Dear Member, The dedicated team at PharmaPlus and I wish you a very Happy, Healthy and Profitable 2023. I hope you all had a good Christmas and New Year break and are re-energised to make 2023 a rewarding year for your business. I would like to take a little bit of your precious time with the message in this email, highlighting what lies ahead of us and the measures we must take to survive. Despite all the pressure we are trying to put on our political taskmasters – we run pharmacy 'businesses', and
ultimately, our actions will determine whether we remain viable. If, by some miracle, the NHS gives us additional funding, then let that be the icing on the cake and not what forms the foundation of our businesses. |
What current issues do we face With 2023 now here, just when we thought at the start of 2022 the trauma of the pandemic was over and life would begin to return to normal, a new crisis struck. The problem was heightened by various global and UK-specific issues, namely the war in Ukraine and the deepening cost-of-living
crisis. High inflation, interest rates and energy prices have landed and are here to stay
for many years - this situation will hit everyone, including businesses, very hard. The Government will be taking tougher decisions in the future to balance the books, and community pharmacies will not be exempt from further cuts and redirection of funds. | What is PharmaPlus doing to help Throughout 2022 the PharmaPlus team has been working very hard behind the scenes to support you through this post-pandemic and new 'cold war era'. Put bluntly, NHS income, the bedrock of our businesses for decades, cannot be relied on in isolation. To counter this, we have developed numerous Private Clinical services to support you in this journey, so you continue being a profitable pharmacy. Importantly, we help create 'time' for you to provide these
services; Pharmaplus affords its members significant administrative support - both professional and for your NHS contractual obligations. |
Please don't reinvent the wheel – see what support we are already giving and let us know what more we can do. The time saved in admin
work can then be converted into revenue generation. |
What to expect in 2023 (and how it will impact your business financially) 1) The Cost of Living and the Impeding Business Crisis 2) NHS funding 3) NHS Services: PQS 2023 4) CQC and Regulatory Changes 5) Supporting Private and NHS Clinical Services – Our Focus! |
1) The Cost of Living and the Impeding Business
Crisis The Chancellor announced significant tax changes that will impact individual and business taxes, and of particular importance to you is the National Living wage increase
to £10.42 from next April 2023. Pension contributions for individuals or companies may also increase soon, as are locum and other costs in utilities, interest rates etc. |
2) NHS funding Funding continues to be problematic for several reasons: - The global sum has been frozen for 22/23 & 23/24
- You will need to do significantly more NHS
Services to get the same income, especially NMS, BP Checks & CPCS. You will need to set up the new Oral Contraception service up too.
- Transitional payments are being removed: costing around £18,000 per annum. By now,
pharmacies should be making the shortfall through NHS services.
- Cat M prices are increasing slightly, but our analysis shows that this is much slower than the purchase rates. Hence a further cut to
margins.
- Smaller pharmacies are likely to be negatively impacted by the changes to the discount scale for drug prices, principally affecting London-based pharmacies.
Pharmacies that have not set up and grown in the NHS services will see significantly lower payments ongoing and, in many cases, are unlikely to be able to secure enough payment each month to meet the overheads and costs of running
the pharmacy. It is a pre-requisite that without making your full claims allowable for NHS-funded services (i.e. BP, NMS, PQS etc.), doing catch-up with just Private services will be almost impossible. We have seen many pharmacies try to provide complex private services while leaving a significant amount of NHS income on the table that can be obtained by relatively simple means. So, maximise your advanced and enhanced service income – this is risk-free money already negotiated for
you. After
implementing the plan to generate additional revenue, we recommend, if you haven't already done so, that you look at the private 'clinical' services. Without this component in your business planning, cash flow will be challenging to manage A further threat we have seen is the emergence of non-NHS pharmacies, that is, pharmacies that provide nothing but private-based services. These pharmacies will have fewer overheads, be less restrictive in their practice, and allow private services to be delivered with fewer resources and increased flexibility. 'Private pharmacies 'will
be owned and run by independent prescribers and avoid paying considerable goodwill. |
3) NHS Services: PQS 2023 The new PQS is in motion, and as with previous years, Pharmaplus have a proactive plan in place for you to maximise the amount you can make. We anticipate that it can lead to your pharmacy receiving between £6,000 and £8,000 if you manage to get all the work done. It will not be easy, but it will form the basis behind the NHS strategy to upskill
the pharmacy workforce and provide you with entry points to get onto NHS services that are currently being developed for future years. We anticipate a two-tier model of pharmacies - those clinically equipped to leap into advanced clinical services and those purely dispensing machines with little growth opportunity. Pharmaplus is all about the former; make sure that you are too! We are in constant contact with shortliners and mainline wholesalers regarding service levels and costs, but
still feel that the supply function margins will continue to be squeezed. |
4) CQC and Regulatory Changes We also expect significant regulatory changes shortly. The CQC will take a more proactive role in regulating clinical services in community pharmacies as independent prescribing takes hold and more complex clinical services are developed. We have also expanded our
registration and inspection system to permit your pharmacy to be CQC compliant. CQC compliance will allow your pharmacy to provide these complex services to a higher degree of safety and oversight, giving your patients the reassurance they need and, importantly, showing the public the standards you operate. Please contact us to learn more about our CQC compliance services. |
5) Supporting Private and NHS Clinical Services – Our Focus! I will mention that dispensing alone is insufficient; you must grow NHS and Private Clinical Services. Our 90% reliance on NHS income is no longer sustainable in the long run. We must de-risk ourselves and investigate the private sector to make up our earnings. People will pay for private clinical services because they cannot afford to wait weeks for a GP appointment, as appears to be the current direction of travel in the
NHS. We are introducing several new Private clinical services, which will also demonstrate a proof
of concept to the local NHS. Private services will support the broader community pharmacy agenda in making a case for local and national NHS commissioners. This year we introduced several new services – that you can now provide in your pharmacy and increase your business cash flow and profitability. These include: - A private walk-in service that allows you to dispense private prescriptions is based on a model where the pharmacist conducts the analysis, and a GP can counter-prescribe a POM (not available on a PGD). It is essential to understand that this new concept we have introduced is not simply PGD driven but goes beyond to allow pharmacists to make advanced
clinical decisions.
- Several services require phlebotomy - including allergy testing, blood testing and sexual health.
- Increasing the vaccination service range to include services for children, travel, sexual health etc.
- Enhancing the scope of our DNA testing system for the judicial system and actively seeking pharmacies outside of the London region to participate.
- We are introducing new services, including cryotherapy, IV Vitamin Infusions, ECG monitoring, Aesthetics (Botox / Fillers) and others.
- Developing our independent prescribing mentor pairing service where we pair you with a GP or prescribing mentor to support you in becoming an independent prescriber.
We have other services in the pipeline and would like you to consider these for the future to increase your profitability in the cost-of-living crisis. Alongside all these services, don't forget the funded training which will continue to be offered to allow pharmacists to become independent prescribers. We foresee future government contracts being offered to those who show that they are willing to navigate these challenges in a way that
offers professional growth. Independent prescribing demonstrates that commitment to the profession, so don't shy away from this incredible opportunity. |
In addition to the
above, we do have numerous agreements in place with many suppliers ranging from PMR suppliers to computer labels and container and sundry suppliers – please take the time to consider these. 2023 will be a challenging year - Think of PharmaPlus as your back office. We are here to support you while you concentrate on your business on the front line. Please let us know if you would like any further information or want to talk to us about anything I have mentioned. Lets remain positive about 2023! On a lighter note, we look forward to seeing more of you at our Social Events. Please come along; they
have always been fun. Regards, Hiten Patel Managing Director, PharmaPlus
Limited |
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