GP Sustainability Loans in the Age of Covid-19

Talking about business and management issues in circumstances like this can seem superfluous if not downright disrespectful for healthcare businesses and particularly for medical partnerships.

Yet the reality for these businesses is that they have been under extreme pressure for years and those pressures have not disappeared overnight. They remain, numbed temporarily by the effects of Covid-19, alleviated in part by dedicated practitioners returning from retirement to the front line on occasion with tragic consequences.

There are, of course, those who feel, and are, under very extreme pressure day in day out. For them, business risk will be far from their minds. However, surprisingly given what we hear in the news at present, for some the initial wave of preparation for Covid-19 in parts of Scotland appears to have abated somewhat.

We are receiving e-mails from Practices indicating that, surprisingly, they are finding they have time to deal with various business and management issues. For some this means focusing on updating Practice Agreements. For others it means doing what they can to progress Sustainability Loans. Over the past week we have seen the CLO (and the Health Boards who instruct them) starting to issue Sustainability Loan paperwork Covid-19 notwithstanding. Even where a Practice has not received the paperwork, that does not mean nothing can be done. 

Whilst not all Practices will feel ready or able to consider anything other than clinical work, some will. For those that do, we recommend taking the opportunity now to put themselves in a position where, when the CLO are told by Health Boards to start issuing formal loan documentation, they can progress as quickly as possible.

As a consequence of having seen Sustainability Loan documentation for some Practices, we now know with much more clarity what will be required for most, if not all, Practices. It follows that we can make significant progress in putting in place the legal steps which will be required to take out a Sustainability Loan be that reporting on template loan documentation, discussing with Practices and their accountants how to treat Sustainability Loans in the accounts, updating title deeds to ensure they meet the Sustainability Loan criteria or liaising with current lenders to get their agreement in principle to the Sustainability Loan.

If you, your clients or your customers feel now is the time to make progress with your Sustainability Loan or indeed to address any other business issues, please contact me or another member of the Davidson Chalmers Stewart dedicated Healthcare Team.

Disclaimer 
The matter in this publication is based on our current understanding of the law.  The information provides only an overview of the law in force at the date hereof and has been produced for general information purposes only. Professional advice should always be sought before taking any action in reliance of the information. Accordingly, Davidson Chalmers Stewart LLP does not take any responsibility for losses incurred by any person through acting or failing to act on the basis of anything contained in this publication.