King Review national webcast: remuneration, location rules & HMRs

Participants posed some tough questions about pharmacy pay and restrictions, but what did the panel have to say?

Chair of the Review of Pharmacy Remuneration and Regulation, Professor Stephen King, began the live national consultation webcast on Wednesday night by reiterating the aims of the review.

“The key driver for this review is the consumer experience: are people getting the right medications at the right time?

“We need to make sure people have access to medicines across Australia, and not leave parts of the country behind,” he said.

“The aim isn’t to make sure pharmacies that are operating today will be operating tomorrow. Unfortunately we can’t prop up community services that are not best serving the community.”

Prof King then went on to describe the pharmacist role and remuneration.

“Pharmacists receive fair remuneration in a very different way to other allied health professionals. To put it simply, they sell stuff. It’s hard to think of another health profession that receives its primary remuneration through selling stuff… medicines and other retail products.

He mentioned there is a lack of accountability “from the taxpayers perspective,” adding that “it is taxpayer dollars that are remunerating medicines through community pharmacy.”

What you said

Some webcast participants were not happy with Prof King’s view of the pharmacist role.

“I do NOT just ‘sell stuff’,” wrote Fiona. “I counsell [sic], I advise I am there long after medical centres have closed ….. So condescending.”

“How are pharmacists expected to continue to deliver medicine advice and other important services to patients with price disclosure continuing to eat away at our margins?” asked Miranda.

Philip Smith asked the panel, “How do we get remunerated for saving a Dr visit when the child only has a viral rash?”

Would an MBS payment be a more appropriate way to remunerate pharmacists for delivering medicine advice and clinical interventions,” asked Sam.

Panel member and pharmacist Bill Scott pointed out that there is a need to make sure people are taking their medicines correctly, using the example of pharmacists teaching the correct asthma puffer technique.

“A payment for a clinical service would be a great idea, and through the MBS is possible,” said Scott.

Prof King agreed, saying, “We need to think about how to remunerate pharmacists for the additional services they provide.”

Home Medicines Reviews

Clinical consultant pharmacist Debbie Rigby brought up the issue of HMRs with the panel.

“You stated this is a consumer-focussed review. Consumer surveys and research have supported the value to the consumer of HMRs. And yet funding for HMRs is limited in the 6CPA, in fact reduced compared to previous Community Pharmacy Agreements. Have you had positive feedback from consumers on HMRs? Can the Review recommend continued or expanded funding for programs that are evidence-based, cost-effective and valued by consumers.”

Scott reassured participants that “the HMR is a very useful product” and the panel was aware of concerns.

“It’s the gold standard. There are issues about the limits on it at present. As we’ve travelled around the country, we’ve had people requesting that they need to do more HMRs for people in their cohort,” he said.

Prof King confirmed HMRs were being discussed as part of the review.

“As a clinical intervention, they’re fantastic. There is debate out there in the community pharmacy sector as to why there were a lot more of these reviews than what the government expected to be, and the money started running out for them. So these reviews were capped.

“But this means that in many areas these have fallen by the wayside, a consulting pharmacist can’t really build up a business on that. We’re asking for submissions so we can find out, how we can make a sustainable HMR system,” he said.

Rigby called on the panel to make HMRs a priority.

“I think current program such as HMRs, RMMRs are valuable services that start to address the 230,000 medication-related hospital admissions every year, half of which can be avoided. And yet these programs have been restricted, when in fact they should be expanded, albeit with a more targeted approach for patients at high risk. Can the Review make recommendations to the Minister to expand these programs?” she wrote.

Location rules

Many webinar participants brought up the current location rules.

“Location rules promote high rent – an approval cannot be granted or relocated unless strict rules are adhered to regarding leases and location,” said Mike.

“Removal of location rules will reduce rents across the board and lower cost of business can be passed onto consumers in the form of medicine prices. Pharmacy may survive under accelerated WAPD if cost of business is reduced.”

“Location Rules are being used to commit monopoly behaviour,” said Madonna.

“It is fair to say, the Guild do not speak for the majority of Pharmacist. The government does not act on behalf of other industries to support monopoly. Why do you think a rule from 1952 should be given to protect one industry only? Please get the ACCC to assist in this process of Location Rules,” she wrote.

Guest said “location rules are a deliberate form of protectionism”.

“The Guild negotiates the Community Pharmacy Agreement with the Government, and a requirement for the pharmacy to be QCPP accredited to be remunerated for supply. The Guild has a vested interest in pharmacies maintaining their QCPP accreditation to continue to be remunerated under CPA for successive, and successful, renegotiation. The QCPP is The Guild’s so this conflict of interest (actual or perceived) needs to be managed. Perhaps when an approval number for a small pharmacy is purchased, and then relocated (‘bunny-hopped’) and metamorphasised into a Discount Warehouse, the pharmacy should have to undergo a bridging QCPP re-accreditation.”

Jo Watson, review panel member and Consumers Health Forum Deputy Chair, responded to the comments by asking “what do location rules actually afford the consumer?”

“At the moment, taking into account the geographical spread, what do they do? What is the reason for them today, and what are the consequences of abandoning them altogether?”

Scott responded that “the aggregation of pharmacies in the better suburbs has actually decreased and the metropolitan area, the spread of pharmacies is a lot better than before. The number of rural pharmacies has increased and rural areas are being better serviced than they have ever been. That doesn’t mean there aren’t issues, such as the problems in shopping centres, but that doesn’t mean they can’t be fixed. We’re interested in looking into those but it doesn’t mean there haven’t been benefits.”

Prof King disagreed with Scott.

“What is the objective? There is not objective to the location rules. The government brought them in to save money. We only have the same amount of pharmacies today that we had in the 1990s.”

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Next 15 comments from King Review national webcast

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  1. pagophilus

    Unfortunately he’s right – pharmacists are remunerated by selling stuff. That’s not the work of a health professional.

    HMR overservicing – pharmacists (who are used to selling stuff to make money) realised that by doing more of something they would get paid more. Then they started doing more HMRs.

    The problem is one of culture in pharmacy. We need to stop treating pharmacy as a business (I was shocked when I first saw double degrees in pharmacy/commerce) and start behaving as health professionals, putting the health of the patient first. We need to develop a remuneration system in place to allow that to happen.

  2. Tim Hewitt

    Prof King has already made his mind up.. so, ‘we’ sell ‘stuff’.. big deal.. everybody is selling something, doctors sell advice, professors sell education (??) and that’s one hell of a business these days!.. bring on the day academics are paid for educational outcomes! bring on the enquiry into the business of the ‘professors’!
    Show me a system anywhere in the world where pharmacies no longer sell anything…

    • JimT

      …and prof King is selling BS and doing a good job of it at tax payers expense!!! which I am one of, and hence not happy my tax monies is being wasted.

  3. bob kelso

    While pharmacy numbers have remained fairly static since the 90s, we have more pharmacies per head of population than the UK does with a deregulated market. 1 pharmacy per 4035 people v 1 per 4,454 people in the UK. Seems like it’s worked to ensure distribution, even though it was ‘just a cost saving measure’.

    • Andrew

      >>>While pharmacy numbers have remained fairly static since the 90s,

      I thought we had 10-15% fewer after the buybacks.

      Sort of contradicts the location laws I reckon.

      • Sorry guys, King is right when he says “they sell stuff”. Frankly, you’d have to be living under a rock not to know that our health professional colleagues and more importantly the Health movers and shakers handing out money for professional services, don’t look favourably on a profession that flogs off half-baked complementary products, whose only “efficacy” standards are based studies with surrogate endpoints! If pharmacists really want to be recognised and financially rewarded as independent primary care advisors and triaging experts, they need to first work out how to divest themselves from flogging off complementary Products!!!

  4. locate this

    I love how the intro to location rules in the King Review states that they achieved their purpose, yet now Prof King says they haven’t. A look at any country without pharmacy location rules shows inequitable distribution. Even in Australia with GP practices there is inequitable distribution. Is he naive, or blind, or we’ll payed?

    • Bob Kelso

      The First Law of Economics: For every economist, there exists an equal and opposite economist.

      The Second Law of Economics: They’re both wrong.

  5. Helen Carrig

    Pharmacy is the only health profession that has to subsidise its professional raisin d’être by selling things like cosmetics and shampoo. If the Government was prepared to pay a decent amount for the dispensing of medicines and all that entails maybe community pharmacies wouldn’t have to sell loo paper

  6. Tim Hewitt

    OK.. the good Professor says the ‘key driver’ for his (tax payer funded) review is the ‘consumer experience’ (whatever that is), then seems to define this as ‘are people getting the right medicine at the right time?’.. well I’ve seen precious little in his review so far that addresses the ‘right medicine’ question (isn’t that one for the prescribers?), or the ‘right time’ question.. it seems to be about everything else..
    Further, why not ask ‘consumers’ what their ‘experience’ is or has been? and what’s the problem here?.. Is there some widespread consumer movement asking for a different ‘experience’?.. are significant numbers of ‘consumers’ somehow missing out on something here? going by consumers ‘voting with their feet’ they seem to be favouring the ‘big box’ experience, are they not?. that kinda flies in the face of Prof Kings view about ‘selling stuff’ i.e. his precious consumers seem to like that model..even if he doesn’t.
    Next he says there is a ‘lack of accountability’, well the Minister and Government are ‘accountable’ for the public monies spent on medicines, ultimately the parliament and voters hold the system to account.. how more accountable can you get in a democracy?
    He also suggests pharmacy is a ‘propped up’ community service, and that it is ‘taxpayer dollars that are remunerating medicines through community pharmacy’,.. apart from not making sense to me, that statement (as reported in AJP), suggests that the focus of his review, is no longer the ‘consumer experience’, but more about a personal view that pharmacy is ‘propped up’ (not that the cost of medicines to the public is subsidised) and that the Minister and Dept of Health have failed in their duty to get best value for taxpayer dollars, despite the fact that it is the same Government (full of experts) that ‘writes the deals’ with pharmacy every 5 years.
    I dont think he will be happy until Government dispensaries sit on every street corner delivering ‘the right medicines at the right time’ to the good consumers of Australia.. bring it on!
    We all know what consumers want.. they want it all, they want it now, and they want it for free..
    Let’s save taxpayers money and divert the funds being sent on this review to the homeless..
    Yes, I’m cynical, but we’ve seen and heard this all before.. over and over again… ho hum..

  7. Still a Pharmacist

    With continuous price disclosure, many small pharmacies will not be able to survive in their current position and they are not allowed to relocate to the position where they can survive [I am selling my small pharmacy this month]. The Guild members will tell you privately that the location rules are basically to prevent one pharmacy chain. To them, other big chain pharmacies killing small pharmacies are fine.

    I think the time has arrived to change the location and ownership rules. If the pharmacy ownership remains exclusive to the pharmacists then one pharmacist should be allowed to own ONLY one pharmacy.

    Because for the 2nd, 3rd, 4th or the 5th pharmacy where he is not physically present, he is an investor like Coles or Woolworths and trying to maximize profit. Ironically Coles and Woolworths offers better working environment than most of the chain pharmacy owners.

    My suggestion- abolish the location rules and limit the pharmacy ownership to ONE pharmacist ONE pharmacy.

  8. Graeme Holloway

    Optometry sells product and at much greater margins than pharmacy

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