Lloyds trials charging patients for home deliveries (as posted on LinkedIn)
We learned today that Lloyds will start charging new patients for home deliveries and may roll out the charges to all patients.
Reaction to this news from Lloyds is mixed across the profession. Maybe the headline could also read “Lloyds realises that the only way to make a profit if the government refuses to pay for services is to charge patients for them”.
Lloyds will charge a £35 for a 6 month subscription to the delivery service or £60 for 12 months and staff have bar codes to scan for the charges to be collected.
Charging for deliveries has been a contentious subject for many years. Decades ago only genuinely housebound patients could hope to receive such a service from most pharmacies, but in more recent times it became a marketing tool to attract customers and there are hardly any pharmacies now charging for delivery.
So why has Lloyds taken this step? It is easy to imagine a heated debate around the boardroom table about whether this is just a sensible business decision or commercial suicide. One must also wonder what the (very recent) ex MD, Cormac Tobin, thought about this idea (feel free to reply Cormac!). If nothing else Lloyds is certainly taking the lead in sending a clear message to the government that pharmacy must be properly funded. I admire the commercial stance being taken by Lloyds and feel sorry for every patient who cannot afford to pay for deliveries but may have no choice other than to do so. Whether you like Lloyds or not, their recent moves have done more to highlight the dire state of pharmacy remuneration than all our trade bodies combined.
Of course the other argument at play here is the Amazonisation of all business. People are now accustomed to ordering online and paying for delivery. We all know that “FREE DELIVERY” just means that the cost was already added to the price you paid, but pharmacy is not allowed to charge more (or less) for prescriptions than the amount set by the government, so that option is not available. So is this just Lloyds recognising the change in the marketplace and taking a lead in reacting to it? It doesn’t help that the demographics of pharmacy users are unlikely to be the same as those that Amazon enjoys, but those demographics are changing and so is the world of pharmacy.
There is another question which will be answered in time and that is whether patients will flock to distance selling pharmacies if high street pharmacies start charging for delivery. The accepted position here is that distance selling pharmacies cannot lawfully charge for delivery as the delivery is an integral part of their NHS service, whereas a high street pharmacy is permitted to charge for delivery as delivery is not an integral part of their service. Personally I would like to see a legal challenge to this as I do not agree that distance selling pharmacies cannot lawfully charge for deliveries despite this being the widely accepted belief. The only way this could be true would be if the definition of “Essential Services” was different for distance selling pharmacies than it is for other pharmacies – and it isn’t.
So where are the other pharmacy big beasts on this? Lloyds will have been careful not discuss their plans with other multiples and will be very wary of anything that looks like collusion, but Boots, Rowlands, Well and Day Lewis will all have this on their agenda for the next board meeting and it will be interesting to see if they fall into line.
Finally, what is this worth to Lloyds? Lloyds has about 1,500 pharmacies and if 500 patients from each pharmacy sign up for 12 months then that is £45,000,000 (yes, 45 MILLION) per year in revenue that is payable in advance and goes straight to the bottom line. Maybe that is why the government won’t pay for deliveries?