Download Frequently asked questions

Frequently asked questions
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DHBs not expecting any pharmacies to close as a result of new service model
Funding arrangements will meet the cost of the proposed service model
Pilot not feasible as it is primarily funding that is changing
Synchronisation pilot showed that less medicine was wasted
Strong focus on quality performance and audit strategy
One-person pharmacies will continue to manage their activity
GPs and pharmacists work in partnership to create alignment
PHARMAC looking at monthly dispensing, and expensive medicines
Proposed service model designed to enhance patient safety
Issues with prescriptions could be considered by GP and Pharmacy leaders
Patients must give consent to registration in the proposed LTC Service
ARRC and methadone dispensing are part of the funding envelope of $370.5m
Patient services, such as synchronisation, are funded from LTC Service patient fee
Service model shifts funding from transactions to patient-centred services
Transition payment calculated using individual pharmacy ratio
Fees cannot be set for the end of the transition until we have data
Core Service patient fee and LTC Service patient fee must be balanced
Core Service fee is paid once per patient, per pharmacy, per day with an initial item dispensed
Examples of how the patient Core Service fee is applied
Pharmacists will use professional judgement on compliance packaging
“To be confirmed” figures are necessary until there is data on patient numbers
Dispensing ratios will be supplied to pharmacy providers from about mid-May
GP Leaders Forum has committed to working collaboratively during implementation
Community residential care is not part of the ARRC service
Funding for community pharmacy set at $370.5 million even if CCP is negative
What percentage of the population is estimated to be eligible for LTC services?
Will this type of capitation funding only be available for LTC clients, whereas Specific and Core clients
will be totally funded on episodic basis?
Considerations for a new pharmacy opening in early 2013
Handling fee is an average
Draft LTC Service eligibility assessment tool will be refined and simplified
LTC Service fee is indicative only until we know numbers registered
Avoiding registering patients more than once for the proposed LTC Service
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Use of trial periods is the responsibility of the prescriber
Adherence aids are designed to increase the patient’s adherence to therapy
Access to information about a patient’s use of the health system
No change to ARRC services in the first year of new Agreement
Indicative LTC Service fee is an annual figure paid monthly in advance
Some LTC Service patients could also be in the Specific Service
Medicines Management Plan has four components
Don’t forget the Transition Payment when working out funding examples
Quality framework is being developed
DHBs not expecting any pharmacies to close as a result of new service model
DHBs are keen to maintain a viable community pharmacy sector. This is why DHBs have committed a
substantial and increasing funding envelope during the transition to the new patient-centred service
model. DHBs have the discretion to use Part P of the Agreement, as they currently do, to provide
additional support to particular pharmacies if needed to ensure access for consumers. Given the
current economic situation it goes without saying that DHBs place significant value in community
pharmacy and have affirmed this with the generous funding envelope over the next three years.
Funding arrangements will meet the cost of the proposed service model
The total funding package committed to by the 20 DHBs is $370.5 million per annum, and all of this
money is guaranteed to pharmacy. Note that this is more than the current forecast for 2011 – 2012 of
$365 million, and is guaranteed to rise by 1.5% or CCP (whichever is the lower) over the following two
years.
Pilot not feasible as it is primarily funding that is changing
Many elements of the proposed changes have already been piloted successfully, such as increased use
of synchronisation. Significant IT system changes are required to support the proposed new patientcentred service model and these would also be required to support any meaningful pilot.
DHBs and sector agents agree that the new patient-centre service model changes the way pharmacy is
funded and not what pharmacist do for patients. You cannot pilot a change in funding. The funding
envelope that is being proposed coupled with the security provided by the transition payment ensures
that any risk to pharmacies is minimised.
The three-year transition period also allows changes to be made during the period to ensure the
success of the transition. It is important to remember that more money is being invested and even
though we all agree that there has been dispensing in excess of patient need that even this is being
bundled into the funding envelope.
Synchronisation pilot showed that less medicine was wasted
The proposed patient-centred service model would allow pharmacists to use their professional
judgement and offer longer periods of supply only where they believe the patient is compliant and does
not require additional help to manage their medicines and that there is not a significant risk to others
living in the same household.
We do not believe there will be more wastage. Experience of the synchronisation service in the
Wairarapa district shows it reduces wastage of medicines rather than increases it.
This arises for two reasons. Firstly, adherent patients frequently require fewer medicines and take
most doses of prescribed medicines rather than leave a substantial amount untaken and therefore
wasted. Secondly, the synchronisation process ensures there is less wastage arising from changes to
therapy before the full course is used and double ups in supply following discharge from hospital or
specialist consultations.
Strong focus on quality performance and audit strategy
During the transition the success of the contract changes must be monitored closely to quickly identify
and rectify any issues that arise. As proposed the patient-centred service model makes fuller use of
pharmacists’ skills and judgement to deliver appropriate medicines management services to patients.
To ensure that patients get the best service possible it is intended that pharmacists’ decisions are
subject to peer review.
The operational group (to include pharmacy representatives) that will oversee the delivery of the
community pharmacist services model of medicines management is developing both a quality
performance and audit strategy. Peer review, education, and best practice standards are going to be
important parts of that strategy, and audit would be used only when there was a performance issue and
standards were not being met. We have asked for feedback on the focus and level of audit activity that
community pharmacy see as necessary to ensure equity during the transition period.
One-person pharmacies will continue to manage their activity
One-person pharmacies already manage their time across patient interactions, counselling and advice,
interactions with primary health care, dispensing and retail. We are confident that the new patientfocused service model only changes the focus of your funding, not what you do as a community
pharmacist.
The funding committed by DHBs of $370.5million is more than the current forecast for 2011 – 2012 of
$365 million; therefore community pharmacy should be able to offer at least the same level of services
as currently without needing locums.
GPs and pharmacists work in partnership to create alignment
The proposed new service model is an opportunity for pharmacists to be medicines management
experts working within a multi-disciplinary team. Medicines management is one component of the
patient’s Care Plan. We expect that GPs and other prescribers would continue to make clinical
judgements for patients.
It is anticipated that GPs and pharmacists would work in partnership to ensure better outcomes for
those patients requiring support managing their medicines regiment. Many community pharmacists
already have excellent working relationships with their primary health care colleagues.
The GP Leaders Forum have indicated that they see the proposed patient-centred service model as an
opportunity to create alignment, electronic support, shared approaches and enable ‘asynchronous
conversations’ between busy professionals to support patients.
PHARMAC looking at monthly dispensing, and expensive medicines
PHARMAC is undertaking two pieces of work relating to monthly dispensing and expensive medicines.
Firstly, there is a list of 39 medicines that PHARMAC is currently proposing could move from monthly
dispensing to 3-monthly or stat dispensing. Consultation closes on 27 April.
Secondly, PHARMAC is reviewing the distribution systems for the top 10-20 most expensive medicines.
This was initially raised in the joint DHB/PHARMAC discussion document issued in late 2010 and further
discussed in the joint consultation document issued early 2011. Currently there is a mixed distribution
model for these medicines with some going through pharmacy and others being sent directly to
patients.
It is proposed that these products would all go through pharmacy as this is the best place for total
management of patients' medication. In consultation pharmacists raised the issue of losing money on
mark-ups and managing stock issues e.g. broken packs as being significant barriers to providing these
medicines.
It is proposed that PHARMAC would negotiate a price to pharmacy (to address the mark-up issue) and
also address the management of broken packs. To do this, PHARMAC would need approval from the
PHARMAC Board and then negotiate the price to pharmacy with the suppliers – this will take some
time. Hence it is not intended for 1 July implementation, but PHARMAC is 'flagging' it so pharmacy is
aware of what is being proposed.
Proposed service model designed to enhance patient safety
Patients assessed as needing help managing their medicines would have much closer interaction with
their community pharmacists and should experience a much better service with regard to their
understanding of their medicines regimen.
The proposed service model is designed to enhance patient safety. It gives an incentive for the
pharmacist to spend time providing their expert professional “cognitive services” to patients assessed
as eligible for this support. This would include the opportunity to work with the patient’s GP, clinicians
in secondary care and other prescribers on reviewing and reconciling medications.
It is important to understand that principally what is changing is the funding mechanism. The patientcentred service model and the new funding arrangements that support it focus on the patient’s needs
and are designed to remove the incentives in the current model for pharmacists to spend more time
preparing and dispensing medicines more frequently than needed to safely and effectively manage a
patient’s condition.
The proposal aims to ensure that vulnerable patients who require additional support to better manage
and adhere to their medicines would continue to receive the same or an enhanced level of care as
currently.
Many pharmacists already provide this level of service to their patients, but now funding will be linked
to that service, and not linked only to dispensing. The proposed new service model endorses and builds
on the excellent work being done by many pharmacists already working in a patient-centred model of
care.
Issues with prescriptions could be considered by GP and Pharmacy leaders
It is expected that illegal/unsafe prescriptions would be the type of issue that could be managed by the
proposed new GP Leaders and Pharmacy Leaders Group. This group will have representatives from the
GP Leaders Forum (GPLF) and pharmacy leaders from across the community pharmacy sector. There
has not been such an opportunity previously for community pharmacists to be so involved.
Patients must give consent to registration in the proposed LTC Service
The patient would need to give consent to being registered in the LTC Service. As part the consent the
patient would agree for the prescriber, the pharmacist and others in the multi-disciplinary team to
share information. When a GP refers a patient to a pharmacy, the GP would supply patient
information, as the patient would have given consent for the referral.
A large volume of health information is exchanged between health professionals in the care of patients
every day. It is envisioned that referral into the LTC Service will be proactive and collaborative, with
primary and secondary care referrers actively referring patients into the LTC Service and sharing
relevant clinical information where appropriate.
ARRC and methadone dispensing are part of the funding envelope of $370.5m
The total funding envelope is $370.5 million in the first year and will be increased by the contribution to
cost pressures (CCP) adjustment paid to DHBs or 1.5%; whichever is lower. All specific payments are
included in the envelope and will be deducted first along with other service and handling fees before
the transition pool is calculated. The transition pool will allocate all the remaining funds through the
Transition Payment up to the guaranteed envelope amount.
Based on the 2010/11 financial year (the most current available) the payments were as follows:
Total dispensing
$346.1 million
Methadone dispensing
$13.0 million
3.8%
ARRC dispensing (estimate)
$24.2 million
7.0%
Note: The dispensing fees for ARRC are based on matching dispensing against a list of patients receiving
subsidised residential care at any point during the year so does not indicate that the patient was
actually resident at the time of dispensing. Patients in residential care will begin to be flagged in the
claims system from 1 July 2012 and more accurate figures will then be available. PHARMAC has already
relaxed some of the duplicated work that pharmacists had been expected to do which lessens
workload.
Patient services, such as synchronisation, are funded from LTC Service patient fee
The LTC Service Fee is provided for you to manage the patient and when considered in conjunction with
the other elements of the funding package (the Handling Fee and the Transition Payment) would cover
the provision of whatever services you consider best meet the patient’s needs.
The proposed funding model does not pay based on the number of items dispensed (other than the
small $1 handling fee for each item) so it does not penalise you financially for reducing the number of
items dispensed. We anticipate that a pharmacy will be able to achieve considerable cost and time
savings through synchronisation and reconciliation services.
Service model shifts funding from transactions to patient-centred services
We acknowledge that pharmacies with high rates of Close Control have received more money in recent
years, but this is to some extent offset by the extra workload involved. We also acknowledge that we
cannot be certain as to the reasons for high rates of Close Control and whether the pharmacy, the
prescribers or patient need has been the driver of these high rates. In the proposed service model, if
any financial advantage of a higher ratio is gained by a pharmacy that is not servicing a higher needs
population, that gain would, at best be temporary. The transition is intended to give all pharmacies
time to adapt to the new patient-centred service model.
To ensure the ratio is as fair as possible, the DHBs are going to analyse those pharmacies outside the
norm for increases in the use of Close Control over the past four years. If the higher rate of use of Close
Control is not aligned to the needs of the population base the particular pharmacy serves, the ratio may
be adjusted to the norm for that DHB. This would help to ensure the Transition Payment remains
equitable across the whole community pharmacy sector.
The new service model would reward the provision of services, not the dispensing function (as is
currently the case). Therefore, those whose business models are geared around high volumes of
dispensing per patient (perhaps through weekly Close Control) and who are not servicing a higher needs
population are likely to experience a financial impact if these patients are not eligible for registration in
the LTC service.
Transition payment calculated using individual pharmacy ratio
The funding for the proposed model has three parts, the patient Service Fee, the Handling Fee (which
recognises the dispensing function) and the Transition Payment which has been designed to ensure
stability of each community pharmacy during the transition. The total funding package committed to
by the 20 DHBs is $370.5 million per annum, and all of this money is guaranteed to pharmacy. Note this
is more than the current forecast for 2011 – 2012 of $365 million.
The transition pool will be calculated once all other payments have been made from the envelope and
will be set to ensure that all the remaining funding in the envelope is passed on to community
pharmacy. If for example the payment through the transition pool worked out at $3.00 per item for a
pharmacy with a dispensing ratio of just 1.0, the pharmacy with a dispensing ratio of 1.4 would receive
$3.00 x 1.4 = $4.20 per initial item dispensed to provide funding to that pharmacy to pay for the repeats
that will follow.
Fees cannot be set for the end of the transition until we have data
The fees used to illustrate the funding model are indicative only until we know how many patients
register for the LTC Service and what reduction can be achieved in repeat dispensing.
We expect that the Core Service patient fee and the LTC Service patient fee will be substantially more
than the indicative figures given by the end of the transition, but we don’t know until we have data.
The fees will be set to ensure that the full funding envelope is paid to pharmacy each year – DHBs have
committed to this. (The envelope includes the 5% quality payment).
We don’t have an average figure for the number of LTC Service patients per pharmacy as that would
depend on the population base that the pharmacy serves. We know there are approximately 380,000
New Zealanders who have two or more long term conditions for which they are regularly visiting
pharmacies for their medications. We believe many of these patients are not experiencing any
problems managing their medications, so would not qualify for the LTC Service. The LTC Service is
designed to support patients who are having problems managing their medicines.
Core Service patient fee and LTC Service patient fee must be balanced
The patient service fees – the Core Service Fee, the LTC Service Fee, and the Specific Services fee –
come out of the same pool of money. There is no set amount allocated to each type of patient service
fee.
The funding arrangements for the proposed new service model have been designed so as not to
advantage or disadvantage any particular type of pharmacy providing a high quality service to its
patients, other than to encourage development of services to meet unmet needs.
It will be vitally important to ensure there is a correct balance between the level of the Core Service Fee
and the LTC Service fee, particularly in years two and three when the transition pool reduces as service
fees increase.
From 1 July 2012 there will begin to be data available on the numbers of patient registered in the
proposed LTC Service. The DHBs will have a team of analysts compiling and analysing the data. The
operational group, which will include pharmacy sector representation, will consider the data and make
a recommendation on the level of the fees to the Governance group.
The fee levels will be closely monitored during the transition and if it becomes apparent that the fees
are producing some unintended shifts in funding these will be addressed quickly.
Core Service fee is paid once per patient, per pharmacy, per day with an initial
item dispensed
The funding for a Core Service patient has three components (as does the LTC Service patient): the
patient Service Fee, the Handling Fee and the Transition Payment.
The Core Service patient fee is paid at a maximum of one fee per patient, per pharmacy, per day with
an initial item.
There will always be circumstances where a patient asks to collect the medicines over more than one
day. If you provide service to a Core Service patient with a prescription with an initial item on two
consecutive days you would receive two Core Service patient fees.
We understand it is quite common for patients to ask if they can collect prescriptions on different days
and for pharmacists to “hold” medicines for later dispensing. If however this is occurring more
frequently than is reasonable or more frequently than is the practice at comparable pharmacies or it is
apparent that this approach is being suggested by the pharmacist to generate extra fees, then further
scrutiny and audit is likely. This audit is to ensure equity of funding for all pharmacists during the
transition when there is a fixed funding envelope.
Examples of how the patient Core Service fee is applied
A patient comes in with a script with four items (including an initial item) on it. The pharmacist is
funded one Core Service patient fee of $3.40 (indicative figure only), plus the Handling Fee of 4 x $1,
plus the transition payment (based on four items).
Another patient comes in with three scripts, each with four items on it (again including an initial item),
and collects half today and half tomorrow. One Core Service patient fee is paid the first day and
another Core Service patient fee is paid the second day. The patient service fee is in addition to the
Handling Fee of 12 x $1, plus the Transition Payment (based on 12 initial items).
The Core Service patient fee is only triggered when one or more of the items being dispensed are initial
items. A Core Service patient fee is not paid where all items dispensed are repeats.
A third patient comes in with a new script with four items on it and collects all the medication that day.
The pharmacist is funded one Core Service patient fee, in addition to the Handling Fee of 4 X $1, and
the Transition Payment (based on four items).
The patient returns on another day to collect the repeats (3 items). On this occasion no Core Service
patient fee is paid because the items are repeats, and the pharmacist receives the Handling Fee of 3 X
$1. (Note no additional Transition Payment is paid for repeats because it is anticipated in the
dispensing ratio, so effectively the pharmacist is paid in advance for dispensing the repeats).
A fourth patient comes in with a three-month script with four items on it (including an initial item) and
collects the first week of all the medication that day. The patient returns every week after that for a
repeat dispensing of all 4 items. The pharmacist is funded one Core Service patient fee for the first
dispensing, in addition to the Handling Fee of 4 X $1, and the Transition Payment (based on four items).
On the second and subsequent dispensings no Core Service patient fee is paid because the items are
repeats, and the pharmacist receives the Handling Fee of 4 X $1.
Pharmacists will use professional judgement on compliance packaging
Some pharmacists have funded compliance packaging through the current funding model. The situation
would not change under the proposed new service model. We expect that pharmacists will continue to
use their professional judgement to determine whether use of compliance packaging is necessary for
their patients. Blister packaging can remain a tool that you would be free to use should you decide that
it is the best solution for your patient.
The total funding package of $370.5 million per annum that has been committed to by DHBs is more
than the current forecast for 2011 – 2012 of $365 million. Community pharmacy should be able to offer
the same or an enhanced level of service to patients as currently.
“To be confirmed” figures are necessary until there is data on patient numbers
The total funding package committed to by the 20 DHBs is $370.5 million per annum, and all of this
money is guaranteed to pharmacy. This guaranteed income for pharmacists for the next three years is
more certain than the current dispensing fee model. The Transition Payment is designed to ensure that
a pharmacy’s income remains similar to current levels (provided it maintains market share), while it
transitions to the new business model focused on patient service.
“TBC” figures are necessary until we know for certain the number of patients likely to register for the
LTC Service. The Governance Group (that will include pharmacy sector representation) would consider
advice from the operational group from the data gathered in the first year to determine the fees to be
paid in the second and subsequent years.
The current proposal is that the transition payment will reduce in the second year to just one third of
the total funding as the amount made up of the patient Service Fees and Handling Fee increases.
Dispensing ratios will be supplied to pharmacy providers from about mid-May
Your DHB pharmacy portfolio manager will discuss your dispensing ratio with you when you meet to
discuss your individual Pharmacy Services Agreement. We don’t yet have individual dispensing ratios
calculated. These will be calculated using 2011 data and as it typically takes three months for data to
become available, the data for the 2011 calendar year has only just become available. However we
expect that all ratios will be calculated by the time you meet with your pharmacy portfolio manager
from mid-May.
Appeals will only be considered if there is a compelling case as why the ratio doesn’t reflect a
pharmacy’s current population. Examples would be gain or loss of a large ARRC contract, or relocation
of business or a new start-up.
Talk first to your DHB pharmacy portfolio manager when you meet from mid-May to discuss your
individual ratio and your individual Pharmacy Services Contract. If you cannot resolve it at that level,
your case will be reviewed by a committee established to consider appeals to pharmacy ratios. The
process for appeals will be agreed with the pharmacy sector agents and the appeals committee is likely
to include pharmacy sector representation.
GP Leaders’ Forum committed to working collaboratively during implementation
In preparing for the new Agreement, over the past two years a working group met every six weeks until
November 2011 and included a representative of the RNZCGP. At the national level DHBs are working
with a wide range of representatives from the community pharmacy sector and the health sector,
including GPNZ, NZMA GP Council and the RNZCGP and this process will continue over the transition.
DHBs, the Ministry of health and sector agents have recently begun the process of establishing the GP
Leaders and Pharmacy Leaders Group that will comprise representatives from the GP Leaders Forum
(GPLF) and pharmacy leaders from across the community pharmacy sector. Initial discussions to date
have been between the RNZCGP, the NZMA GP Council, GPNZ, the Pharmacy Guild and Pharmacy
Partners. We have also had discussions with the Pharmaceutical Society.
All parties agree that community pharmacists are under-utilised community health professionals and
patients will stand to benefit from better service integration across disciplines of care. The parties also
acknowledge that the strength of the relationships between general practice and community pharmacy
is a major determinant of successful implementation at a local level and clinical partnership at a
national level provides the template for leadership at a local level.
Community residential care is not part of the ARRC service
No. Supported living arrangements are not part of the Age-Related Residential Care (ARRC) service
specifications, which is about aged-care only. Supported living/community residential care
arrangements tend to be supplied through agreements between pharmacies and providers of these
facilities.
Funding for community pharmacy set at $370.5 million even if CCP is negative
The total funding package committed to by the 20 DHBs is $370.5 million for each of the three years of
the transition. All of this money is guaranteed to pharmacy. Note this is more than the current forecast
for 2011 – 2012 of $365 million.
The funding envelope will increase by 1.5% or CCP, whichever is the lower, during the 2013 -2014 and
2014 – 2015 financial years. If the CCP that DHBs receive is negative, DHBs have committed to
maintaining the funding at $370.5 million. Community pharmacy will never receive less than the agreed
envelope of $370.5 million.
What percentage of the population is estimated to be eligible for LTC services?
We won’t know until pharmacies begin assessing their patients for eligibility from 1 July 2012. We know
there are approximately 380,000 New Zealanders who have two or more long term conditions for which
they are regularly visiting pharmacies for their medications. We believe many of these patients are not
experiencing any problems managing their medications, so would not qualify for the LTC Service. The
LTC Service is designed to support patients who are having problems managing their medicines.
Will this type of capitation funding only be available for LTC clients, whereas
Specific and Core clients will be totally funded on episodic basis?
It’s not a capitation payment. It’s a fee paid to the pharmacy to cover the services provided by the
pharmacy to each registered patient. This fee will be paid each month for those patients currently
registered with and receiving services from that pharmacy. Although a patient may only register with
one pharmacy at any time, registered patients will still be free to use other pharmacies out of hours or
if they are away from home. This will not affect the payment made to their registered pharmacy.
The Service Fee for Core Service and Specific Service patients will be paid each time a patient presents a
new prescription, but no more than one payment per patient per pharmacy per day.
Considerations for a new pharmacy opening in early 2013
For the sake of simplicity, let’s assume the new pharmacy opens in February 2013, at or after the time
when we expect that the patient Service Fee would begin to be paid. A new pharmacy would be paid a
Handling Fee for items dispensed, plus a Service Fee for patients in each of the three tiers of the
proposed new service model.
In addition it would be paid a Transition Payment, which equates to market share. The Transition
Payment would calculate market share using data from the payment period but would modify this using
an historic ratio between total and initial dispensings – the dispensing ratio – derived from the National
Pharmaceutical Claims Database (“Pharmhouse”). A new pharmacy wouldn’t have an existing market
share on which the ratio could be based. Instead a new pharmacy would normally be given the median
ratio of all the pharmacies in its DHB area.
A consideration for a new pharmacy would be the proportion of its intended customer-base likely to be
eligible for the proposed LTC Service and how quickly it can assess those patients and invite those
eligibile to register with it. Another consideration would be the ability of the pharmacy to be efficient
with dispensing.
Handling fee is an average
The fundamental change with the proposed new service model is that it aligns funding with the three
new levels of service provided to patients, rather than having funding based on transactions as it is in
the current model.
The three elements of the funding arrangements for the transition – a patient service fee, a handling
fee and the transition payment – are designed to give pharmacists financial certainty and security while
they adopt the proposed new service model. The transition payment will ensure that a pharmacy that
has maintained its market share will receive funding that is very similar to that received last year.
For the first year of the transition – 2012/13 – the handling fee has been deliberately set at a low level
low to demonstrate that the focus is now on providing a service to patients rather than being rewarded
for the dispensing process only. It also removes the perverse incentives to continue to “chase”
additional volumes of repeat items.
The proposed handling fee is a token amount and would be a contribution towards the marginal costs
of dispensing each additional item. It would be reviewed during the three-year transition so that on
average it would adequately compensate pharmacy for handling costs.
Draft LTC Service eligibility assessment tool will be refined and simplified
The draft LTC Service eligibility assessment form is a work in progress. We have had a working group of
pharmacists developing this tool since last October – the version we have shared with you is version 10
and further iterations will reflect the feedback that we receive during this consultation process. We
expect there will be further simplification and refinement over the next year or so as the tool is tested
and then used from 1 July. We also intend putting it online, and are committed to making it as easy to
use as possible. It is not possible to begin this work until we have considered all the feedback during
the consultation process and incorporated any changes into the draft tool.
Send feedback about the eligibility assessment tool to [email protected]
All input and ideas for making this tool better will be passed onto the team of five community
pharmacists developing it. We will get more pharmacists involved during the ongoing development and
testing.
There will be other developments over the next couple of years that will reduce the amount of
paperwork, for example, e-prescribing. Our vision for the future of community pharmacy would include
initiatives such as a single patient record accessible by all involved in the patient’s multi-disciplinary
team. We expect pharmacists and their agents will also add their own innovations which make the
service easier, more efficient and cheaper to deliver.
LTC Service fee is indicative only until we know numbers registered
The patient service fee would be just one element of the funding provided to a pharmacist through the
transition period, along with the handling fee and the transition payment which will comprise around
50% of total pharmacy revenue when the service fee is introduced.
The patient service fee for a patient registered with a pharmacy for the LTC Service is likely to be set at
around $130 from early next year for the remainder of the 2012/13 financial year. It will increase in
each of the following two financial years as the transition payment decreases, within the set funding
envelope.
We don’t know yet what the patient service fee will be set at in the 2013/14 year and the 2014/15
years, as we will have to consider how many patients are registered in the proposed new LTC Service.
We cannot say yet what the final patient service fee will be, once the transition payment has been
phased out, but it will reflect the cost of delivery of the services to the three tiers of patients. Moving
to the proposed new service model over three years allows time to gather data on patient numbers in
each tier of service and determine the appropriate fees.
Avoiding registering patients more than once for the proposed LTC Service
We anticipate that duplication registrations into the LTC Service will happen infrequently and probably
only in the early stages. As soon as the NHI for the patient is e-enabled this should prevent duplicated
registrations. Most patients with chronic conditions are known to be loyal to the pharmacist who
currently provides them with service. However it is a possibility that some patients will register at more
than one pharmacy.
We are working with the IT people about a possible solution. We need to capture patient registration in
real time as much as possible, using a patient service flag and the patient’s NHI – to build up a database
of registered LTC Service patients. In the near future we are also going to include the prescriber’s
Health Practitioner Index (HPI) and the pharmacy’s HPI.
The operational group is going to consider the mechanisms relating to patients who are already
registered and then register with another pharmacy. The principle of patient choice is paramount.
Use of trial periods is the responsibility of the prescriber
Many Drs will be unaware of the trial period option. Why are pharmacists not being empowered to use
this as a tool to manage patients who are started on or have medication changes? Once again if we
have identified an issue we will have to send the script back for endorsement – additional cost and delay
for pharmacy. Why not give us the professional responsibility to use trial periods ourselves?
Determining the length of time before the patient's progress is reviewed is the responsibility of the
prescriber who must make clinical decisions about the continuation or cessation of therapy at the end
of the period. This is significantly different to a pharmacist making decisions about the number of times
a medicine is to be supplied within a 3 month period for a stable patient where the doctor has already
decided the patient is to receive the full 3 month's supply. Such decisions are beyond the pharmacist's
legal authority and scope of practice.
Adherence aids are designed to increase the patient’s adherence to therapy
Adherence aids (as mentioned on Page 2 of the draft LTC Service eligibility assessment tool) covers
blister packaging, reminders to the patient or caregiver, special counselling, frequent dispensing, and
other pharmacist interventions designed to increase the patient's adherence to therapy.
Access to information about a patient’s use of the health system
The DHBs and Ministry of Health are currently working on ways to make hospital admission information
easily available to pharmacists. Pharmacies in districts which provide access to hospital patient records
via the Concerto system can access this information directly. Attending A&E does not qualify as it does
not constitute an in-patient admission. We are looking to the test program to provide information on
whether we need to review this distinction and the level of usefulness of measuring hospital admissions
as means of identifying target patients before finalising the tool.
No change to ARRC services in the first year of new Agreement
There would be no immediate change to the Age-Related Residential Care (ARRC) service, but we are
considering a separate service for this group of patients from 2013/14.
In the first year of the transition the operational group would review services to patients in Age-Related
Residential Care. That would include gathering information through the variation on which pharmacies
supply to ARRC, identifying which patients are in ARRC, and what and how often they receive their
medications.
With this information the operational group would put forward a proposal to the proposed Governance
Group – which would include community pharmacy and DHB representation – for a decision on any
changes.
In the meantime, there would be no change to the dollar value of the payment for ARRC services.
Patients receiving ARRC service would be paid through a multiplier of 5.30 to the Handling Fee of $1 to
make a payment per item dispensed equivalent to the current funding of $5.30. If the dispensing is for
a patient who also falls into another specific population the payment would be made on the basis of
whichever attracts the higher multiplier.
Indicative LTC Service fee is an annual figure paid monthly in advance
The indicative figure of $130 for the LTC Service Fee is an annual amount so each month a pharmacist
would be paid the $130 divided by 12.
We expect the IT and claims processing systems will be ready to support payment of the LTC Service Fee
from about February 2013, and the monthly payments would start then. The LTC Service fee is in
addition to the Handling Fee, and the Transition Payment which are the other two components of the
funding that a pharmacist would receive for providing services to a LTC Service patient.
Please note that the fees paid for the Core Service, LTC Service and Specific Services will be set once
there is more complete data on the numbers of patients registered in the proposed LTC Service. The
patient Service fees would gradually increase over the transition period as the Transition Payment
phases out. The total funding envelope remains the same.
Some LTC Service patients could also be in the Specific Service
A patient who is registered with a pharmacy for the LTC Service could also be receiving a Specific
Service from that pharmacy. For example, an LTC Service patient could also be receiving a Class B
Controlled Drug or Clozapine, or special foods. The pharmacist would be paid the LTC Service patient
fee plus the payment for providing a Specific Service to that patient. So the funding package for that
pharmacy would include the service fee for providing particular services to that patient, plus the
Handling Fee and the Transition Payment.
Medicines Management Plan has four components
A Medicines Management Plan is a simple documented record of the problem solving process that
pharmacists currently undertake on a daily basis and include in notes attached to their pharmacy
software and on written records on medication packing charts. The software vendors are working to
include a Medicines Management Plan template in the pharmacy software.
It has four components of assessment, planning, implementation and review. The Medication
Management Needs Assessment is currently part of the Eligibility Tool, and will be further refined. The
planning component provides the opportunity to document simply your plans to improve the issues
identified. For example, this could include counselling, adherence support, synchronisation,
reconciliation, reminders, referral to specialist services and so on.
The Plan will also include a review component where you check at intervals whether or not the plan is
working.
It is important to understand that identifying problems is the first and most important step, and that
not all problems need to be solved at once. A Medicines Management Plan shouldn’t be time limited it allows the pharmacist to work with the patient to address each over a period of time. Some solutions
will be quick (e.g. using compliance packaging), but others will take much longer (e.g. shifting attitudes
towards medicines and enhancing health literacy).
Don’t forget the Transition Payment when working out funding examples
If we get a prescription for 5 items say, do we only get paid $3.40 (or service fee) once for the whole
script and then $1 per item as well (so 1 x $3.40 and 5 x $1.00), = $8.40?.
No, it doesn’t mean you only get paid $8.40. The question only gives two-thirds of the picture, because
it doesn’t include the Transition Payment.
The funding for the proposed model consists of three things, the patient Service Fee, the Handling Fee
(which recognises the dispensing function) and the Transition Payment which has been designed to
ensure stability during the transition. The total funding package committed to by the 20 DHBs is $370.5
million per annum, and all of this money is guaranteed to pharmacy. Note this is more than the current
forecast for 2011 – 2012 of $365 million.
In the current model for the above example the pharmacist would receive 5 X $5.30 = $26.50.
In the proposed new service model, the funding for this example would be:
Patient Service Fee = $3.40
Handing Fee: 5 x $1 = $5
Transition Payment = equal to 5 initial dispensings worth of the transition payment.
This figure will be modified by the individual pharmacy ratio, reflecting the number of repeats the
pharmacy would expect to do.
We can’t say exactly what the Transition Payment will be yet as it will depend on the national total
volume of scripts dispensed and the number of patients registered in the new LTC service (once the LTC
Service fee begins to be paid from early next year).
Indicative figures based on 2011 data show that pharmacy will receive a similar amount to the current
payment of $26.50 after the transition payment is factored in. This is the very reason we are using a
Transition Payment – to ensure that a pharmacy’s income remains similar to current levels (provided it
maintains market share), while it transitions to the new business model focused on patient service.
We anticipate that the Transition Payment would represent just over half of a pharmacy’s dispensing
income in the period when we first introduce service fees (early Feb 2013 to 30 June 2013).
In the second and third years of transition the patient Service Fees will increase as the Transition
Payment decreases to about one-third of a pharmacy’s dispensing income in year 2 and then to zero in
year 3, ensuring that the agreed funding envelope (including any increase, CCP or 1.5% which is the
lower) continues to be paid in full to pharmacy.
Quality framework is being developed
A pharmacist-led and DHB supported workshop was held in October 2011 to consider the indicators for
quality and quantity. The summary of that initial thinking is here.
The quality framework is still under development by a group of pharmacist and DHB representatives.
Quality incentive payments against a defined set of criteria will be paid from early 2013. The framework
and the criteria will be agreed with the community pharmacy sector before then.