CARR-HILL UNDER REVIEW: WHAT GP PRACTICES NEED TO KNOW

The Government’s decision to review the Carr-Hill formula marks one of the most significant developments in general practice funding for over two decades. While many practices are familiar with the term, fewer understand exactly how the formula works, where its assumptions originate, and why the current review could result in substantial changes to the distribution of core funding across England.

The formal review was launched in October 2025 and a 6 month review period was started. Recommendations from the review were expected this Spring/Summer with formal consultation to follow. To date, no findings or recommendations have been released.

Introduced alongside the new GMS contract in 2004, the Carr-Hill formula is used to calculate the weighted patient population for GP practices and forms the basis of the Global Sum allocation, which remains the largest single element of core contract funding for many practices.

The principle behind the formula is relatively straightforward. Rather than funding practices solely according to their registered patient numbers, it attempts to estimate the workload associated with those patients and the unavoidable costs of delivering services in different locations. The result is a “weighted list size” that differs from a practice’s actual registered population.

For example, two practices with identical list sizes may receive different levels of funding because one serves an older population, experiences high patient turnover, or is located in a rural area with higher operating costs.

The current formula is based on data that is now over 20 years old, but at the time was designed to recognise drivers of workload and unavoidable costs using the following factors:

1. Patient Age and Sex 

Different age groups are considered to generate differing levels of GP workload. Older patients require more consultations and management of long-term conditions, while younger adults typically generated less activity. The formula therefore applies weighting according to age and sex profiles

2. Additional Needs Adjustment

This element attempts to account for differences in health status and expected workload. The data underpinning these adjustments was derived from a self-reporting patient Health Survey in the 1990’s!

3. List Turnover

Practices experiencing high levels of patient movement receive additional weighting with newly registered patients considered to require more consultations and administrative activity during their first year.

4. Rurality

The formula is meant to recognise that delivering services in rural and dispersed populations can increase costs. The distance to the nearest practice and population density are incorporated into this weighting calculation.

5. Market Forces Factor

This factor was included to address geographical variations in staffing costs and should reflect differences in local labour markets across England.

The formula has been widely criticised for not reflecting the reality of modern general practice. Demographics have changed over the last 20 years and the formula does not adequately reflect GP workload for increasing multimorbidity, deprivation and service demand. For example, recent studies suggest that practices serving the most deprived areas receive on average 10% less funding than more affluent areas.

For most practices, the biggest single income stream is the global sum payment which is currently £130.07 per weighted patient. Therefore, practice funding could be substantially impacted by any changes to the Carr-Hill formula used to determine patient weighting

The review could simply update existing calculations using more recent data, it could add factors such as the IMD deprivation score, or it could overhaul the formula completely with a new allocation methodology.

Without an increase to the total global sum funding, simply changing the allocation of funding alone would create a new set of winners and losers. Practices serving highly deprived populations may benefit if deprivation becomes an explicit funding factor. However, rural practices and those that currently benefit from existing weightings will be looking carefully at the detail of any proposed reforms.

Practices should review their current demographics, deprivation indicators and understand the factors influencing their current weighted patient calculation. For most practices the patient weighting information is available on the monthly NHS Statements from PCSE.

Practices should keep a keen eye on updates from the government review and consider financial modelling the impact of any proposals.

As always, please do get in touch if you would like support with financial reviews and how this might impact practice strategy.