Contractor Update: PSNC secures £20m cash injection ahead of further funding negotiations

Contractor Update: PSNC secures £20m cash injection ahead of further funding negotiations

June 29, 2020

Ministers have agreed to inject a further £20m of advance funding into community pharmacies at the end of June.

This follows ongoing representations from PSNC about the cashflow problems facing many contractors and businesses as a consequence of the COVID-19 pandemic.

The total advance funding this month is smaller than in previous months because although contractors are still reporting additional COVID-19 related costs and cashflow problems, these are less than those which they experienced through the initial peak of the pandemic.

These ongoing costs must be covered, but there is also now an urgent need to reach an overall settlement on community pharmacy COVID-19 related funding, including on how the advance funding may need to be paid back in future.

The latest funding injection brings the total of the advance funding payments made in recognition of COVID-19 related cashflow challenges to £370m. PSNC’s strong view is that community pharmacy contractors must not have to pay back these monies, and we will continue to press for that.

PSNC’s bid for additional funding for the sector is still being considered by HM Treasury and the Department of Health and Social Care (DHSC) – we will update contractors as soon as we can.

The NHS Business Services Authority (NHSBSA) is calculating payments with the intention that the extra £20 million can be paid at the same time as the 1st July payment.

The latest payment comes as DHSC has also maintained the £15m uplift to reimbursement prices first seen in June.

NHSBSA website: COVID-19 uplift to pharmacy contractors’ payment on 1 July

PSNC Chief Executive Simon Dukes said:

“In April this year, working with the other national pharmacy organisations to gather data from contractors, PSNC put together a case for additional funding for community pharmacies to support them through the COVID-19 pandemic. That business case is still with HM Government: we believe the delay is a consequence of the COVID-19 related demands being put on all parts of Government, but we are continuing to stress the need for urgent answers and funding clarity for contractors.

These advance funding payments, combined with the continued uplift in reimbursement prices, should help to ease the immediate cashflow and procurement problems that we know many pharmacy businesses are still grappling with as a result of the COVID-19 pandemic. What contractors need now is certainty about the rest of the funding for this year: PSNC will keep fighting for this.”

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