The underfunded sector

Interim Report advocates for funding model and remuneration to support “valuable, evidence-based” pharmacy programs

The Interim Report from the Review of Pharmacy Remuneration and Regulation has acknowledged community pharmacy beyond its dispensing role, as an “accessible source of reliable healthcare advice and services”.

Review Chair Professor Stephen King and team members Jo Watson and Bill Scott reveal that submissions to the review argued many services and programs delivered by community pharmacy are “underfunded or not funded at all”.

And while pharmacies had previously been able to absorb the cost of providing such services, “this is now proving difficult as a result of the government’s price disclosure policies, which have reduced pharmacy profits,” says the panel.

“In the panel’s view, it is clear that pharmacy programs and services should be supported where they are evidence based, are of benefit to patient health outcomes, provide value for money and are effectively integrated with other local health services,” they write in the Interim Report, which was released last week.

“The pharmacy profession should be collecting evidence and data that clearly demonstrates the value of these services. Strong advocacy and leadership is required to develop an effective evidence base, secure appropriate funding and drive the development and expansion of such services.”

Professor King and his team emphasise that pharmacists need to better advocate for their own future, with a stronger focus on care-giving and better integration with primary and other healthcare teams.

However they also say it is the government’s responsibility to support pharmacy-driven service delivery.

“The government should investigate how best to support pharmacy programs that meet local needs, are able to demonstrate improved health outcomes for consumers, and provide value for money.”

Key principles

The interim report says community pharmacy programs should be underpinned by the following principles:

  1. Be based on evidence of effectiveness.
  2. May or may not involve government paying for some or all of the cost of the service, to some or all patients.
  3. May in some cases be offered on the basis of each community pharmacy choosing whether or not to offer the program (with all community pharmacies being eligible to offer the program). In other cases, program will only be available with government payment through pharmacies selected by the government.
  4. For some programs, government remuneration will be channelled through the users of the program, so that the users decide which community pharmacies to use to deliver the program.
  5. Adequate funding for the above needs to be found outside PBS expenditure.


Looking into the Home Medicines Review (HMR) program, the panel has rejected the Pharmacy Guild’s suggestion that HMRs should be linked back to community pharmacies, saying “it has not seen any evidence to suggest that independent or corporate consultant pharmacists provide a lower-quality service”.

“The consultant pharmacy model supports the view of medicine review as an advanced area of pharmacy practice,” they say.

“Further, the continuation of the direct referral system provides better choice for consumers and GPs, who can refer to those consultant pharmacists who they believe provide a high-quality service.”

It has also received evidence that PPIP funding is not sufficient to cover the costs of supplying DAAs.

Specifically, DAAs supplied to residential aged care facilities currently do not attract the PPIP payment, and costs associated with the supply of important services such as DAAs are currently insufficiently reimbursed to pharmacies, the Review Panel says.

Community pharmacies are being heavily relied upon by RACFs to address the increasing medication-related needs of patients, the Review Panel heard, and many are providing important services below cost or for no direct remuneration – including 24-hour provision of emergency medicines.

“The panel agrees that [this service] is valuable and should be recognised appropriately,” reads the Interim Report.

“The government should ensure appropriate arrangements and remuneration are made available to allow RACFs to have 24-hour emergency medicine and advice available.”

Professor King, Ms Watson and Mr Scott call on pharmacy leaders to advocate for pharmacists’ role in a variety of settings, such as those in general practice.

“Advocacy and leadership is needed within the pharmacy profession to demonstrate the need for such services, secure appropriate funding, as well as develop effective data collection and evaluation mechanisms to be able to demonstrate value and outcomes,” says the Panel.

“There is also a need to consider appropriate remuneration mechanisms.”

Outgoing PSA President Joe Demarte agrees there are many positive suggestions in the Interim Report, such as the Panel’s interim recommendation for developing a “more flexible approach to the delivery of pharmacy services” and support for “integration of healthcare services, while also encouraging innovation in business models.”

However while the Interim Report acknowledges the positive impact of a range of pharmacists’ services, the PSA says it is “vague on presenting concrete options for progressing services to benefit consumers”.

Mr Demarte says while the report addressed some of the major factors and issues affecting Australia’s pharmacy landscape and supported a sustainable community pharmacy network, there are still many questions to be answered regarding the delivery of professional pharmacy services.

“We will consult with members from all areas of practice to comprehensively assess the interim report, which will inform PSA’s detailed response,” he says.

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