Changes in funding laid out in the new GP contract will “penalise” digital providers, one such service has claimed.

Babylon, which provides online consultations to NHS patients via GP at Hand, claims the revisions will unfairly reduce the amount of money it and other such ‘digital first’ services receive.

The new contract, published last week, sets out changes to the rurality index payment and London adjustment payment.

The rurality index payment is designed to support practices with a higher than average distance to patients’ homes, in recognition of the increased cost of delivering services to a dispersed population.

The London adjustment payment, meanwhile, is supposed to recognise the additional burden of providing services in the capital, where populations can be very diverse and where market forces mean higher costs.

But under the changes, due to come into effect from April, rurality index payments will only apply to patients living inside a GP’s catchment area rather than all the patients registered at the practice. And the London adjustment payment will only apply to patients who actually live in the capital.

Under the section “Fair payment for digital-first delivery” the new contract states funding follows as a patient moves from one practice to another but “the emergence of digital-first providers, who directly register patients, raises the question of whether the consequential redistribution of the general practice funding pot is fair”.

Babylon, whose GP at Hand digital service is based in Fulham – but whose 40,000 registered patients are often not – says the new changes penalise the very services national bodies want to encourage.

“NHS England want to see greater uptake of digital-first primary care, which we completely support, and we also strongly welcome the £4.5bn investment in NHS primary care,” a spokesperson said.

“However, penalising providers like us who have invested in technology in order to serve patients over a wide geographic area sends the wrong signal.”

Since launching GP at Hand in 2017, Babylon has faced accusations of cherry-picking patients.

In March last year patients, GPs and NHS staff protested against the service claiming it was taking money away from GP services who need to “take care of the old and sick”.

Dr Richard Vautrey, British Medical Association GP committee chair, said: “Both the rurality index payment and London adjustment are intended to ensure practices in specific circumstances receive funding to meet the needs of their patients.

“This change is in response to the development of digital providers and improves the fairness of the funding allocation system.

“While some of these new services will lose some of the funding they currently receive, the money will be reinvested into general practice so that all will benefit.”

Babylon this week defended the service, saying the NHS gets “excellent value for money” from GP at Hand.

“We currently receive two thirds of the national average income per patient [around £93 vs. over £140], reflecting our younger-than-average population and putting to rest the myth that we are paid the same amount per patient as other practices,” a spokesman said.

The new contract gives practices almost £1bn across five years to help fulfil ambitions laid out in the NHS Long Term Plan.

One of the features in the package is increased digital access for patients, including GP practices ensuring they can offer online consultations by April 2020 and making at least 25 per cent of appointments available for online booking by July 2019.