The changing face of primary care
Primary care is regarded in most countries as an essential pillar of a functioning healthcare system, yet many governments have tended to stay out of its provision. Whilst in most European countries it is primarily funded by the public sector or statutory insurance, very few countries have any primary care that is actually delivered by the public sector.
Click here to go to HBI Intelligence. We have been working on primary care for the last few months and 12 country entries and an EMEA summary will go live on our website next week.
Yet privately-provided and publicly-funded primary care is rarely thought of or described as outsourcing. In part this is because traditionally it has not been provided by large corporate entities, but by small private enterprises. In many countries (e.g. France and Italy) the majority of GPs still work on a self-employed basis, out of their own private office, sometimes hiring a nurse or administrative assistant, but seldom working with other doctors. In other countries (e.g. the UK and Ireland), GPs have traditionally worked in groups of twos or threes as partners of one-shop clinics.
But over the past couple of decades, a new phenomenon has emerged. Chains of practices are beginning to appear across Europe. Often these are run by major healthcare groups involved in other parts of the healthcare sector. Hospital group Ramsay Sante has about 160 primary care clinics across Denmark, Sweden, Norway and Italy, and is about to open five in France. US insurance giant Centene operates 20 GP clinics in the UK through a subsidiary called Operose, and also operates GP clinics in Spain through hospital group Ribera.
In some countries (e.g. Portugal or Czechia) the private sector only provides primary care via large multidisciplinary outpatient centres. These health centres are often run by the largest for-profit healthcare operators in the country.
In Sweden, the largest corporate entities getting involved in primary care are telehealth companies. Companies such as Kry and Medtanken have begun buying physical GP practices to complement their online platforms. This ‘digi-physical’ business model has not taken off everywhere however: in the Netherlands Quin recently decided to sell all its GP practices and focus on licensing its telehealth service.
In other cases the chains are not created by external entrepreneurs and investors, but by GPs themselves. In the UK, GP clinics have begun organising themselves into larger groups of practices, sometimes referred to as super-practices, in order to achieve economies of scale and better coordination of care. The Hurley Group, which created a special online platform to connect a network of primary care clinics (the ‘eHub’), is a notable example of this.
Even when the companies providing primary care at scale are not major hospital or telehealth groups, often they will be involved in other parts of the healthcare sector. In the UK, Practice Group provides not only primary care but also ophthalmology, sexual health, secure health, urgent care services. Centric Health in Ireland is involved in diagnostic imaging and recruitment as well as being the country’s largest primary care operator. In Sweden there is a chain of primary care and dental clinics called Praktikerjanst, which is run as a cooperative.
There are very few examples of pureplay corporate non-telehealth primary care groups. In the Netherlands there is Arts en Zorg. In the UK there is Doctors Clinic Group (in the private pay sector) and Operose and Our Health Partnership (in the NHS-serving sector). In Portugal there is MiMed. But that’s about it.
The reason for this is likely that primary care is, in and of itself, not an especially lucrative business, due to it being labour intensive and exhibiting minimal economies of scale. Profit margins are low, typically in the single digits, or, in the case of Centric, negative. The major financial motivation for large companies getting involved in primary care is the ability to gain control over the entire patient pathway – and that is lucrative.
We would welcome your thoughts on this story. Email your views to Martin De Benito Gellner or call 0207 183 3779.
