PSNC must secure a long-term solution to community pharmacy's financial woes, industry leaders have warned, following another "disappointing" blow to progress on funding negotiations.
Community pharmacists and representatives said they supported PSNC's bid to secure a long-term funding deal but issued a strongly worded call to resolve the ongoing delays, which could see contractors struggle with interim funding arrangements until the autumn.
PSNC revealed last week it would be unlikely to reach a settlement in the "immediate future" because the Department of Health (DH) had called for the fledgling NHS Commissioning Board to be involved in negotiations. It later told C+D it expected negotiations to be concluded before late summer, after it conducted the "complex" work to update findings from the cost of service inquiry (COSI), published in 2011.
"A settlement at this point for 2012-13 alone would not be in the sector's best interests" Sue Sharpe, PSNC
More on funding negotiations
In the meantime, funding will continue under the interim agreement introduced in October, which has seen a 45p reduction in average item value and monthly shortfalls of up to £7,000 for some contractors.
PSNC said it understood the "frustration and concern" the delays would cause, but pledged to negotiate a multi-year funding agreement that would reflect the costs of service. "A settlement at this point for 2012-13 alone would not be in the sector's best interests," PSNC chief executive Sue Sharpe said.
The Co-operative Pharmacy said the sector would not tolerate another round of "missed deadlines and timetables". "I would say we're extremely disappointed by the continuing delays," managing director John Nuttall told C+D. But Mr Nuttall stressed that a multi-year agreement would enable businesses to plan and invest, putting an end to yearly uncertainty over funding.
Ash Pandya, chief executive of Essex LPC, echoed the support for a longer term model. "At a local level, I look to get a multi-year agreement because contractors want to have stability and know this is the income they're going to generate over the next few years," he said. "So I can see the logic that PSNC is using."
"But it's about time we started to get the impact of the COSI – that's gone on and it does need to be nailed down," Mr Pandya added.
And PSNC must negotiate a strong deal to mitigate the "painful" months under the interim funding agreement, said Kit Tse, chief executive of PharmaBBG, a group of more than 100 contractors across Bromley, Bexley and Greenwich.
But Martin Bennett of Wicker Pharmacy, Sheffield, expressed doubts over the sector's prospects. "I would think the [news] was a good thing if I had any confidence that PSNC would get the negotiations right," he told C+D.
And he stressed that many contractors would "struggle" to maintain cashflow while waiting for the new agreement. "We're running at a loss and that can't go on," the contractor argued. "We need help now."
"When there are rises and falls in remuneration, it can discourage contractors from investing in refits and staff. So I fully support PSNC negotiating a multi-year agreement, which would offer more stability." Ravi Vaitha, pharmacist, Kamsons Pharmacy, Crawley "The initial feeling is of disappointment because the last few months have been painful, but I think our feeling is that if the delay means we will get better outcomes in the future we would look forward to that." Kit Tse, chief executive, PharmaBBG "PSNC should tell the DH to come back to us by a certain time. We could have forced the issue on this, whereas now people are going to drag their feet." Rakesh Patel, pharmacy manager, Mr Pickford's Pharmacy, Leicester "We need a multi-year funding model. It's not appropriate to settle on a single-year basis because we need to be able to plan our investments." John Nuttall, managing director, The Co-operative Pharmacy
Can your pharmacy business survive under the interm funding arrangements until autumn?