CPCF settlement: 2019/20 to 2023/24

Published on: 22nd July 2019 | Updated on: 3rd May 2024

In July 2019, Community Pharmacy England, NHS England and the Department of Health and Social Care (DHSC) agreed a five-year deal for community pharmacies, guaranteeing funding levels until 2023/24. The deal secures pharmacy funding and sets out a clear vision for the expansion of clinical service delivery over the next five years, in line with the NHS Long Term Plan.

The Community Pharmacy Contractual Framework for 2019/20 to 2023/24: supporting delivery for the NHS Long Term Plan

Delivery plan for recovering access to primary care

In November 2023 Community Pharmacy England reached agreement with Government and the NHS on the launch of a new national Pharmacy First service as well as other changes to pharmacy funding and services. Whilst funded separately from the rest of the CPCF, the deal sets out how the £645 million investment pledged within the Delivery plan for recovering access to primary care will be used to support community pharmacy services in the next 2 years.

Pharmacy First service and other changes agreed as Recovery Plan negotiations conclude

Joint letter to community pharmacy owners from Community Pharmacy England, DHSC and NHSE

Briefing 029/23: Recovery Plan agreement – Summary and FAQs for pharmacy owners and LPCs

Briefing 030/23: Funding for Pharmacy First, and other funding-related changes in the Recovery Plan deal

Watch our on-demand webinar about Pharmacy First and the Recovery Plan

Overview for Years 4 (2022/23) and 5 (2023/24)

CPCF arrangements for 2022/23 and 2023/24 agreed

Joint letter to pharmacy owners from Community Pharmacy England, DHSC and NHS England

Briefing 029/22: CPCF Arrangements for 2022/23 and 2023/24

Watch our on-demand webinar about CPCF Years 4 and 5

In each section below we have outlined that element of the five-year CPCF agreement in more detail. The sections have been updated to include elements from the Recovery Plan deal described above.

Funding and payments

Core funding remains at £2.592bn for 2023/24. The £645m investment pledged within the Delivery plan for recovering access to primary care for supporting community pharmacy services comes on top of this and is intended to be provided over two years. However, it does not address the chronic underfunding of the sector and Community Pharmacy England has been clear about the current pressures throughout the negotiations and also that in future CPCF negotiations we will be continuing to push for a sustainable funding package. We are very conscious of the financial and operational pressures on pharmacies, and how the details for 2024/25 need to be provided as early as possible so that pharmacy owners can plan accordingly.

Payment deadline and timetable tracker
A tool to help keep track of how and when to claim for new services, including details of how these payments will appear on the Schedule of Payments.

Transitional payments

The arrangements for 2022/23 and 2023/24 included an extension of the Transitional Payment to recognise ongoing pressures. The Transitional Payment will continue to be paid in full to the sector with up to £70m allocated (to be paid in 2023/24 as a flat fee) and the remaining balance to be distributed with 75% related to services and 25% related to dispensing activity.

Drug Tariff changes

As part of the Recovery Plan negotiations, previous fee over-deliveries in 2021/22 and 2022/23 (worth £76 million) have been written off, with a £36 million fee over-delivery now permitted for 2023/24.

Calculations had shown that remuneration for pharmacy services in those years had exceeded the limit set out in the CPCF budget, and projections indicate that the sector is on course to exceed it again. We negotiated a write-off of funding over-delivery worth £112 million for CPCF Years 3, 4 and 5. If this money had been re-claimed from pharmacy owners over a year, it would result in a reduction in the Single Activity Fee of around 10 pence per item.

Note, any excess remuneration in 2023/24 over the £36m write-off will be reconciled though the adjustment of CPCF fees in the usual way. Going forwards, we will work with DHSC and NHSE to implement stronger mechanisms to prevent any future fee over-delivery.

Reimbursement reforms

Discount deduction: The April 2023 Drug Tariff saw the introduction of changes to the discount deduction arrangements, including changes which Community Pharmacy England rejected, and are subsequently being imposed. The changes included:

  • All concession lines to be considered as Group Items for Discount Not Deducted i.e. DND or zero discount (ZD) items
  • Rate of discount deduction for generics to increase from 17.52% to 20%

NHS Prescription Services announcement

Changes to discount deduction arrangements from April 2023

Price concessions: DHSC also committed to reviewing the implementation of the Price Concessions system. Since September 2022, we have been working with DHSC officials to determine improvements, which led to a six-month review of the concession price system undertaken between August 2022 and January 2023.​ The following improvements have since been agreed:

  • All products granted a concessionary price will be classified as Discount Not Deducted for the month(s) in which they are on concession – introduced from 1st April 2023.
  • A process to roll over concessionary prices where applications have been submitted later in the month – introduced from May 2023.
  • A ‘retrospective correction mechanism’ to be used where appropriate. Further information regarding this concession ‘top-up’ mechanism will be issued once details are finalised with DHSC.

Economic review

NHS England has committed to commissioning an independent economic analysis of NHS pharmaceutical services, to be carried out with Community Pharmacy England and pharmacy owners. This follows the significant concerns we raised about the economic sustainability of the sector both through the CPCF Annual Review process and in subsequent negotiations, and it should help to inform future negotiations.

At its September 2023 Meeting, our Committee analysed NHS England’s plan for the independent economic review of the sector. The Committee were presented with the proposals provided by NHS England and then asked to decide whether they wished to support it. In making their decision, they explored the key concerns identified, as well as the potential risks of not participating.

Earlier advance payments and PEPS

All community pharmacy owners have had the chance to receive earlier advance payments since November 2021. This agreement came as part of discussions on the Pharmacy Earlier Payment Scheme (PEPS), which DHSC decided to end following the collapse of Greensill Capital. The option to receive earlier payments (for prescriptions dispensed from October 2021 onwards) benefits all pharmacy owners, whether or not they had previously taken advantage of the PEPS.

The final PEPS payments were paid on 1st October 2021 and a 12-month transition arrangement helped transfer existing PEPS pharmacy owners over to the new earlier advance payment timetable available to ALL pharmacies from November 2021.

PEPS webpage

Early advance payments for all pharmacy owners following an end to PEPS

Pharmacy Access Scheme (PhAS)

An updated PhAS began in January 2022, to continue to support patient access to isolated, eligible pharmacies. Eligibility was reassessed based on the volume and distance criteria specified in the Drug Tariff. Payments changed to be set in bands based on a bell curve of dispensing volume, with a maximum payment set a £17,500 per year. The total budget allocation will not exceed £20 million per year.

PhAS webpage

The full list of pharmacies eligible for the 2022 PhAS can be found on the GOV.UK website.

Briefing 033/21: Pharmacy Access Scheme starting from January 2022

DHSC guidance: 2022 Pharmacy Access Scheme

Pharmacy Quality Scheme (PQS)

In 2023/24 there is a reduced PQS, compared to the scheme originally planned. This means a reduced list of activities for pharmacy owners with a value of 60% of the originally planned PQS – £45m. The remainder of the PQS funding (the additional £30m) will be used as an alternative to reducing fees to help ensure that there is no over-delivery of fees in this financial year. As the reduced PQS contains a clinical audit, DHSC and NHSE have agreed to Community Pharmacy England’s request to remove the clinical governance requirement for pharmacy owners to undertake two clinical audits in 2023/24.

The decision to go ahead with a PQS this year without an urgent injection of extra funding is in contradiction of our warnings to Ministers that there is not enough money to pay for the current services and dispensing delivered by the sector; let alone for new activities to be rolled out. However, we do recognise the importance of some elements of the PQS to patients and the NHS, and the fact that the scheme continues to demonstrate pharmacy’s commitment to, and exceptional performance on, quality. We note the concessions that Ministers have made in response to our submissions – both in reducing the scope of the PQS to reduce the burden on pharmacy owners, and in avoiding a reduction in the SAF which was previously mooted.

Overall, this is an improvement on their original position, safeguarding the funding for PQS and reducing the activity required, notwithstanding our belief that the funding and capacity constraints which apply to the whole sector mean the scheme is currently unaffordable.

DHSC has published the full details of the PQS on the NHSBSA website, which will give pharmacy owners as much time as possible to consider whether they want to take part in this work. NHS England has also published guidance on the 2023/24 Scheme.

Community Pharmacy England’s position remains that we do not think pharmacy owners will have the capacity to take on additional services or work.

Service development

Pharmacy First service

The new national Pharmacy First service, which launched on 31st January 2024, aims to support communities in staying well and local healthcare systems to meet the needs of their populations.

The service involves providing consultations to give advice and NHS-funded treatment (via Patient Group Directions), where appropriate, for seven common conditions (clinical pathways consultations). The consultations can be provided to patients who self-refer to the pharmacy (e.g. walk-ins) as well as those referred by NHS 111, GPs and others. The service also incorporates the previous Community Pharmacist Consultation Service (CPCS), meaning that there are three elements to the Pharmacy First service:

  • Pharmacy First (clinical pathways consultations) – new element
  • Pharmacy First (urgent repeat medicine supply) – previously commissioned as the CPCS
  • Pharmacy First (NHS referrals for minor illness) – previously commissioned as the CPCS

The seven clinical pathways cover:

  1. Sinusitis (adults and children aged 12 years and over)
  2. Sore throat (adults and children aged 5 years and over)
  3. Acute otitis media (children and young adults aged 1 year to 17 years)
  4. Infected insect bite (adults and children aged 1 year and over)
  5. Impetigo(adults and children aged 1 year and over)
  6. Shingles (adults aged 18 years and over)
  7. Uncomplicated urinary tract infections (women, aged 16 to 64 years)

An initial fixed payment of £2,000 was available to claim ahead of the service launch, which will be reclaimed from pharmacy owners who did not provide five clinical pathways consultations by the end of March 2024. From February 2024, in addition to the £15 consultation fee, a monthly fixed payment of £1,000 will be paid to pharmacy owners who meet a minimum activity threshold of clinical pathways consultations (the threshold will increase over time). Full details are available in Briefing 030/23: Funding for Pharmacy First, and other funding-related changes in the Recovery Plan deal.

Pharmacy First service webpage

Pharmacy Contraception Service

Following a pilot involving pharmacies offering repeat supplies of oral contraception to people who had previously had the product prescribed, a Pharmacy Contraception Service launched as an Advanced service in April 2023. Tier 1 of the service involved community pharmacists providing ongoing management of routine oral contraception that was initiated in general practice or a sexual health clinic.

From 1st December 2023, the service will be expanded to enable community pharmacists to also initiate oral contraception, via a PGD, as well as provide ongoing clinical checks and annual reviews. Pharmacy owners who are already providing the Pharmacy Contraception Service (repeat supplies of contraception) will have time to get ready to start providing initiation of contraception.

Pharmacy Contraception Service webpage

Smoking Cessation Service

The Smoking Cessation Service (SCS) was commissioned as an Advanced service from 10th March 2022. The Service Directions were amended in April 2023 to allow pharmacy technicians to provide the service.

Pharmacy owners who sign up to provide this Advanced service will receive a set-up fee of £1,000, then £30 for the first consultation and £40 for the last consultation, with interim consultations paid at £10. This Advanced service will be most relevant to those already providing a locally commissioned service.

Smoking Cessation Advanced Service webpage

Hypertension Case-Finding service

Hypertension Case-Finding was added to the CPCF as an Advanced service in October 2021.

The service will be relaunched to make better use of skill mix and increase provision of ambulatory blood pressure monitoring (ABPM) on 1st December 2023. From this date, the service can be provided by all suitably trained and competent pharmacy staff; previously, only pharmacists and pharmacy technicians could provide the service.

Pharmacy owners who sign up to provide this Advanced service will receive a set-up fee of £440, then £15 per clinic check and £45 per ABPM. Additionally, there will be incentive payments funded from outside the CPCF envelope, which will be triggered when certain activity thresholds are reached: £1,000 is triggered by delivering 5 ABPM interventions in 2021/22, then £400 for 15 inventions in 2022/23, and £400 for 20 in 2023/24.

Hypertension Case-Finding Advanced Service webpage

Discharge Medicines Service (DMS)

The DMS became a new Essential service on 15th February 2021. The service enables NHS Trusts to refer patients who would benefit from extra guidance around new prescribed medicines to their community pharmacy.

DMS webpage

Hepatitis C testing service

Hepatitis C testing became a new Advanced service on 1st September 2020. The service focused on provision of point of care testing (POCT) for Hepatitis C antibodies to individuals who inject illicit drugs, e.g. steroids or heroin, but who haven’t yet moved to the point of accepting treatment for their substance use.

This service was decommissioned from 1st April 2023.

Community Pharmacist Consultation Service (CPCS)

The NHS Community Pharmacist Consultation Service launched on 29th October 2019 as an Advanced Service. The service connects patients who have a minor illness or need an urgent supply of a medicine with a community pharmacy.

From 15th May 2023, 999 services or providers of urgent and emergency care who are authorised by NHS England to provide this (for example, Urgent Treatment or Urgent Care Centres, an Emergency Department or an Accident and Emergency Unit) can also make referrals to community pharmacy for minor illness or if a patient needs an urgent supply of a medicine. The CPCS provides the opportunity for community pharmacy to play a bigger role than ever within the urgent care system.

From 31st January 2024 (subject to the required IT systems being in place), the service will be subsumed into the new Pharmacy First service – see above.

CPCS webpage

New Medicine Service (NMS) – forthcoming changes

Developments in NMS IT support planned for December 2023

From a date to be determined, subject to positive evaluation of an ongoing pilot, the NMS will expand to include antidepressants to enable patients who are newly prescribed an antidepressant to receive extra support from their community pharmacist. Further details on this change will be published in due course.

NMS webpage

Service pilots

A range of new services will be piloted and introduced over the course of the five years to support the delivery of the NHS Long Term Plan. Whilst the pilots will be funded by the Pharmacy Integration Fund (PhIF), the introduction of new nationally commissioned services will be allocated funding from the overall contract sum as they are launched.

CPCF service development grid – a matrix document setting out when each of the agreed CPCF service development pilots may be implemented during the five-year deal.

Other changes

Terms of service changes

Distance selling pharmacies: As part of the Recovery Plan negotiations, questions arose around service provision across the community pharmacy network, including how the pharmacy terms of service are applied to distance selling pharmacies (DSPs). Community Pharmacy England agreed to a request from DHSC and NHSE to consider this topic more broadly over the next few months.

Annual workforce survey: Completion of an annual Health Education England (HEE) workforce survey has become mandatory, supporting the collection of better data on the sector’s workforce, which will assist workforce planning. To balance pharmacy owners’ workload, alongside the introduction of the mandatory workforce survey, the requirement to undertake an annual patient satisfaction questionnaire was removed, meaning pharmacies no longer need to undertake this every year.

Terms of service changes: patient satisfaction and workforce surveys

Regulatory changes

There will be changes in market entry guidance within the Pharmacy Manual.

DHSC has also indicated that there will be legislative changes following the public consultations on hub and spoke dispensing and original pack dispensing, and that it will launch a public consultation on skill mix in pharmacies in due course.

Briefing 017/21: Hub and Spoke dispensing

Education and training

In 2021/22, Health Education England (HEE) was commissioned to provide a three-year programme of education and training for community pharmacy professionals, including independent prescribing training for existing pharmacists.

Also, from 2022/23, HEE began supporting the management of the training places in community pharmacy and responsibility for administration of payments to community pharmacy owners for trainee pharmacists.

CPCF Roadshow

Shortly after the five-year deal was announced, Community Pharmacy England ran a series of free roadshow events across England to explain the context of the new CPCF agreement and what it meant for pharmacies. A recording of the Digital Roadshow is available to watch on-demand.

Watch our Digital CPCF Roadshow on-demand

For external audiences

Note, these resources are now out of date due to a number of changes that occurred since the start of the five-year CPCF deal. We will look to update these in the near future.

The following resources may help in explaining the five-year CPCF to external audiences. These may be particularly useful for LPCs engaging with local healthcare organisations or other stakeholders.

Community pharmacy presentation – a PowerPoint about community pharmacy reflecting changes to the CPCF.

CPCF summary for external stakeholders (PDF)

CPCF summary for external stakeholders (Word document, so it can be edited for localisation)

Summary of the Five-Year Pharmacy Deal for general practice teams (PDF)

Summary of the Five-Year Pharmacy Deal for general practice teams (Word document, so it can be edited for localisation)

Template letter to GP practices on five-year CPCF – LPCs may wish to ask their LMC to send this letter/email out to local GP practices.

An infographic describing the five-year CPCF settlement – this outlines the journey that community pharmacy will take between now and 2023/24.

Also see our webpage Community Pharmacy: Information for GPs.

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