Funding for dispensing doctors

Funding for dispensing doctors is based on two elements – remuneration and reimbursement. The challenges of both elements are detailed below:


Due to the need to achieve cost efficiencies in the NHS, the dispensing fee is likely to continue to fall in real terms.

Recognising this, pharmacy contract negotiators are encouraging pharmacies to take
on more services and are attempting to negotiate a contract that is less reliant on dispensing

This will be a trend that is likely to be seen in dispensing practice as well, and the challenge for the DDA is to establish new service based income streams in dispensing practice.


The Cost of Service Inquiry for dispensing practice recognises that an ‘average’ dispensing practice was operating on a 7% margin. Since 2010, discounts have declined, and drug – and general – costs have gone up – all of which will impact on operating margin in 2014 and beyond.

Other influences from 2014 will include a practice’s prescribing mix, in particular its use of automatically loss-making drugs that attract no discount as well as higher margin generics.

The DDA is actively campaigning for a fairer system of reimbursement that is right for the patient, that is right for the NHS and which is right for the practice.