Pricing overhaul

Dispensing fees, pricing discretion and pharmacy layout in the King Review firing line

Pharmacies should have no discretion to either raise or lower prices for PBS-listed medicines beyond the co-payment set by the government or the dispensed price, the Review of Pharmacy Remuneration and Regulation has recommended.

The interim report of the Review of Pharmacy Remuneration and Regulation (also known as the King Review), which was tabled in Parliament today has made a series of comprehensive recommendations for the overhaul of pharmacy payments, services and regulations.

Among the key items in its 224 pages is a call for the removal of medicine price variation, as consumers are confused by “the variation in pricing for medicines due to pharmacy pricing discretion”.

The report also recommends the current benchmark for a best-practice dispensing fee should be set within the range of $9 to $11.50, and says “this should be reflected in the average remuneration paid to a pharmacy for a dispense”.

The government should also establish a process to determine the minimum service requirements a pharmacy must meet in order to receive dispensing remuneration, the panel said.

The Pharmacy Guild of Australia expressed concern that “calculating dispensing remuneration on the basis of an efficient cost per unit of production treats a vital patient health service delivered by highly trained health professionals like a utility company transmitting electricity, gas or telecoms.” 

The Guild did, however, welcome the recommendation to abolish the contentious $1 PBS patient co-payment discount, introduced in the 2014 federal budget.

The panel claimed this discount had “not led to appropriate outcomes for consumers”.

The panel also called for remuneration for same services should be the same for all health professionals.

A series of recommendations would see an overhaul of the layout of many pharmacies, with the report calling for complementary medicines to be displayed in a separate area with easy access to a pharmacist for consumers, S2 and S3 medicines to be accessible only ‘behind the counter’ and homeopathic products to be not sold at all in PBS-approved pharmacies.

The report recommended overhauling pharmacy location rules, but in its executive summary, the panel says this will not be included in the final report “given the government’s recent commitment to continue the current location rules”.

Among other recommendations are:

  • A standard fee for the remuneration for compounding chemotherapy medicines in any approved facility, with no additional payment for medicines prepared in a facility that exceeds minimum standards.
  • A trial of machine dispensing in a “small number of relevant secure locations in communities that are not currently adequately served by community pharmacy”. Real-time interaction with a remote pharmacist would be essential to this program.
  • Only making payments under the Rural Pharmacy Maintenance Allowance (RPMA) to a single pharmacy in a 10km area.
  • Investigating the feasibility of a 24-hour telephone and/or internet ‘pharmacy hotline’ to provide Australia-wide medicine information.
  • Setting up an easily accessible and searchable ‘atlas’ of all community pharmacies, with information on their opening hours, services and programs offered and specific accessibility services.

Click here to see a message from review chair Professor Stephen King

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