Hub & Spoke the results and an update 7.30pm 10 March - - PowerPoint PPT Presentation

National Pharmacy Association

NPA webinar

Hub & Spoke – the results and an update

7.30pm – 10 March

1

National Pharmacy Association

Presenters

• Mike Hewitson – Pharmacy owner & NPA

Board Member

• Gareth Jones – Public Affairs Manager

Host

• Fin Mc Caul

4

Hub & Spoke Policy Review

Mike Hewitson, Board Member, NPA. Chair, NPA Hub & Spoke Group.

BACKGROUND

• Alistair Burt announced intention to change legislation to

allow inter-company Hub & Spoke by October 1st 2016.

• Prior lobbying from a regional wholesaler to allow H&S for

independents.

• Keith Ridge has long held views on automation inc. PhD on

hospital pharmacy automation.

• Mentioned specifically in Dec 17th letter.

OBJECTIVES

• Understand & agree consistent terminology.
• Take a holistic approach, and understand implications on NPA Members

interests:

• Strategic
• Economic
• Operational
• Financial
• Understand implications of inter-company assembly on professional practice

including patients & the public.

• Close the information gap between large multiples and the SME sector.

OUR APPROACH

• NPA Practice & Policy Committee, Nov 2015

established Task & Finish approach:

• Membership outside of Board at ‘arms length’.
• Opportunity to draw in wider base of opinions.
• Join up other organisations such as PSNC & PV

to bring two-way added value.

MEMBERSHIP

• Mike Hewitson MRPharmS
• Raj Patel MBE FRPharmS
• Dr Nitin Sodha MRPharmS
• Nick Kaye MRPharmS
• Jay Badenhorst MRPharmS
• Garry Myers MRPharmS
• Claire Ward LLB

SUPPORTED BY

• Gareth Jones, NPA Public Affairs

Manager.

• Nathan Draper, NPA Policy & Public

Affairs Officer.

• Elizabeth Ward, Director of Policy.

Pharmacy Voice.

• Kim Packham, Senior Policy &

Programmes Advisor. Pharmacy Voice

• Fin McCaul, Consultant to NPA

Board.

DEFINITIONS

Spoke

Hub

Spoke Spoke Spoke Spoke

Registered Pharmacy (± NHS Contract) Registered Pharmacy + NHS Contract

Pts Pts

• Important to

be consistent.

• Centralised dispensing is direct

to patient and is out of scope

• Expert witness programme:
• Nobody has all of the answers.
• 20+ witnesses covering all aspects of the issue.
• Literature Review:
• Independent.
• Respected academic from Manchester University.
• Little published evidence.
• Member Consultation:
• Baseline views of members.
• Sense-check of risks and benefits.

UNIQUE INFORMATION

EXPERT WITNESS PROGRAMME

Meeting 1 Meeting 2 Meeting 3

Richard Brown. Chief Officer Avon

• LPC. BRR Consulting

Visit to Celesio PAS Hub Inc: Cormac Tobin. Managing Director Chris Frost. Head of Sales Claire Kerr. Head of Healthcare Policy & Strategy

David Simons. Chief Operations Officer, NPA. Omar Shakoor. Pharmacy Services Director, Mawdsleys

Leyla Hannbeck. Chief Pharmacist, NPA. Drew Warner. Head of Change & Programmes NPA.

Member Consultation results

Remy Croese. Intl. Sales Manager VMI Care. Dr Ellen Schafheutle. University

• f Manchester.

Dr Bharat Shah. Director Sigma Pharmaceuticals.

Paul Mayberry. Independent Contractor.

Fin McCaul. Independent Contractor. LTC Lead Bury CCG.

Andy Beesley. Medication Management Solutions.

Costings Workshop

Chris Brooker. Former consultant to Mawdsleys.

Willach Pharmacy Solutions

Noel Wardle. Partner. CharlesRussellSpeechlys.

LITERATURE REVIEW

• As expected - very little published evidence of any

quality.

• Some international examples, but how applicable are

they to UK systems/issues?

• Closed a gap in knowledge. Reassuring that there is

nothing obvious that we have missed.

MEMBER CONSULTATION

• Members given briefing document, and video

introduction from Group chair.

• Promoted via NPA channels, trade press, and

buying groups.

• Great response rate: 416 individual responses,

covering more than 1,000 pharmacies.

KEY RESULT: PREPAREDNESS

1% 4% 5% 36% 55%

1 Never under any circumstances 2 Not at the moment, but might consider in the future 3 We are in the planning stages 4 We are currently operating a Hub & Spoke system 5 We have trialled but removed a Hub & Spoke system

S ingle independent 2-10 branches 11+ branches Total Negative attitude towards hub & spoke 135 (63.7% ) 51 (49.0% ) 5 (17.2% ) 191 (55.4% ) Positive attitude towards hub & spoke 77 (36.3% ) 53 (51.0% ) 24 (82.8% ) 154 (44.6% ) Total 212 104 29 345

Χ2= 24.670; p≤0.005

KEY RESULT: PROVIDERS

Another branch in your group A local cooperative hub in which your pharmacy owned a share An NHS hospital trust An independent wholesaler A national wholesaler (eg, Alliance, AAH)

0% 25% 50% 75% 100%

Strongly Against Slightly Against Neutral Slightly In Favour Strongly In Favour

KEY RESULT: RISKS & BENEFITS

Improve the operational efficiency of my business Improve the profitability of my business Be in the long-term interests of independent community pharmacy Improve safety of dispensing operations Create capacity to deliver services Reduce stock levels and availability in my pharmacy Reduce choice of wholesalers Increase the complexity of my business Delay patients' access to their medicines Reduce staffing levels in my pharmacy Lead to pharmacies closing Create a data security risk

0% 25% 50% 75% 100%

Strongly Disagree Disagree Neutral Agree Strongly Agree

KEY RESULTS: WORKLOAD SHIFT

0% 25% 50% 75% 100% Regular Repeats Nursing Homes MDS Unfavourable Favourable

KEY RESULTS: IMPACT

0.0% 17.5% 35.0% 52.5% 70.0% Very Negative Negative Neutral Positive Very Positive Patients My pharmacy company The community pharmacy network overall

KEY FINDINGS - BENEFITS

• Capacity
• Some evidence to support

capacity release to deliver

• ther services.
• However, as only limited number
• f services it is difficult to make

the business case today.

• MDS is large opportunity to

reduce workload in community pharmacy.

Tail - not enough service income to fill free capacity Optimal zone - Free capacity used to deliver

• ther services

Head - Not enough free capacity generated to make a difference to services

25%

33%

Proportion of dispensing volume transferred to Hub Service Income Figure 1: Hub & Spoke Efficiency Curve

KEY FINDINGS - BENEFITS

• Cost savings
• Business case is different for inter-company H&S vs intra-

company.

• Intra-company is about centralisation of cost.
• Inter-company is about outsourcing.
• Staff reduction at the Spoke is the only variable cost impacted.
• No reduction in cost base for NPA Members.

KEY FINDINGS - BENEFITS

• Safety
• Difference between accuracy and validity:
• Hubs likely to be more accurate.
• Data input at Spoke is critical - Garbage In Garbage Out.
• One large multiple’s model - Data Validation exercise 5000 items

without a mistake (reset 83 times for 1 branch!).

• Not possible with inter-company model.
• New risks - reconciliation at Spoke, complexity of process.
• May be more accurate but this could be re-produceable with other technology

and may not be a benefit of H&S per-se, and could introduce new risks.

KEY FINDINGS - RISKS

• Professional Accountability
• Explicit, written patient consent required.
• Criminal liability - potentially undermines Statutory Defence & creates

confusion over who is responsible.

• Civil liability - Hub Responsible Pharmacist has Duty of Care to deal with
• bvious clinical errors.
• Legal issues. Especially with MDS - WDL & FMD.
• Major concerns. Need expert legal opinion.

KEY FINDINGS - RISKS

• Procurement & Supply Chain
• Key concern about reduction of competition & choice in the wholesale/Hub market.
• Barriers to entry: DTP

, logistics infrastructure, capital investment, technical and professional knowledge.

• Investment needs to be recovered - reduce margins, item of service payment,

subscription…

• Could undermine short-line wholesalers - against taxpayer interests as this

creates leverage through competition.

• Major concerns. Need to promote competition & choice between Hub

providers.

KEY FINDINGS - RISKS

• System Resilience
• Impact on stockholding:
• Increase in supply chain sensitivity to stock shortages.
• Hub failure e.g. P2U technological, Pharmacy Plus financial

collapse, Boots D90 fire.

• Concerns. This could easily impact on patients and the

public, and may be a risk for politicians post P2U failure.

ENABLERS

• Planned workload - electronic Repeat Dispensing.
• Original pack dispensing:
• What about splits? Cost to the Spoke!
• Fair contracts to protect Spokes.
• New service commitment.

ENABLERS

• Hub Standards
• Superintendents will need to quality assure their Hub partner.
• GPhC Standards alone may not be enough for inter-company H&S.
• Would help to reduce variation between providers - very important to

enabling competition.

• Could frame KPIs to allow for fair comparison between Hubs.
• NPA could be key driver on development of a Public

Specification - controlling rate & development of concept.

BARRIERS

• Falsified Medicines Directive:
• Overall compatibility with system.
• May be incompatible with MDS preparation in Hub.
• Need expert legal opinion on EU Law.
• Product availability:
• Longer turnaround times for patients (c48 hours from ordering).
• Potential threat to twice daily delivery.
• Restrictive Distribution Practice - DTP

, RWA, quotas.

• Government must tackle.

BARRIERS

• Financial Viability: (modelled average pharmacy)

Benefits Costs Service income Procurement disbenefit Staff reduction Hub direct costs OTC income Process Remapping Physical Remapping IT Infrastructure Data entry & validation Max £20k >£20k

RECOMMENDATIONS

• Government:
• Original Pack Dispensing.
• Electronic Repeat Dispensing.
• A new service commitment e.g. Pharmacy First.
• Stop restrictive distribution practices and a

commitment to supporting competition & choice between Hub providers.

RECOMMENDATIONS

• Regulation:
• GPhC to recognise difference between inter & intra-

company models.

• Development of a national set of Standards for Hub

providers to compliment & enhance GPhC Inspection regime.

• This could follow the British Standards Institute:

Publicly Available Specification (PAS) model.

RECOMMENDATIONS

• Legal:
• NPA to obtain formal legal advice on two key

questions:

• 1. Is Hub & Spoke compatible with EU Falsified

Medicines Directive?

• 2. Would a Hub be able to process MDS on

behalf of another pharmacy?

NPA POLICY POSITION

• Inter company Hub & Spoke is a different proposition to current models.
• It is for members to decide if they want to do this, we can help them to

make fair and informed decisions to protect their business and patients.

• The legislative change is one aspect, but it is in the public interest for

there to be competition and choice for Hub services as this will keep costs low and raise service levels.

• NPA can be in a position to influence development of Hub &

Spoke, through the development of Standards to address professional concerns, and taking a critical but constructive approach.

QUESTIONS?

• We have huge amounts of additional information on Hub

& Spoke:

• Final report.
• Member consultation.
• Full literature review.
• Full witness testimony.
• Not enough time to share this with you today.

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