Where’s the efficiency gain you’ll get from hub and spoke?

In an exclusive interview with Independent Community Pharmacist, John D’Arcy, chief executive of Numark, has questioned whether there will ever be a business case for widespread use of dispensing hubs, but promised that Numark would act as a hub for its members if the need arose.

The Department of Health is planning a consultation early next year on legislative changes that would allow independent contractors to operate hub and spoke dispensing models, and England's chief pharmacist Dr Keith Ridge has suggested that up to two thirds of prescriptions could eventually be dispensed this way.

But Mr D'Arcy questioned the motives behind this initiative. "It reminds me of when EPS was launched 20 years ago. Where's the business case? Does it make sense? It sounds very good but what does it mean and how does it work?"

Some multiples already operate hub and spoke models, but it is unclear how successful they are, or whether they are planning to expand. In the US, the use of dispensing hubs has plateaued at around 20 per cent of prescriptions.

Searching for the ulterior motive

"A hub and spoke doesn’t create itself, there’s an investment in that. But where does the payback come? If hub and spoke creates efficiencies what do we do with the savings?" Pharmacy would like to use any savings to deliver additional roles, but ultimately the Department of Health controls its margins and savings could simply be clawed back. Mr D'Arcy highlights the difference between efficiency savings, of which the NHS needs to make £22bn to balance its books, and simple cuts.

And cuts could be an ulterior motive behind encouraging dispensing hubs, for example, by reducing the number of pharmacies. England's deputy chief pharmacist Bruce Warner suggested at the Pharmacy Show recently that the current number of pharmacies could be hard to justify in the face of NHS efficiencies. But Mr D'Arcy points out the the Department of Health itself had encouraged recent proliferation in pharmacy numbers. Before the DH relaxed the control of entry regulations in 2005, there were around 12,500 pharmacies in the UK, but now there are over 14,100.

Mixed messages from government made it difficult to see what it was actually aiming for. If access were important, for example, the pharmacy network should be supported. And if pharmacy were to take some of the workload from general practice, it would also need support rather than further cuts.

But Mr D'Arcy is pragmatic about the current state of NHS finance. "There’s no two ways about it – everybody is having to do more for less. Everybody is having to tighten their belts. We’re facing a cataclysmic shortfall in funding and I can’t see anyone can escape from this."

Where are the efficiency gains?

Yet pharmacy already dispenses a billion items a year for 90p each, while prescription numbers rise at 3 per cent annually. "Where’s the efficiency gain you’ll get from hub and spoke? What is the real problem we’re trying to fix here at the moment? I think it's about cost. This is the difference between the funding agenda and the cost-cutting agenda."

The NHS also faced capacity issues, with shortages of nurses and 25 per cent of GPs set to retire in the next five years. "You could argue that if you wanted pharmacy to do more that’s why hub and spoke is necessary to create the head room in the pharmacy."

But hub and spoke was part of a bigger picture that also included current work in rebalancing legislation and the debate on supervision. If it created head room for more pharmacy services then it would be a positive move. The idea was not simply madness, unless it put the pharmacy network at risk. "Who’s investing in this? If at the end of all this there are fewer pharmacies then it’s a bad thing. Ultimately it’s got to be about what’s best for the patient. I’m not sure that this is."

Any changes to legislation following the consultation would not become law for a year, so developments were likely to take some time. But if it could create head room for members, then Numark would be involved. "From an independent's perspective you’re currently at a disadvantage. So they’re putting out a consultation that will level the playing field and allow independents to play."