Guide: Practice Income and Expenses Policies and Procedures

How to boost income and cut costs from dispensing

Updated 31 October 2022

All practices can do some dispensing. Large practices with high patient demand for items that GPs can dispense can be particularly successful. If you already dispense the flu vaccine, then you are familiar with comparing different suppliers and brands to ensure you have the best vaccine for the patient and the most cost-effective for your practice. See our guide on boosting income from personally administered items.

There are also many opportunities to boost income from fees that you can claim as a non-dispensing and dispensing practice:

  •  Fee per item

The surgery is paid for each item that you dispense. The dispensing fee is calculated per doctor. It sits on a scale, ranging from 286.8p per item if you dispense less than 454 items per month, down to 254p peritem if a single doctor dispenses more than 4,552 items per month. (These figures are correct as of 1 October, 2022).

If some doctors have a large number of patients they dispense to and others have very few, a practice will receive less funding. You can easily fall into this trap if patients are allocated to doctors on a geographic basis. Instead, try to make sure all doctors have roughly the same number of patients they dispense to.

The other important factor to consider is how long each prescription lasts. If you do 28-day prescribing, you will receive 13 fees in a year. However, if you do 3-month prescribing, then you will only get four fees a year. Remember you must dispense for the same time as is on the prescription and you cannot unnecessarily break this into multiple prescriptions to boost your fees.

  • Specials – enhanced dispensing fee

Items in parts VIII A and B of the NHS Drug Tariff are known as specials. When dispensing these items you will be paid an enhanced dispensing fee of £20 if you endorse these prescriptions XP. This is the only fee you will get for your specials. Out of pocket expenses, such as postage, are no longer repaid. It is important to look at the total cost when buying your specials, including the extras such as postage, and use the supplier with the lowest total cost.

  • DSQS patients fee

The third and last fee is the £2.58 per dispensing patient per year, if you complete the Dispensing Services Quality Scheme (DSQS). This is a scheme to encourage dispensing practices to adopt best practices across a range of areas within dispensary. Payments are made at the end of the financial year.

Minimising costs

  • Staff costs

The biggest cost for a dispensing practice is staff. The DSQS sets out the appropriate number of staff hours, depending upon the number of items that you dispense each month. You can compare your staff hours against these guidelines. Each region will have slightly different wages for the same job, so check you are paying the correct amount by looking at how much your local pharmacies and hospital are paying for the same roles.

  • Wholesaler fees

You should monitor the fees that your wholesaler charges for things like returns, fuel surcharges, or monthly fees. It is worth asking them if there is any way to reduce these expenses.

  • NHS prescription charges

Remember you have to collect prescription charges on behalf of the NHS. If you have not collected the charge and there is no evidence that the patient is exempt, by age or by the back having been filled in, you will be charged as if you have collected the prescription charge.

Dr Richard West is a GP partner and chair of the Dispensing Doctors’ Association

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