All-round criticism for appliance payment plans
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Choice of appliances, such as stoma care products, may be affected |
Department of Health proposals to change a 20-year-old system for paying for medical appliances have been criticised by pharmacy organisations and appliance wholesalers alike.
The Pharmaceutical Services Negotiating Committee says that the proposals
risk increasing NHS costs and reducing accessibility and choice for patients.
In a two-stage plan, the DoH wants first to cut and equalise reimbursement
to community pharmacies and other contractors that dispense prescriptions
for medical appliances. In the longer term, it wants to move to a system
of either tendering
or reference pricing for service levels (PJ, 29 October
2005, p538).
In its response to a DoH consultation (PDF 210K), the PSNC says that
cutting reimbursement to pharmacy contractors — who are already
at a financial disadvantage to appliance contractors — will result
in pharmacies not supplying appliances, while the smaller number of appliance
manufacturers,
with
vertically integrated supply chains, corner the market. The PSNC advocates
changing both reimbursement and remuneration at the same time. It wants
a level playing field for both pharmacy and appliance contractors with
fixed remuneration rates based on the cost of providing services plus
a fair return, as in the new pharmacy contract.
The National Pharmacy Association, too, favours the establishment of
service remuneration rates. It says that this will support the principles
of the new pharmacy contract and will aid progression from a volume-based
system to one that rewards service and quality.
The Company Chemists Association has also rejected the proposed two-stage
approach. It favours a system that calculates reimbursement prices from
the net acquisition costs incurred by contractors after any discounts.
This would require separate discount scales for pharmacies that supply
appliances and the vertically integrated appliance contractors.
Dissatisfaction with the proposals is not restricted to pharmacy organisations.
Appliance wholesalers have also expressed fears over the possible changes.
Derryck Bond, a director of appliance wholesaler Donald Wardle & Son,
said of the planned two-stage approach: “The dramatic reduction
in reimbursement for current products could lead to manufacturers squeezing
margins to specialist wholesalers who already operate on narrow net margins.” |
The
Pharmaceutical Journal
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