Pharmacists take action over HSE cost cutting

THE Irish Pharmacy Union (IPU) is taking legal action against the Health Service Executive (HSE) in relation to its proposal to reduce the price its pays to wholesalers for medicines under community drugs schemes.

A number of pharmacy contractors are also involved in the legal action. Both the IPU and the contractors believe if the HSE proceeds with its plan to unilaterally reduce payments it will be in breach of individual pharmacists’ contracts, which provide for the currently agreed level of payments.

According to the pharmacists, this will affect the viability of their participation in state schemes.

The case is in for mention in the High Court for further directions on February 25, just five days before the HSE plans to introduce its cost-saving measures on March 1.

The HSE plans to reduce wholesale margins by up to 9% (from 17.66% to 8%), a reduction the pharmacists claim will be passed on to them. The HSE argues existing margins are more than double the level of other European countries (see table) but pharmacists say any downward revision in payments could mean they end up being reimbursed for less than the wholesale cost of the drugs. Many of the State’s 1,600 pharmacists have threatened to withdraw from the state schemes — which include the medical card scheme (GMS), Drugs Payment Scheme (DPS), Long-term Illness Scheme (LTI), High Tech Medicines Scheme and the Methadone Treatment Programme — on March 1. The HSE has said it could sue individual pharmacists for breach of contract if they withdraw without giving three months notice in accordance with contract terms.

However, Adrian Conlon, a pharmacist in Kilbarrack, Co Dublin, said he believed the requirement to give three months notice “would not hold” because the HSE will have already broken the contract terms if it unilaterally reduces an agreed level of payments.

“Also, if the HSE was to take individual pharmacists to court, it would cost €100,000 per injunction, and given there are 1,600 community pharmacists, this would cost them more than the €100 million they hope to save by reducing price levels,” said Mr Conlon.

Pharmacists across the country have individual contracts with the HSE for the delivery of services under the various community drugs schemes, under which eligible persons can obtain drugs and medicines free, or in a subsidised manner.