Centred Solutions sales and marketing director Louise Laban says time and tech have moved on. As a result, the consultation on hub and spoke dispensing contains some questionable assumptions.
Six years on from the original consultation, speculation within the pharmacy market has focused on how the latest proposals may allow larger chains with automated hubs to charge smaller chains and independent pharmacies for ‘prescription assembly services’, leading to an erosion of profits that cannot be recouped by any amount of patient-facing services.
Unfortunately, the impact assessment published by the Department of Health and Social Care (DHSC) alongside the new consultation, does little to dispel this myth. It suggests the cost of a hub is beyond all but the largest of pharmacies. This could not be further from the truth. Had the authors looked at hub and spoke models being used today by pharmacies other than the big players, they would have come to a very different conclusion.
The impact assessment does admit to focusing on the large scale hubs that have been in operation for some time, as well as responses and figures from the original 2016 consultation, but time and technology move on. The reality today is very different.
Other hub and spoke solutions exist
The DHSC’s impact assessment claims it is only aware of six pharmacy businesses out of 3,000 across the whole sector who are using automation. We know this number is far higher. The six referred to appear to be the larger groups who have established large central hubs, using multi-million pound technology. The figure does not include other hub solutions that are in operation across the market today.
At Centred Solutions, we are already working with six pharmacy groups representing hundreds of pharmacy spokes who have implemented or are in the process of implementing our scalable and affordable repeat dispensing hub and spoke technology. These early adopters are already demonstrating that this is an option for pharmacies of all sizes, including smaller groups with as few as three branches.
"We would go one step further and suggest hub and spoke dispensing would be possible between a few higher volume pharmacies with the option to automate."
Perhaps most concerning are the figures and formulas used as a baseline throughout the assessment. We’re told that pharmacy businesses processing fewer than 250,000 items a week (around 12 million a year) may lack the scale to invest in their own hub and could instead benefit from proposals to outsource hub operations. This is not an accurate reflection of the market. There are hubs already established that process far fewer than 250,000 items a week. We are working with several pharmacies who have installed automation for significantly lower volumes and who are now seeing efficiencies in terms of costs, increased staff satisfaction and the ability to provide revenue-generating services without increasing staffing levels.
The more hubs, the healthier the market. As the assessment says, under new legislation, hub and spoke dispensing may be possible between two or more pharmacies on a local level without any automation, with assembly or part dispensing carried out manually. We would go one step further and suggest hub and spoke dispensing would be possible between a few higher volume pharmacies with the option to automate.
Outsourcing and using fewer, larger scale hubs could result in charges for independent and smaller multiple pharmacies and there is the potential that the benefits of volume buying will not be passed on to spoke pharmacies. Affordable hub and spoke technology and business models do exist for all pharmacies allowing for a higher the degree of competition and greater share of benefits for spoke pharmacies.
Statements that only 40 per cent of items can go through a pharmacy hub, or that set up for spoke pharmacies will cost £4,000 again appear to have been based on large scale automated hub technology. Affordable and scalable technology designed specifically for smaller independent pharmacies or groups of pharmacies has not been taken into account.
These smaller solutions can and already do process 70 per cent of items through the hub. There are hub solutions for spoke pharmacies that cost hundreds of pounds, not thousands. The estimates quoted in the impact assessment, that technology for dispensing hubs costs in the order of £1-2m are not based on technology available now.
There are lots of factors to take into account, but we think a starting point for hub and spoke requires a capital investment of under £100,000 for a group of three-plus pharmacies, with a combined total of 45,000 items a month, and around 10 square metres of space.
The lack of models considered as part of the assessment also affects the perception of what implementing such models means in terms of a change programme. For example, we are told there would need to be significant staff hours to manage change and training in the spoke pharmacies and a requirement to get people qualified and working at the hub.
While there would undoubtedly be a change to workflows and ways of working, this does not require a significant change or training programme. Centred Solutions technology is so intuitive that staff can be trained in half a day. Pharmacy staff are primarily required for managing prescription data and verification.
There are suggestions that some spoke pharmacies might need a change to their patient medication record (PMR) system in order to be compatible with the hub. This is not necessarily the case – our automated hub and spoke technology can be integrated with all the main PMRs.
Data can be a hotly contested topic. In the 2016 consultation, many respondents raised concerns around patient consent and data protection across different legal entities. Since 2016, Centred Solutions repeat dispensing technology simply plugs straight into the PMR. Patient-sensitive data is only transferred between Centred Solutions software and the PMR provider, is 128-bit encrypted and is never shared with third parties.
The impact assessment makes some great observations around improving patient safety and freeing up time for clinical services. However, it only considers the large scale hub and spoke model, which requires significant investment and is unachievable by most pharmacies. As a result, we believe the costs, statistics and statements made throughout the assessment are not reflective of the technology and business models available and already in use today. We’ll be responding to the consultation along these lines and would welcome the opportunity to speak to the authors of the assessment about the other hub and spoke business models already in use.
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