|
In
an endeavour to make the reading of this material less laborious,
I have not published some of the minor or cosmetic type of comment
by the "Working Group".
Given that the previous two articles in this series illustrated
that the Working Group did not support pharmacist control of pharmacy
ownership, any apparent favourable comment has to be cynically
viewed against that background.
The details which immediately follow illustrate this point, for
with minor legislative change, a licencing system could eventuate
in Australian pharmacy.
Australian pharmacists have increasingly been subjected to a punitive
and heavy prescription workload which id government induced.
This type of work has been paid for at an ever diminishing rate
of return, and is about to undergo another reduction in the next
federal budget.
Could this process be simply a strategy to keep pharmacists so
busy that they do not have the time, or even the inclination,
to protect themselves from a government bent on distributing pharmacy
assets to the "big end of town"?
One
can only speculate and hope that there is a critical mass of pharmacists
ready to do battle at the appropriate time.
Review
Recommendation 6:
Pecuniary Interests in a Pharmacy Business
The
Review recommended that:
a.Any
statutory prohibition on natural persons or bodies corporate,
not being a registered pharmacist or other permitted entity, having
a direct proprietory interest in community pharmacies are retained;
b. "Proprietary Interest" be defined clearly in Pharmacy
Acts as relating to the direct ownership of, or partnership, shareholding
or directorship in a pharmacy operating entity;
c. Subject to the proprietor of a pharmacy remaining responsible
and accountable for the safe and competent practice of pharmacy
services in that pharmacy, provisions in Pharmacy Acts relating
to and including:
(i)
Preventing parties other than a registered pharmacist to have
a lawfully permitted association with a pharmacy business, but
not including a proprietory interest as defined in Recommendation
6(b);
(ii)
Inserting specific terms in commercial documents relating to those
businesses;
(iii)
Preventing consideration for third parties based on (a percentage)
of a pharmacy's turnover or profit;
(iv)
Preventing pharmacies having preferred wholesale suppliers of
medicines;
(v)
Otherwise preventing pharmacy proprietors from developing lawful
business associations with other parties; and
(vi)
Allowing regulatory authorities to intervene inappropriately in
matters of this nature;
are
removed; and
d.
Removed provisions of the types described in Recommendation 6(c)
are replaced in each Pharmacy Act with a statutory offence, with
appropriate and substantial penalties for individuals and corporations,
of improper and inappropriate interference with the professional
conduct of a pharmacist in the course of his or her practice.
The
review noted that there was a need to support pharmacists in their
dealings with commercially strong enterprises, and past legislation
has acted to create a regulatory framework that is complicated,
nationally inconsistent and intrusive, that acted in a manner
to inhibit pharmacy commercis arrangements e.g. franchising agreements,
conditions on commercial documents and access to commercial records,
rent for pharmacy premises and joint ventures.
As
long as the proprietor or director of a pharmacy business is a
pharmacist or a permitted non-pharmacist who remains responsible
and accountable for the professional services delivered under
their responsibility, then regulatory scrutiny should not apply
to commercial relationships and transactions of their business.
The only qualification involved authorities being able to act
where safe and competent pharmacy has been compromised.
The
Working Group commented that Recommendations 6(a) and 6(b) narrowed
the definition of pecuniary interest to proprietory interest only
in a pharmacy business, which effectively excludes non-pharmacists,
but allows a normal range of commercial transactions between pharmacists
and non-pharmacists, removing some of the current uncertainties
surrounding pecuniary interest.
Recommendation 6(c) involved the removal of a number of commercial
activities currently prohibited by various Pharmacy Acts, and
have little to do with the safeguarding of public interest in
pharmacy practice.
The
Working group supports the proposal to remove the restrictions
noted in 6(a)(b) and (c).
Recommendation
6(d) is designed to provide support and balance when pharmacists
have to deal with commercially stronger enterprises. Thus, statutory
offences designed to deter third parties exerting improper influence
over the conduct of a pharmacy.
This
provision also applies in the instance where a pharmacist proprietor
gives inappropriate direction to an employed pharmacist.
Because
of some industry concerns, the Working Group looked at a number
of options, including:
*
The application of the Trade Practices Act. The unconscionable
conduct provisions would apply, but it has not been thoroughly
tested. Inadequate precedents currently exist.
*
The development of an Industry Code of Conduct. It was thought
that this had a limited application.
*
The suggestion put forward by the Pharmacy Guild, that any provision
of a contract or agreement between a pharmacy and other third
party be unenforceable at law if such provisions influence or
direct the professional control of a pharmacist within their business.
The Working Group saw merit in this proposal, but commented that
it may give rise to uncertainty.
The Guild suggested that Pharmacy Boards adjudicate, but the Working
Group was strongly opposed to this idea, as it brought Pharmacy
Boards back into the day-to-day running of pharmacies.
*
The NSW Medical Practice Ammendment Bill 200 was looked at as
an appropriate model and was deemed an acceptable model for pharmacy.
While
all the above appears to support the best interests of pharmacists,
legislation could broaden the concept of "other pemitted
entity" (refer Review Recommendation 6(a)), which could lead
the way to open ownership.
The New Zealand concept is to licence "other permitted enities"
so that non-pharmacist applicants satisfy a range of criteria
i.e a system of restricted open ownership.
In such cases, an employee pharmacist has to assume legal responsibility
for the professional elements of a pharmacy practice, sometimes
spread over a number of different, but related, practices. Overseas
experiences indicate that this pharmacist does not necessarily
have professional discretion in the exercise of their purported
function.
If such a situation did arise, the legislation surrounding Review
Recommendation 6(d) would assume major importance.
Working
Group Final Suggestions:
*
Accept recommendations 6(a)-6(c)
*
Accept recommendation 6(d) noting that jurisdictions agree in
principle with the approach adopted in the NSW Medical Practice
Ammendment Bill 2000 but jurisdictions may vary their implementation
to allow consistent treatment with other health professions.
Recommendation
7:
Registration
of Pharmacy Premises and Pharmacy Businesses
The
Review recommended that the legislative requirements be removed
as to the registering of premises and businesses stating that
Pharmacy Acts and the various Pharmacy Boards should focus their
attention on the safe and competent practice of pharmacy.
Noted were that existing restrictions precluded co-locating a
pharmacy in a supermarket, department store or other general business
or placing excessive limitations on the conduct of mail order
or Internet pharmacy services.
While
it is agreed that the above does place restrictions unnecessarily
on pharmacists, the removal also helps to clear the way for a
licensing system of open ownership.
The
Working Group also endorsed the principle of focusing on professional
practice and not commercial aspects of pharmacy.
Working
Group Final Suggestions:
*
Broadly accept Recommendation 7 but leave it to individual jurisdictions
to implement: and
* Reconsider these issues in conjunction with consideration of
the National Competition Policy Review of Drugs, Poisons and Controlled
Substances.
Recommendation
8: Miscellaneous
The
Review recommended that Commonwealth, State and Territory governments
ensure that legislation and agreements for the delivery of professional
pharmacy and health care services negotiated with pharmacy proprietors
and their representatives, require:
*
An acceptable range of services to be provided; and
* Appropriate quality assurance and professional practice standards
to be adopted by community pharmacies covered by agreements.
The
Working Group saw no need to take any action on this recommendation,
other than to note it, leaving individual jurisdictions to take
action if a specific need arose.
Recommendation
9:
New
Pharmacy Approvals
The
Review recommended that:
(a)
Some form of restriction on the number of pharmacies as outlets
for the Pharmaceutical Benefits Scheme (PBS) is retained;
(b) The parties to the Australian Community Pharmacy Agreement
consider, in the interests of greater competition in community
pharmacy, a remuneration system for PBS services that restricts
the overall number of pharmacies by rewarding more efficient pharmacy
businesses and practices, and providing incentives for less efficient
pharmacy business to merge or close: but
(c) If remuneration arrangements consistent with Recommendation
9(b) are not practical, controls on the number of pharmacies'
eligibility for approval to supply pharmaceutical benefits could
be retained but if so any "definite community need"
criteria for those approvals should be made more relevant to the
needs of underserviced communities, particularly in rural and
remote areas.
Recommendation
10:
Relocation
of Existing Pharmacies
The
Review recommended that Pharmaceutical Benefits Scheme (PBS) related
restrictions on the relocations of pharmacies from one site to
another are phased out.
Recommendation
11:
Timing
of Proposed Changes
The
Review recommends that, consistent with Recommendations 9 and
10, the current Pharmaceutical Benefits Scheme (PBS) new pharmacy
and relocated pharmacy approval restrictions be reformed and/or
phased out from 1st July, 2000
The
Working Group noted that the rules on locating new and existing
pharmacies have the most impact of all the restrictions on pharmacy
businesses, are ant-competitive, but are contained in the Australian
Community Pharmacy Agreement thus effectively locking them in
until June 2005.
It noted also that Recommendation 9(a) at odds with the Review's
finding that an incentive-based system should be put in place,
noting that the cost calculation basis for the PBS should represent
best practice, rather than the current industry average.
The Working group also commented that a thorough examination of
all issues should occur and revised arrangements to be implemented
through the next ACPA.
This publication has opposed any form of restriction of approval
numbers agreeing wholeheartedly with the Working Group that it
is anti-competitive, and has further pointed out that the allowing
of pharmacists to incorporate would be the single, most beneficial
method of reducing pharmacy numbers, while concurrently building
large and more viable enterprises. Reducing pharmacy numbers by
this method would certainly eliminate the need for an approval
number system.
Incentives hinted at in Recommendation 9(b), if directed towards
mergers of incorporated individual pharmacists, would be the stimulus
for all the aspirations of both government and pharmacy to be
fulfilled in the most positive and economical manner.
Recommendation
12:
Rural
and Remote Pharmacies
The
Review recommended that:
(a)
Legislation to support specific programs and initiatives to assist
the retaining and enhancing of pharmacy services in rural and
remote areas is considered to be of a net public benefit; and
(b) Non-transferable approvals to supply pharmaceutical benefits
conferred, in limited circumstances, on a specific remote locality
are considered to be a justifiable restriction on competition
in the public interest.
The
Working Group simply noted that $76 million had been budgeted
over five years, but suggested that the initiatives be revisited
to ensure no loss of impact.
The writer would comment that some benefits have been noted to
date in improvements in rural/isolated pharmacy services (including
the first aboriginal pharmacy service developed by one of our
writers, Rollo Manning). However, there is still a chronic shortage
of pharmacist human resource, in both rural/remote community pharmacies
and hospital pharmacies.
This will probably only be addressed when a suitable rural allowance
is developed for employee pharmacists as well as employer pharmacists,
to develop a permanent critical mass of bodies in rural/remote
areas.
Recommendation
13:
Medical
Centres and Aged Care Facilities
The
Review recommended that, should new pharmacy and relocated pharmacy
approval restrictions continue ofter July 2001, that:
(a)
Approvals, for PBS purposes, of pharmacies located in eligible
medical centres, private hospitals and aged care facilities, and
intended to serve those facilities, are considered without reference
to the distance of a given facility's site from the nearest existing
pharmacy; and
(b) Measures as proposed in Recommendation 13(a) are incorporated
in any transitional or ongoing regulatory measures concerning
the approval of new and relocated pharmacies to supply PBS benefits.
The
Working Group commented that the third ACPA provides for a pharmacy
to relocate, without reference to distance criteria, to a private
hospital with more than 150 beds, which is about 10 percent of
all private hospitals.
The writer would also comment that there is a backlog of medical
centre approvals which have not been able to be issued because
of distance criteria.
Because medical centres concentrate a large component of pharmacy
market share, any pharmacist relocating or setting up afresh in
such an environment, would have a distinct market advantage.
Perhaps offering an approval number to a consortium of local pharmacists
would be a fairer first step.
This
type of issue, created by an approval number licencing system,
is the end product of a regulated market i.e at a time when governments
are encouraging active cooperation with doctors and other health
professionals, legislation is preventing this from happening within
medical centres, and does need to be sorted out as soon as possible.
This
ends the commentary from the COAG Working Group.
There is more, but it concerns pharmacist registration requirements,
regulatory principles and authorities, competency based assessment
mechanisms and the need for a national consistency of pharmacy
regulation.
None of this material is directly connected with the pharmacy
ownership issues we have been highlighting.
The writer apologises if readers have found this material a little
heavy going ( it was difficult to focus in the writing), but it
is material that needs to be known if Australian pharmacy has
to mount the inevitable defence to protect its territory.
Back
to Frontpage
|
.jpg)
NEIL
JOHNSTON