The new community pharmacy contract delivered another body blow to hopes. No financial increase from last year, but the need to deal with extra prescriptions (3.3% growth) and an ever more fragile supply chain.
Any businessman knows that to maintain or increase profits from year to year, there are only two options – increase revenue or reduce overheads. So what does this actually mean in practice?
- The NHS contract revenue is flat and community pharmacy will need to absorb a 3.3% increase in workload. There is the national advanced service for flu vaccination as an opportunity to drive revenue, but as ever time is marching on and for those pharmacies new to this game they have limited time to get their act together when GPs have already had their orders for vaccines placed long ago. Will Pharmacy be ready – they have to be – but in the first year 100 immunisations might be a reasonable performance and this only adds a fairly small amount to the top line.
- Community Pharmacy owners, may try to reduce overheads. To reduce staffing numbers may be difficult when you are trying to absorb a 3.3% growth in workload, but owners may try to improve skillmix using dispensers or technicians more, cut some hours or reduce salaries. Pharmacies may try to reduce the price that they pay for medicines, but the advantage of this will be lost within category M arrangements unless you are always ahead of the game.
It is depressing I agree. The contract hardly offers hope of additional enhanced services such as minor ailment next year or additional payments to move to new service models such as ‘Healthy Living Pharmacy’. So where will additional revenue come from? There is only two real places:
- The local NHS. The financial pressures are extreme and joined up commissioning may require groups of community pharmacies to come together to form a commissionable local service provider. There is money from the Prime Minister’s Challenge Fund, some in new models of care (although the Vanguards are looking slow), out of hours integrated services and local authority based public health and even GP federations. I don’t underestimate the difficulties in getting groups of pharmacies in a locality to discard their competitive nature and become a commissionable force, but they just have to do it – win services and over-deliver them.
- The local public. It is not as if people have a lot of extra money to spend, but there seems to be a gently emerging understanding that people have to take an interest in their own health and the NHS can’t and won’t do everything. Community Pharmacy has been ‘dispensing health’, but perhaps they have to be ‘retailing health’. People will trust community pharmacy to provide parcels of care and products of the highest and most consistent quality. There should be a mile of clear water between community pharmacy and other retailers and that needs to expand. There is a wealth of healthcare related and wellness products that community pharmacy could sell to people with appropriate monitoring and standards. It is time for community pharmacy to lead this sector and blow it apart. But it will take a big change in attitude for community pharmacy to deliver the required customer service and build the right relationships.
A lot to do – and not much time to do it if 2015 is going to be the year of the community pharmacist.
And as a final point – community pharmacy has the opportunity to make a massive impact on the health and wellbeing of their local community