The PCRS published their annual report in August, and as always, it makes for interesting reading. The report allows a greater understanding of the trends in the Community Drug Scheme reimbursement patterns, and provides us with knowledge for comparison to our own pharmacy performance.
Figure 1: Pharmacy contractors
|Year||No of HSE pharmacy contractors||Year-on-year||% increase on the previous year|
Source; Annual PCRS reports.
The first point to note is that the number of contracting pharmacies remains static year-on-year in 2022, with currently 1,915 community pharmacies holding HSE contracts. Indeed, as you will note in Figure 1, this is the first time this is the case; this is despite our increasing population (according to CSO figures, Ireland’s population has increased by 387,274, which represents 7.5% from 2016 to 2022), and increasing dispensing activity, so in real time each pharmacy in the country is becoming busier. It also points to the bigger issue of funding for the sector, and a clear message that operating a community pharmacy and the provision of contracted services to the State, is at an inflection point.
Figure 2: The average number of items per pharmacy
|Year||No. of items reimbursed (incl. HT)||No. of HSE pharmacy contracts||Average number of items reimbursed per pharmacy annually|
Source; Annual PCRS reports. (Excluding private)
The number of items dispensed under the community drug schemes has reached its highest level ever, with, for the first time ever, over 90 million items being dispensed as outlined in Figure 2. Community pharmacies in Ireland are dispensing an extra 24,596,706 (↑26%) Community Drug Scheme items in 2022, in comparison to 2009 figures, which represents a huge increase in productivity.
The number of items dispensed during the period of the COVID-19 pandemic is worth noting, a significant increase in activity was observed (↑14% 2019 vs 2022). Clearly indicating that community pharmacists answered the call of the State and remained open and accessible during the COVID-19 emergency and indeed provided enhanced service delivery, something that we should all be proud to have achieved together.
At a pharmacy level, each community pharmacy is dispensing 48,263 items under the community drug schemes, which equates to over 4,000 items per month. However, what is not trending in the same direction is the fees received by each pharmacy for supplying, counselling, and in the provision of care to their patients. With the average income per pharmacy from community drug fees being reduced versus 2009, this is despite the growing dispensing volume and is reflective of the downward pressure being felt by community pharmacists.
Figure 3: Average fee payments to pharmacies
|Year||Community drug scheme total pharmacy fees €||No. of pharmacy contracts||Average total community drug scheme dispensing fees per pharmacy €|
Source. Annual PCRS Reports.
The average total fees paid to pharmacists as outlined in Figure 3, has dropped by €20,709 between 2009 and 2022. This has happened in a period when community pharmacists are dispensing 24,596,706 more items in 2022 than in 2009. A clear indication that community pharmacies have reached an inflection point, and also clearly pointing for the need to increase efficiency in processes, in order to sustain future growth without impacting on the retention and job satisfaction of our dispensing teams around the country.
Figure 4: Breakdown of PCRS expenditure
|2014 €||2014 %||2022 €||2022 %||% Trend|
|Pharmacy HT fees||17,300,000||0.7%||40,924,615||1.1%|
|Total pharmacy fees||15.5%||12.5%|
|Drugs and medicines (excl HT medicine costs)*||979,010,000||39.9%||1,086,610,000||28.5%|
|HT medicine cost||484,710,000||19.8%||1,064,327,553||27.9%|
|Total PCRS expenditure||2,445,330,000||100%||3,813,620,000||100%|
Source. PCRS annual reports.
(*HT medicines payments are made directly from the PCRS to the drug manufacturers and wholesalers, in 2022 the cost of these medicines was €1,064,327,553)
The average total fees paid to pharmacists as outlined in Figure 3, has dropped by €20,709 between 2009 and 2022.
The impact of the Health (Pricing and Supply of Medical Goods) Act 2013, which introduced, amongst others, generic substitution and reference pricing can be noted in Figure 4, where a comparative look at 2014 (prior to the introduction of the price modulation activity), versus 2022 when the full impact of this legislation is apparent. In 2014, pharmacy fees accounted for 15.5% of the PCRS expenditure and drug reimbursement accounted for 39.9% of this expenditure. In 2022, pharmacy fees only accounted for 12.5% of PCRS expenditure, and medicines had reduced significantly to 28.5%.
The savings made in these traditional areas have facilitated greater access for patients to High-Tech medicines, where this trend in spending is reversed. The High-Tech drug spending has substantially increased in the corresponding period from €485 million in 2014 to €1.06 billion in 2022.
Figure 5: Phased dispensing fees
|Year||Value €||% of pharmacy fees|
Source. PCRS Annual Reports.
The value and % of payments made to community pharmacists for phased dispensing have been reducing year-on-year since 2015, as outlined in Figure 5. Phased dispensing is a vital service provided by pharmacists that supports vulnerable patients to manage their medication. Given the number of patients on multiple medications (PCRS monthly reports indicated that 11.8% of GMS claims were for eight or more items in 2022, up significantly year-on-year), has increased during this time, these figures seem at odds and would suggest that not all vulnerable patients have access to this vital service.
Figure 6: Total Payments made by PCRS for drugs and medicines reimbursement
|Year||Drug payments € (excl. HT and vaccination fees)||Dispensed items (excl. HT and vaccination)||Cost per item||Reduction per item since 2009||Annual savings to the HSE from drug price reductions|
Source PCRS Annual Reports.
In 2009, the average drug price per item was €18.88. In 2022 the average drug price per item had significantly reduced to €12.03.
The cost savings in 2022 alone to the HSE-PCRS of the falling medicine prices was worth €618,043,481.
In the 13 years from 2009 to 2022 inclusive, the savings in the drug reimbursement budget to the HSE-PCRS is valued at €
Currently, the HSE has saved €6.40 million on reimbursement costs and dispensing fee reductions since 2009.
Figure 7: Total pharmacy fees
|Year||Pharmacy fees (ex Hi-Tech and vaccination) €||PCRS items dispensed fees (ex Hi-Tech and vaccination)||Fee per item €||Reduction per item since 2009||Annual savings to the HSE from pharmacy fees|
Source: PCRS Annual Reports.
In 2009 the average pharmacy fee payment per item was €6.00. In 2022 the average pharmacy fee payment was €4.51
Since 2009 the HSE has saved €1,069,895,274 by reducing pharmacy fees.
In total, since 2009 the HSE has saved €6,541,920,055 (annual savings for drug cost and annual savings for pharmacy fees).
For more information, please contact the IPU Contract Unit on firstname.lastname@example.org.