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PCO run GPs cost at least £30 per patient more, DDA conference hears

Stabilise dispensing practice to protect a cost-effective rural solution

October 27th 2017

Tagged: DDA news Conference news political news England

By Ailsa Colquhoun

Practices run by a primary care organisation cost at least £30 a patient more to run, compared to those run by GP partners, and are usually run less well. “For the Department of Health dispensing GPs maintain a first-class GP service for rural patients in a rural location,” GPC dispensing policy lead David Bailey told the DDA 2017 annual conference.

He described dispensing practices as providing “excellent value for money for the NHS”. Dr Bailey said: “Dispensing GPs may earn around £15,000 more than non-dispensing GPs but they are doing two jobs, and are doing the second on the cheap”.

An average of half of all rural patients are registered as dispensing, at a cost to the NHS of around £30,000 a year. The conference heard: “Logistically, rural primary care organisation run medical services are a nightmare, and they are unlikely to be attractive to private providers for the same reason. Dispensing practices, therefore, represent excellent value for money, chancellor,” Dr Bailey said.

He told the conference that dispensing GPs have four key demands of the Department of Health:

  • Update the remuneration agreement
  • Resolve reimbursement
  • Commission EPS for dispensing doctors
  • Resolve and integrate the Falsified Medicines Directive

In terms of remuneration, the GPC is seeking an updated version of the agreement set out in 2010 to use a directly negotiated gross uplift that achieves a net recommendation. “The current agreement has efficiency built in but with no inflationary uplift for staff costs. Indemnity, national insurance are just some of the costs that are rising above inflation and these are not now being covered by the envelope,” he said.

Fixing reimbursement would stabilise rural practice and will save money operationally and in terms of admissions, Dr Bailey said.  One solution is to introduce a reimbursement settlement that mirrors that for pharmacy, although this will produce a short-term cost increase for Government, Dr Bailey admitted. This could be funded through windfall savings to category M and changes in the market, he suggested, with the result that it would introduce “a level playing field that is better for the NHS and for patients”.

The outstanding issues that impact on profit include inequitable discount clawback compared to pharmacy, no allowance for ZD drugs, smaller economies of scale, in particular, buying discounts, category M and branded generics that impact on the prices set by Category M. “CCGs are more interested in saving £5 than in the fact that they are undermining the whole NHS system,” the conference heard.

He reminded the conference that the Cost of Service Inquiry in 2010 confirmed that the majority of dispensing practices subsidise GMS from dispensing profits. “But, compared to 2010, the financial situation of rural practice today is much worse,” he said, highlighting the increased costs of pensions and indemnity, as well as the effects of the NHS austerity measures. He asked DDA conference delegates: “If practices were subsidising GMS then, how much more are they subsidising it now? Such are the difficulties facing rural practices that they are not exactly fighting off new GPs with a stick.”

View the conference presentation.

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