Govt reveals actual spend on community pharmacy


an pharmacist holding up a piggy bank employee pharmacist wages money earning funding salary salaries wage

How much money went to Australia’s 5800+ community pharmacies for drugs, dispensing and pharmacy programs in 2019-20? A PBS report reveals all

The Federal Government remunerated community pharmacies and friendly societies $7.3 billion for the cost of PBS and RPBS medicines during the 2019-20 financial year, according to the PBS Expenditure and Prescriptions Report published on Thursday.

Around 94% of this covered the ex-manufacturer price, with the remaining 6% going towards wholesale mark-up. Remuneration included Section 85 and Section 100 scripts, and Drs Bag, but excluded under co-payment prescriptions.

The government also spent nearly $1.59 billion in fees recognising pharmacists’ specialised skills in dispensing medicines—a 6% increase on the 2015-16 figure.

Breaking down the numbers, it paid $1.56 billion for the dispensing fee and over $25 million for the dangerous drug fee, with the remainder going towards wastage costs and the container fee.

An additional $990 million was provided to pharmacies for administration, handling and storage costs through the AHI fee, up 16% since 2015-16.

Furthermore, $158 million in remuneration was provided through the Premium Free Dispensing Incentive (PFDI) between 1 July 2019 and 30 June 2020, plus $13 million for the electronic prescription fee. The PFDI has since been cancelled from 1 July 2020 under the new terms of the 7CPA, with these funds reportedly re-invested into pharmacy dispensing fees.

Altogether $2.7 billion was spent on pharmacy remuneration as part of the 6CPA in the last financial year, excluding the price to pharmacists.

There were 5,822 community pharmacies as of 30 June 2019.

Meanwhile a further $236 million was spent on a range of professional programs and services delivered by community pharmacy under the 6CPA in 2019-20.

Actual expenditure during the last financial year was:

  • $16 million for the Rural Pharmacy Maintenance Allowance;
  • $4.8 million for the Rural Pharmacy Workforce Program;
  • $104 million for Medication Management services;
  • $97.5 million on Medication Adherence services;
  • $5 million on Aboriginal & Torres Strait Islander programs; and
  • $8.6 million on Pharmacy Program administration fees.

Forty-three percent of medication management funding went towards MedsChecks and Diabetes MedsChecks, while about 20% went to HMRs, RMMRs and Clinical Interventions each.

The lion’s share of Medication Adherence services funding went to DAAs (92%), with the remainder going towards Staged Supply.

Community Services Obligation (CSO) expenditure in 2019-20 reached $195 million.

According to the report, the PBS-subsidised prescription volume increased by 1.6% in 2019-20, reaching a total of 208.5 million.

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1 Comment

  1. Michael Ortiz
    18/12/2020

    The PBS paid Pharmacists $40,000 per year per Pharmacy per year

    What did the Government get for its money?

    HMRs, DAA, Staged supply, Medschecks, Clinical interventions

    and what value could Government receive from these services ?

    hospital admissions avoided, nursing home admissions delayed, doctor consults avoided, unnecessary drugs not supplied

    So how could Government use the $40,000?

    40 hospital bed day for 6 hospital admissions or
    10 months spent in a nursing home or
    1000 GP consultations or
    2000 PBS scripts

    If Government spent $10,000 on each, then one year of Pharmacy services can be = valued at
    around 10 hospital bed days avoided, 10 weeks in a nursing home avoided, 250 GP consultations’ avoided and 500 unnecessary prescriptions avoided.

    It seems to me that Government is getting much for its money than it is paying.

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