Fourth Community Pharmacy Agreement Options

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Fourth Community Pharmacy Agreement Options

• Wendy Phillips
• Acting Executive Director
• The Pharmacy Guild of Australia

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History of Guild Government Agreements

• 1989-1990 Dispute with Government
• too many pharmacies (approx 5,600 or 1 pharmacy
  per 3,000 people)
• small inefficient businesses
• cost of dispensing too high
• need to rationalise numbers and distribution

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First Agreement 1991-1995

• Closure/amalgamation incentives to reduce
  pharmacy numbers
• Revised formula - higher fees/lower mark-up
• Controls on pharmacy numbers and location
• First rural allowance
• Additional charges for items priced below the
  maximum patient co-payment

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Second Agreement 1995 2000

• Unchanged remuneration formula dispensing fee
  split into admin and professional
• More flexible rules for new approvals and
  relocations
• Enhanced allowances for rural and remote
  pharmacies
• (During term of Agreement, RMMRs commenced)

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Third Agreement 2000 2005

• Same remuneration formula DD fee increased
• Huge boost for rural pharmacy and pharmacy
  services to Aboriginal communities
• PBS savings returned to pharmacists through
  Pharmacy Development Program including incentives
  to achieve Quality Care standards (QCPP)
• Major commitment to Information Technology
• Payment for Consumer Medicines Information

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Third Agreement 2000 - 2005
Professional Services linking pharmacist
services to pharmaceutical product

• Substantial research program for new services
• Increased fees for Medication Management Program
• Home Medicines Reviews (140)
• Residential Medication Management Reviews (100)

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Pharmacy Adding Value
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Third Agreement Summary of Benefits

• Expanding professional role of community
  pharmacist as a healthcare provider acknowledged
  and funded
• Remuneration for a range of professional services
  (research) and quality initiatives (QCPP, IT and
  rural support)

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Agreements in Summary

• Remuneration governed by 5 year agreements
• 1st and 2nd Agreements - remuneration only
  related to supply function
• 3rd Agreement recognition of payment for
  professional services
• 4th Agreement - pressure to increase and expand
  professional practice payments
• advantages in emphasising professional role of
  pharmacists
• but presents challenges to pharmacy

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Background Challenges for Negotiating Fourth
Agreement

• Problem Issues
• National Competition Policy
• Review of State and Territory Pharmacy Acts
• Limit on numbers/Friendly Societies
• Supermarkets
• Woolworths plan
• Guild proposal to amend ACPA location rules

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Supermarket Claim to make Medicines Cheaper -
Misleading
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Many Rounds to Go
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Politics

• Guild had hoped to negotiate an early Agreement
  prior to the Federal Election
• Linked in with this would have been location rule
  change to prevent pharmacies in supermarkets
• Initially positive response from Minister
• However decided current Agreement to run full
  term (June 2005)

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Objectives for the Fourth Agreement

• To
• guarantee ongoing adequate remuneration structure
  for PBS dispensing
• obtain payment for increasing number of
  professional services

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Objectives for the Fourth Agreement

• Background requirements
• protect network from NCC and supermarkets
• ensure there is sufficient competent workforce to
  deliver new professional services within quality
  assured framework
• have in place systems and changed workflow
  practices using enhanced IT systems for
  recording/retrieving data

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Value of QCPP

• QCPP is designed to
• improve management and business processes
• create an empowered staff that will accept new
  processes
• raise and maintain professional standards
• have in place a quality assurance process which
  facilitates new service deliveries

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Technology

• Relationships and Network
• Technology is the enabler for
• better customer relationships
• the development of a cohesive network to store
  and share data in order to provide more efficient
  and professional services

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Government Concern at PBS Growth
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Government Position

• The Government wants to reduce PBS costs and will
  target pharmacy as a means of doing so
• There is perhaps some thinking that the Guild did
  too well for pharmacy in the last Agreement

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Negotiations for theFourth Agreement

• Negotiations will not be easy and it will be
  essential to
• have a skilled, well trained negotiating team
• know what can and what cannot be put on the table
  as part of the negotiations
• Discipline and team work will be the key to
  successful negotiations

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Heres to a successful outcome