The Department of Health and Social Care (DH) and HM Treasury’s funding proposal was “not sufficient”, the Pharmaceutical Services Negotiating Committee (PSNC) said in a statement last week (November 13).

The negotiator argued that contactors “must not be asked to provide evidence of historical cost”, which it said was suggested by the DH in its proposal.

Contractors would not have been able to “claim compensation for all the impacts that their businesses have felt” during the pandemic under the rejected DH proposal, PSNC added.

It said that for this reason, the “proposed policy was not in line with Ministers’ pledges to give the NHS whatever it needs during the pandemic” and the offer was rejected “as being too limited”.

A DH spokesperson told C+D that the £370 million it gave to the sector in advance payments earlier this year were meant to “support [community pharmacies] in maintaining vital services”.

“We have put forward firm proposals to the PSNC for additional funding to meet extra costs incurred by pharmacies in the peak of the pandemic. A request for funding beyond the initial peak is also under consideration,” they added.

PSNC: Write off £370m advance payments

The DH made available a total of £370m in advance funding to pharmacy contractors in England, which contractors were told they would need to pay back.

However, it emerged last week (November 12) that the DH is “carefully considering” waiving the requirement for contractors to pay this money back.

PSNC filed a counter-proposal to the DH last month, in which it asked for the £370m advance payments “to be written off against the costs of COVID-19 to contractors for a particular period of time”. It is waiting for a response to its latest proposal, it said.

“Contractors must not now be forced to pay this [money] back as they try to cope with the impact of the second wave of COVID-19 in the UK,” PSNC said.

“Very challenging” negotiations

The negotiations with the DH over funding, which started this summer, have been “very challenging”, said PSNC, which added that discussions “are being prolonged because PSNC has not yet received a funding offer that will fully compensate contractors”.

PSNC CEO Simon Dukes said that the initial proposal “attempted to constrain the amount of compensation that was offered to pharmacy businesses and PSNC was unable to accept this”.

“We are waiting for a response to our latest proposal on COVID-19 costs, in which we propose a write-off of the £370m advance payments against the costs of COVID-19 to contractors for a fixed period, and also to our separate bid for an uplift to community pharmacy contractual framework funding.

“Negotiations are continuing, and we are looking for ways to work constructively with HM Government and the NHS on the many challenges they face, but PSNC cannot accept any less than full reimbursement for pharmacies of their COVID-related costs,” Mr Dukes said.

Association of Independent Multiple Pharmacies (AIMp) CEO Leyla Hannbeck told C+D today that the organisation supports PSNC’s request for a full write-off from COVID-19 costs”.

“At the height of the pandemic, community pharmacy was, in good faith, the only healthcare profession in the community still seeing people and patients face to face.

“Our members put themselves at risk, innovated and incurred substantial extra operating costs to do this because we had verbal assurances from the NHS that our reasonably increased extra costs would be paid back.

“The reality is that a significant part of that £370m went towards supporting cash flow on March/April purchases – something that may be necessary again due to the further rising costs [we are] currently [facing],” Ms Hannbeck added.