Manual invoicing and bank transfers introduce delays at every step.

Insurance billing

If you accept insured patients (and most private GPs do), you need to understand the billing process:

1. Verify the patient has cover for the service before the appointment
2. Use the correct billing codes (insurance companies each have their own requirements)
3. Submit claims promptly with supporting clinical information
4. Track claim status and follow up on delayed payments
5. Bill patients for excesses and shortfalls

Insurance billing is where many practices lose money through inefficiency. Claims submitted late, with incorrect codes, or without sufficient clinical detail get rejected or delayed. A clinical system that generates insurance-ready documentation from the consultation record eliminates most of these issues.

Accounting setup

Get an accountant who understands healthcare businesses from day one. They will advise on:

• Business structure (sole trader, limited company, or partnership)
• VAT implications (most healthcare is exempt, but some services are not)
• Corporation tax planning and pension contributions
• Quarterly management accounts so you can track performance
• Payroll for employed staff

Use cloud accounting software (Xero or QuickBooks are the most common) and ensure your clinical system can export financial data or integrate directly. Manual re-keying of invoice data into your accounts is a waste of your time or your bookkeeper's time.

Financial red flags

Watch for these warning signs:

• Outstanding invoices growing month-on-month
• Cash reserves falling below two months of operating costs
• Insurance claim rejection rate above 5%
• Revenue per consultation declining without a strategic reason
• Administrative cost ratio above 40% of revenue

Review your finances monthly - even a quick 30-minute review of key metrics helps you spot problems early.

What is next

In the final part of this series, we cover growing your practice - building your patient base, marketing effectively, expanding services, and hiring your first employed clinician.