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Report on Primary Care Prescribing

Session: 2014/2015

Date: 03 February 2015

Reference: NIA 230/11-16

ISBN: 978-0-339-60560-2

Mandate Number: Mandate 2011/16 Twenty Seventh Report

Report_on_Primary_Care_Prescribing.pdf (5.15 mb)

Executive Summary

1. Primary care prescribing costs £460 million each year - around 10 per cent of all health and social care expenditure. Responsibility for managing the Northern Ireland (NI) General Pharmaceutical Services budget was devolved from the Department of Health, Social Services and Public Safety (the Department) to the Health and Social Care (HSC) Board on 1 July 2010.

2. The overall volume of items prescribed has been increasing across all United Kingdom (UK) countries over recent years. By 2013, almost 39 million items prescribed by General Practitioners (GPs), were dispensed by NI community pharmacy contractors (contractors or CPCs). Despite the rise in volume, prescribing costs per head of population fell in England, Scotland and Wales over the seven year period to 31 March 2014. By contrast the prescribing costs per head of population in NI were slightly higher in 2013 than in 2007.

3. The Committee acknowledges that, working with the HSC Board, GP practices have achieved savings in prescribing costs over the last four years. A key element in this performance has been a substantial increase in the prescribing of lower cost, generic versions of drugs, rather than more expensive brand name drugs. However, the Committee believes that there is scope to generate significant further savings without compromising patient care through GPs prescribing, where suitable, more lower cost versions of generic drugs.

4. The Committee does not understand the Department’s reluctance to accept the validity of cost comparisons either locally (between GP practices) or with other UK regions. It was disheartening that the Department expended considerable energy finding flaws in the use of comparative data and refused to accept that it was possible to use the comparators to estimate the potential for generating savings.

5. Taking account of local data and information on the prescribing costs of other UK countries, the Department, in conjunction with the HSC Board, should undertake an exercise to establish the level of potential savings which more cost effective generic prescribing could generate. This could then be used to set a target prescribing cost for individual GP practices against which to benchmark prescribing performance and to identify areas where further improvement is necessary.

6. In the Committee’s view, GPs have little incentive to consider the cost of their prescribing decisions since the cost falls to the HSC Board. The challenge for the HSC Board is to continue to: develop close working relationships with GPs in order to promote better prescribing; use benchmarking data to help GPs peer-review their prescribing practices; and encourage GPs to more fully explain their decision to prescribe a particular medication to patients.

7. In terms of factors which may impact on prescribing levels and costs, the Committee acknowledges the extensive body of research which indicates that the health needs of the population in NI exceed those in the rest of the UK. However, it notes, too, the data presented in the NIAO report which suggests that the volume and costs of prescribing does not neatly match variations in indicators of clinical need, such as local disease prevalence data collected by GP practices and that NI has a lower proportion of older people than other UK regions. It is important that, as part of the benchmarking process, such data is used in conjunction with that on prescribing costs and volumes to investigate the reasons for any anomalies.

8. It is unacceptable that the Department and community pharmacists have failed to reach agreement on the terms of a revised reimbursement contract. This must be resolved as a matter of urgency. Had the Department been successful in agreeing implementation of the new contract (which is in place elsewhere in the UK) in 2006, £46 million would have been released to provide additional, patient-focused pharmaceutical services in the community.

Conclusions

9. The Health service here could make significant savings, without affecting patient care, if GPs consistently prescribed lower cost, but equally effective, medicines. A comparison of prescribing costs per head of population across the UK suggests that if NI prescribing costs had been in line with those in Wales in 2013, overall costs could have been reduced by £73 million. NIAO’s examination of GP prescribing patterns in three (out of 15) therapeutic areas clearly showed that GPs here tended to prescribe more expensive generic versions of drugs compared to their UK counterparts. More cost effective prescribing in these areas could have saved the health service here £8.9 million in 2012 and £5.1 million in 2013. NIAO also identified that reducing local prescribing levels of the most frequently dispensed drug in NI (Pregabalin[1]) to those elsewhere in the UK would have released over £8.5 million in 2012 and £9.7 million in 2013.

10. Prescribing costs vary greatly between GP practices – over a 100 per cent difference between the lowest and highest cost GP practices. The Department uses standardised costs (NI ‘prescribing units’ which adjust prescribing costs for, among other things, social class and age distribution) to assess the relative prescribing performance of individual GP practices. The HSC Board has had success in reducing the variation in standardised prescribing costs over the period from 2010 to 2013. However, by reducing the average standardised cost by 10 per cent over a three year period, the NIAO have calculated that further savings of £54 million could be generated.

11. The full extent of possible savings on the prescribing budget will need to be quantified if the Department is to demonstrate that annual targets are sufficiently challenging. Insufficient steps have been taken to quantify the potential for generating savings. In the absence of this information, the Department cannot demonstrate the value for money they are getting from prescribing nor whether the savings targets which have been set to date have been sufficiently challenging.

12. GPs prescribing choices have only recently been bound by an agreed “formulary” of cost effective drugs. A higher proportion of more expensive drugs were being prescribed in NI because of the delay in introducing the NI Formulary and a ‘Managed Entry’ process. Prior to April 2014, unlike Scotland and Wales, in NI there was no body which specified what medicines ought to be (or ought not to be) prescribed.

13. Generic prescribing is not economical if the patient fails to take the medicine or is convinced that it is less effective. While campaigns, such as ‘Go Generic’, have been successful in reassuring patients of the effectiveness of generic, rather than branded, drugs, patients, particularly elderly patients, can become confused where they are repeatedly prescribed different, generic drugs. This confusion may mean that patients take their drugs wrongly or not at all. More must be done to ensure that patients are more fully informed of the rationale (clinical and cost) supporting GP prescribing decisions.

14. While prescription drugs work and save many lives, alternative treatments and/or behaviour change can lead to equivalent or better and more cost-effective outcomes. The Department considers that the absence of appropriate treatment facilities and/or therapies (to treat, for example, mental health or to manage pain) results in additional prescribing costs. Short-term decisions to prescribe (rather than provide access to more appropriate treatments/therapies) lead to ineffective long-term treatment of patients.

15. The system for reimbursing pharmacists for dispensing drugs is vulnerable to fraud. The decision on which drug to prescribe rests solely with the GP, however, the controls currently in place may not be sufficient to ensure due regularity and propriety: for instance, in cases where a pharmacist, against the GP’s instructions, dispenses a generic rather than a branded drug. Such potentially fraudulent behaviour not only results in additional costs but may pose patient safety risks. It is not sufficient for the Department and HSC Board to rely on the public to identify such potentially fraudulent behaviour among pharmacists.

16. The Department, HSC Board the NI pharmaceutical contractors need to reach agreement on reimbursement arrangements. In 2010, a judicial review concluded that by continuing to apply the Scottish Drug Tariff in NI in the absence of an agreed contract, the Department had failed to meet its statutory duty to provide fair and reasonable remuneration to community pharmacists. A subsequent judicial review also found in favour of community pharmacists. The Judicial Review process cost the Department £550,000. As a result of the Department’s failure to agree the new pharmaceutical contract, £46 million (which could have been released to provide additional, patient-focused pharmaceutical services in the community) had to be repaid to pharmacists.

Summary of Recommendations

Recommendation 1

The Committee is concerned that large variations between GP practice prescribing costs have little impact on the financial envelope GPs receive through the General Medical Services contract. As this contract is negotiated on a UK-wide basis, the Committee recommends that the Department examines, in conjunction with its UK counterparts, how the GMS contract can be strengthened to ensure that GPs improve all aspects of their performance, including prescribing.

Recommendation 2

Since the cost of the drugs prescribed in primary care falls to the HSC Board, GPs have limited incentive to prescribe more efficiently. To improve accountability, the Committee recommends that the Department establishes benchmarks for GP practices to compare against each other and identify areas where improvement is needed. The Committee also recommends that this benchmarking data is published periodically on the basis that sharing data is a necessary part of a drive to improve efficiency.

Recommendation 3

The Committee recommends that the HSC Board takes a more proactive approach to examining prescribing patterns in each of the remaining 12 therapeutic areas in order to establish the potential for generating savings.

Recommendation 4

The Committee recommends that the HSC Board establishes a long-term plan outlining the timescale within which savings will be achieved and shares this with the Committee.

Recommendation 5

The Committee recommends that the Department takes steps to investigate the relationship between health need and prescribing.

Recommendation 6

While the Committee recognises the benefits of minimising bureaucracy, it is essential that proper systems and controls are in place to prevent and detect fraud. The Committee recommends that the HSC Board considers and introduces appropriate internal controls/sanctions to detect any instances where community pharmacists, contrary to GP instructions, dispense a generic rather than branded drug.

Recommendation 7

The Committee recommends that the Department explores with the pharmaceutical industry the scope to achieve greater consistency of appearance, labelling and/or packaging of the more common drugs supplied to the health service.

Recommendation 8

The Committee recommends that the HSC Board further develops public awareness initiatives to equip patients with more information on the use and cost of medicines, in particular to ensure that patients are better educated on the efficacy of less-expensive generic products. Further the Committee recommends that GPs are reminded of the need to fully inform patients of the rationale for their prescribing decisions.

Recommendation 9

The Department’s decision not to use its reserved powers to obtain information from contractors was flawed. The Committee notes that the Department is currently undertaking a Cost of Service Investigation and is now producing annual Margins Surveys but considers that the continued failure to agree a way forward is unacceptable. The Committee recommends that a suitable solution is reached between the parties as a matter of urgency.

Introduction

The Public Accounts Committee (the Committee) met on 3 December 2014 to consider the Comptroller and Auditor General’s report “Primary Care Prescribing”. The main witnesses were:

Mr Richard Pengelly, Accounting Officer, Department of Health, Social Services and Public Safety;

Dr Mark Timoney, Chief Pharmaceutical Officer, Department of Health, Social Services and Public Safety;

Mr Joe Brogan, Head of Pharmacy and Medicines Management, Health and Social Care Board;

Mr Kieran Donnelly, Comptroller and Auditor General; and

Mr Jack Layberry, Treasury Officer of Accounts.

Responsibility for managing the Northern Ireland (NI) General Pharmaceutical Services budget was devolved from the Department to the HSC Board on 1 July 2010.

In 2013, almost 39 million items prescribed by General Practitioners (GPs), were dispensed by NI community pharmacy contractors (contractors or CPCs). That year, contractors received £460 million for providing community pharmaceutical services on behalf of the Health and Social Care (HSC) Board. This represents approximately 10 per cent of the total spend on healthcare in Northern Ireland.

The overall volume of items prescribed has been increasing across all UK countries over recent years. Despite the rise in volume, prescribing costs per head of population fell in England, Scotland and Wales over the seven year period to 31 March 2014. By contrast, the prescribing costs per head of population in NI were higher in 2013 than in 2007.

The HSC Board has achieved savings in the four years since the General Pharmaceutical Budget was devolved from the Department. Since 2010, while the volume of items prescribed has continued to increase (by almost 5 per cent to 2012), the overall cost of dispensing items has decreased by just over 7 per cent.

The Comptroller and Auditor General’s report identified that, while progress has been made in controlling NI prescribing costs, there is scope to generate significant further savings without compromising patient care.

In taking evidence, the Committee explored four key areas, as follows:

The likely level of additional prescribing savings which can be generated without adversely affecting patient care;

The extent to which closer working with GP practices could generate savings;

The importance of tailoring treatments and medication in order to secure the best outcomes for patients; and

The efforts made by the Department and NI pharmaceutical contractors to reach agreement on the arrangements for reimbursing the cost of the most frequently prescribed and dispensed generic medicines.

The health service can make substantial savings on the prescribing budget without affecting patient care

The Committee and the Department agree that good management of prescribing is about much more than simply containing costs. To be truly effective, patients must receive the most suitable treatment for their condition and that treatment must be secured at the best possible price.

The primary care prescribing budget is significant at £460 million - 10 per cent of the entire health and social care spend each year. While the Committee commends the HSC Board for generating savings since July 2010, it considers that there is scope for generating significant further savings without adversely affecting patient care.

On comparisons of the prescribing cost per head across the UK

It is clear that prescribing costs in Northern Ireland are not in line with the rest of the UK. If the prescribing costs per head of population in NI in 2013 had been in line with those in Wales, overall prescribing costs could have been reduced by £73 million.

The Department acknowledges that published data on UK prescribing costs shows that prescribing here is more expensive than in England, Scotland and Wales. While the Committee accepts that there may be differences, it questions whether the regional service delivery differences outlined by the Department fully explain the extent of the cost differential.

The Committee considers that, at the very least, such high level comparators indicate there is scope to generate significant savings against the NI prescribing budget. Given that NI is the only UK region which incurred higher costs per head of population in 2013 than in 2007, the Committee concludes that NI has been much slower in achieving savings than other parts of the UK.

On prescribing cost comparisons between GP practices

The Committee accepts that variations in GP practice caseloads will result in variations in prescribing costs. It therefore welcomes the use of NI ‘prescribing units’ (NIPU) which normalise prescribing data by adjusting for, among other things, social class and age distribution. The Committee acknowledges that the use of standardised costs offers an opportunity for the Department to assess the relative prescribing performance of individual GP practices.

The Committee welcomes the success in reducing the variation in standardised prescribing costs over the period from 2010 to 2013 but notes that, in 2013, there was over 100% variation between the GP practice with the lowest cost prescribing rate and that of the highest cost practice. The Committee also notes that the Comptroller and Auditor General in his 2014 report calculated that by reducing the average cost per 1,000 NIPU by 10 per cent over a three year period, savings of £54 million could be generated.

Recommendations 1 and 2

The Committee is concerned that large variations between GP practice prescribing costs have little impact on the financial envelope GPs receive through the General Medical Services contract. As this contract is negotiated on a UK-wide basis, the Committee recommends that the Department examines, in conjunction with its UK counterparts, how the GMS contract can be strengthened to ensure that GPs improve all aspects of their performance, including prescribing.

Since the cost of the drugs prescribed in primary care falls to the HSC Board, GPs have limited incentive to prescribe more efficiently. To improve accountability, the Committee recommends that the Department establishes benchmarks for GP practices to compare against each other and identify areas where improvement is needed. The Committee also recommends that this benchmarking data is published periodically on the basis that sharing data is a necessary part of a drive to improve efficiency.

In the Committee’s view, a higher proportion of more expensive drugs were being prescribed in NI because of the delay in introducing the NI Formulary and a ‘Managed Entry’ process. Prior to April 2014, unlike Scotland and Wales, in NI there was no body which specified what medicines ought to be (or ought not to be) prescribed. The Committee acknowledges that such a body is now in place.

The NIAO’s examination of prescribing patterns in three (out of 15) therapeutic areas illustrated how improved prescribing decisions could generate significant savings. The Department accepts that the failure to switch from an expensive generic version of a drug to a less expensive generic version resulted in additional costs of £8.9 million in 2012 and £5.1 million in 2013. Further, it accepts that reducing NI prescribing levels for the most frequently dispensed drug in NI, to levels elsewhere in the UK would have released over £8.5 million in 2012 and £9.7 million in 2013.

The HSC Board told the Committee that it was aware of inefficiencies in stomach acid treatment prescribing prior to theNIAO’s work. If this is the case, it is unacceptable that appropriate action was not taken to avoid incurring unnecessary costs.

Recommendation 3

The Committee recommends that the HSC Board takes a more proactive approach to examining prescribing patterns in each of the remaining 12 therapeutic areas in order to establish the potential for generating savings.

On the adequacy of annual savings targets

Given the Department’s acknowledgment that there may be scope to save “tens of millions of pounds”, the Committee is disappointed that steps have not been taken to quantify the potential savings that could be generated by more cost effective prescribing. In the absence of this information, the Committee is unconvinced that the Department’s annual savings targets have been sufficiently challenging.

Recommendation 4

The Committee recommends that the HSC Board establishes a long-term plan outlining the timescale within which savings will be achieved and shares this with the Committee.

On the impact of varying healthcare needs of the NI population

The Committee notes the extensive body of research, commissioned by the Department, which indicates that the health needs of the population in Northern Ireland exceed those in the rest of the UK. However against this, Northern Ireland has a lower proportion of older people than other UK regions, a lower prevalence of many diseases (according to the Department’s own GP payment tool (the Quality Outcomes Framework (QOF)), and has had a lower volume of prescribing than that in Wales, for example, in each of the past seven years.

While the Department was dismissive of the use of data from the Quality and Outcomes Framework (QOF) to measure relative health needs, the Committee considers that the disparity in the information sources suggests that either the relationship between health need and prescribing is not as straightforward as may be expected or that there may be some problem with the information produced on disease prevalence.

Recommendation 5

The Committee recommends that the Department takes steps to investigate the relationship between health need and prescribing.

The HSC Board must continue to work closely with GPs to secure better value for money from prescribing

On the role and numbers of Medicine Management Advisers (MMAs)

Savings have been achieved through the greater use, and availability, of generic drugs and the work of the Prescribing Efficiency Review Team (PERT). PERT (through its Medicines Management Advisers (MMAs)) monitors prescribing spend at individual GP practice level and sets regional targets for reducing expenditure on specific drugs and therapeutic areas.

The Committee acknowledges that efforts to reduce prescribing costs have achieved real savings over the past four years. The Committee accepts that there is no recognised ‘correct’ ratio of MMAs but notes that in other UK regions additional resources are made available for MMA or other pharmaceutical support to GPs. MMAs play a significant role in generating efficiencies within GP practices. The Department told the Committee that it is currently preparing a business case to identify the optimal number of MMAs (or other pharmaceutical support) required in NI. The Committee expects to have sight of the final business case.

On the vulnerability to fraud

The Committee asked the Department to outline the controls it has in place to identify instances where a pharmacist dispenses a generic drug when the GP’s prescription is for a branded drug. Such potentially fraudulent behaviour not only results in additional costs but may pose patient safety risks.

The Department told the Committee that it relies on the public to identify and report any instances of potentially fraudulent behaviour among pharmacists.

Recommendation 6

While the Committee recognises the benefits of minimising bureaucracy, it is essential that proper systems and controls are in place to prevent and detect fraud. The Committee recommends that the HSC Board considers and introduces appropriate internal controls/sanctions to detect any instances where community pharmacists, contrary to GP instructions, dispense a generic rather than branded drug.

On the relationship between GPs and consultants in secondary care

In some cases, hospital consultants prescribe a drug which is not regularly used in primary care or which is normally prescribed by a GP in a cheaper, but clinically equivalent, alternative form. In such a scenario, the GP is expected to follow the recommendation of the secondary care consultant.

The Committee believes that patient safety and the overall quality of care depends upon appropriate mechanisms being in place to facilitate the exchange of views on prescribing practice between GPs in primary care and their secondary care counterparts. The Committee requests that the Department provides it with an update on the current arrangements in place to ensure that proper consideration can be given to the consequences of secondary care decisions on primary care prescribing.

It is important that patients are treated in the most effective way and provided with appropriate advice on prescribing decisions

On the consideration of alternatives to prescribing drugs

Patient care and safety is of paramount importance in providing health and social care services. An important consideration in this is ensuring that patients receive the appropriate treatment for their condition.

The Department told the Committee that the absence of appropriate treatment facilities and/or therapies (to treat, for example, mental health or to manage pain) results in additional prescribing costs. The Committee considers that short-term decisions to prescribe lead to ineffective long-term treatment of patients. The Committee considers that, to treat patients effectively, the full range of possible treatments must be fully evaluated. Such evaluation would consider the cost and likely long-term success of conventional prescribing against available alternative therapies.

On fully informing patients of the clinical and cost implications of prescribing decisions

The Committee acknowledges the success of campaigns, such as ‘Go Generic’, in reassuring patients of the effectiveness of generic, rather than branded, drugs. However, the Committee is not convinced that sufficient work has been done to reassure patients that, for many conditions, one of several generic versions will be clinically appropriate to treat their condition.

The Committee is concerned that, patients, particularly elderly patients, may become confused where they are repeatedly prescribed a different, generic drug. This confusion may mean that patients take their drugs wrongly or not at all. In the Committee’s view, GPs must do more to ensure that patients are more fully informed of the rationale (clinical and cost) supporting their prescribing decisions.

Recommendations 7 and 8

The Committee recommends that the Department explores with the pharmaceutical industry the scope to achieve greater consistency of appearance, labelling and/or packaging of the more common drugs supplied to the health service.

The Committee recommends that the HSC Board further develops public awareness initiatives to equip patients with more information on the use and cost of medicines, in particular to ensure that patients are better educated on the efficacy of less-expensive generic products. Further the Committee recommends that GPs are reminded of the need to fully inform patients of the rationale for their prescribing decisions.

The Department, HSC Board and the NI pharmaceutical contractors need to reach agreement on reimbursement arrangements

Having undertaken research on community pharmacist procurement profit levels, in 2006, the Department of Health in England introduced a new community pharmacy contract in England and Wales. Scotland phased the contract in during 2007.

The revised arrangements introduced a new UK Drug Tariff category (Category M) covering almost half of all items reimbursed each year. Under the revised contractual arrangements, reimbursement rates for Category M items moved closer to actual purchase prices paid by community pharmacists. Funding released was then made available to community pharmacists who could demonstrate they were providing additional patient-focussed pharmaceutical services in the community setting.

Community pharmacists in NI refused to provide information to allow the Department to quantify local procurement profit levels and subsequently refused to accept the terms of the revised contract. Despite this, the Department continued to rely on the Scottish Drug Tariff and effectively introduced the revised contractual arrangements in NI.

The Department’s actions were challenged by community pharmacists in two separate judicial reviews. Both judicial reviews found in favour of the community pharmacists concluding that although the Department had reserved powers to ensure that community pharmacists provided the required information it had failed to use these powers and had unlawfully continued to apply the UK Drug Tariff in the absence of an agreed contract.

The situation remains unresolved and, seven years after the revised contract became effective in England and Wales, it is still not in place in NI. The Judicial Review process cost the Department £550,000. In addition, as a result of Department’s failure to agree the new pharmaceutical contract a total of £46 million had to be repaid to pharmacists.

Recommendation 9

The Department’s decision not to use its reserved powers to obtain information from contractors was flawed. The Committee notes that the Department is currently undertaking a Cost of Service Investigation and is now producing annual Margins Surveys but considers that the continued failure to agree a way forward is unacceptable. The Committee recommends that a suitable solution is reached between the parties as a matter of urgency.

 

Download the full report here.



[1]  Pregablin is a medicine used to treat epilepsy, neuropathic pain and generalised anxiety disorder. As an analgesic it works by reducing the volume of pain signals sent to the brain from damaged nerves. It can have a euphoric effect on patients and cases of abuse and misuse have been reported.

 

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