Announcement summary:

The arrangements for the Community Pharmacy Contractual Framework (CPCF) in 2020/21 have been agreed between PSNC, NHS England and NHS Improvement (NHSE&I) and the Department of Health and Social Care (DHSC), in line with the five-year CPCF deal.

As set out in the deal, overall funding for community pharmacy will be set at £2.592bn for the year.

There will be an increase in funding for Transitional Payments from April (although these payments will decrease as new services roll out) and the Pharmacy Access Scheme (PhAS) will continue for another year in its current format.

Within the funding envelope a number of new services will be rolled out including an extension of referrals to the Community Pharmacist Consultation Service (CPCS), a new Essential service – the Discharge Medicines Service, and a Hepatitis C testing service. The roll-out of these services is in line with the timetable and agreements made in July 2019.

PSNC, NHSE&I and DHSC have written jointly to contractors today setting out information on the CPCF for 2020/21. The letter sets out as much information as we have at this point in time; remaining details will be announced as soon as possible once Drug Tariff wording has been agreed between the three organisations and when ongoing negotiations on the new services have concluded.

Read the joint letter to contractors on the CPCF for 2020/21

Read the five-year deal document

In line with the five-year CPCF deal, agreements and changes to the CPCF in 2020/21 include:

• Increased funding for Transitional Payments to contractors from April 2020 – these payments will reduce throughout the year as the agreed new services come into the CPCF;
• A renewed Pharmacy Quality Scheme (PQS) with a single review point in February 2021 – an aspirational payment will once again be available;
• A new banded payment structure for the PQS to recognise the increased workload involved to meet the requirements for pharmacies seeing larger numbers of patients;
• Exploratory discussions on the introduction of NHS travel vaccinations from pharmacies (this is subject to negotiation); and
• The introduction of a number of new requirements under the Terms of Service.

Alongside this, PSNC will work with NHSE&I and DHSC to progress changes that will help contractors to release capacity and make the transition to the new services. The Government is enabling hub and spoke dispensing for all contractors through the Medicines and Medical Devices Bill which has now been published in draft form, and PSNC will be looking to strengthen protections for pharmacies wishing to consolidate and to explore options such as original pack dispensing and facilitating generic substitution of medicines.

Pharmacy Integration Fund monies will be used to begin pilots of pharmacy blood pressure testing, point of care testing and referrals from hospitals to a pharmacy smoking cessation service during 2020/21. And we will continue ongoing work to improve reimbursement for contractors.

PSNC has also begun work to prepare for the annual CPCF review process. This review process was agreed as part of the five-year CPCF deal and will be our opportunity to demonstrate the costs and capacity challenges that pharmacy is facing to make the case for further investment in the sector.

FAQs and further information on funding for 2020/21 is available at the bottom of this news story.

PSNC Statements

Statement from PSNC Chief Executive Simon Dukes

“As part of the five-year Community Pharmacy Contractual Framework agreement in July 2019, it was agreed that each year would be subject to separate discussions to determine the detail. The first year established the Community Pharmacist Consultation Service (CPCS) which has been a huge success – further strengthening our role at the heart of primary care, supporting urgent care and making a positive difference to patients.

As this joint letter to contractors sets out, Year Two (from 1st April 2020) will build on earlier successes and include a range of new clinical services which will be rolled out and piloted through pharmacy. This will enable community pharmacies to do more to support their local communities, improve integration and allow us to demonstrate further value to NHSE&I and DHSC. There is yet more detail still to come for 2020/21 – on the Transitional Payments and the Pharmacy Quality Scheme (PQS) and Hepatitis C Testing – but we hope that now we have brought the negotiating cycle forwards, you will in future have more notice of what lies ahead in terms of funding and services.

It is frustrating that we cannot yet give you the full details of the PQS and Transitional Payments – we are working to get the Drug Tariff wording on this agreed, and unfortunately Government processes mean that we cannot share the details with you until that wording has been signed off. What we can tell you is that initially this year you will see Transitional Payments increase, but these payments will drop as more new services come online this year and have funding diverted to them.

This year will be a crucial one for our sector. It will be a significant challenge to deliver all that Government wants from community pharmacy within a flat funding envelope. The capacity released from the decommissioning of Medicines Use Reviews which NHSE&I hoped would give the sector the time it needed to conduct the new services in Years Two and beyond is being eroded rapidly. Displacement of patients from general practice, increased time spent sourcing medicines, and the burden of getting to grips with emerging Primary Care Networks are all having an impact on pharmacy workloads.

PSNC, working closely with the other pharmacy bodies and organisations outside our sector, is engaged in making the case to HM Government to seek additional investment in the sector. We will also this year take forward complex work exploring ways to improve funding models for the benefit of all.”

Statement from Bharat Patel, PSNC Vice-Chair and Negotiating Team Member (and independent community pharmacy contractor)

“The coming financial year will see a number of really positive service developments for community pharmacies, not least the launch of a new national service focused on helping people to understand and use their medicines post-discharge, and the extension of the already successful Community Pharmacist Consultation Service (CPCS). But for pharmacies, none of this will be easy. The challenges in delivering all that Government wants from us within a flat funding envelope are already evident; the financial squeeze is causing a real strain on the health of pharmacists and their teams and businesses are struggling as costs continue to rise and workload goes up.

Our job at PSNC, working with the other national pharmacy organisations, is to prove the extent of our capacity crisis, and to make a persuasive case to Government when we come to the annual review of the CPCF in the autumn. Preparing data and analysis for that review is an urgent topic for PSNC and one that we are already working on. Alongside this critical work, we will continue to work on the ongoing negotiations, aiming to make changes as manageable as possible for pharmacies.”

Statement from Clare Kerr, PSNC Negotiating Team Member (and Head of Healthcare Policy & Strategy at McKesson UK)

“When PSNC agreed the five-year CPCF deal last year we believed that the new services, and particularly the Community Pharmacist Consultation Service (CPCS), presented an opportunity to put community pharmacy at the heart of primary care and to start building some leverage for the sector. In Year One of the deal, pharmacies across England have risen to the challenges phenomenally well – thank you to everyone working in pharmacies for your fantastic efforts in the past six months. Despite facing ongoing financial challenges, pharmacies across England are continuing to make a positive difference to patients, as well as helping the NHS and Government.

This financial year – Year Two of our five-year settlement – will be another crucial year for the sector. We need to build on the platform that we have built in the past six months and continue to show Government that we are serious about helping them to meet their objectives. The new Discharge Medicines Service (DMS) and the extension of referrals to the CPCS will give us some key opportunities to do that, while also continuing to build an important evidence base giving us leverage for the future.”

Further information for contractors

PSNC Briefing 010/20: Community Pharmacy Funding in 2020/21

PSNC Briefing 011/20: CPCF in 2020/21 – Frequently Asked Questions