“There are commitments we will ensure the government holds itself to”


With the report to be delivered in less than two weeks, the Pharmacy Guild is counting on its strong ties with government to secure the current pharmacy model

According to the Pharmacy Guild, the report from the Review of Pharmacy Remuneration and Regulation panel is expected to be delivered to the government by the 15th of this month.

Guild National President George Tambassis and Executive Director David Quilty say that their next critical steps will be to work closely with Health Minister Greg Hunt and the Health Department after it receives the report.

“This is a report to government, not a report of government,” Mr Quilty reminds members.

“It’s an input, we agreed to it as part of the 6CPA negotiation. It can make recommendations but not changes—that’s up to the government.

“So the really important work is the work we do with the Federal government after the Review reports.”

Mr Quilty told delegates of the Pharmacy Connect conference over the weekend that there has been “clear recognition” with Minister Hunt that the Federal Government will work with the Guild on the response to the review, to ensure it maintains the current community pharmacy model, and secures the ongoing viability of community pharmacy.

“There have been commitments that we will be ensuring the government holds itself to in it response to this review,” says Mr Quilty.

Minister Hunt has shown extensive support for both the pharmacy sector and the Pharmacy Guild since he took up the health portfolio early this year.

In his May budget, the minister provided several measures for pharmacy that the Guild applauded, including finalised funding for community pharmacy programs, risk share compensation for lower than expected script volumes in 2015-16, and lowered cost of medicines.

He has also recently announced a plan for a national real-time monitoring system for dangerous prescription drugs to be rolled out by the end of 2018 (a move the Guild has been long pushing for).

The Guild says it will continue to tackle the King Review interim paper’s recommendation for the removal of location rules.

“We know that the current government is very supportive of location rules, but the interim report talks about very negative stuff around location rules,” says Mr Tambassis.

Speaking at PSA17 conference in July, Minister Hunt announced that the government will soon introduce legislation to remove the existing sunset clause on pharmacy location rules.

He had said feedback from pharmacy owners on was that “the threat of taking location rules away was a threat to their very existence” and had prompted the government to action.

Ongoing legislative basis for the pharmacy location rules “will provide pharmacy owners with ongoing confidence that approval to supply pharmaceutical benefits, at particular premises, will continue to be regulated,” the minister has said.

The Guild will also be railing against the recommendation to replace all current dispensing-related fees (aside from the Extemporaneously Prepared Fee) with a total dispensing remuneration benchmark of $9 to $11.50, and a flat $10 per script dispensing fee.

“Obviously we don’t agree with that,” Mr Tambassis.

“We fought very, very hard with negotiations in the 6CPA to argue about how important dispensing is to us. Dispensing is our core service. We don’t think $9-$11.50 is correct.”

Mr Quilty says there are “fundamental misunderstandings” in the interim report about what community pharmacy actually does.

“It’s kind of like putting a square peg in a round hole. [Review Chair] Stephen King has decided it makes sense to apply a system of price setting, which really applies to large utilities like electricity and gas, and decide to apply that to 5,700 small businesses around Australia.

“It’s called Efficient Long Run Incremental Cost and it’s based on the most efficient cost of dispensing a medicine. But it’s not like that – dispensing a medicine can sometimes turn into a 15-minute consultation.

“Placing an incremental fee fails to recognise the fundamental role that pharmacists play in counselling and provides services that patients need.

“The dispensing fee that’s been picked up by the review doesn’t really have any meaning. This includes the PFDI, dangerous drug fee – if you add all these up you can see it’s a significant reduction, about 20% reduction in dispensing fee.

“It’s basically our businesses that have made the PBS sustainable. And 1700 pharmacies will be at risk, smaller pharmacies that might be seen as less efficient, as not providing as much value and those pharmacies will be put at risk. The important this here is I think the government sees this is not the right approach for community pharmacists.”

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“1700 pharmacies will be at risk, smaller pharmacies that might be seen as less efficient, as not providing as much value.”

Mr Tambassis pointed out there were some positive recommendations in the interim report, including that the $1 discount should be abolished.

The government has expressed a willingness to review the $1 copayment discount.

Another recommendation in the interim report was capping the amount pharmacies should pay for medicines.

“Our submission to the review panel was that we would cap the amount that we would pay in our pharmacies and right through the wholesalers, and anything after that gap is worked out between the government and the wholesalers,” says Mr Tambassis.

“So there’s a capped amount right through the supply chain, so our margins stay right where they are. We’re working with the suppliers and wholesalers, they’re not 100% on board just yet. We’re going to hopefully come to an agreed solution [through the Medicines Partnership of Australia].

“Certainly in many ways this review has united parts of the broader sector, including the medicines supply and wholesalers. We’ve also been working very closely with the PSA – like us they are very keen to expand the role of pharmacists as a profession. I’m very confident there will be a united view from the broader sector in response to this report when it’s handed down.”

Minister Hunt has the same vision in terms of expanded roles for pharmacists, and has openly confirmed his strong support for the Guild.

“I want a health system where every Australian has access to the best doctors, nurses, pharmacists, hospitals and allied health professionals,” said Minister Hunt in May.

“Our pharmacies and pharmacists are key to this vision and many are investigating how they can do more in the area of primary health care through the Health Care Homes trial and the Primary Health Networks.

“I know that the steps taken by the Australian Government in partnership with the Pharmacy Guild will ensure our health system continues to go from strength to strength and remain on of the best in the world.

“I look forward to working with the Pharmacy Guild in coming weeks, months and years.”

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