Prescribing

Statistical Publication Notice

30 March 2010

Reimbursement and remuneration paid to dispensing contractors, and quarterly update of prescription charges

Reimbursement and Remuneration

Prescription Charges

INTRODUCTION

KEY POINTS

• The gross total payments to Scottish dispensing contractors continues to increase year on year.
• The net ingredient cost (NIC) paid to dispensing contractors for drug reimbursement continues to increase, as does the cost for remuneration of services.

• Since April 2008, total income generated by sales of prescriptions continues to steadily decrease.
• The volume of prescription items dispensed where the patient holds a pre-payment is increasing, whilst the volume of prescription items dispensed where the patient pays a charge at the point of issue is decreasing overall.

INTERPRETATION

• On the 29th of August 2008, the new patient service elements of the Public Health Service (PHS) was launched in Scotland.  Services covering smoking cessation and sexual health (Chlamydia advice, testing and treatment) and emergency hormonal contraception are detailed in circular PCA(P)(2008)17. 
• As detailed in circular PCA(P)(2009)(18) , the generic discount (clawback) rate was set at 13.25% until 1 April 2008 when a 1.85% temporary abatement was introduced.  A further reduction of 10.4% took effect from October 2008.  The effects of this may be seen in the net ingredient cost (NIC) changing at a higher rate than the GIC.

• For the purpose of these analyses, total prescriptions do not include Minor Ailment Service (MAS) and Stock Order (SO) forms because prescriptions written on these form types are exempt from charges.  An example of a stock order item is influenza vaccinations.  In addition, only those items both prescribed and dispensed in Scotland are included in the analyses.
• The 2008/09 total income from pre-payment certificates does not reflect £0.5 million of refunds made to patients.

DETAILED FINDINGS

Remuneration:

• The gross amount of payments to community pharmacies for the calendar year 2009, in respect of various fees and allowances for dispensing prescriptions and providing pharmaceutical services was £1,131 billion.  This is an increase of £36m when compared to the calendar year 2008.
• 18% (£203m) of the gross total is attributed to the remuneration of services, which increased by over £6m.  The fees and allowances have been revised from April 2008 as explained in circular PCA(P)(2008)13 and these payments make up the majority of the increase.  Payments to the minor ailment service (MAS) have increased (by 20%).  This is attributed to more patients registering for the service, therefore pushing pharmacy capitation payments up to the higher bands.
   
  82% (£928m) of the gross total is attributed to the net ingredient cost (NIC) of drugs, showing an increase of over £29m on the previous year.
• When compared to the calendar year 2008, patient charges for dispensing of single prescription items in 2009 reduced by £9m to just under £21m.  This drop is attributed to the price of a single prescription reducing from £5.00 to £4.00 in April 2009; as detailed in circular PCA(P)3M(15)(2008), as well a rise in the purchase of prepayment certificates.

Prescription charges:

• The total number of items dispensed continues to increase.  Compared to the first three financial quarters in 2008/09, the number of prescription items dispensed in Scotland (excluding Minor Ailment Service & Stock Order) was 66.0 million.  This is a 4% increase when compared to the first three quarters of 2008/09.  Over the same period, the gross ingredient cost (GIC) increased to £735.1m (1%).
• Compared to the first three quarters in 2008/09, the number of items dispensed where the patient held a valid PPC increased by 12% to 4.0 million items in the first three quarters of 2009/10.   The GIC of drugs dispensed on these prescriptions rose by 7% to £49.2m.
• In the same time period, the number of items dispensed where the patient paid a charge at the point of issue decreased by 5% to 3.7m items, and the associated GIC decreased by 13% to £36.1m.
• In the first three quarters of 2009/10, almost 45,000 (15%) more prepayment certificates (PPCs) were sold than in the first three quarters of 2008/09.
• Income generated by prescription and PPC sales continues to decrease.  At £20.5m, the total income in the first three quarters of 2009/10 was 22% less than in the first three quarters of 2008/09.

MAIN CONTACTS:

Caroline Murray
Information Analyst/Statistician
0141 282 2118
Healthcare Information Group (Prescribing)
Caroline.Murray@nhs.net

Joanne Collins
Senior Information Analyst/Statistician
0131 275 6760
Healthcare Information Group (Prescribing)
JoanneCollins@nhs.net

Jane Chisholm
Principal Information Analyst 
0131 275 6197
Healthcare Information Group (Prescribing)
Jane.Chisholm@nhs.net

GLOSSARY:

Part 7 drug discount rate is the total discount applied to those items which are in Part 7 of the Scottish Drug Tariff.  This discount is applied to drugs dispensed by community pharmacies.
An item relates to the number of ingredients dispensed, not an individual product written on a prescription i.e. if one product is an amalgamation of two ingredients this is counted as two items, not one.  Where the patient is eligible to pay the prescription charge he/she is charged £4 per individual product written on a prescription (from April 2009).
Gross ingredient cost (GIC) is the NHS reimbursement cost of drugs, dressings or appliances before the deduction of any discount.  It excludes any dispensing or fitting fees.
The Minor Ailment Service (MAS) is for patients who are exempt from paying a charge on their prescriptions.  Additional related information on eligibility for MAS can be found at: http://www.isdscotland.org/isd/5033.html
An example of a Stock Order (SO) is where a GP writes a prescription to the pharmasist, on a form specifically for SO, to order flu vaccinations.  There is no charge applied to these form types.

PRE-RELEASE ACCESS:

HISTORY OF THIS PUBLICATION:

Last Published: 29 September 2009
Next Due: 30 March 2010
Data Available Since: 
Remuneration was first published January 2002.
Prescription charges – General information on the cost of a single prescription and the percentage of prescriptions dispensed free of charge has been published since March 1980.  Exemption grouping data were released for the first time in June 2009.  Income data including pre-payment certificate data are released for the first time in this publication.

Main contact: Caroline Murray

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