HSE stops payments to Lloyds Pharmacy in fees row

Pharmacy chain’s approach to dispensing fees ‘constitutes fraud’, letter claims

A Lloyds Pharmacy branch. Photograph: Alan Betson / The Irish Times

A Lloyds Pharmacy branch. Photograph: Alan Betson / The Irish Times


The Health Service Executive has stopped payments worth hundreds of thousands of euro a month to the State’s largest pharmacy chain in a row over how it claims dispensing fees.

The HSE says it won’t reimburse claims made by Lloyds Pharmacy for phased dispensing until it is satisfied with the reasonableness and accuracy of the claims.

Lloyds has significantly boosted its dispensing fee income by claiming multiple payments from the State for single prescriptions presented by medical card holders.

The HSE, in correspondence seen by The Irish Times, says the practice “constitutes fraud” and must cease immediately in all Lloyds outlets.

Its suspension of payments is likely to cost the company at least €3 million a year.

The HSE has also been examining how Lloyds deals with “owings”, which occur when a patient’s prescription cannot be completely fulfilled due to, for instance, a medicine not being in stock.

A spokesman for Lloyds said it was unaware of any such investigation.


In correspondence, the HSE says the practice by Lloyds of claiming multiple phased dispensing payments in situations where a prescription is dispensed on a single occasion is “endemic” across all its outlets.

“The current and historic phased dispensing claims are staggeringly high,” lawyers for the HSE wrote in a letter to Lloyds last August 28th.

It claims Lloyds’ position on phased dispensing is “quite alarming” and “raises obvious patient-safety concerns”.

The HSE declined to answer questions about the dispute, saying it was “not in a position to comment on any investigation that is ongoing”.


“That the HSE is now interpreting these differently runs contrary to the clear understanding of the pharmacy community.”

The HSE says phased prescribing is allowed in only narrow circumstances and Lloyds’ interpretation of the rules is “nonsensical”.

“Your client’s practice of separating a prescription into daily doses (“MyMed”) may or may not be of benefit to patients,” it says in a letter to Lloyds.

“However, the point is irrelevant. The critical point is that this practice is not reimbursable under the phased dispensing rules.”

Lawyers for Lloyds responded last month saying its practice was “entirely consistent” with the rules and the approach taken by other pharmacies.

“There is no basis whatsoever for your allegations of breach of contract or other illegal activity on the part of our client, still less of fraudulent behaviour.”

It refused to give the undertaking sought by the HSE to stop the practice but offered to meet and seek a resolution.

On September 17th, the HSE replied, saying Lloyds was a “significant outlier” in terms of claims for phased dispensing and demanding the chain reimburse all fees due to it.