PSNC investigating unexpected drop in community pharmacy payments

Mike Dent, PSNC director of pharmacy funding

The Pharmaceutical Services Negotiating Committee (PSNC) has confirmed it is investigating reports of an unexpected drop in pharmacy payments, which were widely reported last week.

On Friday 2 June 2017, a number of pharmacy contractors took to Twitter to express their concerns about the future of their pharmacies with some saying that, rather than the 12% that was originally announced, their payments had been cut by closer to 20%.

Mike Dent, director of pharmacy funding at the PSNC, confirmed that after the cuts to the community pharmacy contractual framework were enforced by the government in December 2016, the PSNC Prescription Audit Centre in Enfield focused on ensuring that changes in funding were implemented correctly by the NHS Business Services Authority. He confirmed on Tuesday that the PSNC was in now in talks with local pharmaceutical committees (LPCs) and pharmacy contractors over the claims.

“[The] PSNC is aware of concerns regarding the drop in pharmacy payments and recognises that this is an important issue,” says Dent.

“The impact of the cuts on any given contractor will depend largely on their volume, given the Department of Health’s determination to phase out fixed payments, but also on whether they qualify for the Pharmacy Access Scheme, and (in 2017–2018) how much of the funding allocated to Quality Payments they recover.

“It will be important for contractors to separate out the effect of advances and recoveries in the early months,” he explains.

However, Dent says the PSNC is also spending a lot of time studying the decline in net ingredient cost (NIC) per item seen from January 2017 after being alerted by committee members.

“On Friday 2 June 2017 we obtained the last piece of information (Prescription Cost Analysis data for March) that we need to investigate this fully,” explains Dent.

“It appears to be driven by a decline in non-Category M generics. There was a small decline in average Category M reimbursement prices in the January Drug Tariff, driven by falling manufacturers’ selling out prices in the reference period of July to September 2016, but this does not explain all of the decline in NIC per item.

“Now we have the March data we can do a meaningful Q3 versus Q4 comparison and hopefully isolate the cause more precisely,” he adds.

The PSNC has said they will keep LPCs informed of its progress and is meeting with LPCs on 7 June 2017.

Last updated
The Pharmaceutical Journal, PJ, June, Vol 298, No 7902;298(7902):DOI:10.1211/PJ.2017.20202927

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