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PSNC to mull alternative types of contract as current model ‘not working’

The negotiator will consider a totally new community pharmacy contractual framework (CPCF) after the current contract concludes next year, Pharmaceutical Services Negotiating Committee (PSNC) CEO Janet Morrison has said.

Ms Morrison told delegates at PSNC’s local pharmaceutical committee (LPC) conference last week (September 22) that there is “no incentive [for contractors] to take up new services” under the current framework, for which a yearly fixed-funding envelope was agreed in 2019.


The current contract “doesn’t really make sense as a contractual framework”, she told C+D at a press briefing.


Read more: £100m in excess margin written off as DH stands firm on flat funding deal


Contractors can decide to provide the additional clinical services set out in the contract, but reimbursement for these still comes from the same funding envelope that covers other elements such as the global sum and drug reimbursement, Ms Morrison explained.


PSNC announced on Thursday (September 22) that negotiations for year 4 and 5 of the CPCF had resulted in the waiving of £100 of million in excess margin for pharmacies in England. 


However, the Department of Health and Social Care (DH) did not add to the £2.5 billion yearly funding stream it had agreed with PSNC in 2019, despite the negotiator submitting evidence on the mounting pressures pharmacies are currently facing.



Outside examples



“Capacity constraints” are also leading many contractors to question whether they will be able to offer advanced services or the pharmacy quality scheme, Ms Morrison added.


As a result, the negotiator will be “investigating other [contractual] models” that are being used for pharmacies in other parts of the UK, as well as overseas.


Read more: Welsh government pumps cash into national pharmacy clinical service


PSNC will “probably” seek “external advice” on what kind of contractual framework would work best for England before beginning negotiations for the next CPCF, she said.


“At the moment, I think the contractual framework is about introducing slivers of services”, which is not financially sustainable for pharmacy businesses, Ms Morrison told contractors at the LPC conference.


“So, we absolutely have to look at all the alternatives. We can’t just walk in and say, ‘Oh, let’s have more of the same, please.” Because it’s not working,” she stated.



DH has “presided over cuts”


When PSNC and the DH agreed on the five-year CPCF in 2019, the government wanted the sector to “demonstrate the scope of what community pharmacy could do in delivering clinical services”, Ms Morrison said

In refusing to add to the £2.5 billion yearly funding pot as inflationary and workforce pressures mount, the DH has effectively “presided over cuts” to the community pharmacy sector, she said.

“That just seems counterintuitive” given the DH’s ambitions for the sector, she pointed out.

“That ability to demonstrate the value of community pharmacy is now going to start being questioned and diminished” without the further investment that PSNC sought, Ms Morrison said.


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