TY - JOUR T1 - What is the financial risk in GP commissioning? JF - British Journal of General Practice JO - Br J Gen Pract SP - 700 LP - 701 DO - 10.3399/bjgp10X515575 VL - 60 IS - 578 AU - Rodney P Jones Y1 - 2010/09/01 UR - http://bjgp.org/content/60/578/700.abstract N2 - ‘Nought from the Greeks towards me hath sped well.So now I find that ancient proverb true, Foes’ gifts are no gifts: profit bring they none.’ (Sophocles, 496–406 BC, in Ajax)The aim of GP commissioning is quite rightly aligned to the wider issues surrounding cost containment in health care. Of necessity, this implies a budget and a list of items to be purchased. Implicit in the language of purchasing is the assumption of a high degree of control on behalf of the purchaser. Control implies predictability and direct ability to influence volatility. Does this implied level of direct control hold true in health care?To understand the financial risk implied by GP commissioning, therefore, firstly implies an understanding of the volatility associated with healthcare costs. Low volatility means low risk and ease of forecasting, while high volatility means high risk and uncertain forecasting of future demand.Volatility is determined by two factors. First, simple random variation around an average and, second, by additional volatility due to the linkage between the weather (changes in temperature, pressure, humidity, rainfall, and weather patterns), the environment (viruses, epidemics, pollution, water hardness/softness, background radon levels, and any other variable with a potential effect on health), and the expression of illness and disease in their widest sense.Simple random variation is largely set Poisson statistics, which describe the range of outcomes around an average for whole number events; that is, 107 admissions or 223 outpatient attendances. By definition the standard deviation (a measure of volatility) of a Poisson distribution is equal … ER -