Dispensing doctors’ income is under pressure from Government policy in two UK nations, as a result of insufficient rural proofing.

Dispensing GP surgeries are mainly located in rural locations, where a community pharmacy is not economically viable. Dispensing practices therefore provide a vital NHS service for rural populations, which typically, are older than urban populations.

Funding for rural medical services is fundamentally propped up by dispensing income. A Cost of Service analysis of dispensing practice has demonstrated that up to half of a dispensing practice’s income is derived from dispensing. Of this dispensing income, more than half is made up of dispensing fees.

In Scotland the principle of cross-subsidy of general NHS GP services by dispensing income is recognised and now enshrined in legislation controlling pharmacy applications in areas where dispensing GPs operate.

A recent initiative by the Welsh Government seeks to reduce the volume of prescriptions dispensed in Wales – and thus the dispensing fees it pays - in a cost-saving measure for the NHS. However, the review of dispensing volumes in community pharmacies takes no account of the whole range of funding mechanisms for dispensing GPs – only some of which are shared with pharmacies. Nor does the planned review take account of the higher costs of service delivery that are common among rural service providers, including dispensing GPs.  

Faced with similarly increasing drug costs the health administration in England has also proposed a review of community pharmacy drug reimbursement which, as in Wales will impact on those areas of funding that are shared with dispensing GPs.

Due to the highly urban nature of most pharmacies, this review also lacks rural proofing. A consequence of this is that there may be changes that adversely affect the overall financial situation of dispensing GPs. Analysis of dispensing practice funding finds that nearly 40 per cent of overall dispensing income is made up of drug reimbursement payments.

Loss-making dispensaries will have a profound effect on the viability of rural general practices and the delivery of healthcare services in rural areas. Reimbursement mechanisms should as far as possible be designed to prevent dispensing doctors dispensing prescriptions at a financial loss, and as far as possible, provide certainty of reimbursement to dispensing doctors.