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Coronavirus: the financial impact

This is a challenging time for dentists. Here we have collated advice on the financial impact of the COVID-19 outbreak and the mitigation measures being introduced. Each section covers the UK as a whole, then offers nation-specific information where it has been issued.

Page last updated: 15 October 2021

 

On this page you will find:

 

1. Useful links for GDPs

2. Business support measures promised by Government

3. Business interruption cover

4. NHS dental services provision

5. NHS provisions for sick pay

6. Associates in NHS practice

7. Associates in mixed practice

8. Salaried services (HDS, CDS etc)

9. Private practice

10. Associates in private practice

11. Private capitation schemes

12. Practice owners: advice on paying staff

 

NHS advice on COVID-19

 

NHS advice on self-isolating 

 

Government response in England, Scotland, Northern Ireland and Wales.

 

Stay at home guidance for households with possible coronavirus (COVID-19) infection 

 

Public Health England Guidance to health professionals 

 

Guidance on infection prevention and control for COVID-19 

 

Guidance and support for employers and businesses 


NI HSCB communications

 

2. Business support measures promised by Government

The following support measures are available from the Government:

 

  • The government’s Coronavirus Job Retention Scheme, known as the furlough scheme, has ended. Claims for September must be submitted by 14 October 2021 and any amendments must be made by 28 October 2021. See our guide to this scheme in our section below: Practice owners: Advice on paying staff.

  • Business interruption loans, with the Government paying the first 12 months' interest.

  • Bounce Back Loan Scheme (BBLS) enables smaller businesses to get access to 100% taxpayer-backed loans after concerns have been raised about slow and difficult access to the coronavirus rescue schemes. The scheme offers businesses loans up to £50,000 within days of applying. No capital or interest repayments are due for one year. The Government will pay the interest for the first 12 months.

  • £10,000 extra cash grants have been made to some of the smallest businesses, some dental practices with rate exemptions have already received this.

  • Local Authority Discretionary Grants are available for small business who are not eligible for the Small Business Grant Fund or other government initiatives.

  • The Government will refund up to two weeks’ SSP per eligible employee. Statutory Sick Pay (SSP) is also payable from the first day of sickness. You do not have to wait three days before starting to pay SSP. SSP is payable for those who are self-isolating in accordance with UK Government guidance.

  • Limited measures were also announced to support the self-employed, but a £50k cap was placed on these, limiting the amount of dentists in private practice that can avail of it. We will continue to campaign to help associate dentists, please see the relevant sections below. Dental hygienists and therapists are likely to qualify for help under the Government’s self-employment income support scheme.

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3. Business interruption cover

Business interruption insurance covers a business for loss of income during periods when they cannot carry out business as usual due to an unexpected event. It aims to replace certain losses sustained by the business during the period of the disruption.

 

We understand that insurance companies will not cover additional risks, which were not factored into the pricing of the policy. And we acknowledge that these are unprecedented circumstances. However, we are very concerned that many of our members will not be covered for closures due to COVID-19.

 

We have taken legal advice in respect to insurers not paying insurance claims made by dentists in regard to business interruption during the COVID-19 pandemic. We were also the first trade union or professional body to directly engage with the Financial Conduct Authority (FCA) following the failure of most polices to pay out for losses incurred during the pandemic. Members can watch a recording of our webinar with law firm Brown Rudnick LLP on the legal issues relating to business interruption policies and the pandemic.

 

In January 2021, the Supreme Court issued its final judgement in relation to the Financial Conduct Authority’s case on business interruption insurance. Widespread media coverage gave the impression that the decision was a significant outcome for large numbers of small businesses.

 

However, many sets of insurance policy wording were not covered by the scope of the Supreme Court ruling. This was particularly the case where wording was already deemed to be clear regarding exclusions of coverage relating to the Covid-19 pandemic. The impact of the decision will be felt more in relation to ambiguous policy wording, where insurers are now being told again to settle claims.

 

Our assessment, based on previous survey work, is that most dental policyholders are not directly impacted by the FCA decision because claims for cover were excluded.

 

Some QBE policies were overturned in favour of the insured by the ruling, however again based on assessment of the market, we do not believe that many dental practices have those QBE policies impacted by that part of the decision. There are some dental practices insured by QBE, but the Court had already ruled in favour of the insured practices in those cases.

 

There are some positive aspects to the decision for those claimants with an established case:

 

  • Insurers will now find it difficult to argue that they can reduce any loss that happened before lockdown, if that loss is because of a slow-down in activity relating to the Covid-19 pandemic
  • Insurers cannot take any COVID-related issue into account in negotiating a payment
  • Prevention from accessing premises now includes partial prevention from accessing premises. Some policies in the dental sector had wording that required there to be prevention of access.

In summary, most insured businesses (in dentistry and across the economy) did not have a legal route before the Supreme Court decision, and won’t have a claim afterwards. However, the position on damages is now likely to be simpler to calculate where businesses haven’t settled but where claims have been accepted.

 

We know that this is an important issue for many dentists and we will update you when we know more.

 

 

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4. NHS dental services provision

General Dental Practitioners

England

NHS England contracts: Quarter four targets (2020/21)

 

We negotiated for some months with NHS England regarding the support package for contract holders in England for this quarter. We refused to sign up to a deal which saw practices face steep financial penalties if they were unable to hit 45% of their pre-pandemic UDA targets.

 

NHS England should have given practices detailed guidance on this issue in good time. We provided:

 

NHS England contracts: Targets for 1 April 2021 to 30 September 2021

 

NHS England introduced targets of 60% for dental practices and 80% for orthodontic practices.

 

Furloughed workers scheme and NHS contractual payments

 

There have been two different state schemes to help dental practices with an NHS contract:

 

1. The Government furloughed workers scheme, which has now ended.

 

2. The NHS will, subject to certain conditions, continue to pay dental practices in England and Wales their NHS contract value.

 

Wales

 

From 1 July 2020, NHS practices in Wales will receive 90% of their contract value. This will then move up to 100%, potentially from September. In return for this 90% of contract value, practices will work within the scope of the de-escalation plans, at present in the amber phase, and work through the back-log of patients as best as possible on a prioritisation of needs basis.

 

Practices can be in heightened amber and only offering non-AGPs, or be in low amber and be offering AGPs as well, as long as they are set up and signed off by the relevant authority.

 

Key to this offer of 90% is the move away from the UDA system, and its replacement with the UDAS, (units of dental assessment). This is a move from payment based on activity, toward payment based on patient need and number. And filling out the Assessment of Clinical Oral Risks and Needs (ACORN) risk assessment form is an important part of that.

 

We have been in frequent contact with Chief Dental Officer (CDO) for Wales, Dr Colette Bridgeman, on your behalf throughout the pandemic. We can now confirm that there is no set AGP target for quarter four; numbers are expected to be in keeping with the size of the contract and the ACORN status of the patient base.

 

There is also no intention to alter or impact on separate Emergency Dental Service (EDS) contracts. Instead, the ask relates to the core Annual Contract Value (ACV). Patients previously seen on a practice’s EDS contract that are seen for a follow up Course Of Treatment (COT) and care, that do not usually do so, will be treated as a new patient to the practice's core contract.

 

Is sticking with the UDA model an option?

 

Yes. You can stay with the UDA model if you wish. In making any choice, we encourage you to consider social distancing, provision of AGPs and patients throughput. UDA numbers will also be ghosted in the background, so practices will be able to see a comparison.

 

However, there could be clawback if you stay with the UDA. Your UDA target would be 75% of the original. This target did not count for April, May and June. So when deciding whether to stay with the UDA model, you should factor in how much activity you can complete going forward, and whether it will allow you to meet your UDA target.

 

In February 2021, the CDO confirmed that 76% of FP17W included an ACORN assessment between April and December 2020. 85 practices in Wales have signed up to Attend Anywhere. This is an encouragingly high adoption rate.

 

Northern Ireland

 

The Department of Health has publicised details of upcoming changes to the GDS Financial Support Scheme (FSS) in Northern Ireland. This will see patient contributions and abatement funding continue until the end of the financial year with the most noteworthy change being the new link between a GDP’s monthly FSS payment and their monthly Item of Service (IoS) earnings. It’s been confirmed that:

 

  • Nothing will change for the majority of GDPs, who are currently earning 15% or more of their average 2019/20 monthly IoS earnings. They will continue to receive 100% of their FSS payment
  • GDPs earning less than 15% will see an abatement applied
  • Those earning between 10% and 15% will receive 90% of their FSS payment
  • Those earning less than 10% will receive 80% of their FSS payment
  • Meanwhile, GDPs earning less than 1% will receive no FSS payment at all, unless exceptional circumstances can be demonstrated
  • And from the February-March payment cycle, those earning between 1% and 5% will see their FSS payments cut by 50%.

We continue to regularly engage the Health Minister and the Department of Health on Financial Support Scheme issues. We're seeking clarity on long term financial support and assurances that abatement will not be applied on FSS payments as the cost of delivering dentistry increases and patient throughput remains low. We will update you when more information is available.

 

Scotland

 

The Scottish Government has issued a letter from the Chief Dental Officer and a memorandum to dentists with details about the return to dentistry. We have welcomed the additional funding outlined in the CDO's letter – an extra 30% to the General Dental Practice Allowance and a 30% increase to the GDPA cap. However, we argue that this support did not go far enough.

 

We advise you to review this summary of the sources of financial support currently available to dentists in Scotland during the crisis. We are continuing to press the Scottish Government for additional funding mitigation measures for mixed dental practices.

 

The Scottish Government issued a revised funding package for NHS dentists on 30 March. This will provide 80% of the average income from items of service and patient contributions. This is what we asked for – a more equitable funding solution. This should hopefully provide much-needed reassurance to many dentists.

 

The Scottish Government subsequently issued a memorandum setting out more details about the funding package. In addition, Practitioner Services has published a Q+A to answer some of the queries it has received from dentists.

 

Mixed dental practices that receive NHS support funding, can also apply for support from other government sources to cover the private element of their income. These latter claims should be proportionate to the amount of private dentistry delivered.

 

We have written to the Cabinet Secretary for Finance to seek additional funding for private dentists to help them remain viable, and copied the letter to all other MSPs and all MPs in Scotland. This complements the BDA's UK-wide approach to seek additional support from the Chancellor.

 

For information on paying staff during closure and the options open to NHS practices in Scotland, please see section 12 below.

 

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5. NHS provisions for sick pay

There are provisions for long-term sick pay in all four nations. In all four schemes, there is no pay for four weeks, then NHS dentists are paid an amount based on their normal pay for the next 22 weeks.

 

The pay is due if a dentist cannot work due to sickness. At this stage, we have asked the relevant authorities to see how they are going to interpret this provision.

 

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6. Associates in NHS practice

COVID-19 is a global issue. We ask all our members to behave responsibly. Associates should work with practice owners to agree cover for emergency work and other dental work that can be carried out. There will, of course, be members of the dental team who are particularly susceptible to the dangers of COVID-19. In these unprecedented circumstances, we ask all associates and practice owners to work together constructively. 

 

England

 

NHS England contracts

Our advice team have outlined what you need to know about NHS England's third quarter contracts:

 

Members can access this advice by signing in and if you're not a member you can join today.

 

Helping associates

We have been keen to help associates who have issues with the money they have been receiving from their practice owners.

 

Our advice lines are open to Extra and Expert members and we will try to help them discuss the situation with their practice owners.

 

Where we are not able to help the parties reach agreement, and if the local area teams or health board is informed that the practice was in breach of the conditions of the continued contract payment, action may be taken.

 

We do our best to help parties resolve any disputes in a fair and constrictive way. We also  continue to represent your interests in discussions with NHS England, and are continuing to push for legislative change to ensure that appropriate earnings are passed on to associates.

 

Northern Ireland

The Department of Health has publicised details of upcoming changes to the GDS Financial Support Scheme (FSS) in Northern Ireland. This will see patient contributions and abatement funding continue until the end of the financial year with the most noteworthy change being the new link between a GDP’s monthly FSS payment and their monthly Item of Service (IoS) earnings. It’s been confirmed that:

 

  • Nothing will change for the majority of GDPs, who are currently earning 15% or more of their average 2019/20 monthly IoS earnings. They will continue to receive 100% of their FSS payment
  • GDPs earning less than 15% will see an abatement applied
  • Those earning between 10% and 15% will receive 90% of their FSS payment
  • Those earning less than 10% will receive 80% of their FSS payment
  • Meanwhile, GDPs earning less than 1% will receive no FSS payment at all, unless exceptional circumstances can be demonstrated
  • And from the February-March payment cycle, those earning between 1% and 5% will see their FSS payments cut by 50%.

We continue to regularly engage the Health Minister and the Department of Health on Financial Support Scheme issues. We're seeking clarity on long term financial support and assurances that abatement will not be applied on FSS payments as the cost of delivering dentistry increases and patient throughput remains low. We will update you when more information is available.

 

Scotland
It has said that dentists will continue to receive 90% of their average monthly item of service income (net of patient charges for fee paying patients) and they will protect NHS commitment status.

 

Associates’ NHS income is usually paid to the practice. Our view is that practices should pay that money, minus license fee, to the associates in the normal way.

 

The Scottish Government recently issued a letter from the Chief Dental Officer and a memorandum to dentists with details about the return to dentistry. We have welcomed the additional funding outlined in the CDO's letter – an extra 30% to the General Dental Practice Allowance and a 30% increase to the GDPA cap. However, we argue that this support did not go far enough.

 

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7. Associates in mixed practice

England

Self-employed associates earnings less than £50,000 are eligible to claim under the SEISS. This allows individuals to claim a taxable grant worth 80% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total.

 

Given that associates in England are potentially in receipt of NHS earnings as well as separately being eligible for the SEISS, we have been in contact with HMRC so that we can give clear advice to associates. HMRC have clarified to us their view on the SEISS as follows:

 

  • The Government has set out a range of UK-wide measures which will support private income for dentists. If they meet the criteria, private dentists who are self-employed could be eligible for the Self-employment Income Support Scheme (SEISS) and those who are employees and receive a salary through a PAYE scheme could be eligible for the Coronavirus Job Retention Scheme.
  • The SEISS eligibility criteria does include that the dental practitioner has been adversely affected by COVID-19. If part of the dental practitioner’s income stream reduces, but another part remains the same, it is still legitimate for them to claim the SEISS. Dental practitioners will receive the full grant based on 100% of their trading profits, even if only 50% of their profits have fallen.

In summary, if associates fulfil the criteria for the SEISS scheme, continue to receive NHS payments, but have seen any drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

If associates are eligible and want to claim the first grant under the SEISS, the claim must be made on or before 13 July 2020. The scheme is being extended and associates may be able to make a claim for a second and final grant in August 2020. 

 

For more information on NHS contracts and abatement please see the Associates in NHS practice section.

 

Northern Ireland

HMRC has indicated (see above), that if associates fulfil the criteria for the SEISS scheme, continue to receive FSS payments, but have seen a drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

One of the eligibility criteria for the SEISS scheme is that it is only open to those earning less than £50,000 from self-employed roles. We continue to lobby for the removal of this unfair and arbitrary limit. However, those self-employed associates earnings less than £50,000 are eligible to claim under the SEISS.

 

Associates should note that they are required to make a declaration each month when applying for Financial Support Scheme (FSS) funding if they are in receipt of other government supports. Duplication of support for HSC activity is not permitted under the FSS, and GDPs wishing to claim for support from wider business support schemes must do so in relation to private activity only.

 

Scotland

PSD have advised associates: "We consider that you should not claim any aspect of NHS income which you would normally receive, from HMRC. We would advise you speak to your accountant and other professional advisers to determine your course of action.  Practitioners should be aware that we are required to share data with HMRC in order to validate taxation and payments. We anticipate that HMRC will reconcile any payments they make."

 

However, HMRC has indicated (see above), that if associates fulfil the criteria for the SEISS scheme, continue to receive NHS payments, but have seen any drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

One of the eligibility criteria for the SEISS scheme is that it is only open to those earning less than £50,000 from self-employed roles. We continue to lobby for the removal of this unfair and arbitrary limit. However, those self-employed associates earnings less than £50,000 are eligible to claim under the SEISS.

 

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8. Salaried services

If you are a salaried dentist, working in Hospital Dental Services, Community Dental Services or prison dentistry, for example, your employment status should not be affected by this crisis. You will continue to receive your salary.

 

However, it should be noted that they may be deployed elsewhere within the health service. For more info on this please see our latest advice on redeployment (see questions 28-32). This may prove quite stressful and members should be aware that they have access to our 24-hour counselling service.

 

If you are a salaried dentist and have an issue, please reach out: 

  • Members employed on national terms and conditions within the salaried/community dental service, in dental schools, in the armed forces or a variety of other employed roles within the NHS, please contact: employmentrelations@bda.org
  • Members working under hospital terms and conditions can contact the BMA for employment relations support: 0300 123 1233 (please quote your BDA membership number).

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9. Private practice

This is an exceedingly challenging time for business in the UK. The COVID-19 outbreak is impacting the incomes of private practices and many are currently in desperate financial circumstances. We are lobbying Government and representing your interests during this difficult time.

 

Business support made available from the Government

Chancellor Rishi Sunak has pledged additional support for business, on top of measures set out in the budget. These include:

 

  • The Government’s Coronavirus Job Retention Scheme, known as the furlough scheme, has ended. Claims for September must be submitted by 14 October 2021 and any amendments must be made by 28 October 2021. See our guide to this scheme in our section below on Practice owners: Advice on paying staff.

  • Government-backed loans of £330 billion have been made open to all businesses. We are worried that many dentists are having difficulty accessing these, and are instead being offered commercial loans at very high rates.

  • Business interruption loans, with the Government paying the first 12 months' interest.

  • £10,000 extra cash grants have been made to some of the smallest businesses, some dental practices with rate exemptions have already received this.

  • The Government will refund up to two weeks’ SSP per eligible employee

  • Limited measures were also announced to support the self-employed, but a cap was placed on these, limiting the amount of dentists in private practice that can avail of it.

This is a stressful time and members should be aware that they have access to our 24-hour counselling service. Dentists who are worried they cannot meet their current personal household expenditure can also apply to the BDA Benevolent Fund for financial assistance.

 

Business rate exemption should be given to dentists

Dental practices were not included in the new measures introduced in Budget 2020 to give business rate exemptions to retail businesses. We believe that in the context of the business disruption caused by the COVID-19 outbreak, it is essential that this exemption be widened to include dental practices. We've made representations to government to that effect and we will update you on any progress made.

 

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10. Associates in private practice

Self-employed dentists have faced huge uncertainty in the face of COVID-19. The measures announced by the Chancellor last year to support the self-employed during the COVID-19 outbreak did not support the majority of self-employed dentists.

 

We have been working hard on your behalf, lobbying government to provide sufficient financial support to the self-employed during this time of national crisis. The government’s response has however been characterised by inaction on the question of support for associates in private practice.

 

As Chancellor Rishi Sunak told the House of Commons:

  • Self-employed are eligible for the business interruption scheme
  • VAT has been deferred
  • The Universal Credit enhanced rate is available to all self-employed, which includes housing support
  • Self-assessment tax payments have been deferred until January 21
  • Self-employed associates earnings less than £50,000 are eligible to claim under the SEISS. This allows individuals to claim a taxable grant worth 80% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total. If you fulfil the criteria for the SEISS scheme, and saw a drop in your overall income, you can make a claim for a SEISS grant.

Both your safety and the financial viability of your practice are driving priorities for us.

 

This is a stressful time and members should be aware that they have access to our 24-hour counselling service. Associates in significant financial hardship may also speak to the BDA Benevolent Fund about their situation and the possibility of financial aid.

 

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11. Private capitation schemes

We believe that it is best if practices do continue to pay all (or most) of the capitation money to associates, but on condition that associates repay some of that money if they have not been able to provide routine and other treatment to patients because of the lockdown or reduced activity.

 

 

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12. Practice owners: advice on paying staff

This continues to be a challenging time for dentists and dental practices all over the country. Practice owners under financial pressure have the following options regarding staff payments:

 

  1. The Coronavirus Job Retention Scheme, known as the furlough scheme has ended. Claims for September must be submitted by 14 October 2021 and any amendments must be made by 28 October 2021.
  2. Agree with workers that they work reduced hours for proportionately-reduced pay
  3. Lay off employees on guarantee pay
  4. Consider making staff redundant.

 

The furlough scheme

The Government’s Coronavirus Job Retention Scheme, known as the furlough scheme, has ended.

 

 

 

Reduced hours

You may agree reduced hours working. You could suggest or ask your staff to suggest to you a temporary cut in hours and hence a proportional reduction in their pay. There is no obligation for them to agree, but if you are frank and explain the circumstances and the alternatives (lay-off or even possible closure of the business) then they might be agreeable. However, note that the same rules on staff being able to claim for redundancy (see above) apply if you reduce staff hours on short-time working to 50% or less of their normal hours.
 
Any agreement to reduced hours or short-time working should be put in writing – including the new hours, the rate of pay, the date the reduced hours start and the date for reviewing reduced hours or the date that they return to their normal hours – and signed by the employee.

 

Guarantee Pay

Employed staff will either be entitled to full pay or only to guarantee payments during any period where there is no work.

 

What are guarantee payments?


Guarantee payments are £29 per day (£30 per day from April, or less, if the employee would normally earn less than £29/30 in the day). Employees are entitled to a maximum of five days of guarantee payments in any three months. Practices do not have to pay anything to staff once they have had their five days of guarantee payments.

 

When are employees only entitled to guarantee payments?


Employed staff will be entitled to only guarantee payments if, either:

 

a) The practice has a contractual right to lay off staff without pay. There is a clause in the BDA model contract of employment entitling employers to lay off staff with only guarantee pay.

b) Or, in normal times, they are only paid for the work they do; so they do not get paid normally if there is no work.

 

In all other circumstances, where practices have no work for staff, they will have to pay staff in full if the practice closes or if they need fewer staff.

 

How long can practices keep staff on guarantee payments?


If staff are on guarantee payments for more than four consecutive weeks (or more than six weeks in any 13-week period), they can give the practice a notice to claim redundancy pay. The practice may, if it wishes, issue a counter notice to that. A tribunal would then decide whether there is a reasonable prospect of the employee returning, within four weeks of giving the original notice, to full employment for at least 13 weeks. The provisions are not very simple. Our advice team is happy to advise on individual situations.

 

Redundancy

The Government is keen to avoid redundancies if at all possible. That is why is has introduced pay for furloughed workers. However, practices may be able to make staff redundant. There is a procedure to follow. We provide advice on redundancy . Staff who are made redundant may be entitled to Statutory Redundancy Pay, which can be calculated here.

 

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