CEO blog - Getting Ready for SPN Contracts
The proposed contract could significantly change how neighbourhood services are commissioned, controlled, and delivered. The detail has still not been released, so PCNs should avoid making irreversible decisions too early. However, practices can start considering one important question now: if a Single Neighbourhood Provider (SNP) Contract is offered for their neighbourhood, who should hold it?
The key issue
The SNP Contract may be an evolution of PCNs, but how the contract is held will shape who carries the risk, who controls the income and who makes the decisions.
What has NHS England proposed?
In July 2026, NHS England consulted on new contracting models for neighbourhood health services, including an SNP Contract for a defined local population, usually around 50,000 people. It expects the existing PCN footprint to form the neighbourhood in most areas and describes the model as an “evolution and strengthening” of PCNs, not their replacement. Core GMS, PMS and APMS contracts would remain unchanged as far as we know. The SNP Contract would instead provide an additional locally commissioned vehicle through which wider neighbourhood services and funding could be organised. Although the final model is not settled, a single provider may take greater responsibility for coordinating delivery, funding, and performance.
That makes the identity and structure of the contract holder important. It could determine who is accountable to the ICB, who controls the income, how services are allocated and where contractual and regulatory risks sit.
The consultation also sets out other options, including a variation to the PCN DES, under which practices would continue to operate as a PCN rather than take on an SNP Contract, and arrangements under which a Multi-Neighbourhood Provider (MNP) holds the contract and subcontracts services. Those routes raise different questions and are not covered here.
Who could hold the contract?
A lead practice: One practice could hold the contract and subcontract delivery to the others. The model could also give the lead practice considerable influence over income, service allocation, and pricing unless robust governance arrangements are agreed.
A GP federation or existing provider: A federation may offer established infrastructure, workforce, and contracting experience. However, it may represent a wider group than the practices serving the neighbourhood. Participating practices could therefore have less direct control over the contract, revenues, and local delivery decisions.
A practice-owned company: A company owned by the participating practices (a PCN company (although the PCN itself may not be incorporated) could provide a neutral contract-holding vehicle. It could receive the contract income and subcontract services to the practices under agreed arrangements covering responsibilities, performance, pricing and risk.
Even for PCNs that decide to continue as a PCN rather than pursue the SNP route, a PCN company could still be useful, offering limited liability and a vehicle to employ PCN staff, so that employment risk sits with the company rather than with individual practices. Practices and PCNs should discuss any such move with their professional advisors (legal and financial).
Regulatory considerations
A contract holding company would not necessarily require its own CQC registration. The answer will depend on the services, the subcontracting arrangements, who is actually employed by the company and which organisation has responsibility for and ongoing control of regulated activities. Where the services are subcontracted to and delivered by the practices, registration is less likely to be needed, but if the company itself employs clinicians to carry out regulated activities on its behalf, it could be required. NHS Pension Scheme access will similarly depend on the employment and delivery model. Employment, VAT, information governance, clinical governance, and insurance should also be considered before the structure is finalised.
What should PCNs consider now?
Footprint: Will the neighbourhood match the existing PCN?
Contract holder: Which entity should hold the contract, and is an existing PCN company ready to do so?
Control: Who should decide service allocation, pricing, and performance?
Economics: How should income, costs and any surplus be shared?
Liability: Where should contractual, clinical, and regulatory risks sit?
Structure: Does the existing PCN company’s governance need updating, or does the PCN need to set up a PCN company?
Documentation: What changes will be needed to governance documents and service subcontracts?
Prepare now, decide when the detail is clearer
PCNs do not need to restructure immediately, but they should understand their options before an ICB begins commissioning services. Once the final model is available, there may be limited time to agree ownership, governance, subcontracting, income allocation, and risk-sharing arrangements.
William Greenwood
Chief Executive