Duane Hicks
With proposed changes to the prescription drug system making headlines over the last two weeks, Health and Long-Term Care minister Deb Matthews participated in a conference call with media Monday to field questions about the hot topic in pharmacy circles.
As revealed by the province two weeks ago, the changes include:
•lowering the cost of generic drugs by at least 50 percent to 25 percent of the cost of the original brand name drug for Ontario’s public drug system, private employer drug plans, and people who pay for drugs out-of-pocket, saving taxpayers and the provincial government millions;
•eliminating “professional allowances”—payments generic drug companies make to pharmacy owners intended to fund patient services, but which the province says instead are being used by many pharmacies as rebates to fund fringe benefits, bonuses, overhead costs, and boost profits;
•ensuring pharmacists are fairly compensated for helping patients by increasing dispensing fees by one dollar from $7 to $8, and increase by up to $4 in rural areas (pharmacists also will be paid for additional services provided to patients using a new dedicated fund of $100 million, plus $50 million from the existing MedsCheck program, where pharmacists are paid to have annual discussions with patients who are taking three or more medications); and
•supporting access to pharmacy services in rural communities and under-serviced areas with new dedicated funding (the details of which haven’t been determined yet).
A major bone of contention for pharmacists has been the elimination of professional allowances, which some have said will result in them having to cut services and possibly staff.
During Monday’s conference call co-ordinated by the Ontario Community Newspapers Association, Matthews explained part of the 2006 drug reform was to get accountability from pharmacies as to how they were spending their professional allowances, and found only 30 percent of it was going towards frontline services to patients.
“We were right to be concerned,” Matthews said. “We would much rather pay that money directly compensating pharmacies for service pharmacists performed for their patients.”
While Matthews said there had been an understanding that professional allowances were to compensate for the lack of increase is dispensing fees for pharmacists, the province felt it important to move to a much more transparent system where they eliminate the professional allowances, increase dispensing fees, and pay pharmacists directly for the services they provide.
“Pharmacists I know actually want to use the skills they learned in school. They want to put that to work,” she stressed. “They don’t want to spend their time just counting out pills.
“They want to use that money to provide service.
“Under this system, we’ll be able to compensate pharmacists directly for services,” Matthews added. “If pharmacies choose not to provide service, then they won’t get that compensation.”
Companies and local pharmacists have stated that with the elimination of the professional allowances, they will have to reduce staff or, at the very least, business hours, and won’t have enough time to do these additional services.
To which Matthews responded: “I think pharmacists want to provide that care to their patients, and if they are fairly compensated for that, then they will do that.”
“When we brought in these reforms, I knew—and I didn’t try to hide the fact—that this will require a change in the business model for people who are in the business of pharmacies,” Matthews admitted.
“This is a big change in how they are compensated.
“Those independent pharmacists are particularly well-positioned to embrace the new model in Ontario,” she continued. “They have a closer relationship, typically, with their customers.
“They are well-positioned to enhance the services they provide.
“We want to sit down with pharmacies and pharmacists, and talk about how we allocated the money that we will put into that direct service,” pledged Matthews.
“That’s $150 million,” she noted. “That’s a lot of money, and we want to make sure we put it in the right places and that pharmacists embrace the opportunity to be more than just a pill dispenser.”
The ministry has not yet made a list of enhanced services and what pharmacists will get for providing those services, but Matthews said they want to start developing this right away.
“We are at the stage now in this process where the regulations are posted, we’ve earmarked that $150 million,” she remarked.
“We do know that the MedsCheck program is an important piece of that—that’s the program where people who are on three or more medications can go in and have that counselling time with their pharmacist to make sure that the interactions aren’t a problem, to make sure that the drugs work together in the way they were intended to work.
“[MedsCheck] is one example where a pharmacist, I think, should be paid appropriately for that kind of service.”
Matthews said the scope of practices for pharmacists will be expanding in the future to including prescribing a limited number of drugs, and being able to renew and modify prescriptions.
“What that means is people who need a renewal will be able to get that done by their pharmacist—they won’t have to go back to the doctor,” she noted.
“That’s better for everybody,” she argued. “It’s more convenient for the patient, it avoids a trip to the doctor or emerg, and it gives the pharmacist the ability to use their professional skills.
“Those are the sorts of things that we want pharmacists to be doing and are prepared to compensate them for.”
Matthews admitted she “has a little bit of sympathy for” one free service pharmacies have said they’ll have to start charging for now—free medication delivery, especially when it is used by shut-ins or seniors in rural settings.
“But pharmacies are businesses,” she stressed. “They work as businesses like other retailers in that they set their store hours, determine their location, they offer additional services like the free delivery.
“These are all things that businesses might offer.
“We don’t have an access issue when it comes to pharmacies,” Matthews continued. “It is a competitive industry and it will be become more competitive after these changes.
“Pharmacies will have to decide what their business model is. I don’t presume to give them advice on that issue—my job is to make sure that the people of Ontario pay a fair price for their drugs and they are not.
“They are paying far too much for drugs,” she argued.
When it comes to rural and under-serviced areas, Matthews said the ministry has made “special provisions” although they “haven’t defined exactly what that formula will be.”
“It’s important that pharmacies, where there’s only one or two in the community, get what they need to help the people,” she noted.
When asked why the province can’t just fine pharmacies that aren’t using their professional allowances in compliance with regulations, instead of reforming the whole system, Matthews replied “the system isn’t working for the people of Ontario.”
“We’re paying far more for drugs than we need to,” she reiterated. “People are paying hundreds of dollars more for drugs than they need to.”
Some pharmacists also have pointed out about 75 cents of every dollar spent by the Ontario government on prescription drugs is on brand-name drugs, not generic drugs, so why isn’t the province going after the brand names?
Matthews explained that during the first round of drug reforms in 2006, Bill 102 gave CEOs of companies the ability to directly negotiate the prices of brand name drugs.
“We have already taken action to get the price of brand name drugs down, and we’ll continue to do that,” she pledged. “We’re one of the very largest buyers in the world and we have not been seeing the benefits.
“This particular reform focuses on eliminating the practice of so-called professional allowances,” she explained. “That was a business practice that has highly inflated the cost of drugs for Ontarians, and we can substantially lower prices if we eliminate those professional allowances.
“So that’s what were doing in this particular round.
“Make no mistake. This is a very large pie we’re talking about,” Matthews stressed. “The money we spend on generics is far less than what we spend on brand, but we already negotiate—very toughly, I might say—with the brand names to get those prices down.
“So we thought it was important to look at this practice called professional allowances, and eliminate it and pass those savings onto people.”
Matthews clarified the government is not so much saving money as it is “moving money so that we spend that money not in a way that benefits the owners of pharmacies, but in a way that benefits the people of Ontario.”
“It will allow us to add more drugs to the formulary, it will allow us to improve access to drugs, and to continue to improve health care,” she argued.
“One of my big focuses is getting the very best possible value for money, and we can get far better value for money by spending this money directly on services for patients than by paying these so-called professional allowances.”
The drug reforms currently are in the phase where the ministry is accepting comments on the regulations. But when they are implemented, it won’t be all at once.
“The stability of the sector is something that I am concerned about and that’s why decided to phase these changes in over three years,” Matthews said.
