Pharmacists compensated if scripts take a dip

4 minute read

A clause in the Seventh Community Pharmacy Agreement explains why we don’t have double dispensing.

Even if there’s a dip in prescriptions, the Pharmacy Guild of Australia has found a way to make sure its members’ books will always balance.

Under clause three of the Seventh Community Pharmacy Agreement (7CPA), which came into effect in 2020, the government agrees to adjust the pharmacy remuneration payment for dispensing PBS scripts based on the estimated number of prescriptions which will be filled in the year ahead.

In other words, the government will compensate guild members if there’s any reduction in prescriptions filled during a year – such as would happen if it brought in double dispensing.

The 7CPA was the first time a dispensing remuneration guarantee was introduced.

At the end of each financial year the Department of Health adds up how many PBS prescriptions were filled by pharmacists. If the number of prescriptions that financial year is less than what was estimated – i.e. pharmacies were less busy than expected and potentially lost money – the dispensing fee is increased.

If the number of filled prescriptions outweighs expected prescriptions by more than 5%, the dispensing fee gets reduced, and if reality matches expectation, the dispensing fee stays the same. There are different calculations for different years of the agreement.

The current dispensing fee is $7.82, and gets paid by the government every time a pharmacist dispenses medicine.

Increasing the volume of medicines that patients could collect from a 30-day supply to a 60-day supply would effectively halve the number of times that prescriptions are filled, resulting in the government having to up the dispensing fee.

The clause is by no means a secret – it’s in the 7CPA in black and white and the DoH webpage for the agreement explains that it’s a “way to ensure stable payment for pharmacists”.

But while it’s not a secret, it also wasn’t exactly well known, and has been brought to the fore in reporting from the Daily Telegraph about the renewed push for 60-day supply.

The thrust of the reporting is that the government has little motivation to introduce double dispensing, because the money it would save has to be balanced against the additional pharmacist dispensing fees.

Independent MP for Kooyong, paediatric neurologist Dr Monique Ryan, recently questioned the government on why it hadn’t acted on a 2017 PBAC recommendation to introduce extended dispensing.

“Community pharmacies are important, but the government’s first responsibility is to ensure it uses taxpayers’ money as effectively and economically as possible,” Dr Ryan told The Medical Republic.

“We need the Albanese government to review the CPA and other relevant arrangements and to transparently demonstrate its commitment to safe and cost-effective healthcare delivery.”

RACGP president Dr Nicole Higgins was disappointed, but not surprised.

“I suppose given the power of the Pharmacy Guild I shouldn’t be surprised that this clause exists, yet I am still gobsmacked,” she said.

“At a time when Westpac and the Pharmacy Guild have reported that spending in pharmacy has increased by 33.7% to almost $124 million in January 2023, on top of the billions paid to pharmacy through the 7CPA, you would think that pharmacies shouldn’t need a funding guarantee.”

The clause has yet another surprise, though.

In the third financial year of the 7CPA, the DoH is required to meet with the Guild to assess whether the adjustment process remains fit for purpose.

The 7CPA commenced on 1 July 2020, meaning that it’s at the tail end of its third financial year right now.

In a document last updated in January 2023, the DoH lists the assessment as “in progress”.

If the government has reached a conclusion on whether the clause is still fit for purpose, it has not made this available to the public.

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