All contractors including ‘outliers’ to receive Covid cost payments in October

All contractors in England, including those identified as “outliers”, will receive a payment for their submitted Covid-19 related costs in early October, Pharmaceutical Services Negotiating Committee (PSNC) has said.

This follows finalisation of arrangements for payment of contractors’ Covid cost claims by the Department of Health and Social Care (DHSC) and NHS Business Services Authority (NHSBSA).

PSNC said in an update that more than 9,900 contractors have submitted claims for their Covid-19 related costs over the summer, which amounted to more than double the £120 million offered initially by the government.

Last week, PSNC outgoing chief executive Simon Dukes had assured all contractors will receive a payment at the start of October with almost 95 per cent of them receiving their claims in full.

Meanwhile, “outliers” will be paid one sixth of the additional advance payments they received, while their claims are being verified, the negotiator explained.

Some contractors’ claims will be further verified before the payment, including:

• Claims exceeding one third of annual NHS income in 2020/21 for contractors who opened after March 2019 or an average of 2019/20 and 2020/21 income for contractors who opened before March 2019
• Claims where initial review identifies a risk of a potential error that could result in a significant overpayment – eg where claims are likely to fall outside the categories for which contractors were eligible to claim for.

In case the claim remains outstanding for another month, the contractor will be again paid one sixth of the additional advance payments in November, unless the submission is not supported with evidence, PSNC said.

The NHSBSA will also conduct post-payment verification on claims, and can ask contractors to submit the evidence within five working days.

The negotiator said an amendment will be made to the Drug Tariff to reflect these arrangements.

Dukes said: “We have been clear that all contractors must receive a payment in October as last year’s additional advance payments start to be repaid.

“For the very small number of contractors whose claims need to be verified first, the payment of one sixth of the value of their additional advance payments balances the immediate need to support cashflow at this time with the risks of significant cashflow disruption should large claims need be reduced after verification.”