The Pharmaceutical Services Negotiating Committee is “deeply frustrated” by the Government’s refusal to agree to a funding uplift as part of the sector’s annual contractual review, its vice-chair has said.

Bharat Patel said he was “disappointed that the annual review did not lead to immediate and tangible outcomes and improvements for contractors”.

The PSNC published the outcome of the much-delayed first annual review of the Community Pharmacy Contractual Framework on Friday afternoon, having concluded lengthy talks with the Department of Health and Social Care and NHS England & Improvement late last year.

It said that although the review “took place separately from, and too late to inform” the sector’s bid for an uplift to the CPCF funding envelope, some progress has been made.  

This includes agreement by all parties on the direction of travel with regards to a more service-based agenda, a recognition that pharmacy numbers have been in decline since April 2019 and an acknowledgement that “potential efficiencies in dispensing” designed at helping pharmacists focus more on services have not yet been released.

‘Unsustainable’ business savings

The PSNC said it had “raised its serious concerns around the capacity available within community pharmacies in the absence of planned efficiency gains” and about the “unsustainable” business savings contractors have been forced into making.

In a pharmacy funding briefing document aimed at helping contractors and LPCs publicise the issue, the PSNC says a “massive” rise in staffing costs is a key factor in the financial pain affecting pharmacies in England.

Wage bills are described as having risen from 53 per cent of overall business costs in 2015-16 to 84 per cent of the current available funding envelope, and will likely rise again once the rise in the national minimum wage takes effect in April.

This is partly driven by rising locum fees, which the negotiator says are 40 per cent higher now than at the start of the five-year settlement.

Agreement

The PSNC said it is “exploring ways to bid again for additional funding,” but acknowledged that the Government and NHS have never wavered from the view that no extra funding is available for years 4 and 5 of the CPCF.

While the PSNC approached the talks with a view to shedding light on costs and capacity issues in pharmacies, it said the Government wishes to “review the value that patients and the NSH are getting from community pharmacy”.

All parties have agreed to examine capacity constraints in the upcoming year 4 negotiations and to consider the “scale and impact” of the “more complex” consultations pharmacies are now offering, as well as to agree principles for setting service fees.

'Difficult discussions'

PSNC funding director Mike Dent commented: “This Annual Review process involved some difficult discussions and debate about what the future holds for community pharmacy.

“While all three negotiating organisations agreed on the phenomenal performance of pharmacies throughout the COVID-19 pandemic and on the value that pharmacies offer, there were mixed views on some other points.

“The review will fall short of contractors’ hopes in that it did not result in any immediate movement in terms of contractor funding levels, and DHSC and NHSE&I have also remained clear throughout that no funding uplift is available for Years 4 and 5 of the CPCF.”

PSNC negotiating team member Tricia Kennerley said: “We have made absolutely clear the immense pressures the sector is facing as well as laying down very strongly the need for additional funding for a walk-in service [to replace the current referral model for the Community Pharmacist Consultation Service.”

Another year of cuts, NPA warns

National Pharmacy Association chief Mark Lyonette said the review had “rubber-stamped another year of cuts for pharmacies across England”.

He added: “Instead of moving forwards into new clinical roles, which the NHS and DHSC say they want, pharmacies could now slip back, focus narrowly on dispensing and reduce access to care – the very opposite of the aspirations stated in the NHS Plan.”