Any payment cuts would force pharmacists to curtail services, writes MARTIN WALL, Industry Correspondent.
PHARMACISTS HAVE warned the Government that “ill-considered” reductions in State payments would damage patient care, lead to job losses and pharmacy closures and result in increased costs for the Exchequer in the longer term.
In a submission to the Department of Health, the Irish Pharmacy Union (IPU), the representative body for community pharmacists, said any cut in payments would force pharmacists to curtail some services.
It said that any re-introduction of cuts on the scale of those proposed last year by the HSE (but later withdrawn following a legal challenge) would “have catastrophic consequences for services and employment and would render the medical card scheme totally unviable”.
Under the current contractual arrangement, pharmacists are paid in two main ways by the State, through fees or a mark-up on the cost of a product.
Under the medical card scheme, pharmacists receive a fee of €3.27 per item dispensed. No mark-up applies in the case of the medical card scheme.
Under the drug payment scheme and the long-term illness scheme, pharmacists receive a fee of €2.86 and a mark-up of 50 per cent of the cost of the product.
The IPU submission follows comments made by the Taoiseach in the Dáil last month that the Government intended to seek reductions of 8 per cent in professional fees.
The recent pension levy legislation also contained a provision to allow the Minister for Health to set, by regulation, new payment levels for those providing services to a health sector body.
The IPU said it was willing to work with the Government to achieve savings and that the best way to achieve these was through the introduction of a new pricing model. It said this could produce savings equal to those generated by means of an 8 per cent cut in dispensing fees.
The IPU said that existing moves to reduce the State’s drugs bill – such as the price agreement with the pharmaceutical manufacturing industry, the transfer of infertility drugs to the high-tech scheme and recommendations in the recent Barry report to remove some products from the scope of the drug payment scheme – would result in a reduction of almost €20,000 in the net profit of every pharmacy contractor in the State. It said these measures would generate savings of €33.7 million to the Exchequer in a full year.
The IPU also said it was prepared to co-operate with arrangements to reduce waste on the high-tech drugs scheme would could save €15 million per year and that pharmacists were willing to dispense generic medication, where safe and effective to do so, which could produce savings of €30 million.
However, the IPU also said that under any new model the dispensing fee for the medical card scheme would have to be substantially increased.
It also argued that any re-structured payment arrangements would have to retain a “mark-up” which it maintained was “a fundamental underpinning of private enterprise”.
In the absence of a mark-up, the relationship between the State and the community pharmacist was “akin to that of employer to employee, with important implications for pharmacist entitlements, eg pensions, IR supports, holiday cover”.
The submission argued that the attempt by the HSE to reduce drug reimbursement prices last year, although later reversed, had had a negative impact on pharmacy services and employment.
It said that a survey of IPU members this month had found that 44 per cent of pharmacies had let some staff go in the past year.
The report said that more than 300 pharmacy outlets would not remain viable in the short term if cuts along the lines of the €100 million reduction in payments proposed last year by the HSE were re-introduced.