October 2002 issue Pharmacy Today magazine

$10M SHORTFALL

While the Ministry of Health and District Health Boards struggle with an inadequately funded drug budget, pharmacists' patience over the way they've been treated has run dry.

New Zealand's subsidised pharmaceutical spending has accelerated, increasing 5.4% for the year to June 2002, according to DHB and ministry documents.

For the last eight years, average growth in spending has been 3%, with 2% last year, according to Pharmac.

Recently, District Health Boards New Zealand (DHBNZ) told the Pharmacy Guild, under the terms of the draft contract, DHBs face a shortfall of $10 million to fund community pharmaceuticals for 2002/2003.

Now DHBs are looking to pharmacy to absorb part of their deficits via terms dictated through a section 88 notice of the New Zealand Health and Disability Act.

Facing a 9% increase in pharmaceutical spending, Waitemata CEO Dwayne Crombie said in his latest report that, "we need to reach an agreement with pharmacists that shares the volume risk between parties."

The guild successfully argued against risk sharing during the David Caygill mediated settlement last year.

Pharmacy has long argued it has no influence over doctors' prescribing patterns or patient demand on pharmaceuticals. The guild is also questioning the effectiveness of drug budget management arrangements with GPs.

As Pharmacy Today went to press, the guild was meeting with DHBNZ and the ministry to examine the national data and attempt to move forward on a final pharmacy services arrangement.

The guild is arguing for an adjusted dispensing fee by October, after the DHBs withdrew an early proposal to pay an interim $5.07. Under the draft national contract, pharmacists should have been paid $5.19 from October 1.

No mystery

"When you look at the situation there are is no real mystery to it," Auckland pharmacist and guild immediate past president Gray Maingay says.

While Pharmac has freed up access to drugs such as Losec and statins, easing "patient suffering" and pressure on hospitals, the government has not provided funding to match the increased demand for these drugs, he says.

Pharmac says around 30,000 more patients were prescribed subsidised statins for the months April and May. Those eligible for subsidised statins jumped from 180,000 to 300,000.

The increasing use of treatments such as methadone, the Graseby pump and mental health drugs, has also eased secondary health and social costs but the government appears to have reinvested little of these savings into the drug budget, Gray Maingay says.

He also questions whether moving hospital-only medicines such as Clozapine to community pharmacy has been followed by transferring funding from hospital pharmacy to the community budget.

At the front line

Meanwhile, pharmacists are bracing themselves for a pharmacy services agreement with terms less than favourable than those negotiated under the draft contract and delivered via a section 88 notice.

Pharmacist and lawyer Wally Bain agrees a section 88 notice may be pragmatic for DHBs but is open to abuse.

"It's a statutory power to set terms and conditions of payment with no requirement to consult, which in the year 2002 is just unbelieveable.

" In my view, pharmacists are simply being raped."

One of guild CEO Murray Burns's concerns is that the section 88 may not include a mechanism to review terms and conditions.

Christchurch pharmacist Alistair Douglas says with the southern region's dispensing fee now at $4.74, pharmacies are under increasing pressure.

He suggests that if DHBs continue to fail to act in good faith, pharmacists should refuse to co-operate in DHB data collection, which would not impact on patients.

"It's time to stand up and demand to be treated with respect by officials and paid fairly, or given the option of recovering costs from the patient."

Minister of Health Annette King says patient charging for dispensing is not an option under current terms.

The mood of pharmacists in the north is being described as "dark" and "increasingly aggressive."

Auckland pharmacist Simon Cameron says the 15-month delay in implementing a satisfactory agreement is adding stress to a profession already under siege.

The pharmacist shortage means trying to fill growing prescription volumes with dwindling human resources.

"Stress rates are going through the roof and mistakes will be made - it's the law of diminishing returns."

He says the profession has been "patient to a fault", which he believes may have been read as a sign of weakness by the ministry and DHBs.

"My wish now is that if it has to come to being staunch, then pharmacists will stand shoulder to shoulder."

The DHBs

Pharmacy Today received e-mailed replies to questions sent to the three DHBs who started the revolt against ratifying the negotiated contract.

Waitemata, Auckland and Counties-Manukau DHBs say they declined to sign-off the draft because its pricing was unaffordable within the funding available.

DHBs are highly aware of the tension over funding and their inability to finalise an agreement before well into next year.

Waitemata's funding and planning general manager Wendy Reid told a recent board meeting the DHB needs to improve communication with local pharmacists as they are currently only getting the "line from the guild."

She said DHBs "can't afford to have pharmacists driving a wedge between the minister, ministry and DHBs."

Waitemata sees the advantages of using section 88 as being easy to administer and doesn't require a large contract signed by both parties.

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