What is the Pharmacy Access Scheme, and what changes in 2027/28?

What is the Pharmacy Access Scheme?

The Pharmacy Access Scheme (PhAS) is a monthly NHS payment to isolated community pharmacies in England. Its purpose is to keep a pharmacy open where the next one is more than a mile away. The current version started on 1 January 2022, replacing the original scheme introduced in 2016 alongside that year's funding cuts. It is funded to a maximum of £20m a year from the Community Pharmacy Contractual Framework (CPCF).

The scheme is automatic. The Department of Health and Social Care (DHSC) worked out eligibility nationally, using Ordnance Survey road distances, deprivation data and dispensing volumes. Pharmacies do not apply. The GOV.UK settlement for 2026/27 puts it plainly: eligibility "is calculated nationally, with monthly payments distributed automatically alongside regular reconciliation payments". The rules sit in Part XIIA of the Drug Tariff.

After a review window in early 2022, in which 43 of 63 applications succeeded, 1,445 pharmacies were eligible. That figure comes from Community Pharmacy England (CPE), and it has not been refreshed since. The list is static: it was fixed by reference to the pharmaceutical list on 31 March 2021, and nobody has joined it since. That is the root of the review now promised for 2027/28.

Which pharmacies qualify?

A pharmacy qualifies if it passes four tests on the 2022 data and is not in an excluded category. The tests are set out in DHSC's 2022 guidance and in the PSNC briefing that explained them to contractors. The table lists them.

Two points matter for anyone reading their own position. First, the distance test uses road and footpath distance, not a straight line. A pharmacy 0.9 miles away as the crow flies can still be more than a mile by road. Second, the volume cap is a percentile, not a policy on size. DHSC set it at the 70th percentile of 2019/20 volumes, down from the 75th in the 2016 scheme, which pushed some larger pharmacies out.

The service condition has moved with the times. The Community Pharmacist Consultation Service became Pharmacy First on 31 January 2024, and the practical requirement is that an eligible pharmacy stays registered for it. A pharmacy that deregisters risks its PhAS payment as well as its consultation income.

How much does the scheme pay?

Between £109.38 and £1,458.33 a month, set by 2019/20 dispensing volume. The 2022 scheme replaced the old income top-up with 23 bands on a bell curve. Small pharmacies get more as volume rises, the middle of the range gets the £17,500 annual maximum, and payments fall again for larger pharmacies. The values below are from PSNC briefing 033/21 and are carried in Drug Tariff Part XIIA. The three peak bands, which all pay the same, are shown as one row. Annual figures are twelve times the monthly payment.

The shape tells you what DHSC was trying to do. A pharmacy dispensing 4,000 items a month, about 48,000 a year, sits at the peak and gets £17,499.96. A pharmacy dispensing 8,000 items a month, about 96,000 a year, gets £6,562.56. The scheme assumes the bigger pharmacy can carry its fixed costs from dispensing income and needs less help to stay open. Whether that assumption still holds after five years of rising costs is one question the review will have to answer.

The money arrives monthly, alongside the reconciliation payment for that month. The first payments under the 2022 scheme were made with the January 2022 reconciliation on 1 April 2022, and successful review applicants were backdated to 1 January 2022. For the rest of your NHS income lines, see what the 2026/27 pharmacy contract actually pays.

Why is the scheme being reviewed?

Because the scheme is frozen in 2021 and the network has moved on. Every input is old. Dispensing volumes are from 2019/20, the year before the pandemic changed prescribing patterns. The list is the pharmaceutical list of 31 March 2021. The deprivation measure is the 2019 Index of Multiple Deprivation. DHSC said in its own guidance that it would "consider whether further updates and revisions are required, from April 2023 at the earliest". Three years later, that consideration has become a commitment.

The network has shrunk in the meantime. The House of Commons Library's briefing on community pharmacy in England was published on 2 March 2026. It counts 10,526 pharmacies open in February 2026 against 11,609 in February 2016, a fall of 1,083 or 9%. Some of those closures left a remaining pharmacy newly isolated. Under the 2022 rules it cannot join. Other pharmacies gained a competitor within a mile after 2021 and, under the same rules, kept their payment. For where the closures are falling, see how many UK pharmacies are closing, and where.

There is also a fairness problem the scheme itself created. DHSC's guidance says that if a new pharmacy opens very close to a PhAS pharmacy, "the PhAS pharmacy will not lose entitlement". It also says a pharmacy that grows past the volume cap "will not automatically lose entitlement" until the next revision. Those protections were sensible for stability. Over five years they have produced payments that no longer track isolation.

What did the 2026/27 contract decide?

It kept the scheme as it is and promised a review. DHSC, NHS England and CPE published the 2026/27 CPCF settlement on 29 May 2026. On PhAS it says: "The Pharmacy Access Scheme (PhAS) will be retained with funding capped at £20 million for the financial year 2026 to 2027. We also commit to reviewing the scheme with a view to implementing updates from 2027 to 2028". CPE's briefing 009/26 records the same commitment: DHSC will "review and update PhAS, implementing any changes from 2027/28".

Note the wording. "With a view to implementing updates" is a commitment to try, not a guarantee of a new scheme on 1 April 2027. The 2026/27 deal was worth £3.636bn, up £340m or 10.3%, and it also committed both sides to a joint reform programme on reimbursement, margin distribution and dispensing at a loss. The PhAS review sits alongside that programme, and the two will compete for the same officials and the same money. For the wider programme, see what the community pharmacy reform programme will change.

What could change from 2027/28?

Nobody knows yet, and this section is analysis rather than announcement. DHSC has not published options, a consultation or criteria. What follows is the set of levers the 2022 scheme design leaves open, and what each would do to a typical recipient. Treat it as a checklist for scenario planning, not a forecast.

The arithmetic of the cap is the point most owners miss. If DHSC re-runs the 2022 tests on the 2026 network, the list almost certainly grows, because more than 1,000 pharmacies have closed since 2016 and each closure can isolate a neighbour. If the cap stays at £20m, the extra pharmacies are paid by shrinking everyone's band. If the cap rises, the money has to come from elsewhere in the CPCF envelope. Neither outcome is announced. Both are possible.

Timing is the other variable. The 2022 update was announced in August 2021, started on 1 January 2022, ran a review window from 4 January 2022, and finished its reviews by the end of May 2022. A 2027/28 update on the same pattern would need its guidance and list in the second half of 2026 or early 2027. If nothing has appeared by the autumn, an April 2027 start becomes less likely.

Can a new or relocated pharmacy join?

Not under the current scheme. DHSC's guidance is explicit: "Any new pharmacy opening will not be eligible for the 2022 PhAS until the next update of the PhAS scheme". The same logic shuts out an existing pharmacy that became isolated after 31 March 2021. Its neighbour's closure does not trigger a reassessment. The 2027/28 review is the first realistic route in.

Losing the payment is easier than gaining it. Payments stop from the month a pharmacy leaves the pharmaceutical list. PSNC's briefing warned that "a pharmacy that moves permanently may become ineligible". If you are considering a relocation, ask your ICB and NHSBSA how the move would be treated before you commit. A short move that keeps the same isolation may be fine; a move into town almost certainly is not.

Buyers should read the payment with the same care. A PhAS band worth £17,500 a year is material to the price of a small rural pharmacy, and it is a 2021 entitlement that the review could reprice or remove. Check the pharmacy's band against its current volume, check whether a competitor has opened within a mile since 2021, and discount accordingly. For how to value the rest of the business, see what a pharmacy is worth in 2026.

What should owners and buyers do now?

Model the downside this year, because the upside will announce itself. A PhAS pharmacy at the peak band earns £17,499.96 a year from the scheme. If the review moved it two bands down the curve, to £1,348.96 a month, it would lose £1,312.44 a year. If it fell out altogether, it would lose the lot. Those are the numbers to put next to your rent, your locum bill and your margin.

Isolated pharmacies that are not on the list should prepare the opposite case. Gather the evidence now: your road distance to the next pharmacy, the deprivation decile of your premises, and your dispensing volume for the last full year. When DHSC publishes the review, it will need exactly those facts, and the 2022 process gave contractors only weeks to challenge the mapping.

Finally, watch the reform programme and the 2027/28 negotiation together. The PhAS review is one line in a much larger renegotiation of how dispensing is paid for. For the timetable of everything else due next year, see what is coming for UK pharmacy in 2027.

Key takeaways

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