Written evidence submitted by Dispensing Doctors Association (FGP0214)

Opening Statement


The Dispensing Doctors’ Association (DDA) represents 4050 GPs in 1,058 dispensing practices, which accounts for fifteen per cent of all GP practices.  It is the only organisation that specifically represents the interests of dispensing doctors and their 9.7 million dispensing patients.


If a patient lives in a rural area, known in the NHS (Pharmaceutical and Local Pharmaceutical Services Regulations) 2013 as a ‘controlled locality’, more than 1.6km from a pharmacy, they can apply to the NHS for their local GP surgery to dispense medicines to them.  This has been the case since 1911The GP practice dispenses to these patients because of their lack of easy access to a community pharmacy. 


Patients enjoy the convenience of the ‘one-stop-shop’ service offered by their surgery and the CQC has found that dispensing practices receive a disproportionate number of ‘outstanding’ ratings following their inspections. 


For the purposes of dispensing, the NHS regulations assume that the GP practice is run as a partnership, so any move away from the partnership model in rural areas would endanger GP dispensing and much of rural general practice. In 2010, the Department of Health, funded the Cost of Service Inquiry (COSI) into dispensing doctors, at a cost to the taxpayer of £150,000.  The COSI demonstrated that up to half of a dispensing practice’s income is derived from dispensing. 


Of the dispensing income, nearly 40% is made up of drug reimbursement costs,[1] and dispensing profits are particularly sensitive to changes in drugs costs.  We have been asking for reforms to the system of drug reimbursement for over five years because, as Robert Francis said, in his first report, that "...it should be the patients - not numbers - which counted."[2]  We believe that the current system of reimbursement is not adhering to that principle.


If the current system continues indefinitely, we are concerned that some rural practices will cease to be economically viable. This concern is based on statistics from the COSI. In addition, the Scottish Health Department has acknowledged that the cross subsidy from dispensing income ensures that rural GP practices are economically viable.[3] Where dispensing income has been lost, at least three Scottish practices have closed in the recent past.  One Health Board was forced to keep a practice open through the use of locums, which is expensive for the NHS and not providing patients with the kind of continuity of care to which they are used, or deserve. 

The drug payment mechanism for dispensing doctors is set out in the Statement of Financial Entitlements (SFE) of the GP contract, which is formally linked to the Drug Tariff (DT), where approximately one third of community pharmacy’s funding, agreed with NHS England and the DHSC, is delivered using margin retained on the purchase of medicines for dispensing against NHS prescriptions.  There is currently no funding mechanism in the dispensing doctor contract relating to margin. Local prescribing policies and patient mix can have a significant impact on the delivery of this income given the unequal distribution of margin across medicines.


In rural and coastal England, practices are also closing.  The Daily Telegraph reported over the summer of 2019 that 1,946 villages are at least three miles from the nearest GP practice, which is 162 more than was the case four years ago.[4] In many rural communities, the dispensing GP practice is perhaps the last public service left standing.  Banks, post offices and pubs have declined markedly over the last twenty years.  The dispensing practice is the one-stop-shop for the public’s health and care needs. 


Many of the developments in general practice over the last ten years have favoured urban practices.  For example, Primary Care Networks (PCN), where groups of practices work together to share staff to deliver services, work well in towns and cities, where economies of scale can be achieved.  However, in rural communities one practice can serve an area of upwards of one hundred square miles, where public transport is almost non-existent.  In addition, a lack of high-speed broadband and poor, or non-existent, mobile ’phone coverage can hamper the delivery of remote services. 


It seems that policy solutions are being developed by those who rarely venture beyond the city limits and who seem to believe that ‘one-size-fits-all’ approach is the ‘silver bullet’ to the problems in general practice.


The DDA believes that small is beautiful.   With a small, for the NHS, amount of capital investment, practice premises can be modernised so that surgeries can host community health and social service teams on site.  Hospitals could even conduct outpatient clinics at surgeries, as used to be the case in the days of GP Fundholding and, indeed, before the internal market was invented in the early 1990s.  It used to be the case that hospital consultant consultations took place in many urban health centres during the 1980s and 1990s.  With targeted investment in decent broadband, there is also the possibility that remote consultations with hospitals might even be possible. 


Health and Wellbeing Boards are responsible for the publication of Pharmaceutical Needs Assessments (PNAs).  Unlike Wales, English PNAs do not count dispensing doctors as providing full pharmaceutical services.  This can, and has, led to new pharmacy applications which, if granted, can lead to the loss of some, or all, of a practice’s dispensing rights.  This can destabilise the finances of a practice, rendering it unviable.  Once a GP practice closes in rural community, it is unlikely to re-open, with the obvious detrimental consequences for the community. 


In addition, so-called ‘unforeseen benefits’ pharmacy applications can result in the loss of both GP dispensing and existing rural community pharmacies.  The DDA believes that the NHS (Pharmaceutical and Local Pharmaceutical Services Regulations) 2013 should be amended to remove the ‘unforeseen benefits’ application category, in addition to the full recognition of dispensing practices.  In Wales, the Government has recently introduced regulations which do precisely this, which has been welcomed by both rural pharmacy contractors and dispensing practices alike. 


Our experience is that there is no attempt to ‘rural proof’ policy in either the DHSC, or NHS England.  The Committee should note that ‘rural proofing,’ was recommended by Lord Cameron of Dillington in his report of 2015[5], with subsequent implementation guidance from DEFRA in 2017[6]. Indeed, the policy’s genesis can be traced back to the early 2000s.  It is an indictment of successive governments that the policy has not been embraced.  Whenever the DDA has raised the subject in discussions with officials we are met with blank looks or, on one memorable occasion, were told that: “rural proofing is a DEFRA issue.”


Had rural proofing been embraced by the DHSC and NHS England, rural dispensing practices would have been included in the Electronic Prescribing Service (EPS) from the outset. To date, they remain outside the scope,” to quote one official. The consequences are that practices are still parcelling up paper prescription forms at the end of each month and sending them by Royal Mail to the NHS Business Services Authority for processing, when the rest of the primary care are sending electronic messages.  No doubt, the lack of decent broadband in rural communities is a contributory factor, but this demonstrates how rural services are neglected.


The initial phases of EPS were considered to have been implemented too slowly by pharmacies, so a £200 monthly fee for EPS was introduced, which was subsequently included in the pharmacy single activity fee.   Unlike a pharmacy, dispensing practices do not have any ability to gain extra patients, or income, as a dispensing practice exists because there is no pharmacy for patients, who qualify under strict rules. Therefore, it appears totally iniquitous that NHS England should take the view that dispensing practices should fund the introduction of EPS out of their own budgets.  It is absolutely essential that rural GP practices have access to superfast broadband/5G as a matter of urgency.  The COVID-19 pandemic has demonstrated the necessity of the best possible communications technology.


Dispensing practices are not permitted to sell over-the-counter (OTCs) to their patients, due to the vagaries of the NHS regulations.  This outdated prohibition needs to be removed in order to promote better self-care.


Rural GP recruitment remains in a perilous state, putting further pressure on an already beleaguered and exhausted healthcare teamWe requested evidence on the current situation from DDA  members.  Their responses are quoted in full below.


We're down two GPs, its not pretty. We're advertising continuously, we are getting new GPs but others have left/retired faster over the last year. I imagine that it is harder for rural and market town practices than those in cities to recruit. Most new GPs don't want partnership (a few do), so a dispensing practice may not be as attractive as it once was.  It is easier to recruit nurses and paramedics generally. My impression is the pool of excess pharmacists is now used up so they're hard to get hold of now. (Dispensing GP partner in south-east of England)


My practice is fully staffed , but that is because we are training practice and 5 out of 6 last recruits have been our traineesWe really look after the trainees, 3 out of 6 of them now partners after initially being salariedOther local practices are struggling especially one run by the Acute Trust.  Practices in Exeter can recruit as so many of the consultants at the hospital have wives who are GPs. Dispensing practices do better than non-dispensing, but practices in Plymouth are in real problems; the system there is nearly broken.” (Dispensing GP partner in south-west of England)


We are down by 1 salaried GP, and trying to recruit an additional one because the practice list has grown by 30% in 2 years.  There are very few GPs around and it is often a case of ‘robbing Peter to pay Paul,’ as GPs move from other nearby surgeries; effectively just moving the vacancy around.  Our neighbouring practices are at least 2-3 GPs down and have been for at least 18 months and so everyone is advertising. Their lack of GPs is one of the reasons why patients are migrating to us, magnifying our problem.  Nurse recruitment is not bad, but there are no Physicians Assistants to be found.  Our biggest problem here seems to be that no-one wants to come to East Anglia, although once they do, they stay forever as younger GPs migrate to London.  (Dispensing GP partner in East Anglia).


“The local practice I locum in is doing OK and has recruited both a new salaried GP & a paramedic. 
Often in Ayrshire, the experience is similar to parts of England with GPs swapping from one local practice to another.  One issue for the two Girvan practices is providing community hospital cover, which puts some applicants off. Arran has bucked the trend, but that is because of the rural fellow scheme, which gives extra time in a rural practice providing part service delivery and part additional education around rural practice. (Retired Scottish dispensing GP partner).

We are down a salaried GP. We’ve advertised three times with no applicants.” (Dispensing GP partner, South Wales)

Some of our losses have been to the private online GP platforms, for example doctorcareanywhere. They offer £9.5k per session with 20 minute appointments and no paperwork, so very attractive to salaried GPs. I think there'll be an ongoing migration. (Dispensing GP partner, South-East of England).  On this point, it is our view that these sorts of jobs are attractive at the moment, but we doubt that any of these types of online provider has a profit making business model at present, and some are leaving the market.  This may mean that salaried GPs will move to other more traditional forms of practice eventually.
Select Committee Questions

An Insufficient number of GPs and associated health care professionals, arising from no significant workforce planning and a lack of investment in the GP contract, including premises and IT since 2010.

There is not enough targeted investment in practices and workforce.  Most of the investment is being driven via Primary Care Network (PCN) services and yet another reorganisation of the bureaucracy.

They go to A&E, which costs the NHS more, or they stay away altogether with the obvious consequences.

Some, but in reality, many patients will see other GPs or health professionals within the practice.  This was also true before the 2004 contract was introduced.

Workforce. There are not the numbers coming through the system to replace those who are retiring.  The pension tax will also force many older and experienced GPs to retire early; many have already done so.

Considerably.  Please see our statement above.

90% of patients interact with the NHS general practice/primary care.  With the right structure and incentives in the contract, GPs can improve public health. The QoF and Target Payments before them had the effect of improving health outcomes; these were payments direct to practices, not via PCNs.

The current GP contract was supposed to be ‘high trust, low bureaucracy.’  NHS England was set up to ensure that the system did ‘one thing, one way.’  This has never been the case because regional teams and local managers cannot resist the micro-management of contractors. Until they are formally told to ‘back off,’ or given other more important tasks to perform, this will not change. In fact, maybe a great cost saving to the NHS would be to make this cadre of managers redundant and re-direct the savings into frontline care. 

Sustained investment in practices and making working in general practice more attractive.  There used to be many innovative schemes involving medical schools/postgraduate deaneries and training practices.  Often with the use of ‘golden hello’ payments.  See our remarks about workforce above in relation to Scotland.

In particular:


Yes, if investment is made in practices and not via PCNs.  The 2004 contract solved the problems with recruitment/retention within several years.  The current problems stem from the reduction in investment in the GP contract from 2006 onwards and excessive micromanagement by NHS England. Similarly, the development of modern general practice can be traced to the GP Charter of 1966.  The lesson is clear: invest in practices with payments linked to health outcomes and the results will follow. 

Yes, if there was consistent investment and removal of regional NHS England teams who micromanage practices.  In addition to investment in IT systems which are designed around the needs of GPs and their teams. 

Please see our remarks above about PCNs.  We are not opposed to working together, but this can be constrained by technology (slow broadband and mobile coverage) and the way in which staff are employed i.e., the application of VAT

GPs have been doing this for decades.  Practice teams have expanded since the 1970s to employ nurses and other health professionals.  They work best when they are employed by the same entity and work under the same roof.  The fragmentation in recent years has often compounded the problem.  For example, where nurses are employed by community Trusts, they have been removed from practice premises to work from other premises, so they lose familiarity with the practice teams and patients; the opportunity to discuss patients with GPs and other staff is lost.  Good IT will ameliorate this, but it needs to be designed around the needs of the those using it. 

There is a misguided view amongst policy makers that new management structures will solve every problem.  The evidence from the last thirty years is that they simply compound them.  The NHS needs to roll back the frontiers of the bureaucracy and leave healthcare professionals to do their jobs, with the appropriate resources.


Dispensing Doctors’ Association

13th December 2021


December 2021

[1] Cost of Service Inquiry for Dispensing Practices, Department of Health, September 2010, p46 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/215502/dh_128817.pdf

[2]Robert Francis QC, quoted in the Report of the Mid-Staffordshire NHS Foundation Trust Public Inquiry, Volume 1: Analysis and Lessons Learned, Part 1, p11, 2013.

[3] David Thomson, Scottish Government to Health & Sport Committee of the Scottish Parliament, Tuesday 24 June 2014, Column 5732:

“…It is important to note that dispensing income for GPs is never intended to cross-subsidise the delivery of core services. That is in our Statement of Financial Entitlement and those directions are the financial basis for the regulations. We do know that that is not what plays out on the ground. It is important that we recognise that, even if the rules state something slightly different.”


[4] Daily Telegraph, Wednesday 26th June 2019, pages 1 & 6.

[5] Independent Rural Proofing, Lord Cameron of Dillington, DEFRA, January 2015


[6] Rural Proofing, DEFRA, March 2017