SEPTEMBER , Edition # 33, 2001

Click on the Newsletter Reader's Forum link to access a forum from which you can express your comment or viewpoint on this article.
The author values your input, so please take the time to register your details, and participate in the only free debate on the future of Australian pharmacy.
Registration is free, and required once only, for permanent access.
You do not need to register if you only wish to view comments.

In this sixth article in this series I will be looking at what ought to be a consultant's fee and how it would be possible to add value to basic services.
As this article builds as a series, it is suggested that if you have not read any of the previous articles, that you access the links at the end of this article, and scan them first to gain context.

Consultants usually arise from out of the ranks of a particular specialty or discipline, in which they have had broad exposure and experience.
The hourly rate they would have expected to have been paid as a high-level employee to perform that work, is taken as the base hourly rate when calculating a practical fee.
For practical purposes, let us assume that that hourly rate is $35 per hour in a salaried capacity as a pharmacist, in a responsible position. That rate is then indexed to take to account the casual nature of the work and other benefits e.g annual leave and sick leave, which brings the hourly rate up to $48.
The rate is then multiplied by three, which gives an hourly rate of $144.
This is arrived at by budgeting one hour for operational overheads and one hour for research time. It is the only practical method of determining a fee which will allow you firstly, to survive, and secondly to expand.
Many consultants, when they first start out, operate from a home office to conserve overheads, and discount their operational costs and research time back to a more modest amount. However, the work and costs are real and have to eventually be charged for.
What a consultant must do is always demonstrate value for work done, so the correct fee must always be charged for a service. A discount may be shown as a client benefit if there is a degree of competition for the assignment.
If you are starting out, then you maywish to discount your rate by up to 40 percent, but you always have the flexibility to reduce your discount without altering your rate, as you expand your client base and variety of work.
Successful consultants will always develop work methods and use systems that reduce their time involvement.
So, if we look at a medication review assignment done with current tools available, it may take an average of two hours to complete. If you had good software and portable hardware, you may reduce the applied time by one hour.
This requires an investment on your part in appropriate hardware, plus time to develop your own software to your particular specifications. Already you are investing, researching and creating costs and overheads.
You can also reduce your assignment time by sending out survey forms in advance for completion by the client, with requests for other types of information e.g biochemistry results etc.
If it is a doctor initiated assignment, send the requests to the surgery and have them prepare the material for you, so that they are seen to earn their part of the fee.
As much preparatory work should be systemised as possible to minimise your personal time involvement.
So, with a systems approach to consulting, you may be able to reduce your personal time input to one hour, at a cost, to whoever is paying, of $144.
If you discount this rate by 40 percent to try and develop more volume, then the client eventually pays $86.
Believe me, if you are planning to go below this rate as an independent consultant, you will not survive.

When looking at the basic service of a medication review, also look for an opportunity outside of the model that is being proposed. There will be a small private market that will be willing to pay for your service at full price, if you are judged to give value. Consider also, that approximately 55 percent of the population take complementary medicines, with few of their medical practitioners knowing what they are taking, let alone whether there is any potential for interaction with orthodox therapy.
Remember that a large number of these people will have already visited a naturopath or other complementary therapist, and would have paid a substantial private fee for the privilege.
Why would they not pay a pharmacist for a medication review if they perceived value?

I provide a consulting service to a group of people in my region who market a nutritional and herbal range of products under the Neways label. I have often been invited to provide education to the group and have requested any of the participants to refer any people who may be polypharmacy patients or who have serious illness, to me. Neways operate as a multi-level direct sales marketing organisation, and their national sales are huge. When you add in similar organisations such as Neo-Life, Herbalife etc, you would begin to realise just how enormous the complementary medicine market is.
These figures do not make it into the Nielsen or similar surveys, because their operations are low key and virtually hidden in the market place. I believe their market share in Australia could exceed 25 percent (combined), but this is only a guestimate. It is all achieved through personal direct sales networks.
I have consistently found a range of potentially serious interactions with medications such as warfarin, theophylline, fluoxetine etc. and some herbal medicines.
Most times I am able to negotiate a satisfactory outcome between the doctor and the patient. For example, I suggest that if the patient takes their supplement at a regular time each day, and maintains a constant dose, then a doctor may be willing to accept responsibility for the patient, and titrate warfarin against these parameters, and monitor regularly for INR. The factor that tips the balance is providing some written evidence-based material to support the process.

Of course some doctors will get quite irrational at the very mention of a complementary medicine. It is usually fair to say that these doctors know very little about the subject. On the other hand, some patients will refuse to see their doctor for the same reason i.e.they fear the response.

Now the people who belong to these nutritional groups do so because they are intensely interested in their personal health and wellbeing, and they also earn an income by sponsoring other people into the organisation. There are literally thousands of Australians who participate, in the belief that they are being proactive in regard to their health, and they operate as a gigantic national network.
Tap into these networks, and you have a market that you can use to sell a consultancy service to, and maybe help to prevent a misadventure.
Many of these people are antagonistic to othodox medicine because they have not had good experiences with the system. But my personal experience is that they will accept pharmacists, because pharmacists are already involved in recommending nutritional products and complementary therapies.
Pharmacists work out of a friendly environment, and are thus seen to have the "common touch".
I get regular phone calls from many Neways people from all over Australia, many of which evolve into a consultant contact.
I believe that I am dealing with people who wish to have input into their own health and who take a large measure of responsibility. They enjoy being educated, for this very reason, plus the fact that their parent organisation does not generally provide "hard" information, and they are more involved in selling "benefits".
The fact that a large majority are outside of the orthodox health system is all the more reason to engage them, and basically educate them back into the fold.

I have also tried this consultancy process based in a community pharmacy for a session of approximately four hours per week. Clients were developed by pharmacy staff and referred to me by appointment. I worked in two pharmacies, spaced well apart geographically, and filled up two sessions per week on a regular basis.
Both pharmacies had enormous increases in nutritional and complementary medicine products, and I had a busy eight hours per week on a regular basis.
The interesting aspect of this service is that it was sold internally by the pharmacy with no local advertising support.
It spread rapidly by word of mouth, and people used to travel fairly long distances (up to 45 minutes by car) to get to their appointment. Most of these people did not belong to groups such as Neways, but a small percentage did, and often apologised to me for being disloyal to their pharmacist, by participating in a direct marketing group.
Rental on the space occupied was paid for as a percentage of consultancy fees to the community pharmacist.
So it became a "win-win" situation all round with the pharmacy getting a return on its space plus a permanent increase in counter sales of nutritional and complementary medicines.
I was very happy to receive a proper return for my efforts.

Some time ago, the Queensland Pharmacy Guild organised and ran an excellect course on clinical nutrition, to an advanced diploma level. Many pharmacists participated, and graduated in the course with a totally different view of health, than they had held previously. As far back as 1986, the Better Health Commission endorsed pharmacists as the appropriate persons to provide information and to sell such products.
The course sadly has disappeared, and the course coordinator disappeared into a medical organisation to advise their members on nutrition and complementary medicine.
It was a great resource and was well organised by the Queensland Pharmacy Guild. I have not seen a quality replacement product as yet, although this does not mean that one does not exist.
However, if you are planning to do this type of consultancy, you should prepare first, by gaining suitable qualifications. Next, you should prepare specialised databases of information relative to the service you are planning and develop as many informational and measurement tools as possible, to ensure an efficient and professional consulting encounter.

Opportunities also exist to give nutritional services for chronically ill patients e.g cancer, diabetes, heart disease etc, and pharmacists should look to provide a competitive service for these patients.
New information is constantly being published about how a drug may deplete a nutrient and create a side effect or a progression to a worsening of the condition e.g there has been some recent information published about how a modest supplement of iron can eliminate the cough of an ACE inhibitor. The mechanism is not fully understood at this point, but should it be proven that an iron supplement can be beneficial on a continuing basis, then the ACE inhibitor market will expand again. Vitamin B12 has been shown to reduce the potential for lactic acidosis and muscle pain when taking metformin.
There is quite a list that many patients are willing to know about, and pay for information specific to their therapy.
Including the patient's GP in the process (with patient approval) can generate future referral opportunities for consultancies outside of a government payments scheme. However, when approaching GPs, always give details of your expertise and your qualifications, and most importantly, reassure them that they WILL get their patients back again.

So now we have two products on offer......the basic medication review and the medication plus nutritional review, the latter a value-added product.
Both lend themselves to packaging and branding, which creates tangibility to a service, which in turn creates a communication directed towards a targeted group.
Marketing skills are essential, and the message should be spread as rapidly as possible.
There is opportunity to develop a wide range of pharmacy based consulting services, and some of these will be covered in the next edition of the newsletter.
For consultancy to become a vital part of pharmacy it must have a healthy private sector component, so as to avoid manipulation by governments and competing professions.
This means becoming a "generalist" across a wide range of services, before volume of activity forces you to specialise in a particular field.

Article 1

Article 2

Article 3

Article 4

Article 5

Ends

The newsletter archives are now fully searchable via the search engine on the left hand side of this page. If you would like to find similar articles to the above material, please enter the appropriate keyword(s). To retain context with multiple keywords or phrases, please enclose in inverted commas.

Previous Article

Next Article

Back to Article Index
Newsletter Reader's Forum

The comments and views expressed in the above article are those of the author and no other. The author welcomes any comment and interaction that may result from this and future articles.

* If you have found value in this newsletter, please share it with a friend, or alternatively, encourage a colleague to subscribe at neilj@computachem.com.au .
* Don't forget to advise of any change in your e-mail address so that your subscription may be continued without interruption.
* Letters to the editor are encouraged, or if you have material you would like published, please forward to the editor.
* You are invited to visit the Computachem web site at http://www.computachem.com.au .
* Any interested persons who would like to receive this free newsletter on their desktop each fortnight, please send a single word e-mail "Subscribe" to neilj@computachem.com.au .
* Looking for an organised reference site for medical or other references? Why not try (and bookmark) the Computachem Interweb Directory , for an easily accessed range of medical and pharmacy links, plus a host of pharmacy relevant links.
The directory also contains a very fast search engine for Internet enquiries

Back to Article Index
Article Archive 2000
Article Archive 2001
Home