Abstract
Ontario's new regulations governing drug pricing and pharmacist reimbursement are putting the financial viability of many of the province's pharmacies on the line, according to the Ontario Pharmacists' Association (OPA).
The Transparent Drug System for Patients Act (TDSPA) became law in Ontario on October 1. Before the Act took effect, the OPA had negotiated some changes to better protect pharmacists' income. When the final regulations were implemented, says the OPA, it became evident that the compensation model was inadequate.
“Now we are starting to see the real economic impact of this Act and its regulations,” says Donnie Edwards, the chair of the OPA and a community pharmacist in Port Colborne. “The situation is becoming untenable. Pharmacists in Ontario are being reimbursed at or below their medication acquisition costs.”
In early December, the OPA was still waiting for confirmation that the province would renegotiate some of the terms. Health Minister George Smitherman said that his government planned to address many of pharmacy's issues before Christmas.
“This is critical,” says Donnie Edwards, “We have some pharmacies closing and others are on the verge of closing or reducing services. We need to be treated fairly, with fair compensation.”
Unexpected impact
The TDSPA restricts professional allowances to pharmacists and, effective next April 1, will reduce pharmacists' mark-up on the drug benefit price from 10% to 8%. The drug dispensing fee has been set at $7.00, a level the OPA says is far too low.
The final form of the regulations contained measures that were not in the draft regulations and these new requirements “imposed substantial and unanticipated financial impacts on pharmacy and our members,” said the OPA and the Canadian Association of Chain Drug Stores (CACDS) in a submission to the province.
Of particular concern were changes that the government made to the generic drug pricing formula — changes that added new financial burdens to pharmacists.
“After operating under the new regime for just one month, many of our members are indicating that the economics imposed by the TDSPA and the TDSPA regulations will mean their existing patient care services will need to be reduced or eliminated to remain financially viable,” the submission stated.
Raising the profile of the issue with government and patients
The OPA, CACDS, the Ontario Chain Drug Stores Association, and the Independent Pharmacists of Ontario have mounted a new advocacy effort, the Partners for Pharmacy Initiative. If the province doesn't change the regulations, the organizations plan to lobby members of the Ontario legislature and to continue to urge their patients to press for government action.
“We fear this trend will worsen, which will lead to a real crisis in pharmacy care,” says Edwards. “Pharmacists are very threatened and so are services to patients. More pharmacists may have to lay off full or part-time staff, stop services such as home deliveries, or carry a narrower range of drugs.”