Financial Framework

Financial Framework 2016/2017

Financial Framework 2016/2017

1. Advance Payment

2. Margin Sharing Arrangements

3. Dispensing Pool Payment

4. Establishment Payment

5. Pharmaceutical Needs Payment

6. Care Home Element

7. Quality and Efficency Payment

8. CMS Capitation Payment

9. Operations and Development Payment

10. Minor Ailments Service

11. Public Health Service

12. Payments to Essential Small Pharmacies

13. Payments to New Contractors

14. Training Grants

 

1. Advance Payment

The calculation of this payment is no longer linked to GP34 submission and Average Item Value. From April 2014 the payment is based on 90% of the previous rolling 12 month total gross amount. This should make the advance payment more predictable for contractors.

Where a contractor or its predecessor has a history of less than 12 months actual payments at the time the advance payment is calculated, it will be calculated as 90% of the mean of the number of actual months for which data is available.

For brand new contractors the advance payment will be calculated as follows:

  • Month 1 Advance = (no. of days open/31) x £18,000
  • For contractors who opened on 1st of a month, their Month 2 and subsequent Advance will be calculated as 90% of the mean of the number of actual months for which data is available
  • For contractors who opened after the 1st of a month, their Month 2 Advance will equal: (no. of days open/31) x £18,000; then month 3 and subsequent advances until a 12 months history is available will be calculated as 90% of the mean of the number of actual months for which data is available

2. Margin Sharing Arrangements

These arrangements, outlined in PCA(P)(2016)7, cover:

  • The level of guaranteed minimum funding for contractors (increased from 83.5m to £93.5m)
  • The sharing arrangements beyond that figure
  • The steps which will be taken to ensure that cash flow continues to flow at the level seen in 2015/16
  • The steps to ensure that amounts due to health boards in respect of previous years’ arrangements are returned within 2016/17
  • Generic clawback will be baselined at 3% from April 2016 and may be adjusted on in year monitoring.

3. Dispensing Pool Arrangements

The value of the Dispensing Pool was enhanced to a monthly aggregate pool of £6.171 m from July 2016. An analysis of each contractor’s non care home prescription activity (for both standard and instalment prescriptions) is carried out on a quarterly basis and the appropriate share allocated. Figures for methadone prescriptions, any items provided using the CPUS form or MAS prescriptions are not included in this calculation. The timetable for this activity during 2016/17 will be:

Month when dispensing allocation is established

Month when dispensing pool payment is made

Bank Payment at Month End

September 15 - November 15 April 16 - June 16 June 16 - August 16
December 15 - February 16 July 16 - September 16 September 16 - November 16
March 16 - May 16 October 16 - December 16 December 16 - February 17
June 16 - August 16 January 17 - March 17 March 17 - May 17

4. Establishment Payment

This payment was first introduced from 1 October 2013 under stage one of the two-stage final move out of transition. The value for this ongoing fixed rate payment is £1730 (except for part-time ESPs) and it is made up from the following existing payments:

  • Payment Supplement
  • PHS Payment Core Element
  • Infrastructure Support Payment
  • Unscheduled Care Support payment
  • Plus the base level payable previously for the professional allowance (= £575)

This reallocation of payments means that there will be no more mention of the above payments on any payment schedules.

The establishment payment will be scaled for Essential Small Pharmacies in accordance with the existing provisions for opening hours.

5. Pharmaceutical Needs Payment

This element of the remuneration represents £3.843m from the global sum.

The way the proportion of funding is allocated to each contractor is set out below.

ISD has analysed all prescriptions dispensed in every pharmacy between December 2014 through to November 2015. The postcode and CHI data of the patients who presented these prescriptions were used to look at two factors:

  1. The proportion of patients aged 60 or over with dispensed prescriptions
  2. The % of patients with postcodes in the two most deprived Scottish Index of Multiple Deprivation (SIMD) areas

These two factors are combined to produce a combined index for each pharmacy.

Age

Age Index

SIMD

SIMD Index

75% or more of patients under 60 years 1.0 40% or less of patients with postcode in the two most deprived quintiles 1.0
Between 65% and 75% of patients under 60 years 1.2 Between 40 and 60% of patients with postcode in the most deprived quintiles 1.2
Between 65% and 75% of patients under 60 years, with more 75+ than 60-74 1.3 Between 40 and 60% of patients with postcode in the most deprived quintiles, and more in the most deprived quintile 1.3
Between 55 and 65% of patients under 60 years 1.4 Between 60 and 80% of patients with postcode in the most deprived quintiles

1.4
Between 55 and 65% of patients under 60 years, with more 75+ than 60-74 1.5 Between 60 and 80% of patients with postcode in the most deprived quintiles and more in the most deprived quintile 1.5
Between 45 and 55% of patients under 60 years 1.6 Between 80 and 90% of patients with postcode in the most deprived quintiles 1.6
Between 45 and 55% of patients under 60 years, with more 75+ than 60-74 1.7 Between 80 and 90% of patients with postcode in the most deprived quintiles and more in the most deprived quintile 1.7
Between 35 and 45% of patients under 60 years 1.8 More than 90% of patients with postcode in the most deprived quintiles 1.8
Less than 35% of patients under 60 years 2.0 More than 90% of patients with postcode in the most deprived quintiles and more in the most deprived quintile 2.0

The combined index found by adding the two scores and dividing by 2 is then applied to the payment pool and a proportional distribution made for each contractor. The index notified at the beginning of the financial year will remain in place for the full year. New contractors will be allocated an index of 1.0.

6. Care Home Element

The Care home element is available to any contractor whose prescriptions for care home patients represents more than 2.5% of their total activity. The sum of £3.816m has been set aside from the global sum to pay for this activity.

Every quarter each contractor’s prescriptions are analysed using the separate care home marker to find how many items have been dispensed for patients resident in care homes. Where the percentage found is less than 2.5% of total activity no further action is taken. For contractors where the percentage is more than 2.5% of overall activity, a share of the funds available is allocated in proportion to their share of the national number of items dispensed. The analysis is carried out at the same time as that for the dispensing pool allocation.

7. Quality and Efficiency Payment (QEI)

Circular PCA(P)(2015)26 issued in October 2015 outlines the most up to date criteria to receive this payment. To receive any payment, a contractor will have to achieve a rate of electronic claims of at least 90%; below this threshold there will be no payment. An electronic claim rate of 90% will see payment capped at the target QEI for that contractor.

8. CMS Capitation Payment

This payment was first introduced in October 2011 and each contractor was notified of the amount that had been set aside from their then transitional payment for redistribution as a CMS capitation payment. That money was then pooled. The size of this pool was doubled in October 2012 to £3M per month. Each contractor is given a share of the pool depending upon the activity carried out around CMS in their pharmacy.

At the end of each month the number of CMS registrations across Scotland, where the initial assessment process on the Pharmacy Care Record (PCR) has been completed, is established both for the individual contractor and nationally. The contractor’s share of the pool is then calculated.

Each contractor’s share is not allowed to deviate by more than 10% either way from the amount that the contractor had allocated to the central pool.

Contractors who have not signed up with the NHS Board to provide CMS as an additional service will not be eligible to receive the CMS capitation payment. Community Pharmacy Scotland advises all contractors to check their position with their NHS Board if they have been granted a contract or where a contract has changed hands.

9. Operations and Development Payment

Operations and Development Payment

From October 2013 dispensing, pharmacy contractors became eligible for the new Operations and Development Payment (OD Payment) which replaced the CMS Phasing Payment. There is a fixed and a variable element to the payment.

The amount due to each contractor has been recalculated for all contractors using the GIC figures found between 1 December 2014 and 30 November 2015 according to the following equation:

£4.307m  x  (Contractor Part 7 non ZD GIC)  x  100
                  National Part 7 non ZD GIC

A fixed element of £125 is available for all contractors (including those who have no Part 7 dispensing history) who have signed up with the NHS Board to provide the gluten free foods additional pharmaceutical service. Contractors were asked to opt-in with their local Health Boards for this service. We advise all contractors to check their position with their NHS board if they have been newly granted a contract or where a contract has changed hands with regards to provision of this service.

From 1st of August 2016, where a significant proportion of CHI numbers are invalid or missing from contractors claims a deduction to the fixed element of the O&D payment will be applied as follows: -

Level 1: (to apply during the period 1st August 2016-31st October 2016)

            £50 deduction monthly where CHI capture is less than 90%

Level 2: (to apply during the period 1st November 2016-31st March 2017)

            £125 deduction monthly where CHI capture is less than 50%

            (Important to note that Level 1 is also applicable in Level 2 also)

These deductions will be monitored and reviewed for 2017-18.

The variable portion of the payment calculated as above less £125 is currently linked to two elements:

  • Maintaining prompt assessments after CMS registration
  • Producing Standard Operating Procedures (SOPs) for serial dispensing of CMS prescriptions

For each element that is not achieved the contractor could lose 25% of the non-fixed payment.

10. Minor Ailments Service

Minor Ailments capitation payments are based on the number of patients registered with the pharmacy. The table below shows the bands and corresponding payments:

Band

Number of Registered Patients

Capitation Payment Annual

Capitation Payment Monthly

1 1 - 250 £7300.92 £608.41
2 251 - 500 £9,253.92 £771.16
3 501 - 750 £11,208.00 £934.00
4 751 - 1000 £13218.00 £1101.50
5 1001 - 1250 £15228.00 £1269.00
6 >1250 £15228.00 + £8.04 per head beyond 1250 £1269.00 + £0.67 per head beyond 1250

Changes in ownership

Where a pharmacy changes hands over the course of a month the MAS capitation payment is made to the contractor on the pharmaceutical list on the last day of the month.

Payments to Essential Small Pharmacies for MAS

Payments to Essential Small Pharmacies are scaled in accordance with the existing provisions for opening hours.

11. Public Health Service

Patient Centred Services

It has been agreed to maintain the payment of the intervention fee for the smoking cessation and the EHC service where treatment is supplied. Any contractor asked to provide the Chlamydia Testing and Treatment service should ensure the local NHS Board has agreed a service specification and payment structure with the local Community Pharmacy Health Board Committee.

The fees agreed are as follows:

Smoking Cessation Service under service specification in place from 1st July 2014

Quit Attempt Event

MDS Submission

Remuneration

Event A
Submission of the MDS information with confirmed quit date (normally first return appointment)

To be electronically submitted once the quit-date is confirmed with client. This will form the basis of the timelines for the four-week and twelve-week post-quit date follow-ups. £30.00

Event B
Four week post-quit date

To be electronically submitted immediately after the four-week post-quit date and not later than six weeks from the confirmed quit-date. £15.00

Event C
Twelve week post-quit date

To be electronically submitted immediately after the twelve-week post-quit date and not later than sixteen weeks from the confirmed quit-date. £35.00

Sexual Health Service Part A-Chlamydia Service

This service will be subject to local negotiations. It no longer forms part of the national specification.

Sexual Health Service Part B-Provision of Emergency Hormonal Contraception

Payment Element

Amount

How to Claim

Fee Per Intervention

T£25 per intervention where a patient is prescribed and supplied treatment for Emergency Hormonal Contraception

Claim forms to be sent to Pharmacy Payments at PSD by the 7th working day of the month.

CPUS scripts for Levonorgestrel and Ulipristal Acetate should be submitted to PSD for payment in the bundle

Opting Out Provision of PHS Sexual Health Service-Part B

Participation in the Sexual Health Service Part B is optional but contractors who wish to opt out and have not already done so should inform their NHS Board and PSD if they decide to opt out.

Support for Meningitis B vaccination programme

This relates to the provision of prophylactic antipyretic (paracetamol) in advance of or following childhood meningitis B vaccination. The service was introduced from 1 October 2015 and contractors who have signed up with their NHS board to provide the service will receive with effect from October 2015 dispensing a monthly payment of £40.

12. Payments to Essential Small Pharmacies

Guaranteed minimum target income for ESPs

The aggregate of Establishment Payment plus Dispensing Pool plus Pharmaceutical Needs Weighting Payment made to an ESP each month will also be subject after any stabilisation to a guarantee of a minimum target income. From 1st July 2015 it the target income is £3,804 for full time contractors.

An equivalent guarantee for part time contractors is to be calculated as follows:

Hours contractor is open     % of above guaranteed payment for full time contractors

>5 </=10                         60%

>10</=15                        75%

>15</=20                        85%

>20</=25                        90%

>25</=30                        95%

>30                                 100%

The aggregate of Establishment Payment plus Dispensing Pool plus Pharmaceutical Needs Weighting Payment to be made to an ESP each month will be calculated as for all other contractors and if that aggregate is less than the level of the guaranteed minimum payment a top-up - the Essential SmallPharmacy Allowance – equivalent to the shortfall will be paid for the months concerned.

To be eligible for this minimum guaranteed target income for ESPs a contractor must be included in the register of essential small pharmacies held by their host NHS Board, and if a successor to an existing ESP, have their continued inclusion in the ESP register ratified by the Health Board.

13. Payments to New Contractors

New contractors will be eligible to receive:

Establishment Payment £1730
Dispensing Pool Allocation £750pm for 3 months
£750 per month for next quarter or calculated amount due from dispensing pool whichever is the greater
Calculated amount due from dispensing pool
Pharmaceutical Needs Payment Amount due for a contractor with a combined index of 1
CMS capitation payment Minimum monthly payment of £600
QEI Payment Target payment of £150
MAS Payment In line with number of patients registered
PHS Payment In line with activity

*Dispensing Pool payment – special arrangements for contractors recently added to the Pharmaceutical List, and/or with incomplete dispensing history, or whose dispensing pool payment would otherwise fall below a minimum target

A minimum monthly payment of £750 will apply for dispensing months April 2016 onwards in respect of eligible contractors who were not on the list, or who did not have a predecessor contractor on the list for the relevant prior reference period used when calculating dispensing pool payments. That minimum payment would then remain in place until the contractor has 3 (three) consecutive months dispensing activity to be used for the determination of the dispensing pool payment.

However, where a contractor recently added to the list considers that the £750 payment does not fairly reflect their share of overall dispensing activity in the first 3 months of operation they may make a specific request to ISD within 9 months of the dispensing months concerned for a retrospective adjustment calculation to be carried out. This would establish whether an adjustment calculated by reference to the previous quarter’s dispensing pool would be appropriate. Where the total amount due is less than the £750 already paid no further action will be taken. Where the amount due exceeds £750 an adjustment will be made as soon as practical for the dispensing months concerned and if necessary as a retrospective payment. This provision is back dated to apply for payments related to dispensing month April 2015 onwards.

14. Training Grants

Training Grants

Contractors will once again be able to apply for a training grant of up to £800 for a member of staff who has commenced a course booked after 1st April 2016. Only one grant is available per contractor. Eligible courses include:

  • Pharmacy Services Level 2 or 3 (S/NVQ)
  • Accredited Checking Technician: NPA Accuracy in dispensing Training Module or equivalent
  • SQA Higher National (HN) Unit: Procedures for Pharmacy Dispensary Checking Technicians.

The claim and payment process is managed by NHS Education for Scotland (NES) Pharmacy. Claims should be submitted, on the form attached at Annex A of PCA (P) (2016) 8 (available on our website), together with the required documentation by 31st January 2017 to:

Anne Watson
NES Pharmacy
3rd Floor, 2 Central Quay
89 Hydepark Street
GLASGOW
G3 8BW