Thread by @MikeHewitson1

Ok, so today we have seen the bones of the new community pharmacy contract. Lots* of people are asking what I make of it, so here are my first thoughts. Its a curates egg - good in parts, less in others.

*ok, some would probably be a more accurate reflection.

First thing: the money. Disappointing that there is no additional investment in community pharmacy services. Given the huge inflationary pressures on contractors: pensions, living wage, utility bills, rates, FMD, sourcing of medicines, compliance with meaningless NHS bureaucracy.

The five year settlement is a double-edged sword. On the one hand the certainty about future funding does give some ability to plan, on the other - inflation! General inflation is running at just under 2%, but could spike under a no-deal Brexit.

This is particularly concerning because this eats in to the value of the contract each year. Over the 5 year term, even if inflation is low, the value of the contract will be c11% less than it is today, if inflation is closer to 3% it could be closer to 16% less.

Our last funding increase was 2014/15. So by the end of this deal in 2024, we will have seen the value of the pharmacy contract reduce by as much as 30% because of inflation in a decade.

Because of the prospective uncertainty about inflation around Brexit, I hope that PSNC has a review mechanism built in, which specifically addresses this problem.

Moving on to the other stuff. While everyone will welcome the principle of shifting towards services, the devil is very much in the detail.

MURs phased out. In some respects I think this is a shame for patients and for pharmacists. Yes there has been a lot of inappropriate target setting from some corners of the profession, but I find MURs helpful for patients.

I often find myself having complex conversations with patients about their medicines, or at least aspects of their medicines taking, and sometimes find it appropriate for these to become MURs with a more holistic check on how they are using their other medicines.

As a pharmacy doing less than 400/year, money moved into other services could be potentially more accessible which could provide some upside.

The new Community Pharmacy Consultation Service sounds like it could be a very positive service for the future of the profession, by potentially taking the strain off General Practice, BUT, I still have major concerns over the ability of some patients to pay for medicines.

I'm not convinced about the longevity of the service. Once patients get used to being referred, they may short-cut the service by going straight to the pharmacy for more 'free' (to them) advice. If patients and General Practice becomes reliant on it, it could be a game changer.

I remain open minded about the service, but instinctively I don't like being reliant on NHS111/General Practice for activity. What's to stop them referring to their 'pet' pharmacies? What happens to the payment if they refer millions of extra people?

I am surprised by the Hepatitis C offering. NHS England is spending around £200m/year on Hep C eradication, £2m/year feels fairly paltry given that this is supposed to be an NHS priority.

Which brings me on to another major concern about the service agenda. It all feels very bitty. 'Pilot-itis' - CV disease, smoking cessation, NMS, POC testing, discharge medication reviews, AMR. Feels like throwing a dozen darts at the board and hoping something sticks.

The difficulty I have is that unless new services = new money from this point forward, it just means more and more work for the same (or in reality less) money.

Re-engineering the community pharmacy service away from today's incentives and drivers (margin and volume) towards a service driven (quality & clinical) offering won't be easy. It requires no less than transformation. But that doesn't come for free.

I am concerned that there may not be enough headroom to deliver this change against a rising tide of cost pressures. We can only access capital funding through banks which means sacrificing prospective revenue funding.

While a 5 year planning horizon is helpful, we are still exposed to the risk of margin clawbacks, and under deliveries. The recent Cat M increases announced equate to c£120m in funding which would not otherwise have been delivered - this is around 4.5% of contract funding.

There could well be more than this to come as NHS England/DHSC tend to be quite conservative in their approaches to prospective margin adjustments.

Here is the big elephant in the room about margin. The system relies on manufacturers factory gate prices with DH applying an uplift to get to the reimbursement price. Problem is that where wholesale margins increase, OUR money ends in THEIR pockets.

The system of margin HAS to go.

So overall B- from me.

Good elements: visibility of longer term funding; tentative moves towards a more secure future.
Bad elements: not dealing with margin & manipulations from wholesalers; downside risk from inflation.