Meaning of trade: mutual trading and members clubs: mutual associations: specific activities: NHS doctors’ co-operatives: varieties
Many and various
The term ‘doctors’ co-operative’ covers organisations which range from those providing little more than the administration of on-call rotas between neighbouring practices, to co-operatives (particularly in big cities) that are large and have negotiated bulk deals with commercial deputising services. The term may also apply both to co-operatives contracting with Primary Care Trusts or Primary Care Organisations to provide out-of-hours care and to a co-operative providing such care on behalf of its members. In the latter case, members pay to benefit from the co-operative’s services and are themselves paid for the work that they do for the co-operative. The typical such co-operative is owned and staffed by General Practitioner (GP) principals. A GP using the co-operative to provide out-of-hours cover pays a fee for the service. The doctors working for the co-operative are most often paid a session rate, so much per shift worked.
Local Health Authorities have allocated funds to reimburse any non-doctor costs of a GP’s membership of a co-operative. Such costs may, for example, include communication equipment (pagers, telephones, fax machines, etc), premises, non-medical staff costs and so on. Equipment costs are likely to be capital. Capital contributions by the GP to the co-operative will not be allowable.
For administrative convenience, payment may be made direct to the co-operative. But the reality is that the payments belong to the individual GP who may then pay them to the co-operative together with the balance of their contributions for the services that they receive. In strictness the payments from the Local Health Authority should be shown in the GP’s own (or partnership) accounts, either as a professional receipt or netted off against payments to the co-operative.
It is essential that you establish all of the facts before venturing an opinion as to whether the co-operative carries on a trade and if such trade is a mutual trade.