Health Department
Directorate of Primary Care

Dear Colleague

PHARMACEUTICAL SERVICES - REVISION OF NET INGREDIENT COST SCALE FOR CHEMIST CONTRACTORS

Summary 1.

This Circular draws the attention of Island Health Boards, Primary Care and Integrated Trusts and chemist contractors to revisions to the net ingredient cost scale which was originally advised in NHS Circular: PCS(P)(2000)2 dated 5 May 2000. Background

2. PCS(P)(2000)2 advised that from 1 April 2000, dispensings would be subject to the provisional scale which was produced with the circular. It stated that work was continuing to determine whether there was any requirement to change the scale algorithm, which sets the shape of the scale.

3. PCS(P)(2000)2 also advised that a separate scale would be announced with respect to dispensings made during the period 1 April 1999 to 31 March 2000.

4. After discussions with SPGC, both the final scales have now been calculated.

Detail

5. With effect from 1 April 2000, dispensings will be subject to the graduated discounted recovery scale detailed at Annex A. This is designed to recover an average rate of discount of 8.9% and replaces the provisional scale announced in PCS(P)(2000)2.

6. For dispensings made during the period 1 April 1999 to 31 March 2000 the graduated discounted recovery scale is detailed at Annex B. This has been designed to recover an average rate of discount of 8.55%

7. These revised agreements have been agreed with SPGC.

8. The Drug Tariff will be amended in due course.

Action

9 These revisions to the clawback scale will be effected by Practitioner Services Division and Information and Statistics Division as follows:

9.1 Prescriptions dispensed 1 April 2000 onwards:
The amendment to the scale for dispensings 1 April 2000 onwards will take effect with June dispensed prescriptions and a reconciling additional payment or recovery as appropriate will be made with the June dispensed prescriptions payment for the contractors concerned. The amounts recovered by the new scale will be monitored by the department in conjunction with SPGC.

9.2 Prescriptions dispensed 1 April 1999-31 March 2000
The appropriate extra recoveries, due to the retrospective amendment of the scale in respect of prescriptions dispensed between 1 April 1999 and 31 March 2000, from contractors then on the list will be recovered with effect from the May prescriptions . Recovery in respect of those contractors who remain on the list will be by 18 equal monthly amounts. Contractors no longer on the list will receive an invoice for the total amount due as they leave the list. Retrospective recoveries will accrue directly to the Island Health Board or Primary Care Trust concerned. Further guidance is provided at Annex C.
9.3 Effect on allocations and prescribing reporting arrangements
There will be no changes to existing Unified Budget allocations as a consequence of these scale amendments. ISD will continue to provide performance reports in respect of prescribing budgets in notional NIC terms using the discount "factors" promulgated in the 5 January 2000 letter which announced 2000-01 allocations. The effect of these scale amendments on local budgets will vary between Trusts and Island Health Boards. ISD will provide information on the discrepancy between actual and notional discount in monthly reports to Primary Care Trusts and Island Health Boards commencing with April dispensed prescriptions.

10. Island Health Boards and Primary Care and Integrated Trusts should copy this Circular to all chemist contractors in their area who appeared on their lists on, or since 1 April 1999. It should also be copied to Local Health Care Co-operatives and GP Sub-Committees

Discount Scale 2000/2001(xls)

Discount Scale 1999/2000(xls)

Accounting Arrangements(doc)

Yours sincerely

DR HAMISH WILSON
Directorate of Primary Care

February 2000
________________
Addresses
For action
General Managers,

Island Health Boards

Chief Executives,
Primary Care Trusts

Chief Executive,
West Lothian Trust

General Manager,
Common Services Agency For information General Manager,
Mainland Health Boards
______________________________ Enquiries to:

Mr Blair White
Directorate of Primary Care
Room 29C/1
St Andrew's House
EDINBURGH EH1 3DG
Tel: 0131-244 3433
Fax: 0131-244 2621
email: blair.white@scotland.gov.uk
______________________________