“Small rural practices earn 30-40% less from GMS than urban practices. They need dispensing income to survive and if you pull dispensing income out from rural practices, they will fall over,” Dr Richard West told GPs in a presentation outlining the challenges and opportunities in the new dispensing environment.

The Department of Health was pushing forward with its vision for new models of care, and as a result, “money will move in that direction,” he said.

And, for dispensing GPs this will present a unique challenge. The DDA chairman explained: “You need to keep your dispensing contract,” for if the contract stops and is replaced, the dispensing practice will lose its dispensing rights and it will have to reapply under the 2013 pharmacy services regulations. “These make it very easy for pharmacy to pick off all your patients,” he said.

During the presentation, which was held in Kent and sponsored by Napp Pharmaceuticals, the DDA chairman raised a number of questions about the alleged benefits of new models of primary care. Starting with the optional new GP contract, he said this will require at-scale service provision to deliver outcomes such as seven day care to patient populations of 30,000. A key question to ask is: ‘How do you move to at-scale models without losing individuality?’

Better use of the skill mix has been suggested as a way to achieve these outcomes, but this presents difficulties for rural practices which may have challenging geography. “Skill mix offers the most advantages when it is there all the time. In rural areas you can lose your skill mix for hours on the road.” He also noted that incorporating different professional skills can generate as much work as it saves: “The danger that it just creates more specialisms and generates more inter-professional referrals – not all functions can be shared.”

Cost savings are also mooted as an advantage, but Dr West invited the audience to consider where savings can actually be made. “Cost savings can only arise through losing staff or buildings – which is never very popular with patients – or cutting profits or wages – which won’t go down well with your staff. And, remember, the work won’t just disappear.”

Looking specifically at the super practice model, he said: “Having a Board function will require the time and attention of a GP partner; staff moving around practices will reduce continuity for patients. There is also likely to be an equalisation of partner income across the organisation, which will mean reductions for some.”

He said: “As a GP, you must ask yourself: ‘Do I want to be managed by a larger organisation?’ He also warned: “If you think we have a recruitment crisis now, just see what happens when we do this.”

As the only organisation to specifically represent the interests of dispensing doctors, the DDA is highlighting the challenges currently facing dispensing practice, which include reimbursement and category M, and lobbying for the development of medicines optimisation services and clinical pharmacists.

Dr West told the meeting that the DDA’s reimbursement  lobby aimed to achieve a model that was good for patients, the NHS and the practice – but he warned that any agreement before 2016 was “unlikely”. He also advised practices that the retainable profit margin delivered through category M – and which is imposed on dispensing practices – has moved from the principle of achieving a minimum of £500 million in retained profit to achieving a maximum of £800m. “Even though there is an apparent increase, this change in methodology will impact on the profitability that category M delivers to dispensing practice,” he said.

However, on a more positive note, the DDA was actively working towards the development of medicines optimisation services in rural practice. “Rural patient should have the same opportunities… as urban patients,” he said.

He also noted that dispensing practices were ideally situated to develop the GP pharmacist model. “We have staff who are used to looking after medicines and we already have the DRUM, which is a precursor to pharmacy medicines optimisation services. We already integrate GMS and pharmaceutical services and have skills in dispensing. The CQC also considers dispensing practices to be better run than the average GP.”

Dr West’s slides are available here.