The Pharmacy Guild of Australia-led agreement requires the government to make an ‘adjustment’ if there is a reduction in the Commonwealth-funded component of estimated total pharmacy remuneration.
The Eighth Community Pharmacy Agreement (8CPA) has been invoked to ensure that pharmacist pay is not materially affected by a new pharmaceutical wholesaler agreement which could have effectively taken close to $11 million out of the sector.
The 8CPA – which is negotiated between the Pharmacy Guild of Australia and the health minister – details an expected $16.96 billion flowing from the Commonwealth into the community pharmacy sector between 2024 and 2029.
The bulk of this cash, around $13.55 billion, is expected to come from dispensing frees, administration, handling and infrastructure fees, and dangerous drug fees, but excludes the wholesale mark-up fee.
Built into the 8CPA is a clause stating that, where separate negotiations between the Commonwealth and the National Pharmaceutical Services Association in relation to PBS wholesaler remuneration result in the Commonwealth potentially paying pharmacists less than promised, the Commonwealth has to make an “adjustment that is designed to ensure the estimated total pharmacy dispensary remuneration to Approved Pharmacists under the Agreement is received”.
Furthermore, the adjustment has to be agreed to by the Pharmacy Guild of Australia.
The upshot is that the total amount of money that the Commonwealth spends on pharmacies is at least partially locked in by the 8CPA, even if it renegotiates elsewhere.
Related
Last month, the Department of Health, Disability and Ageing signed the First Pharmaceutical Wholesaler Agreement with the National Pharmaceutical Services Association.
This affects the PBS wholesaler mark-up, which in turn triggered that 8CPA clause.
According to an addendum to the 8CPA published by the department this week, the introduction of these changes to the wholesaler mark-up would “result in a reduction of $10,947,269 to the remuneration that would be paid to Approved Pharmacists pursuant to the 8CPA, compared to what would have been paid if the changes were not introduced”.
Basically, pharmacists across Australia would collectively lose out on about $11 million – a tidy chunk of change, yes, but a drop in the bucket of the $13.55 billion total Commonwealth investment promised in the 8CPA.
But as a result of the 8CPA clause, the tier one administration, handling and infrastructure fee for pharmacists will be increased by $0.01.
This change is estimated to compensate pharmacists for $8,873,672 of the estimated $10,947,269 total impact on remuneration.
The outstanding $2,073,597 will be distributed to pharmacists through adjustments to the Additional Community Supply Support payments.
These changes will not affect the patient co-payment.
