a study of the demand and supply of pharmacists, 2000 -...

A Study of the Demand and Supply of Pharmacists,

2000 - 2010

This project was funded through the Third Community Pharmacy Agreement Research and

Development Grants Program and undertaken by

Health Care Intelligence Pty Ltd.

18 February 2003

Acknowledgments Health Care Intelligence Pty Ltd would like to thank the following members of the National Pharmacy Workforce Reference Group for their valuable advice and assistance over the course of this project: Mr John Bronger Pharmacy Guild of Australia Ms Donna Harvey Pharmacy Guild of Australia Mr Lance Emerson Pharmacy Guild of Australia Mr John Dowling Pharmacy Guild of Australia Ms Yvonne Allinson Society of Hospital Pharmacists of Australia Ms Sue Kirsa Society of Hospital Pharmacists of Australia Professor Colin Chapman Victorian College of Pharmacy Mr Chas Collison Association of Professional Engineers, Scientists

and Managers, Australia Ms Kirrily Edmondston Commonwealth Department of Health and Ageing Dr John Primrose Commonwealth Department of Health and Ageing Mr Allan Neate Commonwealth Department of Health and Ageing Mr Jay Hooper Pharmaceutical Society of Australia Mr Bill Kelly Pharmaceutical Society of Australia Mr Steve Marty Pharmacy Board of Victoria Professor Lloyd Sansom Australian Pharmacy Examining Council Ms Glenice Taylor Australian Institute of Health and Welfare Mr Warwick Conn Australian Institute of Health and Welfare Ms Leone Coper Australian Association of Consultant Pharmacy Ms Jessica Graves Australian Association of Consultant Pharmacy Ms Michelle BouSamra Pharmacy Guild of Australia The members of the National Pharmacy Workforce Reference Group contributed to the report but the assumptions and findings contained herein may not reflect the opinions of individual members or their organisations. This project was funded by the Commonwealth Department of Health and Ageing as part of the Third Community Pharmacy Agreement Research and Development Grants Program.

CONTENTS Ex ec ut ive Sum m ary ............................................................................................. 1

Overview.................................................................................................................................1

Key findings ...........................................................................................................................1

Summary of Recommendations ...........................................................................................4

Chapt er 1 : Met hodology & dat a sourc es .................................................. 8

Methodology overview ..........................................................................................................8

Objectives ...............................................................................................................................8

Measuring supply ..................................................................................................................8

Measuring demand................................................................................................................9

Primary data collection.......................................................................................................10

Details of HCI survey ..........................................................................................................10

Details of SHPA survey.......................................................................................................12

Labour market balance.......................................................................................................14

Introduction .........................................................................................................................15

Impact of structural change in the health system.............................................................15

International trends.............................................................................................................17

Australian trends – supply issues.......................................................................................20

Factors influencing pharmacy workforce demand...........................................................22

Factors affecting community pharmacy............................................................................25

Factors affecting hospital pharmacy..................................................................................31

Summary of key issues ........................................................................................................32

Chapt er 3 : Pharm ac is t supp ly ...................................................................... 34

Current active workforce size ............................................................................................34

Characteristics of the current pharmacy workforce........................................................35

Movements between the active and inactive workforce...................................................42

Reasons for pharmacy workforce losses............................................................................43

New graduate supply...........................................................................................................47

Immigration effects on supply............................................................................................51

Supply projection.................................................................................................................53

Chapt er 4 : Dem and for Pharm ac is t s ......................................................... 55

Overview...............................................................................................................................55

Dispensing in community pharmacy..................................................................................57

Quality in community pharmacy .......................................................................................58

Medication management services.......................................................................................59

Residential management .....................................................................................................60

Domiciliary medication management review (home medicines review).........................61

Hospital demand..................................................................................................................65

Underlying hospital demand—admissions........................................................................67

Impact of changing work environment on hospital demand...........................................68

Commentary on the impact of changing work environment on hospital demand ........70

Overall pharmacist demand projection.............................................................................72

Chapt er 5 : Labour m ark et ba lanc e and ad just m ent ......................... 74

Summary ..............................................................................................................................74

Sectoral balance...................................................................................................................75

Overall balance ....................................................................................................................80

Adjustment to balance ........................................................................................................81

Recommendations................................................................................................................83

Appendix 1.1 Attendance at first workshop......................................................................89

Appendix 1.2 Attendance at second workshop .................................................................90

Appendix 1.3 National survey questionnaires...................................................................91

Appendix 2 References......................................................................................................101

Appendix 3 Projection of supply of all pharmacists - 2000 -2010 .................................107

Appendix 4.1 Projection of demand for community pharmacists, 2000 - 2010 ...........109

Appendix 4.2 Projection of demand for hospital pharmacists, FTEs, 2000 - 2010......112

Appendix 4.3 Projection of demand for all pharmacists, FTEs, 2000 - 2010...............114

Appendix 4.4 Extract of Demand Model for Hospital Pharmacists .............................116

Appendix 5 A vision statement for the future.................................................................124

Ex ec ut ive Sum m ar y Overview This study aims to project the supply and demand for pharmacists between 2000 and 2010. It updates the supply and demand model previously developed by HCI (1999) for the National Pharmacy Workforce Reference Group (NPWRG), by reviewing and modifying its assumptions where appropriate, in the light of new developments since 1999. On the supply side, these include the latest information on student intake and projected graduations. On the demand side, they include a consideration of the impact of the Third Community Pharmacy Agreement, the increasing focus on safety and quality of medicines use across the continuum of care and a host of clinical governance and Commonwealth and State/Territory government policies which impact on the demand for pharmacists. Key findings

1. Literature The literature review, discussed in Chapter 2, indicates that there are national and international shortages of both community and hospital pharmacists, and include the United States, Canada, New Zealand and South Africa. The literature suggests that a complex range of factors will affect the Australian pharmacist labour market and include:

• structural issues—changes in the way that health services are organised and delivered, and the evolution of new management models;

• technical changes—associated with the increasing complexity of medication; • workforce demographic change—associated with feminisation and ageing proprietors

in community pharmacies; • working arrangements—the way in which pharmacists work with assistants and

technicians and collaborate with the medical profession; • demographic change in the general population—and its impact on the demand for the

services of pharmacists; • educational—marked by increases in pharmacy student enrolments; • political and cultural—associated with the Third Community Pharmacy Agreement,

the application of new professional standards, government and consumer expectations concerning safety and the quality use of medicines, and the implementation of new Government policies;

• rural concerns—associated with ensuring adequate service access in rural and remote localities;

• information technology—characterised by the integration of professional care with electronic data interchange.

2. Supply

In measuring supply, Chapter 3 focuses on the variables that affect the active workforce from year to year, such as new graduates, immigration, emigration, retirement, participation and occupational separation. Both primary and secondary data sources are used. The main source of primary data is the response from a survey of a stratified sample of pharmacists. The supply data confirm that:

• the community pharmacy workforce is ageing; • the proportion of females in the pharmacy workforce has steadily grown and now

approximates the number of males; • there is likely to be a significant restructuring of the workforce in the next 10 years, as

older male pharmacists retire and are replaced by younger female pharmacists; • average hours worked by pharmacists remain fairly stable; • total enrolments in pharmacy schools have grown by nearly 4% per annum for the past

15 years. The model projects that overall FTE pharmacist workforce supply will grow from 11,188 in 2000 to between 13,594 and 14,147 in 2010, representing an average annual growth rate ranging between 1.98% and 2.38% depending, respectively, whether one adopts high or low values for net workforce loss.

3. Demand Chapter 4 considers projected demand for community and hospital pharmacists separately. It uses the demand model developed by HCI in 1999 to examine the impact on demand for community pharmacists of:

• growth in dispensing demand, largely as a result of population and demographic change; and

• growth in cognitive services by way of activities associated with implementation of the Quality Care Pharmacy Program (QCPP) and additional interventions attributable to QCPP— as well as residential and domiciliary medication management review services (DMMRs). DMMRs are also known as Home Medicines Reviews (HMR).

In the case of hospital pharmacists, demand has been modelled using specific assumptions about the allocation and use of hospital beds and hospital pharmacist staffing ratios required to service their respective needs. The consultant argues that demand for hospital pharmacists is likely to remain a structural feature of the hospital system rather than a growth phenomenon. Modelling for differential hospital demand was also undertaken separately by the Society of Hospital Pharmacists of Australia (SHPA) under subcontract to HCI. In contrast, the SHPA report concludes that:

• An additional 259 hospital pharmacists will be required to counter the current unmet demand represented by estimated vacant positions in hospitals across Australia; and

• An additional 1207 hospital pharmacists FTE will be required to meet future demand between 2001-2010 (estimated range of 1200 to 2200).

In forming this conclusion, SHPA is in agreement with the US Department of Health and Human Services which considers that for the whole pharmacy workforce, “the critical issue is the delivery of all needed pharmaceutical care services (some are termed cognitive services in this report) to consumers, not simply the dispensing of prescriptions”. Concerning the hospital pharmacy workforce, they counsel that “any effort to base the increased demand for such pharmacists upon increased numbers of prescriptions, medication orders or the like, ignores the reality that today’s hospital, long term care, and home care pharmacists devote less than half of their time to dispensing medications and the rest to other clinical and management activities”. This is consistent with the most recent Australian data (O’Leary et al, 2002). Amalgamated data on year-to-year demand for the two mainstream roles of community and hospital pharmacists are modelled using various combinations of demand settings to represent different illustrative scenarios for overall demand. Depending upon the scenarios selected, by 2010 total demand for FTE pharmacists could range between some 12,700 and 20,000.

4. Labour market balance and adjustment In terms of overall balance, we provide a possible simulation of the evolution of the total labour market between 2000 and 2010. This is based on:

• an optimistic assessment of workforce loss (the lower bound sensitivity of 3%)— in turn yielding “high” overall supply, embodying a rise from some 11,200 FTE pharmacists in 2000 to about 14,150 in 2010;

• “high” community demand for dispensing services and a positive view as to the uptake of cognitive activities in community pharmacy— in turn resulting in “high” community demand; and

• a conservative view about the demand for hospital pharmacists— in turn suggesting that the key driver will be an underlying dispensing demand based substantively upon hospital admissions activity. This scenario does not allow for the implementation of existing government policies on access, equity, medication safety, quality use of medicines, or continuum of care. As noted, this contrasts with the view of SHPA as to the expectations of both consumers and governments.

The scenario for demand is projected to cause overall demand for FTE pharmacists to increase between 2000 and 2010 from some 13,100 to 17,200— in turn contributing to the overall shortfall of FTE pharmacists increasing from about 2000 to around 3,000. The overall shortfall is likely to be primarily attributable to the current shortage and the endemic problem of wastage in conjunction with the behaviour of the demand for community pharmacists. The market for hospital pharmacists is currently under-supplied and likely to remain so, unless changes are made to mitigate the existing recruitment and retention factors of the sector. While alternative scenarios for supply and demand of FTE hospital pharmacists are presented in Chapter 5, they do not alter the conclusion (based on the structural characteristics of the model in this study) that an overall excess demand for pharmacists is likely to continue during the next 10 years. The only issue in contention is the degree of excess demand over supply. If allowance is made for the possibility of greater than minimum levels of ‘wastage’, the shortfall could be greater by 2010 by up to at least 500 FTE pharmacists. Moreover, if as argued by SHPA, the demand for hospital pharmacists were to materialise at even a medium

level to meet service delivery targets, there could be a further 2,500 FTE contribution to the overall shortfall. From page 80 (Figure 5.6: Total FTE pharmacists, ‘high’ supply and ‘high’ community’ / ‘low’ hospital demand to 2010).

8,000

9,000

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In the context of an ongoing shortage and the ability for community pharmacy to offer higher remuneration, this is likely to result in ongoing reduced supply flowing to the hospital sector. Summary of Recommendations The recommendations attempt to focus on a ‘managed’ response to the most likely labour market outcome, and are aimed at either:

• minimising the gap between sustained overall demand for, and supply of pharmacist labour; or

• minimising disruptive internal market dislocations, especially those prone to occur in less flexible market segments (such as hospital pharmacy practice).

The NPWRG identified five main targets for intervention in relation to supply, viz:

1. the number of qualified pharmacists entering Australia from overseas (immigration); 2. the training rate; 3. wastage from the workforce; 4. labour substitution; and 5. pharmacy rationalisation.

The first three, at least, need to be considered as a suite of actions, the effects of which will be felt chronologically (in the order listed above).

1. Immigration There is limited scope for increasing pharmacist immigration rates and the most rational approach would be to target overseas labour markets with a current or emerging oversupply of pharmacist labour, and where the standards of training were acceptable. Recruitment from overseas should be a short-term, stopgap solution— possibly helping to moderate the impact of the underlying labour market situation through 2003 to 2004. A difficulty here is that, as remarked in Chapter 2, many countries comparable with Australia also face likely pharmacist shortages.

2. Graduate supply In the medium term— 2006 to 2008— a second tier intervention could come into play. Increased student intake into Schools of Pharmacy in 2003 and 2004 would provide the supply benefits sought in the medium term. In an appropriately managed response, the source of training supply would need to be capable of being turned both on and off. This implies that significant increases in student intake should occur only at educational institutions where increased infrastructure investment was not required. Wherever infrastructure investment is required to facilitate an increase in student numbers, there could be difficulty in flexibly responding to unforeseen demand reductions. A related strategy suggested by the NPWRG concerns the fast tracking of students. Although those who have related degrees can usually skip part or all of first year, the introduction of professional skills into the first year curriculum means that some science graduates need to attend a summer school to attain a first year credit. Accurate location and tracking of pharmacy graduates and monitoring their career paths are important for developing and evaluating strategies for the retention of pharmacists. Thus, linked to the third intervention discussed below, the NPWRG recommended the development and implementation of a longitudinal tracking system of graduates to determine their subsequent career moves and to more accurately calculate the wastage rate.

3. Wastage rates Third, in the longer term, a reduction in wastage from the projected 3% - 7% range down to 2% per annum (or lower) is desirable. In the short term, the disproportionate number of pharmacists over sixty years of age remaining in the workforce will continue to feed net workforce loss. The challenge will be to retain younger, female pharmacists, both in the active workforce, and in a more fully participating capacity. In other similar workforces, female participation rates appear to be enhanced by having an ownership stake in the practice in which they work (HCA, 1998). The NPWRG noted that there is a huge pool of about 5,000 registered pharmacists not working in pharmacy. The NPWRG has suggested that an increase in re-entry rates would require:

• Research into the characteristics of “ lapsed” pharmacists (age, gender, location, etc), their reasons for leaving (such as long working hours, switching to medical degree, etc), and the types of re-entry courses that would suit their needs;

• A national effort to provide innovative and flexible models for re-entry, including part-time training, on the job training, existence of infrastructure, etc.

4. Training and labour substitution Increased emphasis on training and labour substitution may constitute an important parallel avenue to augmenting the supply of pharmacy services, through greater efficiencies in the use of a given stock of pharmacy labour. This may be possible through:

• Better, more appropriate use of pharmacy assistants/technicians in both community and hospital settings. Competency standards are in place for community pharmacy at the basic training level which match legal requirements, and there is a move in some states to require technicians to have completed courses at a recognised level. However, for the role of technicians to significantly expand, there needs to be enforceable standards of practice under the jurisdiction of regulatory authorities which can then be linked to technician standards. The Guild has commissioned a project ‘Workforce and Career Path Options for Pharmacy Assistants” through the Third Community Pharmacy Agreement Research and Development Grants Program and this project will investigate many issues identified in workforce substitution;

• Enhanced use of technology to support a professional service role— for example, the electronic transmission of prescriptions, increased automation, etc.;

• Streamlining workflow practices in pharmacies to release the time of pharmacists for provision of cognitive services (PGA 2000).

5. Pharmacy rationalisation

The NPWRG has suggested that further amalgamation of community pharmacies, leading to the creation of larger pharmacies, would provide a better platform for the delivery of cognitive services, although it was noted that, in the past, closures meant some pharmacists leaving the profession altogether. Members of the NPWRG have noted that some operators make a commercial decision to open for long trading hours for competitive reasons, not always in response to consumer demand. Supply to hospital pharmacy As nearly a third of all hospital pharmacists have postgraduate qualifications, finding replacements for this highly qualified and experienced workforce is extremely difficult. Training issues make the recruitment of pharmacists from community to hospital practice labour intensive; recruiting from this sector must be viewed as an investment in the future supply of suitably qualified staff, and appropriate retention strategies would be needed to support such a recruitment strategy (O’ Leary et al, 2001). Instead of attempting to impede the movement of pharmacists from hospital to community practice (that is arrest the ‘leakage’ ), one objective could be to engineer an enhanced ebb and flow of pharmacists between the two forms of practice. Some of the mechanisms for doing this are discussed below:

• hospital pharmacy practice could be marketed to older community pharmacists, in conjunction with refresher training programs;

• the gap between ‘private’ and ‘public’ sector pharmacy practice could be narrowed; • hospital practice could become an ‘on-the-job training ground’ for community

pharmacists wishing to improve their clinical skills in preparation for advancing their community practice towards delivery of more cognitive pharmacy services;

• joint mentoring programs could be developed for young pharmacists across both the community and hospital sectors, to equip them for a professionally satisfying role in the future.

Chapt er 1 : Met hodology & dat a sourc es

Methodology overview This study brings up to date the supply and demand model previously developed by HCI (1999) for the National Pharmacy Workforce Reference Group (NPWRG). Its aim is to project the supply and demand for pharmacists between 2000 and 2010. It relies substantively on the structural characteristics of the earlier work, but its assumptions have been reviewed and modified where appropriate, in the light of new developments since 1999. On the supply side, these include incorporation of contemporary evidence on student intake and projected graduations; on the demand side, they include a consideration of the impact of the Third Community Pharmacy Agreement on the role and work that community pharmacists are likely to perform. For hospitals, the SHPA examined 18 drivers of demand, ranging from the increasing focus on safety and quality of medicines use across the continuum of care, as well as a host of clinical governance and Commonwealth and State/Territory government policies. Objectives The specific aims of this study were to:

• identify the short and medium term supply of registered pharmacists and discuss factors currently and potentially driving the supply;

• identify the short and medium term demand for registered pharmacists and discuss factors influencing demand for the different sectors of pharmacy;

• synthesise and integrate the results of supply and demand forecasts to assess the short and medium term pharmacist labour market balance;

• provide recommendations to assist the transition to a balanced workforce. Measuring supply In measuring supply, we concentrate in Chapter 3 on the variables that affect the active workforce from year to year (eg new graduates, immigration, emigration, retirement, participation and occupational separation)— using both quantitative and qualitative data from primary and secondary sources. Secondary data sources used include:

• Board registration data held by the AIHW; • ABS labourforce data for 1996; • current and future graduate supply scenarios— from data supplied through the

Committee of Heads of Pharmacy Schools in Australia and NZ;

• the distribution of the pharmacist workforce between different sectors— using data from the AIHW; and

• net migration data— from Department of Immigration and Multicultural Affairs. The main source of primary data on supply was the response from survey questionnaires mailed by HCI to a stratified sample of pharmacists (see below). The pharmacist supply model consists of an iterative process that progressively builds a picture of supply by sequentially accounting for the effect of workforce participation and separation, graduate supply and migration. Supplies are then proportionately allocated between the community pharmacy, hospital and “ other” sectors. The base year for purposes of projecting supply is 1996— the most recent year for which actual AIHW registration data were available at the time of writing for the number of pharmacists working in pharmacy. Measuring demand The methodological aspects of demand estimation are fully documented in the earlier study (HCI, 1999). This study accordingly considers economic, demographic and funding criteria as mainsprings of the demand for labour for both community and hospital sectors. For community pharmacists, the demand model explicitly takes into consideration the impact of funding from the Third Community Pharmacy Agreement. Using the demand model developed by HCI in 1999, in Chapter 4 we examine the impact on demand for community pharmacists of:

• growth in dispensing demand, largely as a result of population and demographic change; and

• growth in cognitive services by way of QCPP implementation activities and additional interventions attributable to QCPP— as well as residential and home medicines reviews.

In the case of hospital pharmacists, we consider demand by drawing upon two main sources of evidence. We first model demand as an underlying demand, driven by the demand for hospital admissions, using specific assumptions drawn from the earlier HCI (1999) study about the allocation of hospital beds and appropriate hospital pharmacist staffing ratios. We then model the differential demand for hospital pharmacists, which may be construed as a series of layers of demand additional to underlying demand. Amalgamated data on year-to-year demand for the two mainstream roles of community and hospital pharmacists are modelled using various combinations of demand settings to represent different illustrative scenarios for overall demand. “ Other” pharmacist activities (covering personnel employed in administration, the pharmaceutical industry, government, etc as well as in other emerging roles) are not explicitly modelled in this study. However, as they have remained remarkably stable over the last 15 years, they are projected in accordance with the sum of the projected FTE growth in community and hospital demand.

As in the case of the supply projection, the base year for the purposes of projecting demand is 1996, using data supplied by the AIHW. Primary data collection Primary data were collected through:

• interviews in August 2001 with selected key informants from various stakeholder organisations— eg employer groups, professional associations, universities, industry associations— to discuss new developments in pharmacy and how these could affect the assumptions of the 1999 model;

• a workshop in September 2001 with members of the National Pharmacy Workforce Reference Group (NPWRG) and others to further consider, review and refine the methodology used in the 1999 workforce study, in the light of recent changes in pharmacy. A list of workshop participants may be found in Appendix 1.1;

• two survey questionnaires mailed by HCI to a stratified sample of pharmacists: one for those actively practising, the other for those not currently practising;

• a separate survey undertaken by the SHPA of hospital pharmacy services; and • a workshop in July 2002 with members of the NPWRG and others to discuss the main

findings of the draft report and to develop action-oriented draft recommendations. A list of participants may be found in Appendix 1.2.

Details of HCI survey As in the case of the 1999 study, quantitative primary data were collected by way of a workforce questionnaire mailed to a stratified sample of pharmacists drawn from records accessed from State Registers. A copy of the two survey instruments may be found in Appendix 1.3. Their design drew extensively upon input from members of the NPWRG. To assist the survey response, several Registration Boards sent out the survey under cover of their own letterheads and their Registrars’ signatures. On the coversheet of the questionnaire itself, the logo of all stakeholder interests was also reproduced. The survey instruments were designed to help shed light on various aspects of the labour market, especially characteristics of pharmacist supply, including:

• age / sex composition; • occupational participation and separation; • workforce distribution between sectors and their respective characteristics; • actual and preferred hours of work; and • calculation of a full time equivalent ( FTE) conversion factor.

The survey instrument was administered to the sample population progressively through October 2001. A faxed / mailed follow-up survey of non-respondents, in conjunction with a telephone follow-up, commenced in February 2002 and was completed in March. The sample

population was encouraged to respond by completing a coupon to enter into a draw to win a cash prize of $1,000.00. The draw was administered on behalf of HCI by the Guild. The two administrations of the survey questionnaire yielded 507 active workforce respondents and 159 non-active workforce respondents— in turn producing a total of 666 useable responses. A break down of responses from the active pharmacist sample population, including those who were identified as ‘out of scope’ (emigrated, retired more than 10 years, changed address) is presented below. The response rate can hence be calculated as follows:

Total questionnaires administered 1,139 Out of scope sampled subjects 37 In scope sample 1,102 Total useable responses 666 Response rate 60.4%

Respondents and non-respondents can be compared with respect to various characteristics including:

• gender (Figure 1.1); and • state of registration (Table 1.1).

Figure 1.1: Distribution of survey respondent and non respondent population by gender*

0%

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Respondents Non-respondents% of pharmacists

Male Female

* Not all registration records in the sample held data on gender Slightly more males than females responded (50.9%). Gender differences between respondents and non-respondents were not, however, statistically significant.

Table 1.1: Distribution of survey respondent and non-respondent populations by place of registration (state / territory)

State Respondents Total Response rate per state (%)

NSW 133 256 52.0 QLD 100 198 50.5 SA 155 200 77.5 TAS 33 50 66.0 VIC* 146 284 51.4 WA* 96 151 63.6

- * The sample population from these two states included specifically selected ‘off’ register pharmacists. In Victoria, at least, this segment of the sample population produced a notably poor response.

Most sample subjects resided within the three eastern states. This was expected as these states contain the highest number of pharmacists. The response rate in all states and territories was at least 50%, with the highest response rates from SA, Tasmania and WA. Given the overall reasonable response rates, there is no reason to believe that differences in response rates between states would have biased the results. Extrapolations from data collected in the survey (in conjunction with quantitative data from secondary sources) assisted in the derivation of values for parameters in modelling supply. Details of SHPA survey Modelling for differential hospital demand was undertaken by the SHPA separately under subcontract to HCI. Data was obtained from a workload questionnaire which was sent to 248 hospitals identified as having a pharmacy service. The data returned from 101 hospital pharmacy services represented a survey response rate of 40.7% (or 36.2% of the 279 hospitals identified nationwide as having hospital pharmacy departments). The SHPA was required to deliver its final report to HCI by mid December 2001. This provided a snapshot of where hospital pharmacists are currently working, what they spend their time doing and the role of pre-registration pharmacists and pharmacy support staff in providing hospital pharmacy services. Respondents also highlighted current vacancies and planned changes to their services, with corresponding changes to FTE, in the next two years. Key findings of the responses from these 101 hospital pharmacy services include:

• in October 2001, 129.16 of the 929.46 pharmacists establishment FTE (14%) were vacant;

• one in three hospital pharmacists works part time; • one in three hospital pharmacists has a postgraduate qualification; • on average 41% of pharmacists’ time is devoted to clinical services, 39% distribution

services and 16% in management activities; and • planned changes to these 101 hospital pharmacy services in the next two years will

require an additional 192.99 pharmacist FTE. Apart from the high number of positions already vacant, the authors identified a further eighteen issues that may drive the future demand for hospital pharmacists, especially over the

next decade. The SHPA states that conservative figures were used when quantifying the impact of each of these drivers. In general the minimum value for each calculation is based on the actual figures supplied by 101 hospital pharmacy services. The maximum value has been calculated by extrapolating figures for each hospital peer group to the number of hospitals in the group; these figures have been summated to give an estimate of the national impact. Most figures are based on the needs of acute overnight patients only. Allowance should be made for the FTE required for services for same day inpatients and outpatients when interpreting these estimates. Many factors can drive the need for a specific service and the staff required to deliver that service. In Australia the shortage of hospital pharmacists has coincided with considerable reforms in hospital budgets across the country. The resulting dramatic shift in staffing levels in most pharmacy services has required creative thinking about the delivery of services sought and demanded by funders, medical and nursing staff, patients and their families. The construction of a demand model involves the identification of issues that will impact on the need for the skills that pharmacists can provide and the environment in which they work. Drivers for the future demand for hospital pharmacists were identified through discussion with hospital pharmacists and responses received in the workload questionnaire. These drivers can be broadly classified as issues that affect or are linked to the external environment (demand drivers 1 to 9); the environment within a hospital (demand drivers 10 to 16); and changes to the practice or delivery of hospital pharmacy (demand drivers 17 and 18). The identified drivers of future demand are listed in Table 1.2. All 18 demand drivers have been examined and individual (positive or negative) impact estimates prepared. However, three (3) drivers (shown in bold text in the table) were noted to contribute to the majority of future demand and these will be discussed further in this document.

Table 1.2: List of drivers of future demand for hospital pharmacists

1 Ageing of the Australian population 2 APAC guidelines 3 Enterprise bargaining agreements 4 Hospital accreditation requirements

5 New medical technologies 6 Number and types of hospitals

7 Number of admitted patients 8 Pre-registration pharmacists

9 Safe dispensing loads 10 Automated drug distribution

11 Electronic prescribing with decision support 12 Outsourcing

13 Patient complexity 14 PBS dispensing in public hospitals 15 Risk management and quality of care issues 16 Service level at private hospitals

17 Changes in pharmacy service delivery 18 Pharmacy support staff

The full report by O’ Leary, K et al (2001) A Demand Model for Hospital Pharmacists is available at http://www.shpa.org.au/documents/demandworkforce.pdf

Labour market balance As noted above, a workshop with the NPWRG and other interested parties was undertaken in July 2002 to (a) examine the draft findings of the study and possible policy implications, and (b) to develop appropriate strategies and to allocate duties to particular organisations to ensure the recommendations of the report are successfully implemented. These strategies and recommendations are outlined in Chapter 5. An assessment of labour market balance from 2001-2010 is also outlined in Chapter 5. As noted in the 1999 report, the major impact of any labour market imbalance will likely have marked sectoral and regional implications— where the burden of adjustment will occur.

Chapt er 2 : L i t e rat ure rev iew

Introduction This review seeks to cover relevant material that has become available since completion of the first study on the pharmacist labour market on behalf of the National Pharmacy Workforce Reference Group (NPWRG) (HCI, 1999). Information was gathered for this review from various sources, including national and international published reports and documents, on-line databases and websites, overseas inquiries into the pharmacy workforce, pharmacy and health journals and other relevant documents. It concentrates on Australia, but draws parallels with information from overseas, particularly the USA and the UK. References may be found in Appendix 2. Impact of structural change in the health system In July 2000, the Pharmacy Guild of Australia convened a national Community Pharmacy Summit. This was a landmark convention to take stock of the opportunities and destiny of community pharmacy in Australia in the light of the opportunities provided by the Third Community Pharmacy Agreement between July 2000 and June 2005. By way of its initial exploration of the health care environment and landscape in Australia, the 2000 Summit proceedings remarked upon the changes it considered were likely to cause some redefinition of the roles of both community and hospital pharmacists (PGA, 2000). It thought that these changes were likely to include:

• significant cost and economic pressures, particularly associated with the aged and regional populations;

• a gradual shift from Government support for health care towards self-funded care; • an increase in integrated healthcare companies providing healthcare packages; and • growth in the economic importance of complementary medicine, other non-

mainstream health care and new “ mainstream” medical approaches. Additional changes thought likely to affect the pharmacy profession included:

• an ageing population— there are now 2.3 million people, or 12% of the population, over 65. By 2016, there will be 3.5 million or 16%, and by 2051, there will be 6.03 million or more than 25%. Outlays on health will rise fast, including those on pharmaceuticals (Access Economics, 2001);

• technological and social change— characterised by more specialised (and costly) mainstream medical treatments, remote monitoring and diagnosis, development of the “ hospital in the home” and widespread adoption of the Internet by both health consumers and providers;

• changes in the role of doctors, pharmacists, and other service providers; • the emergence of new health care management models— notably in preventive and

community care;

• advances in the way health services are organised and delivered through the development of pharmaceuticals and in the future from genomics, which will enable genetic screening and a wide range of preventative rather than curative interventions; and

• de-institutionalisation of patients to community based care (including early discharge of patients) (HCI, 2000; NHS 2000; Warner et al, 1998).

Changes in the way hospitals deliver health care were also thought likely to affect hospital pharmacy services. Recent trends include:

• increases in both inpatient and outpatient activity in Australian public hospitals; • increasing levels of patient acuity and complexity; • decreasing average length of hospital stay; • increasing day only admissions; • increased emphasis on evidence-based decision-making and clinical care; • increased focus on safety and quality of care, reduction of adverse events, medication

safety and clinical risk management activities as part of clinical pharmacy services; • increased focus on the quality use of medicines generally and in particular across the

continuum of care; • new management and financial arrangements, such as outcomes based funding /

casemix funding, devolution and purchaser-provider split and changes to the Australian Health Care Agreements (DHAC, 1999; KPMG, 2001).

As it responds to such changes by way of cost effective, higher quality regimens, the health system will stimulate new professional skill development, new collaborations and new configurations of staff— including, in some cases, reductions or changes in the mix of practitioners. This will be a complicated and creative undertaking, with parallels in other countries, which will make demands on traditional professional attitudes (O’ Neil & PHPC, 1998). In the United States, for example, the practising pharmacist today offers a broader range of services than was offered even ten years ago (DH&HS, 2000). This change is likely to continue as pharmacy:

“ …. Transforms itself from a primarily product-centred profession to a patient-care oriented profession” (American College of Clinical Pharmacy, 2000).

To prepare for these challenges, pharmacists will need to combine a strong foundation in clinical therapeutics with sound communication skills, an appreciation of the health care system, effective team-building and management capabilities and clinical problem-solving skills. They will also need the ability to apply these skills across different health care settings, including the ambulatory, long-term care and community settings favoured by managed care (O’ Neil & PHPC, 1998). The Fourth Report of the Pew Health Professions Commission accordingly makes recommendations for pharmacy in the United States that would:

• continue to orient pharmacy education to reflect pharmacists’ changing practice roles and settings under managed care and in clinical drug therapy;

• embrace an interdisciplinary approach to health care delivery— this includes fostering collaboration with pharmacy technicians and other allied health workers and encouraging them to contribute to patient care to their full capacity; and

• provide opportunities for re-training and continuing education for practitioners to develop skill sets for expanded clinical roles beyond dispensing pharmaceuticals (O’ Neil & PHPC, 1998).

International trends United States Responding to speculations about a possible shortage of licensed pharmacists in the United States, the Department of Health and Human Services undertook a study to assess the extent of any shortage, and to seek comments on its extent (DH&HS, 2000). Released in December 2000, the National Center for Health Workforce Information and Analysis study indicated:

1. A shortage of pharmacists— evidenced by a greater number of women pharmacists with shorter work patterns, difficulties in hiring and increased vacancy rates. The number of unfilled full- and part-time drug store pharmacist positions nationally rose sharply from about 2,700 vacancies in February 1998 to nearly 7,000 vacancies by February 2000, and such vacancies were expected to continue to grow. During the year 2000, 70% of hospital pharmacies termed the shortage of experienced pharmacists “ severe” as opposed to 48% the year before. For public hospitals in particular, vacancy rates averaging 11% were reported, with 48% of respondents noting that it took at least six months to fill unfilled positions. The SHPA reports that this is similar to the current Australian experience.

2. A sharp increase in demand for pharmacy services—reasons for which include:

• increased use of a wide range of prescription medications. Retail prescriptions dispensed in the United States rose by 44 % between 1992 and 1999, from 1.9 to 2.8 billion. The estimated annual number of prescriptions filled by each retail pharmacist grew by 32 %;

• expansions in pharmacy practice and pharmacists’ roles and professional opportunities;

• increased access to health care and more health care providers authorised to prescribe medications;

• expanded health insurance coverage resulting in increased prescriptions and time-consuming third-party payment tasks;

• the growing emphasis in pharmacy education on a doctor of pharmacy degree, which lengthens the education program and increases the amount of training in clinical practice; and

• strong competition for pharmacists, trained at the residency or fellowship level, with schools of pharmacy, managed care organisations, pharmaceutical corporations and hospitals all competing for these highly trained pharmacists— resulting in sector shortages especially for schools and hospitals less able to compete economically.

Specific reasons for the growth in demand for pharmacists in hospital settings include the increased complexity of medication therapy and the need for proper drug selection, dosing, monitoring and management of the entire drug use process to assure quality and cost-conscious use patterns. The report found that the demand for pharmacists in the institutional sector, including both long-term care and home care, remained strong.

3. Declines in pharmacy school graduates— corresponding with declines in applications

to pharmacy schools. The number of applications in 1999 was 33% lower than it had been in 1994, the high point over the past decade.

4. The effect of structural factors— causing shortages to persist without fundamental

changes in pharmacy practice and education.

5. Shortages leading to: • less time for pharmacists to counsel patients; • job stress and poor working conditions with reduced professional satisfaction; • greater potential for fatigue-related pharmacist errors; • service restrictions particularly affecting the most vulnerable sectors of the

population such as the elderly, rural communities, people with a mental illness who are on medication and those dependent on publicly-supported services such as Native Americans and veterans; and

• fewer members of pharmacy school faculty— because of their recruitment into the workforce.

6. Avenues to remedying shortages, including:

• using more technicians to perform repetitive manual tasks, thus freeing up pharmacists to focus on tasks they alone are authorised to do;

• greater use of automation to increase efficiency and reduce pharmacists’ workload;

• reducing administrative burdens to health plans and insurers (DH&HS, 2000). United Kingdom The Government has developed a program for the role of pharmacy in the new National Health Service (NHS) “ to give patients the right care at the right time, in the right way and of the right quality” (NHS, 2000). Developments proposed include:

• patient access to a growing range of over the counter medicines from pharmacies and easier out of hours access to medicines;

• direct NHS patient referrals to a local pharmacist (by 2002) if that is the best way of getting patients the help they need;

• 500 one-stop primary care centres (to open by 2004), a substantial number of which will include a community pharmacy, giving patients access to the services of doctors, nurses, pharmacists and others under one roof;

• access to repeat prescriptions from a pharmacy, without on each occasion having to contact a doctor (by 2004);

• the advent of electronic prescribing (by 2004), facilitating dispensing by “ e-pharmacies” ;

• the introduction of initiatives to help patients get the best from their medicines, including a national medicines management services pilot scheme, based exclusively in community pharmacy;

• a national contract to reward community pharmacies providing high quality services at the expense of those offering only the basic minimum;

• removal of the barriers to new community pharmacies, in so far as barriers may thwart development of superior patient care;

• prescribing of some medications directly by pharmacists, for example anti-coagulation therapy;

• an expansion of pre-registration pharmacy training places in NHS hospitals, with 500 planned in 2001/02— at least 50% more than in 1990; and

• encouragement of debate that contributes to better use of pharmacy technicians and other support staff, in both community and hospital pharmacy (NHS, 2000).

In relation to hospital pharmacy practice, a recent report by the Audit Commission (2001) aims to raise the profile of medicines management in hospitals and to make a case for providing adequate investment to enable standards to be raised. The report notes that 15 percent of pharmacy posts are vacant, and that half of UK hospitals are unable to provide all their intended pharmacy services because of staff shortages. It suggests that these shortages are being exacerbated by growing demand for pharmacy staff, including:

• demand for pharmacists from outside the hospital sector; • increases in demand from traditional workload areas; • increases in demand from new services, such as extending pharmacists’ clinical roles;

and • the need to increase pharmacy operating hours (Audit Commission, 2001).

Other countries Information from overseas indicates an increasing role for pharmacists in patient care in the next few years which, combined with growth in the number of prescriptions, will result in an increased demand for pharmacists and their services. The view that dominates the literature surveyed is that there is a shortage of pharmacists, not just in the United States and the United Kingdom, but also in Canada, New Zealand and in a number of other countries, and that this shortage is likely to worsen as the demand for pharmacy services increases. There are concerns about a continuing shortage of pharmacists in many parts of Canada (CphA, 2001). Information from both hospital and chain drug store vacancy surveys suggests that about 10% of full or part time positions pharmacist positions in Canada were vacant early in the year 2000. Based on approximately 24,000 practising pharmacists in Canada, a 10% vacancy rate projected over all employers of pharmacists suggests that well over 2,000 additional pharmacists could readily find work in Canada (HRDC, 2001). New Zealand is experiencing increasing problems in maintaining rural pharmacy services. Forty one percent of the proprietors of pharmacies in small towns are over the age of 55 years, and they can be expected to retire within the next 10 years (Pharmacy Guild of NZ, 2001).

Similarly, concern has been expressed about the decline in pharmacy human resources in South Africa (Stanton and Pleaner, 2001). This is being exacerbated by an increase in South African pharmacists seeking employment in other countries, often due to crime and salary related factors, and by the compulsory one-year community service for interns in state institutions prior to registration. To help alleviate the shortage, greater focus is being placed on training, registering and using pharmacist assistants (Stanton and Pleaner, 2001). Australian trends – supply issues Pharmacy labour force In February 2001 the Department of Employment, Workplace Relations and Small Business (DEWRSB) found that there were national shortages of retail and hospital pharmacists, and shortages in all States and the Northern Territory (DEWRSB, 2001). In this context, the Australian Institute of Health and Welfare (AIHW, 2000) notes that:

• the number of pharmacies remained almost unchanged between 1995 and 1999 (4,958 compared to 4,942);

• the pharmacist workforce grew from 12,525 in 1992 to an estimated 13,834 in 1996; • between the 1991 and 1996 population censuses, there was an increase in the number

of pharmacists in the older age groups of the workforce. For example, the proportion of community pharmacists that were aged 45 or more was 54.5%, including 7.1% that were aged 65 and over. The average age of all community pharmacists was 46.3 compared to the average age of all hospital and clinic pharmacists of 41.6;

• high rates of retirement from an ageing pharmacist workforce, and growth in female participation in the workforce (resulting in higher proportions of pharmacists working part-time) appear to have been largely responsible for reported workforce shortages;

• there has been a marked increase in students embarking on pharmacy degrees. The number of pharmacist graduates, however, declined considerably in 1999, because of the effect of changing from three to four year degrees.

Geographical shortage: rural and remote pharmacy practice As remarked in the literature review in the HCI’ s earlier study (1999), there are marked variations in the supply of pharmacists between metropolitan and rural areas. In 1996, capital cities had the most full time equivalent (FTE) pharmacists per 100,000 population at 70.9, while large rural centres had 61.2, small rural centres had 55.4, other rural areas had 41.6, remote centres had 38.0 and other remote areas had 25.6. “ Other” metropolitan centres were an exception to this trend, with 55.5 FTE pharmacists per 100,000 population— less than in large rural centres. Acknowledging the shortage of rural pharmacists, the Third Community Pharmacy Agreement between the Guild and the Commonwealth Government earmarked funding of $74m over five years to help maintain Australia’ s pharmacy network in rural and remote areas. The new measures included:

• a Rural Pharmacy Maintenance Allowance ($57 million over five years) – replacing the Isolated and Remote Pharmacy Allowances and providing assistance to rural and

remote pharmacies in maintaining essential pharmacies in the bush. The amount payable will vary with the remoteness of the pharmacy and its prescription volume. This element of the package commenced on 1 January 2001.

• a Start-up Allowance ($1.5 million over five years)— to assist pharmacists establish pharmacies in rural/remote areas of need.

• a Succession Allowance ($2 million over five years)— to be paid to a pharmacist who purchases an existing pharmacy in a rural/remote location that would otherwise have risked being closed because of lack of buyers.

• Aboriginal Health Services ($2 million over five years)— an annual allowance for pharmacists, working under special supply arrangements, to supply pharmaceutical services to remote Aboriginal Health Services.

• an Emergency Locum Service, to ensure remote pharmacies are not forced to temporarily close because the sole proprietor is ill, or has a family or other emergency ($1.3m over five years) (PGA, 2000a).

Various other education and training initiatives were also announced under the Rural and Remote Pharmacy Workforce Development Program. These included funding for pharmacist academics at University Departments of Rural Health; an expansion of the Rural and Remote Placement (internship) Scholarship Scheme; ongoing funding for the Continuing Pharmacist Education / Professional Development Allowance; an Infrastructure and Development Grants Program (to help develop initiatives to enhance rural practice); expansion of the Undergraduate Scholarship Scheme; and establishment of a scheme for Aboriginal and Torres Strait Islander students to study Pharmacy (PGA, 2000a). A baseline evaluation of the Rural and Remote Pharmacy Workforce Development Program is currently being undertaken by the Guild, which is concerned that the shortage of pharmacists in rural and remote areas may limit the expansion of their professional roles1. Sector shortages: hospital pharmacists In addition to shortages of pharmacists in rural and remote areas, the literature review in the earlier study (HCI, 1999), noted concerns expressed by certain stakeholders about shortages of hospital pharmacists. To determine the effect of reported pharmacist shortages on public hospitals, the Victorian Healthcare Association undertook a workforce survey of both metropolitan and regional public hospitals as at 1 March, 2000. Thirty-one from a possible 44 hospitals (70%) responded to the survey. The survey found that:

• 94% of pharmacist positions were filled at the time of the survey (98% in metropolitan hospitals and 83% in regional hospitals). Many hospitals, however, reported difficulties in recruiting staff with the required level of expertise and experience.

• Full staffing was reported for dispensary technicians. These comprised about 40% of the pharmacist FTE positions in metropolitan hospitals, compared to 60% in regional hospitals.

• There were high turnover rates. In the year to March 2000, resignations for 68 FTE positions were reported (26%) (VHA, 2000).

1 Personal communication, Mr J. Bronger, PGA President, 5th September, 2001

Since this time, the SHPA study (O’ Leary 2002) has noted an average vacancy rate of 14% of funded hospital pharmacy positions. A study of 100% of Victorian hospitals (Kainey 2002) shows an average vacancy rate of 8% which rises to 19% when considering rural hospitals. Factors influencing pharmacy workforce demand Pharmacist roles An expanding role for pharmacists as health providers is being driven partly by the sheer technical imperatives associated with the increasing complexity and diversity of medications, and their growing potential for misuse. In addition to counseling patients on the proper use of medication, the role of today’ s pharmacist includes drug monitoring and disease management for defined conditions; clinical interventions; participating in multidisciplinary clinical care teams; consulting on drug utilisation programs; supporting health services research on outcomes of care; providing drug information; patient education; formulary management; and furthering public health initiatives such as smoking cessation programs, diabetes education and immunisation (DH&HS, 2000). New drug innovations require the continuous modernisation of the pharmacists’ information base and the acquisition of new skills in counselling patients and other members of health care teams (DH&HS, 2001). In this context, the Community Pharmacy Summit noted that there are no competency standards for experienced pharmacists, even though it is experienced pharmacists that are most likely to adopt the new and emerging roles in community pharmacies described above. There is also a gap in the competence of pharmacists taking and keeping clinical records (PGA, 2000). However, the Pharmaceutical Society of Australia has advised that they are currently developing a single set of competency standards for Australian pharmacists, as well as specialised competency standards for additional professional services, such as medication review2. Skills mix of pharmacy staff The earlier study (HCI, 1999) noted that the extent to which community pharmacists delegate part of their current workloads to other staff would have an effect on the future demand for pharmacists. Before the Community Summit, stakeholders supported career development opportunities to assist the recruitment and retention of retail pharmacy assistants, including an improved career pathway up to, and beyond levels 1-4; recognition of training from various sources, including in-house suppliers; and an assessment process that is competency based and provides national and portable qualifications (HCI, 2000). Participants at the Summit suggested that many quality and business process re-engineering proposals would have an impact on the administration and organisation of pharmacy (PGA, 2000). For instance, the ability to substitute adequately trained and supervised technicians for some tasks now performed by pharmacists will mitigate, to some extent, the demand for pharmacists. Concern has been expressed that the competencies of pharmacy personnel may not be sufficient to meet impending professional challenges confronting community pharmacy (PGA, 2000). Entry level competency standards for pharmacists were reviewed at the

2 Personal communication, Mr Bill Kelly, PSA, Canberra, 5th September, 2001

Australian Pharmacy Conference in Melbourne in October 2001. At the conference the profession endorsed revised competencies that now apply to all pharmacists. During the recent US pharmacy workforce review, community pharmacist professional associations emphasised the need for augmenting pharmacists’ resources through the appropriate use of pharmacy technicians and the enhanced use of technology, including automation, robotics and electronic transmission of prescriptions (DH&HS, 2000). In relation to the hospital pharmacy workforce, Leversha et al (2001) note that, in response to the shortage of clinical pharmacists in rural and remote areas, an innovative ward role has been developed for pharmacy technicians to relieve the pharmacist of non-clinical duties at Latrobe Regional Hospital, Traralgon, Victoria. They note, for example, that assembling complete and detailed information about patients’ medication at admission involves non-clinical tasks such as photocopying drug charts, collecting medication that patients have brought into hospital themselves, listing the drugs which have been left at home, and informing patients of the hospital’ s policy with regard to medication. Training technicians to carry out these tasks allows pharmacists to concentrate on clinical issues. The study found that, as a result, most patients were reviewed by a pharmacist within 24 hours of admission, clinical issues were addressed promptly and the discharge process was efficient and comprehensive (Leversha et al, 2001). The SHPA has investigated the current use of support staff in hospitals (O’ Leary et al, 2002). The breakdown of activities of support staff is interesting. As expected, the vast majority of FTE perform distribution activities (85%), however 9% perform management, policy and procedure activities. This figure may appear surprising, but it reflects the improved qualification and professionalism of technical support staff (their growing number and a corresponding growth in personnel management roles) and the role of support staff in processing PBS claims (Section 100 in many public hospitals and Section 85 items in most private hospitals). A small number of support staff are being employed to assist clinical pharmacists. This is a new role being trialled in some hospitals.

Table 2.1:Pharmacists and support staff by state/territory.

State Pharmacist FTE (filled)

Pharmacists: Distribution

Services

Support staff FTE

Support staff FTE to

pharmacist FTE ratio

Support staff FTE to

pharmacist FTE for distribution services ratio

ACT 8.20 4.90 7.00 1:1.17 1:0.70 NSW 228.44 88.48 169.17 1:1.14 1:0.52 NT 2.50 2.44 3.00 1:0.83 1:0.81 QLD 151.55 64.91 116.79 1:1.29 1:0.56 SA 68.60 35.05 74.75 1:0.92 1:0.47 TAS 6.50 3.65 7.0 1:0.93 1:0.52 VIC 255.21 83.86 140.91 1:1.81 1:0.59 WA 79.30 32.57 74.00 1:1.07 1:0.44 Total 800.30 315.87 592.62 1: 1.35 1: 0.53 The average number of support staff for each hospital category varies significantly. The largest hospitals have an average of 13 support staff FTE. Hospitals with less than 5,000 casemix adjusted inpatients have an average < 1 FTE. These figures are probably linked to the

volume of patients treated at these hospitals and the corresponding workload associated with the acquisition, warehousing, manufacturing and distribution of pharmaceuticals. The number of support staff and their role has changed considerably over the last decade. The SHPA survey may be the first to examine the number and role of technical staff in hospital pharmacy services in Australia. Without a baseline it is impossible to draw any conclusions. It can be noted that:

• greater than 85% of support staff FTE perform distribution activities; • the ratio of support staff to pharmacist FTE was 1.00 : 1.30 across the hospitals

surveyed; and • when the ratio is limited to the pharmacist FTE performing distribution activities, the

figure jumps to 1.00 : 0.53. Clearly the services required by the hospital and chosen method of service delivery has a greater impact on the pharmacist FTE for the clinical and distribution activity streams than the number of pharmacists and support staff available alone. Drug related illnesses Studies have shown that pharmacists have an important role in preventing medication errors in both institutional and community pharmacy practice (DH&HS, 2000). In the United States the importance of pharmacists in delivering quality care has been highlighted by the shortage of pharmacists. A 1999 Institute of Medicine report estimated between 44,000 and 98,000 people in US hospitals die each year because of medical errors (Kohn et al, 1999). The overall cost of drug-related morbidity and mortality has been estimated to be between $US77 billion and $US136 billion per year (DH&HS, 2000). The Institute of Medicine noted the important role that pharmacists play in reducing medication error. The report emphasised the importance of human factors— maintaining reasonable working hours, workloads and staffing ratios, and avoiding distractions— in keeping errors to a minimum (Kohn et al, 1999). It has been estimated that in Australia, medical error results in as many as 18,000 unnecessary deaths per annum, and more than 50,000 patients become disabled each year (Weingart et al, 2000). Adverse drug events constitute about 25% of hospital errors (Weingart et al, 2000). A recently reported randomised controlled trial of Medication Liaison Services in hospital wards (Stowasser et al, 2002) found that a Medication Liaison Service was associated with improved patient outcomes, more clinical pharmacy interventions intended to optimise therapy, a decrease in readmissions and in community healthcare professional visits, and improvements in functional health status score. The final report of the Review of Drugs, Poisons and Controlled Substances Legislation (Galbally, 2001) (see below) argues that the destiny and credibility of community pharmacists in Australia will need to increasingly rely on successful strategies for risk-based intervention. In a survey of Tasmanian community pharmacists Peterson et al (2001) found that community pharmacists thought the risk of dispensing errors was increasing, primarily due to high prescription volumes, pharmacist fatigue and overwork, interruptions to dispensing and similar or confusing drug names. Most pharmacists in the sample (58%) stated that there should be a regulatory guideline for the safe dispensing load in Australia. A median of 150 was nominated as the maximum number of prescription items that can be safely dispensed per

9-hour day (ie 17 items per hour) by, or in the presence of one pharmacist. Pharmacy Board of NSW has indicated that an average of about 12-15 prescription items per hour may be a reasonable guideline (Pharmacy Board of New South Wales, 1996). Better Medication Management System (BMMS) New roles for pharmacists are likely to be facilitated by information technology, using an individual patient’ s electronic medication record to underpin medication management (PGA, 2000). The BMMS, endorsed by State and Territory Health Ministers at the Australian Health Ministers’ meeting on 27 July 2000, is a planned system of electronic medication records. For each person choosing to participate, it will create a single, integrated electronic record of medication, linked to an individual’ s Medicare PIN number, and accessible to authorised doctors, pharmacists and the person concerned. Its objective will be to provide a safer prescribing and dispensing environment (DHAC, 2001a). When first introduced, the system will cover prescriptions attracting benefits under either the Pharmaceutical Benefits Scheme (PBS) or the Repatriation Pharmaceutical Benefits Scheme for veterans. It will later expand to include hospital prescriptions and over the counter medications. Development on the BMMS is continuing in consultation with a range of interested parties, with the expectation that field tests should be underway in 2002 (Wooldridge, 2001). Factors affecting community pharmacy This section reports on developments with workforce implications since the first NPWRG study (HCI, 1999). Implications of the Third Community Pharmacy Agreement The Third Community Pharmacy Agreement between the Commonwealth Government and the Guild commenced on 1 July, 2000 for a five-year period to 30 June, 2005. The Agreement seeks to complete the foundation for transition in pharmacy towards professional service provider status. Its commitment to professional services includes opportunities for pharmacists to participate in enhanced professional activities under a Pharmacy Development Program (PDP). This will attract funding of $188 million over the term of the Agreement and provide pharmacies that register to become accredited under the Quality Care Pharmacy Program (QCPP) with generous financial incentives, which have been set by the Agreement Management Committee (CWA and PGA, 2000). PDP funding also includes a $15 million component for community pharmacy research. This is likely to serve the enhancement of professional skills in the delivery of professional pharmacy services and their integration with:

• strategies for information technology— for which a further $10 million will be provided; and

• delivery of medication management services— now extended to domiciliary settings—for which $114 million has been allocated over the life of the Agreement (HCI, 2000).

The first two Community Pharmacy Agreements have gradually increased remuneration opportunities for professional pharmacist services (Coper, 2001). The Third Agreement, however, is intended to mark a shift in emphasis for community pharmacists from a retailing

focus towards a professional service focus. It demonstrates Commonwealth support for pharmaceutical care that extends the pharmacist’ s role to providing medication therapy, which continues through to the goal of improved patient outcome. For example, arrangements under the Third Agreement for medication review represent a significant extension of the residential medication review program that was funded under the Second Agreement. For the first time, too, there is special provision for cooperation with the medical profession. Key aspects of PDP Third Agreement funding are:

• an increase in the fee for residential review from $54 to $100 per service; • the implementation of domiciliary medication management reviews (DMMRs), also

known as home medicine reviews (HMRs), at $140 per service— representing a new dimension of review activity; and

• provision of funding to enable pharmacist facilitators working out of Divisions of General Practice to support collaboration between pharmacists and general practitioners in implementing DMMRs.

By way of international comparison, two new professional roles recently introduced for Canadian pharmacists include:

• independent prescribing authority for the emergency contraceptive pill for over 1,300 certified pharmacists in the province of British Columbia, who charge patients a $25 consultation fee for professional services in addition to the drug cost and dispensing fee; and

• development of a ‘fight-flu’ toolkit to help pharmacists promote annual vaccination to their patients (CphA, 2001).

In the United States, community pharmacies are increasingly providing disease management services, with 79% of “ independent” pharmacies receiving payment for immunisation, 46% for anticoagulation monitoring and 26% for asthma training (NCPA, 2001). Contemporary studies that have demonstrated the benefits of cognitive pharmaceutical services are briefly outlined below. Recent evidence on cognitive services Some five years after its implementation, experience with residential medication review suggests that its associated workload has developed in a way that has become markedly concentrated in the hands of a small number of consultant pharmacies. Nevertheless, it has been suggested that as opportunities to new remunerated services increase, the number of pharmacists accredited to deliver them will increase and the patterns of provision will become less skewed. Coper (2001), for instance, believes that the introduction of DMMRs will create a need for all pharmacists to have access to an accredited pharmacist (Coper, 2001). Before their formal launch, various Australian studies evaluated pilot DMMR projects, involving collaboration between pharmacists and general practitioners (Krass et al, 1999; Krass et al, 2000; Gilbert et al, 2000; Roberts et al, 2000; Bennett et al, 2000). Although there is a consensus that DMMRs are likely to yield overall savings to the health care system, there is disagreement as to their impact on the volume of prescribing.

In settings outside Australia, Tully et al (2000) examined the main motivators and barriers to implementing prescription monitoring and review services by community pharmacists working either in pharmacies or in general practice surgeries. They found high levels of agreement that providing a prescription monitoring and review service would improve perceptions of pharmacists, help develop relationships with patients and give pharmacists professional fulfilment. The key barriers to implementing these services were their time-consuming nature, locum difficulties, the prohibitive cost and unwillingness of pharmacy owners or GPs to fund services. They concluded that adequate remuneration structures were an important factor for these services to succeed. Rutter et al (2000) investigated community pharmacy managers’ perceptions of their role in providing health care to patients and compared these with their aspirations for the future. They found that participating pharmacist managers wanted to play an integral part in the health care of patients. Strategies put forward to encourage this included delegation of health screening and minor illness clinics from the prescriber to the pharmacist, having more formalised and open channels of communication with prescribers and moving away from performing technical duties, such as the physical assembly of medicines. Participants were aware that apathy and inaction would result in potential opportunities for pharmacy to be sacrificed or passed over to another profession within the primary health care team. In the United Kingdom, a literature review and qualitative research conducted by the University of Manchester School of Pharmacy concluded that pharmacies could play a bigger role in the management of minor ailments, and could reduce the general practice workload if the cost barrier for exempt patients could be removed when going to the pharmacy (UK Delegation, 2001). On the other hand, a review by the University of Kent at Canterbury found that considerable work needed to be done before pharmacists were ready to assume an extended role in chronic disease management (UK Delegation, 2001). Studies have shown that pharmacists can contribute to reducing the cost of healthcare while at the same time improving patients’ use of medications and health outcomes. Donato et al (2001) conducted a cost analysis of the Community Pharmacy Model Practices project in South Australia. The study comprised ten community pharmacy practices in primary care: five provided generalist medication management, two diabetes care, two asthma care, and one wound management. Services were provided to 411 pharmacy patients in a nursing home, a hostel or a hospital. The study found the provision of medication management services by community pharmacies can be expected to reduce overall direct costs to the health system. While similar findings are likely with wound management, the results are less certain for asthma management and diabetes management. Despite new arrangements and developments described above, there is little evidence that professional cognitive services have yet been widely adopted by community pharmacists in Australia. Furthermore, some concern was expressed during the July 2000 Pharmacy Summit as to whether systems in place for training, management and development of pharmacy’ s human and intellectual resources will guarantee the delivery of the new roles referred to in the Third Agreement (PGA, 2000), as well as whether the pharmacy workforce itself is large enough to provide these additional services. Miscellaneous workforce issues Other workforce issues identified at the Community Summit were:

• access to sufficient capital to meet the ownership aspirations of young pharmacists; • managing the gap between student expectations and the reality of practice, which can

lead to de-motivation and cause young pharmacists to leave the profession; • options for career change and alternatives to make careers more flexible and

rewarding; and • overcoming difficulties many pharmacists have in paying professional rates to make it

rewarding for employed pharmacists (PGA, 2000). The Summit stated that it could be desirable to implement new ownership structures to provide a corporate base for the profession to address a number of these issues. The first workforce study noted that general practitioners could potentially play a greater role in providing computer-based medications (HCI, 1999). Daffey (2001) notes that a group called “ dr.direct.com” claims on its website that it will be enhancing patient convenience and care through direct dispensing of vaccines and antibiotics, stating that they will “ provide a select range of pharmaceutical medicines at the point of care” . A recent US study has nominated extended trading hours as one factor contributing to the current pharmacist shortage in that country. The move by community pharmacies in Australia, over the last 10 years, towards increased trading hours, exemplified by the recent extension of trading hours in Queensland, may also affect pharmacist shortages here. The demand for prescriptions One measure of the demand for pharmacists and their workload that has been consistently documented, is the growth in prescription medication use and the volume of prescription medicines dispensed. Although an incomplete measure of demand, prescription volume serves as a useful starting point for measuring changes in the work of community pharmacists. Changes in the volume of prescriptions filled are inevitably accompanied by corresponding changes in other related functions, including the number of prescriptions filled by others that must be checked and the number of occasions on which patient counselling is required (DH&HS, 2000). Furthermore, changes in the demand for private prescriptions— especially increases in the demand for those associated with lifestyle drugs— spill over into demand for private dispensing services3. National Competition Policy Review of Pharmacy In July 1999, the Minister announced a National Competition Policy Review of Pharmacy. Its brief was to consider whether specified Acts and Regulations relating to pharmacy imposed restrictions on competition and if so, whether any such restrictions were of net public benefit and, if not, whether they should be removed (Wilkinson, 2000). For instance, under the National Health Act 1953, the Commonwealth controls the location of community pharmacies that are approved to dispense pharmaceutical benefits. 3 Personal communication, Mr J. Bronger, PGA President, 5th September, 2001

Amongst other things, the Review recommended that: • legislative restrictions on who may own and operate community pharmacies be

retained; and • with existing exceptions, the ownership and control of community pharmacies

continue to be confined to registered pharmacists (Wilkinson, 2000). It was suggested that the findings of the Review would help to ensure the viability of pharmacy in smaller communities (PGA, 2000b), although some consumer advocates considered the recommendations of the Review were unduly cautious (Ballenden, 2000). Location of community pharmacies The Third Agreement contained revised criteria for new pharmacy approvals and pharmacy relocation, some incorporating recommendations of the Wilkinson review. Changes effective from 1 July, 2000 included:

• less stringent criteria required to demonstrate a “ definite community need” for new pharmacies to be opened, particularly in growing outer metropolitan areas;

• clarification of the definitions of a large shopping centre and a retail shop, to simplify administration by the Australian Community Pharmacy Authority (ACPA) of pharmacy relocations to shopping centres;

• creation of a special category of new rural pharmacy approvals to promote improved access to pharmaceutical services in areas currently under-serviced; and

• simplification of ACPA’ s administration of the rules for new approvals and pharmacy relocations.

The Third Agreement, however, did not incorporate a recommendation of the Wilkinson review that new pharmacies should be allowed to be located within medical centres in proximity to pharmacies that already served the area. Under location changes to come into effect from 1 July, 2002:

• distance between pharmacies will be measured in a straight line from door to door rather than by public access routes;

• the 2km distance rule for relocating pharmacies will be reduced to 1.5km; • the 1km distance rule for short relocations will generally increase to 1.5km; and • special rules will apply to short relocations of between 1km and 1.5km (CWA and

PGA, 2000). It is possible that, overall, these changes may make it easier for new pharmacies to open and thus secure the demand for pharmacy labour. Review of drugs, poisons and controlled substances legislation Australia has a unique system of scheduling non-prescription medicines that gives pharmacies control of the sale of S2, “ pharmacy only” and S3, “ pharmacist only” products. This is facilitated by way of national poisoning scheduling made by the National Drugs and Poisons Schedule Committee, pursuant to the Therapeutic Goods Act 1989.

Rulings concerning which products may be covered by S2 and S3 classifications nevertheless remain the responsibility of individual States and Territories— who each apply their own (but not necessarily uniform) regulations. Compliance with standards to support professional supervision of sales of S2 and S3 medicines is a key feature of QCPP accreditation. In accordance with COAG’ s implementation of National Competition Policy Principles, the final report of the Review of Drugs, Poisons and Controlled Substances Legislation, was released in December 2000. It was agnostic about the effectiveness and use of S2 and S3 scheduling (Galbally, 2001). Among other things, the Review recommended that funds be allocated from the PDP under the Third Agreement to commission:

• the development and implementation of comprehensive standards that could facilitate a risk-based approach to professional intervention in the supply of S2 and S3 products to individual consumers;

• the development of effective procedures for auditing professional behaviour congruent with the standards;

• independent research to provide baseline data and evaluation of any improvements in health that may be attributed to the development of standards and operating procedures associated with the provision of S2/S3 patient counselling;

• the delivery of evidence to demonstrate that Australians are generally better off with S2 and S3 scheduling than they would have been without it;

• a report on the research results and standards, to be provided to the Australian Health Ministers Council by the end of July 2004. This will enable Health Ministers to determine whether current restrictions on access to S2 and S3 medicines confer any real net benefit upon the Australian community.

Pending the outcome of the above commissions and investigations, and their consideration by the Australian Health Ministers by July 2004, the Galbally Report (2001) recommended retention of Schedules 2, 3, 4 and 8 and associated Appendices. A Working Party of the Australian Health Ministers’ Advisory Council has been established to assist the preparation of comments on the Review for the Council of Australian Governments’ Review of Drugs, Poisons and Controlled Substances Legislation (TGA, 2001). The issue of effective S2 and S3 standards implementation has already been comprehensively addressed. Benrimoj et al (Forthcoming) have developed and tested an implementation mechanism to raise standards of practice for S2 and S3 product supply. The mechanism consists of an audit cycle in which pharmacy educators and pseudo patients pay a series of visits to community pharmacies to score, evaluate and improve their S2 and S3 interventions. Benrimoj et al show that their methods have a powerful impact on implementation and compliance. The issue of whether compliance with S2 and S3 standards in fact confers a net benefit, however, remains to be tested (PGA, 2001). Full resolution of the issues raised by Galbally (2001) will clearly have major implications for the role of community pharmacists, as well as for the professional workforce development of pharmacists and the path of future workforce planning.

Factors affecting hospital pharmacy Demand for hospital pharmacists Recent studies in the US have concluded that there is a growing demand for pharmacists in hospital settings. The Pharmacy Manpower Project (PMP) evolved out of concerns in the late 1980s, when the demand for pharmacists exceeded the supply. In 1996-97, the PMP’ s subcommittee to study demand issues concluded that medication management problems in the context of increasing prescription numbers and the emergence of data-driven health care, support a scenario of a steadily increasing demand for pharmacists and pharmaceutical services (Knapp, 1999). Similarly, the Department of Health and Human Services concluded that the demand for hospitals pharmacists was increasing, largely due to the increased complexity of medication therapy and the need for proper drug selection, dosing, monitoring and management of the entire drug use process to assure quality and cost-conscious use patterns (DH&HS, 2000). In this context, Cattell et al (2001) found that integration of a pharmacist into the hospital discharge system improves the timeliness of discharge, benefiting hospital bed management. Significant reductions in drug wastage and release of medical time were also apparent with this modified discharge process. As discussed, a recent study by the Victorian Healthcare Association was undertaken in response to reported concerns about a shortage of hospital pharmacists. In the study, Directors of pharmacy suggested factors that had a negative impact on job satisfaction, recruitment and retention, included:

• increased workloads, due to shorter length of stay, increased throughput and reduced staffing levels, budget constraints, downsizing, tendering out, and network reorganisations; and

• reduced staffing levels and loss of experienced staff, leading to reductions in clinical services provided to wards, drug utilisation reviews and research, which are the more attractive aspects of hospital pharmacy work.

The VHA found that 77% of respondents employed all pharmacists on award wages. Directors commented that salaries in both community pharmacy and the pharmaceutical industry were more attractive than hospital rates, particularly when combined with working conditions. It was also suggested that the Third Agreement, which includes the funding of research and quality assurance programs, was likely to further enhance the attractiveness of community pharmacy compared to hospital pharmacy, where pressure of work and budget constraints have resulted in a decrease of research and “ value added” clinical work (VHA, 2000). Thus, it appears that any increases in demand in the community sector could adversely affect the supply of pharmacists available to the hospital sector. Proposed introduction of PBS into public hospitals The Commonwealth has been concerned about the lack of continuity of pharmaceutical care for patients who are discharged from public hospitals. There are inherent risks of cost shifting hospital pharmaceutical care by States and Territories onto the Commonwealth. This can contribute, to poor quality patient health outcomes. Patients may be discharged with only

minimal quantities of medication and without communication between the hospital and the patient’ s general practitioner. Expensive drugs freely available on the PBS, furthermore, may be either severely rationed or not available in some public hospitals. Under the auspices of the Australian Health Care Agreements, the Commonwealth is seeking to counter the risk of cost shifting by offering to extend the PBS to admitted patients on discharge and to outpatients of all public hospitals. In order to take up the Commonwealth’ s offer, States/Territories will need to implement, within agreed timeframes, the Australian Pharmaceutical Advisory Council (APAC) guidelines to ensure continuity of pharmaceutical care between hospitals and the community (DHAC, 2001b). The APAC guidelines represent what are considered best practice patient care. They seek to provide a smooth transition in pharmaceutical care from hospital to the community, through better coordination between acute and primary care. Although some States either have implemented or are piloting the Commonwealth’ s offer, PBS dispensing in public hospitals is unlikely to become an Australia-wide phenomenon in the foreseeable future (DHAC, 2001b). The SHPA does not support the current proposal to use the PBS in public hospitals in the form offered by the Commonwealth, arguing that it is unworkable within hospital practice, will increase administrative workloads and thus adversely affect patient care. However, the SHPA states it unreservedly supports change that represents a genuine opportunity to improve the continuum of care between hospitals and the community. Such change should focus on patient safety, quality of care and equity of access to pharmaceuticals without adversely affecting the existing patient care functions provided by the hospital pharmacy (SHPA, 2000).

Summary of key issues The literature suggests that the market of pharmacists will be affected by a complex intersection of changes and dilemmas that include:

• structural issues— changes in the way that health services are organised and delivered, and the evolution of new management models in the administration and organisation of pharmacy;

• technical changes— associated with the increasing complexity of medication; • workforce demographic change— associated with feminisation and ageing proprietors

of community pharmacies; • working arrangements— the way in which pharmacists work with assistants and

technicians and collaborate with the medical profession; • demographic change in the general population— and its impact on the demand for the

services of pharmacists; • educational— marked by increases in pharmacy student enrolments; • political and cultural— associated with the Third Community Pharmacy Agreement,

the application and dissemination of new standards of professionalism, government and consumer expectations concerning safety and the quality use of medicines, and the implementation of new Government policies;

• competitive— related to the destiny of controls over S2 and S3 medicines points of sale;

• sectoral issues— dominated by concerns for an equitable workforce balance between community pharmacy, hospital pharmacy and industry and educational avenues of pharmacist employment;

• rural concerns— associated with ensuring adequate service access in rural and remote localities;

• information technology— characterised by the integration of professional care with electronic data interchange.

Chapt er 3 : Phar m ac is t suppl y

Current active workforce size The previous study (HCI, 1999) reported the wide use, for workforce planning purposes, of Australian Bureau of Statistics labour force data, based on collections from the five-yearly population census. Table 3.1 below reproduces data presented in the earlier study for census years 1986, 1991 and 1996. At the time of writing, 2001 Population Census data were not available to provide a more contemporary picture.

Table 3.1: Qualified pharmacists by type of employment in the pharmacy workforce in 1986, 1991 and 1996

1986 1991 1996 Persons % Persons % Persons %

Highest qualification pharmacy / pharmacology

15,559 17,872 19,588

Working in pharmacy 10,655 68.5 10,880 60.9 12,310 62.8 Community pharmacists 8,537 80.1 8,713 80.1 9,870 80.4 Hospital pharmacists 1,412 13.3 1,556 14.3 1,730 14.1 Other pharmacists 706 6.6 611 5.6 710 5.5

Source: Population census data (ABS) The previous study (HCI, 1999) estimated most supply parameters (including workforce size) from data collected by State and Territory registration authorities, collated by the Australian Institute of Health and Welfare (AIHW). Their most recent publication on the pharmacist workforce (AIHW, 2000) is the source of baseline data for this study. The actual number of registered pharmacists and the estimated number of pharmacists active in the workforce up to 1998 are shown in Table 3.2 below. The AIHW’ s estimate of the workforce in 1996, given in Table 3.2 as 13,834, however, differs from the ABS’ s estimate of 12,310 in Table 3.1.

Table 3.2: Pharmacy registration and employment trends, 1992 to 1998

Year 1992 1993 1994 1995 1996 1997 1998 Registered pharmacists

16,685 16,454 17,292 17,120 17,421 17,819 18,270

Pharmacists employed

12,525 13,248 13,331 13,427 13,834 14,150 14,508

Pharmacists employed as a % of registered

75.1% 80.5% 77.1% 78.4% 79.4% 79.4% 79.4%

Source: AIHW (2000); data for pharmacists employed in 1997 and 1998 are estimates Between 1992 and 1998, the national workforce grew by 15.8%, an average of 2.3% per annum. In some states, notably WA and SA, it grew significantly faster. A singularly large increase in workforce size between 1992 and 1993, however, substantially influenced the average annual change of 2.3%.

Figure 3.1 below, illustrates the annual change in aggregate rates of growth between 1992/3 and 1997/98. These rates serve as prima facie “ benchmarks” for evaluating rates of growth projected in this study. By way of comparison, ABS Census data suggest that between 1961 and 1999 the total pharmacy workforce grew by 46.5%, equivalent to 1.3% per annum.

Figure 3.1: Proportional growth in the active pharmacy workforce between years from 1992 to 1998

01234567

1992-93 1993-94 1994-95 1995-96 1996-97 1997-98

Transition years

% c

hang

e in

size

Source: AIHW (2000)

In this study, we will use 1996 as the ‘base’ year for analysis, since it is the most recent year for which actual workforce numbers were available. We will adopt the AIHW calculated figure for 1996 of 13,834 as the workforce size at that time (that is, the actual number of pharmacists working in pharmacy). Characteristics of the current pharmacy workforce Age Distribution This study supplements published pharmacist workforce data with data gathered in the course of its own workforce survey undertaken between October 2001 and March 2002 (Chapter 1). Evidence from this survey corroborates the finding in the literature review (Chapter 2) that the pharmacy workforce is ageing.

Table 3.3: Age distribution of employed pharmacists in sample population

Age No. of respondents Respondents (%) < 25 16 3.16

25-34 103 20.32 35-44 130 25.64

45-54 108 21.30 55-64 107 21.10

65 plus 43 8.48 Total 507 100

Source: Pharmacy workforce survey, 2001

Table 3.3, which plots the age distribution of respondents to the survey who are currently employed as pharmacists, shows a fairly even distribution between the ages 25-34 and 55-64. It is worth noting that 21% of respondents are aged 55-64, and a further 8.5% are aged 65 or more, indicating that the age distribution of the pharmacy workforce is very similar to the total Australian population (ABS, 1998 Year Book of Australia, 1301.0). This is highly unusual since the working population usually draws from a considerably younger aged profile. It suggests, moreover, that a sizeable proportion of the workforce will be retiring within the next 10 years, a long-standing prophecy (echoed by HCI, 1999), yet unfulfilled. As we will see later in this chapter, however, the long anticipated consequences of an aged workforce are nevertheless becoming closer. The community pharmacy workforce and the non-working pharmacist population both represent older age distributions. For instance, the proportion of community pharmacists and non-working pharmacists over 65 years is 9.3% and 24.5% respectively. Hospital pharmacy, on the other hand, employs a considerably younger workforce. Its largest age groups are 25-34 and 35-44, with few practising pharmacists above the age of 65 (AIHW, 1998). The hospital pharmacist workforce is especially vulnerable to female losses, attracted by the superior terms and conditions of community pharmacy. Gender distribution Over the last decade the proportion of females in the pharmacy workforce has steadily grown to the extent that it now approximates the number of males (AIHW, 1998). As indicated in Table 3.4, for both active and non-active pharmacists, this pattern is broadly reflected in the survey— which is generally representative of the gender balance in the wider pharmacist workforce population.

Table 3.4: Distribution by gender of survey respondents (n = 507 active and 159 non active)

Gender Active workforce respondents (%)

Non-active workforce respondents (%)

Female 47.5 50.3 Male 52.5 49.7

Source: Pharmacy workforce survey, 2001 Female pharmacists tend to be younger than males (see Figure 3.2 below). More than 60% of female respondents were less than 45. On the other hand, more than 60% of male respondents were 45 or more, including 30% aged 55-64. This seems to foreshadow a significant restructuring of the pharmacy workforce in the next 10 years, as older male pharmacists become due to retire and are replaced by younger female pharmacists.

Figure 3.2: Age groups by gender, active workforce

0

5

10

15

20

25

30

35

<25 25-34 35-44 45-54 55-64 >65

Age groups

% o

f res

pond

ents Male

Female


The structure of the inactive pharmacy workforce (Figure 3.3 below) is similar to active members, suggesting that any future contributions from inactive members could accentuate the trend towards feminisation.

Figure 3.3: Age groups by gender, non-active workforce

0

5

10

15

20

25

25-34 35-44 45-54 55-64 65-74 75-84 85-94

Age groups

% o

f res

pond

ents

Female

Male


Distribution of pharmacists by workplace The distribution of respondents by workplace (Table 3.5) shows that almost 80% of respondents work in community pharmacy, and about 17% in hospital pharmacy. These figures are representative of the wider population for community pharmacy, and slightly higher for hospital pharmacy, which is about 14% (AIHW, 2000). The number of respondents

engaged in other areas of pharmacy-related work, such as academia, administration and consultant pharmacy, remains comparatively small.

Table 3.5: Distribution by pharmacy practice type in 2001 (n = 507)

Type of pharmacy work No. of respondents % respondents*

Community (retail) pharmacy 403 79.5 Hospital/clinic pharmacy 87 17.2 Consultant pharmacist 17 3.4 Pharmaceutical industry 15 3.0 Other pharmacy related work 31 6.1

- * Respondents could nominate more than one reason. In fact, 553 ‘workplaces’ were mentioned. Source: Pharmacy workforce survey, 2001

If the analysis of work distribution between types of pharmacy practice is based on hours worked, a slightly different picture emerges. Community pharmacy accounts for only 76% of total working time of the respondent population. This differs from the AIHW estimate of slightly over 80% (which is based on the ‘main’ place of work). Both Table 3.5 above and 3.6 below suggest the respondent population is over represented by hospital, industrial and other pharmacists relative to AIHW data.

Table 3.6: Distribution of pharmacy workforce hours across practice types (n = 500)

Type of pharmacy work Total hours worked in one

week

% total hours

Community (retail) pharmacy 14630 75.8 Hospital/clinic pharmacy 2932 15.2 Consultant pharmacist 302 1.6 Pharmaceutical industry 603 3.1 Other pharmacy related work 830 4.3

Source: Pharmacy workforce survey, 2001 Hospital pharmacists are the largest group of pharmacists that work in more than one type of pharmacy workplace. Almost 38% of hospital pharmacists work additional hours (mostly) in community pharmacy, academia and consultant pharmacist situations. This compares with only 12% of community pharmacists working in a second area of practice. Hours worked As noted in Table 3.6 above, survey respondents worked a total of 19,297 hours per week in 2001, an average of 38.6 hours per pharmacist. This figure is identical to the AIHW estimate for 1996 (AIHW, 2000). Table 3.7 indicates that almost half the survey respondents worked more than 40 hours a week. Just on 46% of respondents worked 41 hours or more. If hours per week are calculated using hours comparable to AIHW (2000) of 40 hours or more, then it appears (contrary to popular belief) that the proportion of the pharmacy workforce working long hours is decreasing. For instance, 60.5% of pharmacists worked 40 hours or more in 1991. This proportion dropped to 57.9 in 1996, and based on the current survey responses, has dropped to 54.8% in 2001. Interestingly, average hours worked per week have changed little over the same period (39.2, 39.1, and estimated 38.6 hours per week in 1991, 1996 and 2001,

respectively). Average hours have remained stable largely because part time pharmacists are prepared to work longer hours.

Table 3.7: Distribution of respondents based on average working hours per week (n = 500)

Average hours worked per week

No. of respondents % respondents

<10 23 4.6 11-20 56 11.2 21-30 67 13.4 31-40 125 25.0 41-50 155 31.0 51-60 56 11.2 61-70 13 2.6 71+ 5 1.0

Source: Pharmacy workforce survey, 2001 At the other end of the spectrum, over one quarter of pharmacists surveyed, worked 30 hours or less per week. A significant proportion of part time pharmacists (working less than 30 hours per week) are female, as shown in Figure 3.4. Indeed, on average, female pharmacists work 33.9 hours per week, compared with 42.8 hours for males, who are more likely to work overtime. This is partly because male pharmacists are over represented in community pharmacy and in rural and remote work locations, both of which may be conducive to longer hours.

Figure 3.4: Distribution of survey respondents by average working hours per week & gender in 2001

0

20

40

60

80

100

120

0-10 10-20 21-30 31-40 41-50 51-60 60+

Hours worked per week

Num

ber

of p

harm

acis

ts

Female Male

Source: Pharmacy workforce survey, 2001 Table 3.8 indicates that just under half the pharmacists who worked more than 38 hours per week, did so because they were unable to obtain appropriate relief and /or because they were unable to fill permanent vacancies. This corroborates the findings of the literature review that there are national shortages of both community and hospital pharmacists, making it difficult to fill vacant positions and /or to obtain locum relief.

Table 3.8: Reasons given for why pharmacists worked more than 38 hours per week (n = 280)

Reason Number % respondents* Need extra income 66 23.6 Enjoy the work 60 21.5 Have insufficient relief 91 32.5 Unable to fill vacancies 35 12.5 Other 98 35.0

- * Respondents could nominate more than one reason Source: Pharmacy workforce survey, 2001

Table 3.8 reveals that whilst almost a quarter of pharmacists who worked longer hours did so for the additional income and / or because they enjoyed the work, about a third did so because they could not fill vacancies. Workforce planning models can accommodate working hours that exceed preferences by applying full time equivalent (FTE) conversion factors. As shown in Chapter 4, this has the effect of redistributing ‘unwanted’ excess working hours to additional demand. Although the impact of FTE conversion is a demand parameter, it will also be convenient to consider its implication in this chapter. Full-time equivalent conversion factor As noted in the section above, hours worked vary between pharmacists, based on gender (males tend to work longer hours than females), type of work (community pharmacists work longer hours than hospital pharmacists) and location (rural pharmacists work longer hours than city pharmacists). In any workforce modeling, the number of employed pharmacists can be a misleading statistic, given the significant variation in hours worked between employed pharmacists. Conversion of total hours worked by the workforce into full time equivalent (FTE) units of labour is conventionally used to address this. Calculations of FTE conversion factors can nevertheless vary. The AIHW (2000) use two separate calculations, both based on a 35-hour week. The previous HCI report used a similar method, but based on a 38-hour week. The three methods are compared below:

AIHW method 1: All pharmacists working 35 hours or more are counted as one FTE, and all those working less than 35 hours per week are counted as an FTE fraction. Conversion factor = 0.83 HCI method, used in previous study: All pharmacists working 38 or more hours are counted as one FTE, and all those working less than 38 hours per week are counted as an FTE fraction. Conversion factor = 0.84 AIHW method 2: All pharmacist work hours, irrespective of how many per week are worked are divided by 35. Conversion factor = 1.06

The above conversion factors would hence translate 1,000 employed pharmacists into respective FTE units of 830.0, 840.0 and 1060.0. Although AIHW method 2 fully acknowledges all hours worked, it has the effect of augmenting supply. Because this method

actually tends to over-estimate the level to which demand for labour is being satisfied, it vitiates the proposition that unwanted hours are a measure of excess labour demand (rather than highlighting ‘unmet’ demand). Our preference is hence to retain the (recalculated) FTE conversion factor developed for HCI’ s previous study. Thus, employing the methodology of the previous study, and using the survey results for hours worked in 2001, the FTE conversion factor is calculated as follows:

Total hours worked by pharmacists in 2001 (n = 500) = 16,260 per week4

Average hours per week therefore (16,260/500) = 32.5

FTE conversion factor (32.5/38) = 0.86

The trend towards gradually reducing workforce participation, highlighted in Figure 3.5, is likely to cause reductions in the FTE conversion factor in the future. Survey responses reflect that between 1997 and 2011, the average working week is likely to diminish from 41 hours to 32.

Figure 3.5: Respondents estimated past (up to 2001) and predicted (after 2001) average hours in pharmacy work per week (n = 5075)

0

5

10

15

20

25

30

35

40

45

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Years

Average weekly work hours

The data in Figure 3.5 are consistent not only with lower participation because of losses from the workforce (see below), but also because of those remaining in the workforce choosing to work fewer hours. The latter is probably an inevitable consequence of the method by which the data were collected. A static constant sample of pharmacists will inevitably ‘work less’ over time as they age. On this basis, it is difficult to project the future behaviour of the FTE conversion factor. For this reason, we believe it is reasonable to assume a constant, fixed FTE conversion until at least 2010.

4 Limits all 280 or 56% of pharmacists working more than 38 hours to a 38-hour contribution. 5 The average is calculated each year based only on those pharmacists actually working. Thus the n for that calculation varies each year.

Movements between the active and inactive workforce The AIHW estimated that in 1996 the proportional balance between the active and inactive workforce components was 84.4% and 15.6% respectively. Estimates of net movement between these segments of the workforce are important for workforce planning. In its previous study, HCI (1999) reported the likelihood on increasing net losses attributable to increasing retirements. Net workforce movement is the balance between gains (pharmacists re-entering or increasing their hours of work) and losses (working pharmacists reducing their hours of work or permanent occupational separation). The methodology for this project attempted to gain estimates for each of these movements, by analysing both the active and inactive sample population data. The active population, for reasons outlined above, offers the best perspective on losses from the active workforce. Table 3.9 below details proportional (reported and projected) year-to-year losses in participation of the active workforce sample population. These reflect both decreased hours of work as well as workforce departures (retirements and separations).

Table 3.9: Average estimated annual losses (%) from the workforce

Period Loss as a percentage of total hours worked in the previous

year 1997 to 1998 4.6% 1998 to 1999 4.2% 1999 to 2000 5.3% 2000 to 2001 7.0% 2001 to 2002 9.6% 2002 to 2003 8.1% 2003 to 2004 9.5% 2004 to 2005 8.1% 2005 to 2006 8.1%

Source: Pharmacy workforce survey, 2001 Gains to the pharmacy workforce were estimated to reflect workforce re-entry of the non-active survey sample in conjunction with increased hours of work in the active workforce sample, to approximate their increased participation. While the method adopted has limitations, it offers a perspective on gains to the workforce from movements within and between the active and inactive workforce components. Table 3.10 below accordingly maps estimated workforce gains between 2001 and 2005.

Table 3.10: Average estimated annual gains (%) to the pharmacy workforce

Period Gain as a percentage of total hours worked in the previous

year 2000 to 2001 6.9% 2001 to 2002 13.5% 2002 to 2003 3.9% 2003 to 2004 2.0% 2004 to 2005 1.1%


Combining the results of Tables 3.9 and 3.10 for years where comparison is possible yields net losses shown in Figure 3.6. The pattern revealed is one of a progressively larger workforce loss.

Figure 3.6: Net estimated wastage rates (gains less losses), 2001 – 2005

-10

-5

0

5

10

15

2001 2002 2003 2004 2005

Year

Rate (%)

Loss Gain Net wastage

Aggregating and averaging estimates in Figure 3.6 over five years yields an annual wastage rate (net loss) of 3%, ranging between –0.1% and 7.5%. The average is close to the estimate developed in HCI’ s previous study (3.1%). A check on the plausibility of HCI’ s estimates is possible from analysis of registration authority ‘transition’ data supplied by the AIHW, who provided this study with de-identified unit record data from WA and Queensland registration authorities for 1994 to 1996 and 1998 and 19996. The unit record data tracked employment status for successive years. It is hence possible to map the year-to-year number and proportion of pharmacists changing workforce status between years. AIHW data suggest an average net loss of 4.1% over four transition periods (1994-95; 1995-96; 1996-98; and 1998-99). This is roughly congruent with HCI findings. The estimate, based on AIHW data moreover, is consistent with the proposition that wastage has been steadily advancing on the trend identified in HCI’ s earlier study (1999) and should be considered to be at least 3% per annum and possibly as high as 7%. We will accordingly treat these as our respective lower and upper bound estimates of net loss. Reasons for pharmacy workforce losses Retirement from the workforce

6 It was not possible to use the incomplete data series also provided for several other States.

Approximately one third of currently active survey respondents (169) expect to permanently depart the pharmacy workforce during the next 10 years, of whom 85.2% (144) intend to retire (Table 3.11). This is equal to a loss from the overall workforce due to retirement of about 2.9% per annum, and is higher than occurred in the last 10 years.

Table 3.11: Why respondents working in pharmacy intend to cease pharmacy work (n = 169)

Reason for ceasing pharmacy work

No. of respondents Respondents (%)*

Retire 144 85.21 Alternative 18 10.65 Not enough income 14 8.28 Not interested 12 7.10 Other 11 6.51 Family 9 5.33

- * Respondents could state more than one reason Source: Pharmacy workforce survey, 2001

As expected, retirement intentions appear highly positively correlated with age (Table 3.12) although a significant proportion of working pharmacists aged 45-55 years (approximately 32%) have signalled retirement intentions. This seems a disquieting statistic, and could provide a target for action to redress potential losses. Table 3.12, moreover, indicates that the retirement intentions of females are no different to male pharmacists.

Table 3.12: Age and gender distribution of pharmacists intending to retire by 2011 (n varies between age and gender groups)

Current Age grouping

No. of pharmacists intending to retire in different age

groupings

% of pharmacists at age group intending to retire

Female Male Female Male

Less than 34 0 0 0 0 35-44 2 2 2.9 3.3 45-54 17 17 31.5 31.5 55-64 20 48 68.9 61.5 65 or more years old 9 29 81.8 90.6

Source: Pharmacy workforce survey, 2001 In absolute terms, most pharmacists planning retirement in the next 10 years are males (61%). This is likely to reflect, at least in part, the “ bulge” of male pharmacists aged 55-64 years identified earlier in Figure 3.2. Occupational separation Table 3.11 above shows that, while intended retirements are expected to account for about 85% of workforce losses, there are also other reasons for potential losses. Table 3.13 shows that the latter also appear to have strongly influenced those who have already left the workforce.

Table 3.13: Reasons why respondents ceased practising (or never commenced practising) as a pharmacist (n = 159)*

Reason for leaving the pharmacy workforce No. of respondents

% of respondents

Retirement from the workforce 60 37.7 Absence due to child rearing or other family reasons 44 27.7 To work in more satisfying alternative career 41 25.8 Dissatisfied with pharmacy work tasks 24 15.1 Not enough income 19 11.9 Unsuitable work hours 17 10.7 Intention to travel/live overseas 15 9.4 Absence for health reasons 14 8.8 Lack of advancement opportunities 8 5.0 Other 7 4.4 Lost confidence 3 1.9 Sold business 5 3.1

* Respondents could state more than one reason Source: Pharmacy workforce survey, 2001

For non-practising pharmacists, retirement accounts for only 38% of past workforce loss. On the other hand, disenchantment with work (or alternatively the attraction of different work) is an important factor, as are other personal reasons (family and health). A small but significant group of trained pharmacists either never actually enter the profession or take several years to commence practice after graduating. About 3% of graduates take at least two years before entering the pharmacy workforce. A later section discusses loss due to migration. Potential to reduce losses Several important motivators encourage respondents to remain working in pharmacy. Table 3.14 shows that more than half the survey respondents nominated the following:

• enjoyable tasks (72%); • good income (70%); • flexible hours (64%); and • good working conditions (57%).

Table 3.14: Why respondents currently working in pharmacy intend to continue pharmacy work (n = 338)

Reasons for continuing pharmacy No. of respondents

Respondents (%)*

Enjoyable tasks 247 73.1 Good income 240 71.0 Flexible hours 217 64.2 Good working conditions 194 57.4 Access to continuing education 142 42.0 Economic necessity 37 10.9 Job satisfaction 31 9.2 Other 23 6.8 Felt they could do no other job 10 3.0 Shortage of pharmacists, felt obligation to continue 5 1.5

- * Respondents could state more than one reason Source: Pharmacy workforce survey, 2001

For practising pharmacists, as with many health professionals, lack of quality continuing education remains a source of discontent. Non-practising pharmacists that were surveyed and who indicated they would not be returning to the workforce in the next 10 years, were asked what conditions might bring them back into the pharmacy workforce. Nearly 40% of these respondents (mostly those retired) would not consider returning to pharmacy practice under any circumstances. However, as Table 3.15 below indicates, there is a potential to address a wide range of conditions that could be influential in encouraging those who had separated to return.

Table 3.15: Reasons that could motivate those respondents who do not intend to return to the pharmacy workforce in the next 10 years to re-enter the pharmacy workforce (n = 111)*

Reason No. of respondents

% Respondents

Change in personal circumstances 53 47.7 Access to continuing education / suitable refresher courses 29 26.1 Better income 15 13.5 Better hours 7 6.3 Other reasons 8 7.2 Increased variety in work tasks 7 6.3 Better working conditions 6 5.4 Access to suitable childcare 1 0.9

* Respondents could state more than one reason Source: Pharmacy workforce survey, 2001

It is interesting to note that industrial relations type issues (work conditions, income, childcare) appear to be of marginal consequence in occupational separation.

New graduate supply Past and current graduations and enrolments The graduate supply has risen from 338 in 1985 to 619 in 2001 (Table 3.16). Although there have been substantial year-to-year variations, this represents overall an annual rate growth of about 3.8%— a very significant increase in graduate numbers. ‘Graduations’ in the context of this workforce planning study are synonymous with course completions and with graduates entering the workforce in the year following graduation.

Table 3.16: Pharmacy graduate7 figures, 1985-2001*

Year of grad-uation

Curtin Monash Qld SA Sydney Tas CSU Adjustment8

Total

1985 35 105 63 22 101 12 - 338 1986 31 98 35 20 93 14 - 291 1987 34 91 61 23 71 17 - 297 1988 38 116 92 34 103 17 - 400 1989 39 123 71 31 116 18 - 398 1990 34 116 62 35 104 20 - 371 1991 33 107 57 39 118 20 - 374 1992 31 106 63 31 118 23 - 372 1993 35 116 57 34 149 19 - 410 1994 51 (9) 101 (9) 77 (10) 29 (6) 122 11 (2) - 391 1995 58 (19) 98 (9) 67 (14) 41(4) 124 25 (9) - 413 1996 65 (14) 133 (13) 82 (11) 31 (4) 164 22 (9) - -37 460 1997 34 (9) 97 (5) 105 74 (11) 151 (15) 24 (5) - 485 1998 63 (13) 110 (16) 122 (4) 78 (13) 159 (7) 35 (3) - +13 580 1999 88 - - - 65 12 - +119 284 2000 87 (9) 145 (20) 119 51 (10) 124 (5) 24 (4) 39 -4 585 2001 106 130 116 63 130 38 36 +31 650

- * Figures in brackets represent overseas students. A breakdown of the graduations prior to 1994 is not available. It is estimated, however, that approximately 10% of graduations each year are overseas students. Source: Committee of Heads of Pharmacy Schools in Australia & NZ9

Graduate supply in recent years has been, and is destined to be further augmented by the commencement of new schools of pharmacy, including Charles Sturt University (first graduate cohort in 2000), James Cook University (first graduates in 2002) and La Trobe University (first graduate cohort 2004). Current enrolments in each of the schools of pharmacy in Australia by year of enrolment are detailed in Table 3.17 below. 7 ‘Graduations’ are usually counted the year after the year of course completion, when graduate recognition is formally conferred. In Table 3.15, the figures represent what other sources (eg AIHW) refer to as “ course completions” . These are students who ‘graduate’ in the year of course completion. 8 Adjustment reflects the latest data from the Committee of Heads of Pharmacy Schools in Australia and New Zealand, supplied 12 July 2002, which was not broken up on an individual university basis. 9 Figures for New Zealand Universities are excluded, assuming that most NZ graduate supply is destined for the NZ labour market.

Table 3.17: Current undergraduate pharmacy course enrolments in Australian Schools of Pharmacy (as of 31 March, 2002)

School of Pharmacy

1st year 2nd year 3rd year 4th year

Curtin 93 (32) 98 (20) 108 (14) 92 (12) Monash 166 (18) 139 (19) 120 (15) 117 (13) Qld 182 (10) 117 (4) 104 (6) 123 (4) James Cook 82 (3) 65 (1) 59 - SA 72 (7) 74 (13) 79 (2) 68 (7) Charles Sturt 52 58 50 56 (2) Sydney 182 (20) 182 (16) 183 (16) 172 (16) Tas 36 (16) 44 (8) 30 (8) 24 (4) La Trobe 40 (1) 27 - - Adjustment10 +24 +204 +64 +96 Total 1036 1089 858 806

Source: Committee of Heads of Pharmacy Schools in Australia & NZ The student numbers are effective fulltime students (EFTS) and include both fee-paying and HECS students (only Monash and Sydney Universities currently enrol local fee paying students). Overseas student numbers are additional to each year’ s figures (shown here in brackets) but are included in the (adjusted) total estimate.

Table 3.18 estimates the cohort effect of enrolments in the pipeline on graduate supply between 2002 and 2005. Projected graduations are calculated on an estimated ‘wastage’ from the course in years 1, 2 and 3 of 10%, 5% and 5% respectively of effective full-time student numbers (with no loss of final year students). Overseas student numbers are estimated to experience the same level of wastage (although one might argue the wastage could be higher). Approximately 85% of overseas fee paying students are estimated to remain in Australia to practise. Recent moves by the Commonwealth Government to increase the level of skilled migration to Australia suggest that the estimated proportion of overseas graduates likely to remain and practise in Australia could be conservative.

10 & 8 Adjustment reflects the latest data from the Committee of Heads of Pharmacy Schools in Australia and New Zealand, supplied 12 July 2002, which was not broken up on an individual university basis. Includes overseas student numbers.

Table 3.18: Projected undergraduate pharmacy course graduations for the years 2002 to 2005 based on current student enrolments (includes overseas students)

School of Pharmacy

2002 2003 2004 2005

Curtin 102 114 104 98 Monash 128 130 140 147 Queensland 127 116 111 153 James Cook 56 59 68 74 SA 74 76 79 64 Charles Sturt 57 48 51 39 Sydney 185 187 177 162 Tasmania 27 37 44 37 La Trobe - - 24 33 Adjustment11 +101 +48 +127 +23 TOTAL 800 815 925 830

Source: Committee of Heads of Pharmacy Schools in Australia & NZ Projected enrolments and graduations One of the key innovations in higher education of the late 1990s was the introduction of fee-paying places for Australian students. This could have important ramifications for popular university courses such as pharmacy, since this is a means for universities to contribute to their non-grant revenue. In order to project future graduate supplies, we have considered only one scenario, where graduate supply is led mainly by growth in normal enrolments, with a modest additional growth in Australian fee-paying students. As a consequence of normal enrolments, it is estimated that students in the pipeline at established schools of pharmacy will cause graduations in future years to grow as fast, if not faster, than the previous decade (see Table 3.18). This is not an unreasonable expectation, since growth in total enrolments has been nearly 4% per annum for the past 15 years. Moreover, pressure on universities to maintain or increase enrolments in high demand courses such as pharmacy is unlikely to abate in the short to medium term. We have not allowed, however, for future changes in the structure of pharmacy undergraduate courses— such as occurred with the shift to a four-year degree course 1996/97, which led to a significant one-off curtailment in graduate output in 1999. For instance, pharmacy course structures might move to further extend the term of training or to a postgraduate training structure similar to medicine. Nor have we allowed for graduate supply from a school of pharmacy at University of Newcastle. While this school was considered a certainty in the earlier workforce study, unlike La Trobe University, enrolments have not yet eventuated and there is now some doubt their program will commence. It is possible to project graduate supply to the year 2010 by making assumptions about student enrolments at each of the schools of pharmacy for the years 2003 to 2008, and accepting too, that other important conditions of undergraduate study remain fixed or assume constant rates of change— for example wastage and pass rates. Note that projected enrolments in 2003 are down on 2002, especially for Queensland University (see Table 3.17 for comparative 2002 enrolments).

11

Table 3.19: Projected enrolments in pharmacy where growth is attributable to normal enrolments, 2003 to 2008*

School of Pharmacy

2003 2004 2005 2006 2007 2008

Curtin 90 (30) 95 (30) 95 (30) 100 (30) 100 (30) 105 (30) Monash 160 (20) 160 (20) 160 (20) 170 (20) 180 (25) 190 (30) Queensland 130 (10) 133 (10) 133 (10) 140 (10) 150 (10) 160 (10) James Cook 79 83 88 94 99 100 SA 75 (10) 75 (10) 75 (10) 80 (10) 80 (10) 80 (10) Charles Sturt 62 66 69 74 78 78 Sydney 180 (20) 180 (20) 185 (20) 185 (20) 200 (25) 210 (30) Tasmania 32 (10) 32 (10) 32 (10) 32 (10) 32 (10) 32 (10) Griffith La Trobe 40 40 40 45 45 50 Total 848 (100) 864 (100) 877 (100) 920 (100) 964 (110) 1005 (120)

*Overseas student enrolments are provided in brackets. Limited growth in overseas student numbers is projected § The year 2002 is the ‘base’ year for subsequent year-to-year projections

It is assumed that established Schools, such as Monash, Sydney, Curtin and Queensland will increase student enrolment by approximately 3% per annum between 2003 and 2008. Enrolments at newer Schools such as James Cook, Charles Sturt and La Trobe are assumed to increase their enrolments at a slightly higher rate. Some Schools, like SA and Tasmania, are predicted to experience little or no growth in enrolments. Projected enrolments for each of the Schools of Pharmacy are detailed in Table 3.19 above. Adopting a broad rule of thumb that 80% of enrolled students graduate (and allowing for a further loss of overseas students), a projected estimate for new graduate supply to 2010 can be calculated, as in Figure 3.7 below.

Figure 3.7: Projected graduate supply, 2002 to 2010

699767 798 807

744 759 770 804846

0

100

200

300

400

500

600

700

800

900

2002 2003 2004 2005 2006 2007 2008 2009 2010

Years

Num

ber

of g

radu

ates

Source: Tables 3.18 and 3.19

Immigration effects on supply Supply of pharmacists from overseas has been steadily growing since the mid-1980s. Settler arrival statistics collected by the Department Immigration and Multicultural Affairs (DIMA) show (for all types of immigration program) that the number of persons with pharmacy qualifications permanently migrating to Australia rose by just over 40% between 1993/94 and 1997/98 (Table 3.20). Approximately 45% of total permanent migration of those with a pharmacy qualification is through the skilled migration program, although in recent years the proportion of total migrants through this program has been growing. The other major program contributing migrants with pharmacy qualifications is the family migration program.

Table 3.20: Settler arrivals (permanent migrations) of persons with pharmacy qualifications, financial years 1993/1994 to 1999/2000

Year 1993/4 1994/5 1995/6 1996/7 1997/98 1998/99 1999/ 0 Settler arrivals 72 97 119 101 101 120 155

Source: AIHW, using figures supplied by Department Immigration and Multicultural Affairs Most pharmacists permanently migrating to Australia and wishing to practise as a pharmacist are obliged to successfully complete the Australian Pharmacy Examining Council (APEC) requirements. These consist of a series of preliminary and final examinations and clinical practice. Based on figures supplied through APEC, the pass rate appears to be about 40% of those who initially apply for testing and sit the preliminary examination. The history of successful passes of the APEC exam is plotted in Figure 3.8 below. On average, approximately 22 candidates per year successfully complete the APEC examination, although in the three most recent years for which data are available, the average number of certificates issued has been considerably higher. As well as those who satisfy APEC requirements, pharmacists from some countries may enter the Australian pharmacy workforce directly12. Based on DIMA data for 1992 to 1996, it seems that between 18 and 22 pharmacists enter the pharmacy workforce each year in this way. In addition to permanent migration, there are persons who arrive in Australia on temporary visas, who stay for several years. Their number arriving in recent years for either employment or education has increased significantly to approximately 110-130 per year (AIHW). This source of supply, however, is not enumerated as an element of immigration since, in theory, it should already be captured in one or other of new graduate supply or the net wastage rate.

12 Pharmacists with qualifications gained in New Zealand, the United Kingdom and Ireland are exempt from APEC requirements.

Figure 3.8: Persons completing APEC requirements successfully by year of sitting examination

0

10

20

30

40

50

60

85 86 87 88 89 90 91 92 93 94 95 96 97 98 9920

0020

01

Year of pass in APEC exam

No. of successful candidates

Source: Committee of Heads of Pharmacy Schools in Australia & NZ

Immigration into Australia may be offset by emigration abroad of practising pharmacists, who are Australian nationals or permanent residents, for work, education or recreation— often permanently. The AIHW estimates losses from emigration of persons with qualifications in pharmacy at 20 to 30 per year, but as indicated in Table 3.21 below, the number seems to have been increasing in recent years.

Table 3.21: Permanent migrations of persons with pharmacy qualifications from Australia, financial years 1993/1994 to 1999/2000

Year 1993/4 1994/5 1995/6 1996/7 1997/8 1998/9 1999/ 0 Migrations of persons with pharmacy qualification from Australia

19 16 31 26 19 38 47

Source: AIHW, using figures supplied by Department Immigration and Multicultural Affairs

The average net annual supply of pharmacists from migration is estimated at 27 per annum and is calculated as follows:

Immigrants:

From NZ and UK/Ireland +22 From countries identified as having to complete the APEC

examination +30

Emigrants:

Australian nationals and permanent residents -25

Data on migration most susceptible to possible variation probably relate to the number of pharmacists that APEC is likely to certify. This figure could possibly be much higher.

Supply projection The year-to-year projection for the supply of pharmacists between 1997 and 2011 is set out in Appendix 3. This is summarised in Table 3.22 below, in head count and FTE terms, based on the following assumptions:

• use of 1996 as the base year (the latest for which actual data were available at the time of writing), when the estimated pharmacist workforce was 13,834 (representing persons working as pharmacists in the pharmacy workforce in all sectors and capacities);

• a full time equivalent (FTE) conversion factor of 0.86; • net wastage rates of 7.0% and 3.0% per annum for the years 2001-2010— with the

former constituting the basis of a “ low” supply projection and the latter a “ high” projection— and where “ wastage” is defined to include the projected combined net impact of retirement, participation (through changes in hours worked) and occupational separation; following consultation with the NPWRG13, wastage rates for the years 1997 – 2000 are based on revisions of estimates undertaken for purposes of HCI’ s previous study (1999);

• projected graduate supply, based on normal enrolment, as set out in Figure 3.7— to whom wastage rates are applied in the year after graduation and thereafter;

• an estimated net annual average increase in pharmacist supply attributable to migration of 27 persons— to whom wastage rates are applied in the year after their arrival in Australia and thereafter;

• a stable proportional distribution of workforce supply between community, hospital and “ other” pharmacy work (Table 3.1), whereby persons participating in the workforce ‘offer’ their services, at going wage rates, to one or more of these three sectors in a customary, fixed pattern.

Table 3.22: Summary projection of supply of pharmacists – 2000 to 2010

1996 1997 2000 2010

Base year, persons 13,834

Low supply projection (net loss = 7% PA, 2001-10): - Total supply, persons 13,624 13,009 15,807 - FTE community supply 9,413 8,989 10,922 - FTE hospital supply 1,657 1,582 1,923 - FTE other supply 646 617 750 LOW FTE TOTAL 11,716 11,188 13,594 High supply projection (net loss = 3% PA, 2001-10) - Total supply, persons 13,624 13,009 16,450 - FTE community supply 9,413 8,989 11,366 - FTE hospital supply 1,657 1,582 2,001 - FTE other supply 646 617 780 HIGH FTE TOTAL 11,716 11,188 14,147

Source: Appendix 3 13 NPWRG meeting, Canberra, 15 July, 2002.

Of course, there can be no presumption that any projected series of ‘offers’ of services constitute projections of pharmacist employment or workforce disposition. In this way, it is possible to allow for the possibility that there may be unemployed pharmacists within or across all or some categories of the pharmacist workforce (as distinct from those who are occupationally separated). The model projects that overall FTE pharmacist workforce supply will grow from 11,188 in 2000 to between 13,594 and 14,147 in 2010, representing an average annual growth rate ranging between 1.98% and 2.38% depending, respectively, whether one adopts high or low values for net workforce loss. The engine of growth for the pharmacy workforce is the joint product of new graduate supply and net migration, whose year-to-year contributions are in turn offset by losses occasioned by retirements of ageing male pharmacists, reduced per diem average hours of participation, largely as a consequence of increasing feminisation, and a relatively high rate of occupational separation (HCI, 1999). Projected new graduate supply and net migration between 1997 and 2010 jointly represent an average annual net contribution to the workforce of about 6.6%. At approaching the upper bound level of annual net wastage (7%), this means that the workforce is barely capable of maintaining constant numbers. Overall growth has furthermore been severely thwarted by the impact of the introduction of a four-year pharmacy degree manifest in 1999. This caused the net graduate supply to falter for at least three years, before recovering its trend as result of increases in graduate outputs from some of the established schools of pharmacy— likely to be assisted during the mid-2000s by the contributions from the new schools.

Chapt er 4 : Dem and for Phar m ac is t s

Overview The demand for pharmacists is assumed to be governed by the demand for the professional services they provide— as distinct from demand led by business conditions associated with commercial and merchandising activities that may be unrelated to the professional training and knowledge of pharmacists. As described by HCI (1999), the demand for professional services by community pharmacists relates primarily to those associated with dispensing prescription medicines. The SHPA states that the HCI assumptions regarding demand contrast with the report “ The Pharmacists Workforce – A Study of the Supply and Demand for Pharmacists” of the US Department of Health and Human Services 2000 and concern the • whole pharmacy workforce, the report counsels that “ the critical issue is the delivery of all

needed pharmaceutical care services to consumers, not simply the dispensing of prescriptions” ;

• hospital pharmacy workforce, the report counsels that “ any effort to base the increased demand for such pharmacists upon increased numbers of prescriptions, medication orders or the like, ignores the reality that today’ s hospital, long term care, and home care pharmacists devoted less than half of their time to dispensing medications and the rest to other clinical and management activities” .

Both community and hospital pharmacist demand may be augmented by a range of cognitive services. In the case of community pharmacists these activities divide into two broad classes, as follows:

• medication management in nursing homes and hostels and in domiciliary settings;

• interventions delivered in conjunction with dispensing services for prescription medicines as well as for over the counter sales of non-prescription, ‘pharmacist’ and ‘pharmacy only’ (S2 and S3) medicines. For prescriptions, they may be to determine the appropriateness of a prescription and / or for proactive communication with consumers to ensure appropriate use of a medication; for over the counter sales, they may include advice on the most appropriate medication and counselling on its use.

Interventions in community pharmacy are now closely associated with the quality movement, promoted through the Quality Care Pharmacy Program (QCPP). The Pharmacy Guild of Australia, through its Quality Care Pharmacy Division, administers this. Implementation of the QCPP is by way of accreditation and ongoing re-accreditation, to ensure that pharmacies adhere to prescribed QCPP Standards. A dominant influence upon the level and content of community pharmacist and pharmacy services has been the implementation of the Third Community Pharmacy Agreement (CWA and PGA, 2000)— to run for the five-year period ending 30 June 2005. This will deliver, inter alia, some $416 million in program funding over its term, with a view primarily to creating a

strategic framework to elevate and uphold the professional status of community pharmacists and the potential for them to further integrate into the health system as key service providers (PGA 2000). In the case of hospital pharmacy, the consultant argues that underlying demand for dispensing services is a product of the demand for hospital inpatient admissions. The demand for hospital pharmacist labour is nevertheless likely to be less sensitive to variations in admissions than to the structural environment of inpatient care. The SHPA suggests that the underlying demand for pharmacists will be augmented by a variety of considerations, including innovations in risk management and the introduction of PBS prescribing in public hospitals. Overall, demand for pharmacist and pharmacy services— and for prescriptions in particular—is likely to be influenced by a range of considerations (HCI, 1999), including:

• population growth and variation in its demographic characteristics; • the health status of the population; • the cost to patients of medicines; • the availability of new medicines.

The mix of associated dispensing services between community and hospitals will be determined by the state of technology that governs the division of services between hospital and community care, and thereby the relative importance of either community or hospital dispensing. Other considerations may also be relevant, such as the adoption of Australian Pharmaceutical Advisory Council (APAC) Guidelines which could encourage some substitution of hospital dispensing services for those in the community. Using the model developed by HCI (1999) to estimate demand between 2000 and 2010, we will concentrate substantively on the impact of projected population and demographic change. In the case of community pharmacists, we also allow for the cognitive factors identified above. In the case of hospital pharmacists, although demography and population affect the demand for hospital admissions, the associated demand for dispensing services appears to be supported by the scale of the hospital pharmacy infrastructure rather than by incremental demand for pharmacist labour, attributable to patient loads. As documented in Table 4.1, community pharmacy dominates the pharmacy labour market—employing some 80% of pharmacists. About 14% of pharmacists are employed in the hospital sector and a further 6% work in other miscellaneous activities, including public health, government, education and the pharmaceutical industry14. Demand for services of the latter group, however, is not amenable to systemic modelling as for the major areas of demand.

Table 4.1: Disposition of pharmacy workforce, %

1986 1991 1996 Community pharmacy 80.1 80.1 80.4 Hospital pharmacy 13.3 14.3 14.1 Other pharmacy 6.6 5.6 5.5 100.0 100.0 100.0

Source: Table 3.1; HCI (1999)

14 This pattern of employment is comparable with other similar countries. In the Unites States, for example, 79% of pharmacists work in community pharmacy, 15% in hospitals and 6% in other activities (HRSA, 2000).

Dispensing in community pharmacy The demand for community dispensing services associated with population and demographic change is not expected to cause changes in pharmacist demand that are materially different from the HCI’ s earlier estimates (HCI, 1999). Table 4.2 summarises projected growth for the demand for FTE community pharmacists between 2000 and 2010, based upon key assumptions previously modelled by HCI (1999). Dispensing demand for FTE pharmacists is modelled with respect to the number of pharmacists employed, using 1996 as the base year (the latest for which, at the time of writing, actual data were available). Labour market balance is assumed in the base year. The demand for community pharmacists, led by growth in the demand for prescriptions in subsequent years, is hence a function of15:

• a combined annual growth factor for population and demographic change of 1.51%; • combined respective provision for “ low” , “ medium” and “ high” estimates for the

growth effects of doctor supply, real co-payments, health status and the introduction of new prescription medications of 0.10%, 0.60%, and 1.05%; and

• the productivity of FTE pharmacists, measured by their technical capacity to produce prescriptions— based upon the 184 million prescriptions dispensed in 1996 (the base year)— equivalent to about 11 prescriptions per hour per FTE pharmacist, working off a 38-hour week ×48 weeks PA. Although there are reports of pharmacists working considerably longer than a 38-hour week16, if provision were made for a professional working week exceeding 38 hours, it would imply that the hours of work assumption we are using were overestimating demand.

Table 4.2: Total projection of demand for FTE pharmacists attributable to dispensing demand

Projected demand Growth factors Annual rate of growth, % 1996 2000 2010

Base year (head count) 11,216 Population & demography 1.51 10,160 11,802 ADD: combined other factors - low 0.10 10,200 11,966 - medium 0.60 10,402 12,817 - high 1.05 10,591 13,650

Source: Appendix 4.1 Table 4.2 indicates that as a result of growth in dispensing, FTE pharmacist demand may be projected to increase from within a range of some 10,200 to 10,600 in 2000 to between 12,000 and 13,650 in 2010. The assumption of constant productivity in dispensing— based upon Guild Digest data for the base year (1996)— could be expected to cause demand to fall (relative to our 1999 forecast) because it yields a value slightly higher than used in the earlier study. Projected demand for FTE pharmacists attributable to dispensing is nevertheless a little higher than forecast in 1999 because the earlier study slightly under forecast actual pharmacist demand in 1996 (by some 3%). It is possible that Pharmacy Boards, out of concern for quality considerations, may seek to limit pharmacist dispensing loads. This would cause our projection to underestimate

15 See previous HCI report for a fuller explanation of how some of these variables were derived (HCI, 1999). 16 EG National Pharmacy Workforce Reference Group, Workshop, contributions to discussion, Sydney Airport Hilton, 5 September, 2001.

demand, although the model is working off an average that is below the 12 to 15 prescriptions per hour that the Pharmacy Board of NSW (1996) thinks may be “ reasonable” . Quality in community pharmacy Community pharmacist demand must also take into the consideration the progressive development of services associated with dispensing that have acquired new poignancy as result of the Third Community Pharmacy Agreement. Most significant of these is the possible impact the QCPP— now strongly endorsed by the Commonwealth through the Pharmacy Development Program (PDP) for which purpose the Third Agreement has allocated $188 million. The major share of PDP funding has been earmarked for quality improvement, mirroring the Commonwealth’ s support for quality improvement in general practice under the Practice Incentives Program. Until the end of 2003, individual pharmacies are eligible to receive a $7,500 grant from the Commonwealth to defray the costs of accreditation. The first pharmacies received accreditation under the QCPP in 1999; at the time of writing, it is estimated that some 3,400 were accredited. By 2003, it is expected that about 85% of pharmacies will have been accredited (Appendix 4.1). Respondents to the project’ s workforce survey rated accreditation as the future activity most likely to drive changes in the way the workload of community pharmacy is likely to be distributed. Implementation of QCPP Standards has assumed significance, particularly in relation to various over-the-counter (OTC) medicines. These medicines are known as ‘pharmacy (S2)’ and ‘pharmacist only (S3)’ and the Standards detail the role of pharmacy staff and pharmacists in guiding consumers in their use and choice of these products (Industry Commission, 1996; Galbally, 2001). Standards that are being implemented for purposes of the QCPP impose obligations upon pharmacies to adopt a series of internal risk management processes for both prescription and non-prescription medicines. In the case of the latter, these include the extensive documentation and observance of operating procedures for the supply of S2 and S3 medicines, training and supervision of pharmacy assistants and compliance with an appropriate physical floor plan. The Standards are designed to promote the effective and rational use of medicines by consumers through proactive pharmacist and pharmacy staff interventions. The effect of progressive uptake of accreditation is likely to prove demanding of pharmacist labour inputs— particularly so in the case of non-prescription medicines. Based on various assumptions, summarised in Table 4.3, it is estimated that the effect of pharmacy interventions will cause an additional layer of demand for FTE pharmacists. Between 2000 and 2010 FTE demand is expected to increase from 59 to 525— more than 80% of which will be attributable to non-prescription interventions. A small element of this demand is likely to be caused by direct Third Agreement funding of QCPP Coordinators, located in the Pharmacy Guild’ s State Branches— which it is assumed will continue to receive funding (to assist in re-accreditation) after the term of the current Agreement.

Table 4.3: Impact of QCPP on the demand for FTE pharmacists & key assumptions

2000 2010 Pharmacies accredited under QCPP 556 4,860 Additional prescription interventions, PA 192 Additional S2/S3 interventions per hour 1 Pharmacist time per intervention, minutes 2.5749 Additional FTE pharmacists required to support: - S2/S3 interventions 51 445 - prescription interventions 6 55 - QCPP coordinators 0 7 Total additional FTE pharmacists 57 506

Source: Appendix 4.1 There are substantial costs associated with implementing the QCPP (Ballenden, 2000)— not the least of which is the additional pharmacist labour input. We have allowed for the effect of QCPP on the demand for pharmacists on the assumption that QCPP, and the system of stringent scheduling of ‘pharmacy’ and ‘pharmacist only’ medications which it underpins, will prove a durable innovation with a capacity to confer a net public benefit. In accordance with National Competition Policy principles, and further to the Galbally Review (2001), the impact of QCPP in relation to over the counter medication is soon to be evaluated to test the net public benefit proposition (PGA, 2001). In the meantime, the QCPP is attracting strong Commonwealth support (CWA and PGA, 2000). In the event, however, of a finding that its costs cannot be socially amortised, the destiny of ‘pharmacy’ and ‘pharmacist only’ scheduling will become uncertain17. A substantial element of the estimated additional demand in Table 4.3 could then probably fail to materialise, with the corollary that demand for FTE pharmacist labour allocated to over the counter intervention could be substantially less than the 441 projected for 2010. On the other hand, several new professional services are likely to be introduced within the next few years that can be expected to have a positive increase on demand. These include:

• The introduction of case conferencing with GPs, from 2003-04; • Payment for specialty services such as diabetes and asthma management, under the

proposed Fourth Guild-Government Agreement; • Payment for dose administration aids and clinical interventions; and • Provision of other specialty services, such as warfarin monitoring.

Medication management services The Third Community Pharmacy Agreement has allocated $114 million for medication management services to be conducted by pharmacists in two different settings:

• as residential management in nursing homes and hostels; and

17 Senator Grant Tambling, Parliamentary Secretary for the Minister for Health and Aged Care, Speech to Australian Pharmacy Professional 2001 Conference and Trade Exhibition, March 2001

• by way of domiciliary mediation management (DMMR)— in home environments (also known as Home Medicines Review).

The overall demand for pharmacist labour for medication management is assumed to be capped by funding allocated to medication management until expiry of the Agreement in June 2005. The commitment to residential management represents a continuation of a program that commenced in 1997. DMMR, on the other hand, commenced in October 2001 and embodies new administrative processes quite different from residential management. Because it is an established program with operational machinery in place, it seems plausible to assume that available funding will most readily translate into residential management services. Our demand for labour model accordingly first allocates available funding to residential management— driven by population and demographic criteria as well as compelling accreditation compliance requirements for nursing home and hostel proprietors. The balance of available funding is then allocated to support the delivery of the DMMR program18. At the time of writing, medication reviews in residential agreed care facilities were under review. The review can be expected to have an impact on required FTE pharmacists because there will be a Quality Use of Medicines (QUM) component in the service (i.e. the service will not just include a review, but also a range of other services such as medication rounds, participation in medicines advisory committees, etc). The Pharmacy Guild estimates that the demand for additional QUM activity could comprise about one quarter of the total service19. Some private funding for domiciliary medication management recently also became available through a major private health fund. Residential management The demand projection for residential management in Appendix 4.1 is based upon actual nursing home and hostel beds under review between 1997 and 2002, and (having regard to the 1997 – 2002 experience), 75% of available beds being reviewed between 2003 and 2010. The associated demand for residential management and the consequential demand for FTE pharmacists to deliver these services is summarised in Table 4.4. As described in the earlier demand study (HCI, 1999), the workforce implications of residential management are twofold. There is an increase in the demand for labour to undertake the reviews but a reduction in the demand for labour consequent upon interventions, associated with review, in reducing the demand for dispensing services (Roberts, 1995). The net demand for FTE pharmacists is projected to increase from 47 in 2000 to 73 in 2010.

18 The putative simulation above should not be construed as a possible value statement about the relative merits of residential over domiciliary management or the way in which expenditures should be prioritised. Indeed, from time to time the Australian Pharmaceutical Council has expressed concern about the uneven quality of residential management. 19 Written communication from Lance Emerson, Pharmacy Guild, 8 October 2002.

Table 4.4: Projected FTE pharmacist demand attributable to residential medication management

2000 2010 Number of beds subject to medication review (75% of total)

90,032 140,970

FTE pharmacist demand (beds under review ×1.5 hours per review ÷ 1,824 FTE hours PA)

74 116

Reduction in FTE community pharmacists attributable to savings in medication (37%)(a)

27 43

Net FTE pharmacist demand 47 73 (a) HCI (1999) pp 125-6 Source: Appendix 4.1

The Third Agreement raised the annual fee payable to pharmacists undertaking residential management from $54 per reviewed bed to $100 (plus GST). We project that some 490,000 beds will be reviewed during the term of the Agreement (Appendix 4.1). This represents a total expenditure of about $54 million (including GST), leaving a balance of $60 million available to support the DMMR program between 2002 and 2005. Domiciliary medication management review (home medicines review) The pathway to initiating a DMMR service differs significantly from residential management. In the former case, a general practitioner through a pharmacy of the patient’ s choice must invoke the service; in the case of the latter, nursing home or hostel proprietors initiate services through individual pharmacists with the agreement of the general practitioner concerned. Arrangements for DMMRs were finalised in October 2001, following extensive consultation between pharmacists, general practitioners and consumers. The outcome is a collaborative model in which a pharmacist from a pharmacy may perform a DMMR only with a referral from a general practitioner— who in turn must have assessed a patient as meeting specific criteria and determined that they would benefit from a DMMR. A general practitioner assessment and referral attracts a Schedule Fee of $120 fee under MBS item number 900, introduced on 1 October, 2001. Funding for the new MBS item, chargeable by general practitioners, is by way of the Medicare appropriation and remains quite separate from Third Agreement funding available to pharmacists. Pharmacies providing general practitioner-referred DMMRs are separately remunerated by way of a $140 fee (plus GST) paid through the Health Insurance Commission. In order to promote and assist the uptake of general practitioner DMMR referrals, divisions of general practice may employ medication management facilitators. Their role is to support implementation of the collaborative model within general practice. At the time of writing, some 60 divisions either had employed or were about to employ DMMR facilitators. By 2005, it is estimated that 115 divisions will have appointed facilitators. Pharmacists working a 2 – 3 day week occupy about 85% of these positions, with the balance filled mainly by nurses.

Third Agreement funding available for DMMRs (after meeting residential management commitments) hence needs to support two streams of expenditure: those for services provided by pharmacists who deliver DMMRs to patients through pharmacies; and those for pharmacist (and non-pharmacist) services associated with facilitation of the DMMR model provided through divisions. Both streams will contribute to the demand for community pharmacist labour. The latter represents a fixed cost (invariant with respect to the volume of DMMR services), which on present indications, we forecast will involve creating an establishment that by 2004 will reach a maximum of 39 FTE pharmacists and 7 non-pharmacist positions (Appendix 4.1). At the conclusion of the Third Agreement in 2005, facilitation will have expended about $7 million in labour costs20, leaving a maximum of some $53 million available for the delivery of DMMR services21. At $140 per DMMR (plus GST), $53 million would fund a maximum of some 344,000 services over the period 2002 – 2005. To simulate gradual uptake, these services are distributed by fitting a logarithmic trend to exhaust the $53 million residual funding between 2002 and 2005 as well as to allow for further allocations thereafter— assumed to be available for continuation of the program until at least 2010. Assuming a DMMR takes an average of two hours, and the $53 million were fully acquitted, our model would have the demand for FTE pharmacists to deliver MMMR services increase between 2002 and 2010 from 69 to 139 (Table 4.5).

Table 4.5: Projected growth range for DMMRs and associated FTE demand for pharmacists

2002 2010 DMMR projections, ‘000s - low (ex Medicare, item 900) 17 87 - medium 40 107 - high (ex Third Agreement) 63 127 Divisions of GP with facilitators 60 115 FTE pharmacist demand, DMMR services - low (ex Medicare, item 900) 19 95 - medium 44 117 - high (ex Third Agreement) 69 139 FTE demand, facilitation 20 39

Source: Appendix 4.1 It is uncertain whether available Third Agreement DMMR funding would indeed be fully acquitted. DMMR is a new program that will rely upon the disposition of general practitioners to ‘unlock’ by way of resort to MBS item 900— a proxy in itself for the number of DMMRs. At the time of writing, little substantive data were available through the Health Insurance Commission on the Medicare claims experience for this new item number22. 20 This assumes that the number of pharmacist and non-pharmacist facilitators will be 24 in 2002, 40 in 2003, and 46 in 2004 and 2005, working an average of 15.2 hours per week (Appendix 4.1) at an average of $35 per hour, plus 25% on costs. The capital cost of placing facilitators is ignored (ie purchase of furniture and office equipment), as many of the facilitator appointments represent extensions of part time positions already established. For instance, some facilitators were already working in divisions on funding for the National Prescriber Service. 21 IE $114 less the $54 million forecast spending on residential review less the $7 million expended on DMMR facilitation. 22 HIC claims experience data for the period 1 October - 30 December, 2001 reveal that 765 item 900s had been processed. Internal PGA sources indicate that as at 26 April, 2002, 1,900 DMMRs had been delivered – ie approaching a rate of 300 per month.

Whilst initial reports for implementation of the DMMR program appear optimistic23, the Commonwealth’ s forward estimates for the Medicare benefit cost of Schedule item 900 between 2002 and 2005 do not reconcile with the full acquittal of Third Agreement money available to pharmacies. Medicare estimates would fund a maximum of some 166,000 DMMR services during these years at a benefit cost of about $17 million (Appendix 4.1). This is substantially less than congruent with the extent of Third Agreement funding. To simulate the gradual uptake of DMMRs, using Medicare forward estimates, we again distribute the 2002 – 2005 forward allocation by way of a logarithmic trend over the period 2002 – 2010. This would be consistent with an increase in the demand for FTE pharmacists from 19 to 95 (Table 4.5). There is clearly a difference between the basis of Medicare forward estimates and Third Agreement funding. The former is indicative and open ended, whereas the latter is likely to be capped, and to represent a possible expenditure constraint. For this reason we shall treat the demand for pharmacists extrapolated from Medicare forward estimates as a “ low” DMMR projection and demand extrapolated from Third Agreement funding as a “ high” projection, with the median as a “ medium” projection24. Trends fitted for these projections are graphically represented in Figure 4.1.

Figure 4.1: Projected FTE demand for pharmacists to deliver DMMRs

0

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160

2002 2003 2004 2005 2006 2007 2008 2009 2010

No

FTE

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ists

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Source: Appendix 4.1

In contrast to residential management, we do not allow for an impact of DMMRs upon the number of medications prescribed. The evidence on this is mixed. A pilot study in the Sutherland area of NSW found that DMMRs “ reduced medication costs” , but no information was provided on the number of prescriptions (Krass et al, 1999). Other pilot studies have been undertaken in South Australia (Gilbert et al, 2000), Queensland and Victoria (Roberts et al, 2000) and in the St George / Canterbury area of NSW (Bennett et al, 2000). Although these

23 Personal communication, Mr Michael Quaas, PGA, Canberra; Ms Carlene Smith, PGA (NSW Branch), Sydney. 24 Although the Third Agreement has a deal to say about unspent program funding (Clause 65), it is silent about overspending— although there is provision for “ flexibility.. to enable movement of funds between years if circumstances require” (Sub clause 6.1.3). There is hence a presumption that parties to the Agreement were satisfied that subject to flexibility “ between elements of the program and between years” (Sub clause 50.4), overall funding was likely to adequately cater for future program growth. The rate of utilisation of DMMRs at the time of writing, for instance, (vide supra, footnote 7), would need grow about 10-fold to reach the “ low” projection for 2003 (Appendix 4.1).

found that DMMRs yielded overall savings to the health care system, they found that DMMRs had little or no impact on the number of prescriptions. Until further evidence becomes available, we therefore believe it reasonable to treat growth in the demand for pharmacists to deliver DMMRs differently from residential management. Even with a level playing field, the uptake of programs without specific guidelines where there are funding limits is always speculative— if only because to establish claims in their respective programs under a single budget, funded players may be induced to compete with each other. In extreme situations, this may contribute to premature exhaustion of funding without the objectives of one or other of the programs being addressed. Level playing field assumptions may not hold in our model. Residential management will tend to run ahead of the domiciliary program in appropriating the $114 million Third Agreement funding— simply because its machinery is already operational and its pathways are relatively straightforward. There may nevertheless also be inherent pressures holding back the uptake of DMMRs: if indeed they were widely adopted (as has been proposed25), they would have to be spread fairly thinly across pharmacies. At the conclusion of the term of the Third Agreement, even on high-end assumptions, there are likely to be about 100,000 services a year— an average of about 20 per pharmacy. Unless they can hope to attract a reasonable amount of work, pharmacists may be reluctant to invest time and energy in training and accreditation for the DMMR program. It seems unlikely that DMMRs will attract many pharmacies unless they can expect to reasonably amortise their investment. This may be conducive to high levels of concentration in DMMR activities, involving relatively few highly specialised pharmacists. Uneven distribution of DMMR skills may tend to thwart Australia-wide implementation of the program and the ready access of consumers to their pharmacy of choice26. In our view, it is therefore unlikely that the high-end demand for pharmacist labour for DMMRs will readily materialise. A subsidiary source of funding for domiciliary management is available through the Medical Benefits Fund of Australia (MBF)— Australia’ s largest privately owned health fund. It has significant market presence in NSW and Queensland. In March 2002, the MBF introduced a benefit for a Medication Assistance Service (MAS). Benefits are payable to persons covered under “ Extras” or ancillary tables for “ comprehensive one-on-one consultations” with a pharmacist about their medications, lasting “ 20 – 30 minutes” . The entitlement is subject to waiting periods and is limited to one service per year on which a benefit is payable for 80% of the charge, up to maximum $40, from within existing pharmaceutical limits. If pharmacists were to set their charges at $50 per service, to exactly exhaust the $40 entitlement, the 20% co-payment would represent an out-of-pocket patient cost of $10 per service. MASs could prove attractive to pharmacists: a $50 fee, for instance, would offer a higher return on professional time than DMMR remuneration without either intricate channels for initiation or the complexities of accreditation. The real test for their uptake will be the willingness of health insured consumers to incur the cost of say, a $10 co-payment for a new service.

25 Ms Kay Patterson, Minister for Health and Ageing, Speech to Australian Pharmacy Professional 2002 Conference and Trade Exhibition, March 2002 26 Subject to agreement with the accredited pharmacist, the program attempts to mitigate this problem by allowing consumers to nominate their own community pharmacist— who may not be accredited, but with whom they are familiar— to conduct their DMMR interview.

Because at the time of writing, the MAS benefit was a very recent innovation, this study does not make allowance for its possible impact on the demand for labour. It would nevertheless be instructive to monitor the MBF’ s MAS claims experience. Hospital demand There are two possible dimensions to the demand for hospital pharmacists:

• the first relates to an underlying service demand that is driven by the demand for hospital admissions— for which purpose we rely upon work from the earlier study (HCI, 1999);

• the other relates to demand in so far as it may be influenced by selected influences on the work environment of hospital pharmacists, the evidence for which the SHPA were invited to supply under subcontract for this study (Appendix 4.4).

The SHPA identify 18 drivers for the future demand for hospital pharmacists through discussion with hospital pharmacists and responses received in the workload questionnaire (O’ Leary et al, 2001). The SHPA suggests that the underlying demand for pharmacists will be augmented by a variety of considerations, including innovations in risk management and the introduction of PBS prescribing in public hospitals. Many factors can drive the need for a specific service and the staff required to deliver that service. In Australia the shortage of hospital pharmacists has coincided with considerable reforms in hospital budgets across the country. The resulting dramatic shift in staffing levels in most pharmacy services has required creative thinking about the delivery of services sought and demanded by funders, medical and nursing staff, patients and their families. The construction of a demand model involves the identification of issues that will impact on the need for the skills pharmacists can provide and the environment in which they work. Drivers for the future demand for hospital pharmacists were identified and investigated through discussion with hospital pharmacists and responses received in the SHPA workload questionnaire. These drivers can be broadly classified as issues that affect or are linked to:

• the external environment; • the environment within a hospital; • changes to the practice or delivery of hospital pharmacy.

The external environment These drivers stem from general issues in the community, changes in the policies of governments, non-government organisations and other stakeholder groups and changes to the delivery of health services as a whole. In general individual hospitals and the managers of pharmacy services have little opportunity to influence these factors; their impact on the hospital as a whole, or any particular service, must be managed within the resources of the system.

The drivers identified in this category are: • Ageing of the Australian population; • APAC guidelines; • Enterprise bargaining agreements; • Hospital accreditation requirements; • New medical technologies; • Number and types of hospitals; • Number of admitted patients; • Pre-registration pharmacists; • Safe dispensing loads.

The hospital environment These drivers stem from specific issues within a hospital, in particular decisions about funding, services offered, risk management strategies, service delivery models and the inter-connectedness of services within the hospital. Managers of hospital pharmacy services have some level of proactive input into these decisions (they may even drive hospital-wide change), however some decisions are made without wide consultation necessitating a reactive response. The drivers identified in this category are:

• Automated drug distribution; • Electronic prescribing with decision support; • Outsourcing; • Patient complexity ; • PBS dispensing in public hospitals; • Risk management and quality of care issues; • Service level at private hospitals.

Changes to the practice or delivery of hospital pharmacy These drivers stem from changes or issues within a pharmacy service. The drivers identified in this category are:

• Changes in pharmacy service delivery; • Pharmacy support staff.

The SHPA has analysed each driver as to how and when they may impact on the demand for pharmacists (O’ Leary et al 2001). From these the NPWRG (February 2002) suggested that three drivers considered to contribute to the majority of future demand be selected for inclusion in the final report. These are PBS dispensing in public hospitals, risk management and quality of care issues and the impact of the APAC guidelines on the continuum of care between the community and hospital. Further discussion of the remaining 15 drivers are not included here, but can be accessed in the full report (O’ Leary et al 2001).

From reports of various hospital pharmacy services on vacant hospital pharmacist positions, the SHPA also proposes that there is a backlog of past, unrequited demand, that must be incorporated into a demand model (Appendix 4.4). We will address each of these issues in order. Underlying hospital demand—admissions HCI has modelled underlying hospital pharmacist demand using specific assumptions about the allocation and use of hospital beds and hospital pharmacist staffing ratios required to service their respective needs. Some 80% of the demand for hospital pharmacists is likely to be attributable to overnight admissions in public hospitals. The balance roughly evenly divides between overnight admissions to private hospitals and same day admissions to both public and private hospitals (Table 4.6). In the case of public hospitals, we have assumed an overall distribution of 60% medical/surgical hospital beds, 25% specialist unit beds and 15% critical care unit beds. This yields a mean staffing ratio of 1,526 overnight admissions per FTE pharmacist (HCI, 1999). We believe that this staffing ratio provides an appropriate and adequate structural environment to explain the demand for hospital pharmacists (delivering all pharmacy services, including clinical pharmacy) between 2000 and 201027. Since about 95% of the growth in hospital activity between 2000 and 2010 is expected to be concentrated in public and private same day admissions, where hospital pharmacist staffing ratios are very substantially less than for public system overnight activity— and are likely remain so in the foreseeable future— little change is expected the underlying demand28. Between 2000 – 2010, underlying demand is hence expected to stabilise at between 1,700 – 1,800, FTE hospital pharmacists (Table 4.6). It seems reasonable to conclude that the underlying service demand for hospital pharmacists is very much a structural feature of the hospital system, which remains relatively insensitive to the scale of hospital activity. That is, there is a certain minimum infrastructure investment required in establishing and maintaining a hospital pharmacy department, which can support a comparatively wide range of activity levels.

27 This is in fact the staffing ratio adopted by the SHPA (2001, p 27). The actual distribution of hospital beds is more plausibly 80% medical/surgical beds, 15% specialist unit beds and 5% critical care unit beds— yielding a mean staffing ratio of 1,749 separations per FTE pharmacist (HCI, 1999). 28 For private hospital overnight admissions, the staffing ratio is 6,534 admissions per FTE hospital pharmacist; for both public and private same say admissions, the corresponding ratio is 23,652 (HCI, 1999).

Table 4.6: Projected demand for FTE hospital pharmacists attributable to hospital admissions

2000 2010 Projected demand for admissions Overnight - Public 2,187 2,226 - Private 865 997 Same day - Public 2,037 3,544 - Private 1,272 2,440 FTE Demand for pharmacists due to admissions Overnight - Public 1,427 1,459 - Private 132 153 Same day - Public 86 150 - Private 54 103 TOTAL FTE HOSPITAL DEMAND 1,699 1,864 Source: Appendix 4.2

Impact of changing work environment on hospital demand Additional layers of demand for hospital pharmacists may be attributable to the changing environment in which hospital pharmacists work, especially as a consequence of Commonwealth Government policies. As discussed above, the SHPA identifies three key drivers that could have a cumulative additional impact on the demand for hospital pharmacists between 2000 and 2002 (Appendix 4.4). These are:

• the progressive implementation of APAC Guidelines for hospital discharge planning; • the introduction of PBS dispensing in public hospitals; • the introduction of seven-day a week hospital pharmacy risk management services.

The consultant considers that implementation of APAC Guidelines and PBS dispensing in public hospitals are closely intertwined. The Commonwealth has made a funding offer to the States and Territories to extend the PBS to admitted patients on discharge from public hospitals as well as to public hospital outpatients (DHAC, 2001). The offer also includes access to public hospitals for chemotherapy drugs listed on the PBS for same day admissions. It does not, however, include pharmaceuticals dispensed to patients during their inpatient stay. These measures are intended to confer significant benefits upon patients, whereby any State accepting PBS hospital funding will be obliged, as a quid pro quo, to implement best practice APAC Guidelines for maintaining the continuum of pharmaceutical care for patients from admission to discharge. These guidelines include

• more equitable access to pharmaceuticals in hospitals and the community; • better communication between hospitals and general practitioners on patient

pharmaceutical needs;

• smooth transition in moving between hospitals and the community, including access to reasonable quantities of medication upon discharge, no change in brand names, etc (DHAC, 2001)29.

Under the Commonwealth proposal, hospital-generated PBS prescriptions would be dispensed either by the hospital pharmacy or presented at a community pharmacy. By 2010, the SPHA suggest that all States and Territories will have accepted the Commonwealth’ s offer and that the additional demand for services associated with implementation of APAC Guidelines and PBS dispensing will cause the demand for FTE hospital pharmacists to increase to 867 and 106 respectively (Appendix 4.4). At the time of writing, the APAC / PBS offer had been introduced in Victoria. Queensland is likely to follow in mid 2002, commencing with a trial in four hospitals within the southeast corner of the state. The SHPA also identify upgrading hospital risk management from a five-day service to a seven-day service as source of service demand. By 2010 it is suggested that “ hospital management will demand seven-day a week hospital pharmacy services as part of each hospital’ s approach to reducing medication errors and its associated morbidity and mortality” . It is predicted that by 2010 this will cause the demand for FTE hospital pharmacists to increase by a further 234 (Appendix 4.4). Our demand model incorporates the additional layers of demand advocated by the SHPA by way of an exponential trend, distributed over the period 2000 – 2010 (as well, for the sake comparability, the immediately preceding base years). We also allow for a one-off demand shift necessary to fill 259 FTE hospital pharmacist vacancies, which the SHPA identify as unmet workforce demand (Appendix 4.4). The contribution, as proposed by the SHPA, of the additional sources of hospital pharmacist demand to underlying service demand is projected to increase progressively from about 430 FTE pharmacists in 2000 to 1,466 in 2010 (Figure 4.2). The corollary of this would be a rise in total FTE hospital demand from 2,316 in 2000 to 4,537 in 2010 in order to deliver the services associated with the full implementation of these existing government policies (Appendix 4.2).

29 There are currently incentives for hospitals to cost shift by discharging patients with minimal quantities of medication. Inefficiencies associated with this practice include excessive immediate post discharge doctor visits to obtain prescriptions to be dispensed by community pharmacists.

Figure 4.2: Contribution of other sources to FTE demand for hospital pharmacists

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1600

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Source: Appendix 4.2

Commentary on the impact of changing work environment on hospital demand We will refer to the projection for underlying service demand outlined in section 8 above (Table 4.6), as a “ low” projection of hospital pharmacist demand. Underlying service demand, augmented by contributions from other sources identified by the SHPA, we will refer to as a “ high” demand projection. We consider the “ high” demand projection to be an unlikely outcome for the following reasons:

• APAC Guidelines— Although has there has been a start in implementing APAC Guidelines, it is doubtful whether all States and Territories will accept the Commonwealth’ s package offer on APAC / PBS before 2003 (the time when a new Health Care Agreement will be in place)30. To be sure, to the extent that the offer is implemented, there will be workforce implications, but APAC Principles make it clear that their implementation is likely to be the responsibility of “ all hospital staff” . Much of the burden of implementing APAC Principles will fall predominantly on the shoulders of the discharge residents, registrars, social workers and community nurses. We consider that workforce implications for hospital pharmacists may be minimal31. This will be reviewed by the Victorian/Commonwealth evaluation.

• PBS in public hospitals— The Commonwealth has forecast that some 85% of PBS

work in hospitals will relate to discharge medication and 15% to outpatient prescriptions. The former will not increase the workload of pharmacists; it will simply increase the quantity of medication dispensed per prescription. Outpatient prescriptions could conceivably represent new work for hospital pharmacists, but only to the extent that hospital pharmacies were successful in clawing back work they may

30 Personal communication, B. Griffin, Department of Health and Ageing 31 Ibid

have previously successfully cost shifted to the community32. This, in conjunction with the uncertainties in implementing this program (outside Victoria and Queensland), suggests its workforce implications for hospital pharmacists are again likely to be minimal.

• Seven-day risk management— The SHPA do not document this statement and we are

unaware of any formal Commonwealth or State initiatives that will involve weekend rosters for additional hospital pharmacists to further enhance hospital pharmacy risk management33. Other scarce resources would also be involved and the cost would be prohibitive. However, the SHPA notes that extending service hours for hospital pharmacy services is now being suggested in the UK (Audit Commission, 2001).

• Vacancies— The SHPA has gathered data on what are suggested to be hospital

pharmacist vacancies from a sample of respondent hospital pharmacy services. Because of the likelihood of selective respondent bias, we doubt they can validly be extrapolated to obtain national totals. Neither is it clear that vacancies enumerated would have represented established, permanently funded positions that could logically contribute to demand. However, the SHPA contends that this figure accords with data from the UK, USA and the general international experience described in the literature review in Chapter 2 of this document.

In identifying the prospective exogenous influences that may influence demand during the next 10 years, we believe that the SHPA do not consider those which may adversely affect demand (HCI, 1999)34. These include the outsourcing of hospital pharmacy services, automated dispensing, the possible introduction of electronic prescribing for hospital inpatients (Stephenson, 2001) and labour substitution associated with hospital pharmacists working with increasing numbers of pharmacy technicians (HCI, 1999). Accordingly any minor gains to workforce demand associated with the Commonwealth’ s APAC / PBS offer (where accepted) could be more than offset by other changes that may very likely reduce demand.35 On balance therefore, we consider that demand for hospital pharmacists is likely to remain a structural feature of the hospital system rather than a growth phenomenon. Changes to the structure of acute service delivery, such as the building of a new major teaching hospital, could be expected to have more impact on the demand for hospital pharmacists than the net effect of environmental influences. Because of changes to medical technology and concentration on service rationalisation, the era of constructing additional major teaching hospitals is now past. We accordingly consider the “ low” demand projection for hospital pharmacists to be the most plausible outcome. However, the SHPA believes that this scenario will not allow for the implementation of existing government policies on access, equity, medication safety, quality use of medicines, continuum of care and the expectations of consumers. In noting this variation in opinion, the

32 Ibid 33 Notwithstanding this, the SHPA identify seven-day risk management as one of the “ three drivers” that “ relate to the implementation of existing national Commonwealth Government policies” . 34 Albeit the SHPA state that this was part of the analysis that they undertook (O’ Leary et al, 2001). 35 The SHPA advised the Consultant on 10 July 2002 that it strongly disagrees with this analysis of the impact of the three primary drivers.

NPWRG has recommended that a medium demand scenario be constructed for hospital pharmacists. Overall pharmacist demand projection Appendix 4.3 amalgamates data on year-to-year demand modelled in Appendices 4.1 and 4.2 for community and hospital pharmacists respectively, using various combinations of demand settings to represent four different illustrative scenarios for overall demand. Other combinations of settings are of course possible, but configurations in Appendix 4.3 are chosen to broadly reflect groups of events that can be used to gain insights into a range of possible outcomes— not all of which may be necessarily plausible. The scenarios also incorporate demand projections for pharmacists employed in miscellaneous, “ other” activities, including teaching, public sector work and the pharmaceutical industry. The demand for pharmacists in “ other” activities is essentially a demand for public health-like services— demand for which cannot be modelled in the same way as demand for services which can respond to the volume of patient care— exemplified by demand behaviour in community pharmacy. The dominant influences on “ other” demand are likely to be public policy initiatives that entail discontinuous employment shift effects, such as the reorganisation of a government department, the establishment of a new public health unit, the opening of a new university department of pharmacy or the creation of new training needs, etc. There are similarities between the underlying infrastructure characteristics of hospital pharmacist demand and the demand for “ other” pharmacist services, but the latter is quite different because it embodies no patient service content (HCA, 2002). Although demand for “ other” pharmacist services cannot be systematically related to observable events, its contribution to the share of overall pharmacist employment has remained remarkably stable over the last 15 years (Table 4.7)— as indeed have the community pharmacy and hospital sectors. For purposes of projecting overall demand between 2000 – 2010, we assume that the distribution of pharmacists between the three identified areas of employment (community, hospital and “ other” ) will hence maintain their historical relationship. This means that the volume of demand for “ other” pharmacists will grow roughly in proportion to growth in demand for pharmacists in other sectors, with actual growth sensitive to permutations of demand settings inherent in the different scenarios (Appendix 4.3; HCI, 1999). The outcome of these assumptions is summarised in Table 4.7.

Table 4.7: Summary projection of FTE demand for pharmacists

2000 2010 LOW COMMUNITY, LOW HOSPITAL - Community 10,303 12,679 - Hospital 1,699 1,864 - Other 700 848 - TOTAL 12,703 15,392 MEDIUM COMMUNITY, LOW HOSPITAL - Community 10,506 13,553 - Hospital 1,699 1,864 - Other 712 899 - TOTAL 12,917 16,316 MEDIUM COMMUNITY, MEDIUM HOSPITAL -Community 10,506 13,553 -Hospital 1,984 3,201 -Other 727 976 -TOTAL 13,217 17,730 HIGH COMMUNITY, LOW HOSPITAL - Community 10,694 14,407 - Hospital 1,699 1,864 - Other 723 949 - TOTAL 13,116 17,220 HIGH COMMUNITY, HIGH HOSPITAL - Community 10,694 14,407 - Hospital 2,268 4,537 - Other 756 1,104 - TOTAL 13,719 20,049

Source: Appendix 4.3 Depending upon the scenarios selected, by 2010 total demand for FTE pharmacists could range between some 12,700 and 20,000. Despite prominence given to new forms of professional service, it is noteworthy that the character of this demand in the foreseeable future— on present indications at least— is likely to remain predominantly associated with overall growth dispensing— for the most part in community pharmacy. New forms of professional practice, such as the delivery of DMMRs, seem destined to contribute no more than around 1% of overall demand for labour. Quantum changes in new areas of collaborative practice will not only require a considerably greater commitment of public funding, but also, commensurate changes in the style of service delivery involving significant support and cooperation from various professional players.

Chapt er 5 : Labour m ar k et ba lanc e and adjust m ent

Summary The character of pharmacist demand and supply is much the same as when modelled in the earlier study (1999). In Figures 5.1 to 5.6, below, we project the demand and supply of pharmacists between 1997 and 2010 by presenting various scenarios based on different configurations of assumptions in the community and hospital sectors. In all cases, we take 1996 as the base year— the latest for which actual data were available at the time of writing. Growth in the FTE supply of pharmacists is iteratively modelled, from year to year, taking into consideration the net effect of migration, new graduate supplies and wastage (through retirement, participation, and occupational separation). There are “ high” and “ low” sensitivities for average annual ‘wastage’ (7% and 3%), yielding respectively, “ low” and “ high” projections of growth in offers by FTE pharmacists to supply their services at going wage rates. Predominant influences upon supply are the joint effects of high wastage and the high output of new graduates— punctuated, in the case of the latter, between 1999 and 2003, by the one-off impact of the shift in 1997 from a three-year to a four-year degree. Offers of pharmacist service supply are distributed between community, hospital and “ other” sectors according to the structure of pharmacist employment observed between 1986 – 1996 (Figure 3.1). The demand for FTE pharmacists is modelled separately for the community and hospital sectors. As in the case of the earlier study, demand for community pharmacists is fundamentally driven by population growth and demographic change, with “ high” , “ medium” and “ low” sensitivities for real co-payments, doctor supply, health status and the introduction of new drugs. This has implications for the demand for prescriptions and hence the demand for pharmacists— driven by the productivity of pharmacists in dispensing. Additional layers of demand are attributable to the effects of progressively implementing the QCPP and residential and domiciliary medication management review. For hospital pharmacists, there are sensitivities for a “ low” , “ medium” and “ high” demand. Low demand constitutes an underlying, structural explanation of demand and is based upon the way in which demography and population are projected to affect overnight hospital admissions, as modelled in the earlier study (HCI, 1999). “ High” demand is a combination of underlying demand, plus additional layers of demand attributable to the changing environment in which hospital pharmacists work— for which purposes the SHPA have identified three key drivers as likely to have a cumulative impact on the demand for labour (detailed in Appendix 4.4). The “ low” sensitivity is essentially a product of the hospital pharmacy infrastructure, whereas the “ high” sensitivity allows for an incremental demand, with “ medium” demand between these two views.

The character of demand for “ other” pharmacists is a function of assumptions that are employed in each of the community and hospital sectors. Joint projections in these sectors are assumed to drive the demand for pharmacists in “ other” areas of employment— independent evidence for which is too fragmentary to exert independent systematic influence. As we shall show in the sections below, stable equilibrium in the pharmacist labour market is susceptible to dislocation, partly because of differentials in wages and salaries paid to pharmacists in the community and hospital sectors (HCI, 1999). A recurring theme in the analysis that follows is that community pharmacy is more generally able to bid for labour (at either employee or proprietorial levels) at the expense of the hospital system. Sectoral balance Community In the case of community pharmacy, in Figures 5.1 and 5.2 we use illustrative scenarios based upon synchronous “ low” and “ high” community supply and demand projections. In each scenario, there are indications of an excess demand for pharmacists becoming progressively apparent after 1997. By 2010, our model suggests that the FTE community pharmacist deficit is likely to lie between some 1,760 in the case of the “ low” demand / “ low” supply scenario and some 3,000 in the case of the “ high” demand / “ high” supply scenario. Even if there were allowance for a conjunction of “ high” supply and “ low” demand projections, there remain indications of a significant and progressively growing shortage of community pharmacists.

Figure 5.1: FTE community pharmacists, “low” supply and “low” demand to 2010

8,000

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Source: Appendices 3 and 4.1

Figure 5.2: FTE community pharmacists, “ high” supply and “ high” demand to 2010

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Notwithstanding that dispensing demand remains the dominant influence in community pharmacy, a significant component of the excess demand for community pharmacists (some 1,760 FTE pharmacists by 2010) is likely to be attributable to new cognitive activities, funded under the Third Community Pharmacy Agreement. One indicator of community pharmacist shortage would be evidence of longer working hours, as the existing stock of labour responds to pressure of work. Paradoxically, responses to the survey of pharmacists suggest that between 1997 and 2011, the average working week of community pharmacists could well be expected to diminish from 41 to 32 hours— principally because of declining levels of participation. Guild Digest figures, however, suggest that between 1996 and 2000, average weekly hours of pharmacy proprietors have remained remarkably constant, at just over 47 hours per week. The marker to date for excess demand is nevertheless readily perceptible in the work patterns of pharmacists-in-charge, whose average hours of work per week per pharmacy (for both full and part-time pharmacists and including pharmacies with no ‘in-charge’ ) during the same period increased from 11.1 to 14.1. Average actual hours per week worked by all pharmacists, as revealed by the survey, were 32.5— from which logically followed the derivation of our FTE conversion factor in Chapter 3. To the extent that excess demand for community pharmacists is capable of inducing extended hours of work— perhaps as result of increasing wages— it may in fact be compensating for susceptibilities to declining participation. During consultations for this project the sentiment was firmly expressed that many community pharmacists work longer hours than they would prefer. This is a difficult issue to address within a workforce planning methodology framework. As has been discussed in Chapter 3, adding ‘excess’ hours to the supply effectively satisfies demand more completely, thus inducing the opposite effect to that desired of a demonstrated ‘unmet’ demand.

It is possible, however, to gain an estimate of the hours worked by community pharmacists in excess of that which they desire from the survey data. First, it is important to acknowledge that not all those pharmacists working hours in excess of a ‘normal’ 38 hour week do so involuntarily. Many (indeed most) do so to maximise their income or because they simply like their work. The survey results suggest that of those who work more than 38 hours per week (over half those working), a much smaller proportion (13%) indicated that they were forced to do so because either they could not find relief labour and/or they were unable to fill permanent staff vacancies. Second, it is accepted that not all of the hours worked in excess of a normal 38 hour will be involuntary. If, somewhat arbitrarily, it is assumed an extra day of ‘overtime’ will be accepted, then the proportion of total workers who are estimated to be working in excess of what they might desire reduces to 10.4%. It is further calculated that on average they are working 8.1 hours per week more than they would choose. These estimates can be extrapolated to available national workforce statistics to gain a crude approximation of the level of demand currently unmet by supply. Thus, if the total workforce size in the base year 1996 was 13,834, then 10.4% of that number (1,439) could be assumed to be each working an excess of 8.1 hours per week (equal to 11,654 hours). This translates to additional demand for 306.7 full-time equivalent pharmacists. In the base year, this amounts to some 2% - 3% of total demand. Hospital Figures 5.3 and 5.4 represent alternative scenarios for supply and demand of FTE hospital pharmacists. Figure 5.3 is a “ low” supply / “ low” demand scenario, with relatively little change in demand, being the outcome of the structural environment of hospital inpatient care, as discussed in Chapter 4.

Figure 5.3: FTE hospital pharmacists, “ low” supply and “ low” demand to 2010

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Under this scenario, the shortfall of hospital pharmacists since 1998 appears destined to continue until about 2008-09. Thereafter supply should be close to meeting demand.

Figure 5.4: FTE hospital pharmacists, “ high” supply and “ high” and “ medium” demand to 2010

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Figure 5.4, on the other hand, is a “ high” supply projection in conjunction with “ high” and “ medium” demand projections for hospital pharmacists and provides a very different interpretation from that depicted in Figure 5.3. With the “ high” supply / “ high” demand combination, for example demand is projected to far outstrip supply, rising from some 2,300 FTE hospital pharmacists in 2000 to some 4,500 in 2010— in turn causing excess FTE demand to grow from about 700 to 2,500. The behaviour of demand under this scenario is driven by SHPA incremental drivers, plus the demand for appointments to outstanding vacancies in conjunction with the infrastructure demand used in Figure 5.3. Apart from philosophical reservations underlying the plausibility of the “ high” demand for hospital pharmacists outlined in Chapter 4, it is counter-intuitive to suppose that the demand for labour in a health workforce could be expected to double over a period of 10 years. Some genuine, ground-breaking, technological change in conjunction with compelling evidence as to the cost effectiveness of such growth would be required to justify this projection. It is hard to identify precedents in the health sector for dramatic labour market shift effects on this scale36. To be sure, if the SHPA interpretation of demand were to prevail and to be fulfilled, it would change the whole character of the pharmacist labour market. Historically, levels of pharmacist remuneration in the hospital sector have been less than that for community pharmacists. To respond to excess demand on a scale of the proportions proposed by the SHPA would immediately precipitate a bidding war between community and hospital pharmacy that would substantially augment salaries and wages of all pharmacists in both sectors. This would

36 A possible case in point was the increase in the demand for medical record librarians that accompanied the growth of interest in casemix funding, commencing in the mid-1980s.

aggravate and intensify shortages already apparent in community pharmacy and exert strains on the training capacity of Pharmacy Schools. If such labour market competition were sustained, it would almost certainly require a considerable expansion in the output of graduate pharmacists (at current levels of wastage). Even if such growth as projected for a high demand scenario was to occur, it would seem unlikely that state health authorities would be able to double the number of pharmacists employed in public hospitals at higher predicted wages (HCI, 1999). Under current award arrangements for hospital pharmacists, this would clearly have unwelcome budgetary flow on effects for other public health system employees. For hospital pharmacists, we accordingly believe that the most plausible demand outcome would be something approximating the “ low” projection in Figure 5.3, with perhaps some allowance for the existence of vacancies and an additional associated demand to fill them—though not on the scale proposed by the SHPA (Appendix 4.4). The SHPA, on the other hand, believes that the consultant should make more adequate provision for its projection of vacancies. To this end the SHPA advocated a demand projection midway between “ high” and “ low” demand projections37. Figure 5.4 accordingly also incorporates a “ medium” demand projection (which is the median of the “ low” hospital demand projection in Figure 5.3 and the “ high” projection in Figure 5.4). A “ medium” demand / “ high” supply scenario suggests ongoing shortages of pharmacists in hospitals will continue into the foreseeable future. As discussed in Chapter 4, the SHPA’ s collection of evidence on vacancies is likely to exhibit sample size bias. Notwithstanding this, the SHPA states that subsequent research (Kainey, 2002) has corroborated SHPA work from 100% of all Victorians hospitals which, being one of the larger states, supports the SHPA analysis. However, given the real disparity in remuneration between hospital and community pharmacists, it is logical to assume that community pharmacy is always leaching pharmacists from the hospital system. Unfilled vacancies thereby occurring could hence provide a justification for supply to shift from the “ low” projection in Figure 5.3 towards the “ medium” projection in Figure 5.4. The mere existence of the demand for vacancies is nevertheless an insufficient condition for the market to clear of its own account, because it is not necessarily commensurate with the public sector’ s ‘willingness to pay’ . We accordingly conclude that there is a structural disequilibrium in the labour market for hospital pharmacists. At least one of the conditions for its resolution would hence likely be a change in relative remuneration. “Other” activities Figure 5.5 is a representation of other areas in which pharmacists work. As described elsewhere in this report, these relate mainly to various types of Government and academic employment and research activities in the pharmaceutical industry. Since demand here is modelled predominantly on behaviour projected in community pharmacy, the state of the labour market mirrors that sector. We accordingly project that excess demand for “ other” pharmacists will continue, manifesting as a shortage of about 100 FTE pharmacists from 2000 to 2010. Excess demand in this sector is consistent with a likely expansion in Australian research and development activities (because of exchange rate advantages vis à vis the United

37 SHPA; NPWRG meeting, Canberra, 15 July, 2002.

States and some other OECD countries) and the increasing use of Australia’ s high quality clinical environment as an international base for clinical trials.

Figure 5.5: FTE “ other” pharmacists, “ low” supply and “ low” demand to 2010

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Overall balance Figure 5.6 is a synthesis of sensitivities that we believe to be a possible simulation of the evolution of total labour market between 2000 and 2010. This is based on:

• an optimistic assessment of workforce loss (the lower bound sensitivity of 3%)— in turn yielding “ high” overall supply, embodying a rise from some 11,200 FTE pharmacists in 2000 to about 14,150 in 2010;

• “ high” community demand for dispensing services and a positive view as to the uptake of cognitive activities in community pharmacy— in turn resulting in “ high” community demand; and

• a conservative view about the demand for hospital pharmacists— in turn suggesting that the key driver will be an underlying dispensing demand based on hospital activity.

The scenario for demand in Figure 5.6 is projected to cause overall demand for FTE pharmacists to increase between 2000 and 2010 from some 13,100 to 17,200— in turn contributing to the overall shortfall of FTE pharmacists increasing from about 2000 to around 3,000. The overall shortfall is likely to be most attributable to the current shortage and the endemic problem of wastage in conjunction with the behaviour of the demand for community pharmacists. Under this particular scenario, the market for hospital pharmacists, while currently undersupplied, appears likely to attain balance within a few years. As discussed above, the SHPA disagrees with this forecast. Our forward projections of demand do not allow for the possible impact of increases in patient prescription co-payments on the demand for labour associated with changes to the demand for dispensing services. At the time of writing, the Commonwealth announced measures, as part

of its 2002/03 Budget and intended to begin on 1 August, 2002, to raise the patient co-payment on PBS general prescriptions from $22.40 to $28.60 and on pensioner and concession card prescriptions from $3.60 to $4.60. It was unclear at the time of writing whether these measures will proceed through the Senate. If implemented, it is estimated that such measures could punctuate long growth in the demand for prescriptions with a one-off of 6.5% annual reduction in prescription volumes38. Various studies have shown that the price elasticity of demand to changes in PBS co-payments is relatively low. Johnston (1991), for instance, estimated a value of 0.25. Even if implemented, we therefore believe that any co-payment effect will not do more than interrupt the trend demand for labour in Figure 5.6. The various scenarios that may be constructed do not alter the conclusion (based on the structural characteristics of the model in this study) that an overall excess demand for pharmacists is likely to continue during the next 10 years. All that is in possible contention is a matter of the degree. If allowance is made for the possibility of greater than minimum levels of ‘wastage’ , the shortfall could be greater by 2010 by up to at least 500 FTE pharmacists. Moreover, if the demand for hospital pharmacists were to materialise at even half the rate proposed by the SHPA, there could be a further 2,500 FTE contribution to the overall shortfall.

Figure 5.6: Total FTE pharmacists, “ high” supply and “ high” community / “ low’ hospital demand to 2010

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Adjustment to balance As discussed in the earlier study (HCI, 1999), the projections employed in this type of analysis do not provide a true indication of how the labour market for pharmacists functions or how it is cleared. This is because they are projections with respect to time rather than to wage rates. At any particular point in time, by definition, supply must equal demand. This is nevertheless, a ‘still frame’ that does not provide information about the sustainability of a

38 Personal communication, Mr Vasken Demirian, Pharmacy Guild of Australia, 4 June, 2002.

labour market solution or whether it represents a stable equilibrium in which buyers and sellers of labour maximise their respective returns and satisfactions at the going wage rate. In fact, there appear to be conspicuously different labour market solutions for community and hospital pharmacy, marked by a significant disparity between their respective average wage rates. Indeed, this contributes to ongoing instability in the pharmacist labour market (HCI, 1999). The consultant has assumed a stable proportional distribution of workforce supply between community, hospital and “ other” pharmacy work (Table 3.1), whereby persons participating in the workforce ‘offer’ their services, at going wage rates, to one or more of these three sectors in a customary, fixed pattern. However, in the context of an ongoing shortage and the ability for community pharmacy to offer higher remuneration, this is likely to result on reduced supply flowing to the hospital sector. Why is it that in two sectors employing labour with much the same sort of training and learned skills, it is possible to sustain such an ongoing differential in remuneration? Some commentators in fact believe that professional work in the hospital sector is considerably more demanding of skills and professional training than in the community sector. We believe that the answer to the difference in wage rates is related in part to the different organisational structures of the sectors and in part to their differing goals and objectives. Hospital pharmacy services generally represent integral components of large, complex, publicly-funded, not-for-profit points of service. Community pharmacies, on the other hand, generally represent individual for-profit business units. The former are constrained by rigid and unyielding award systems across various State and Territory jurisdictions; the latter can swiftly and flexibly respond to the exigencies of day-to-day business and take advantage of profitable opportunities as they present. This may in turn necessitate bidding for labour at rates substantially in excess of the award system (not to mention the prospect of entrepreneurial risk-based returns) as well as offering working conditions that are seen as more favourable than those available in hospital pharmacy services. Some commentators have argued that barriers to entry into the community pharmacy business, in conjunction with restrictions on the sale of S2 and S3 over the counter medicines in non-pharmacy points of sale have artificially inflated prices in community pharmacies (ACA, 1997; Ballenden, 2000; CHF, 1999; Productivity Commission, 1999). One may speculate that this has introduced profit horizons conducive to business expansion that have in turn enabled pharmacies to bid for labour on terms that hospitals could not possibly hope to match. The counter proposition to this is that anti-competitive restrictions favouring community pharmacy confer a public benefit. It nevertheless places community pharmacies in a powerful bargaining position and augments their appetite for additional labour. Generic strategies, aimed at the profession as a whole, such as increasing the output of Pharmacy Schools or reducing wastage, are hence destined to continue to benefit community pharmacy at the expense of the hospital system. While the disparities in wage rates (in conjunction with risk-based rewards) between community pharmacies and hospital pharmacy services remain, it will perpetuate a demand to fill short term vacancies in the latter, if only to support underlying admissions demand for labour. To assist the adjustment mechanism in the pharmacist labour market, public hospital systems may need to recognise that they are competing to attract professionals with the private sector,

in much the same way as they do for some types of medical practitioners (see below). Offering more attractive remuneration packages and flexible working conditions, given the higher proportion of younger women in the hospital workforce, may help to attract and retain pharmacists in that sector. Recognising that a remuneration gap is expected to remain a feature of the system, albeit less of a gap than at present, considerable investigation is taking place in many countries regarding non-remuneration incentives for public sector pharmacists (Kainey, 2002). Health Ministers are also considering such recruitment and retention incentives for future Australian Health Care Agreements. Recommendations Our recommendations attempt to focus on a ‘managed’ response to the most likely labour market outcomethat is, a current and increasing overall shortfall in supplies of pharmacists (see Figure 5.6). A managed response is one where proactive initiatives seek to avert projected labour problems. Appropriate interventions to scenarios, such as in Figure 5.6, are calculated to yield two possible consequences:

• closure or minimisation of the gap between sustained overall demand for, and supply of pharmacist labour; and

• minimisation of disruptive internal market dislocations, especially those prone to occur in less flexible market segments (such as hospital pharmacy practice).

Acting on the broad supply variables One of the tasks of a workshop with the NPWRG and other interested parties, undertaken in July 2002, was to develop appropriate strategies and recommendations to address concerns with a continuing undersupply of pharmacists in the future. The NPWRG identified five main targets for intervention in relation to supply, viz:

6. the number of qualified pharmacists entering Australia from overseas (immigration); 7. the training rate; 8. wastage from the workforce; 9. labour substitution; and 10. pharmacy rationalisation.

The first three, at least, need to be considered as a suite of actions, the effects of which will be felt chronologically (in the order listed above).

6. Immigration The first and immediate intervention might be to initiate concerted recruitment of pharmacists from abroad. There is scope for increasing pharmacist immigration rates, albeit from only a small base. The most rational approach would be to target overseas labour markets with a current or emerging oversupply of pharmacist labour, and where the standards of training were acceptable. Recruitment from overseas should be a short-term, stopgap solution—possibly helping to moderate the impact of the underlying labour market situation through

2003 to 2004. A difficulty here is that, as remarked in Chapter 2, many countries comparable with Australia also face likely pharmacist shortages. Furthermore, currently pharmacists sponsoring overseas pharmacists are responsible for expenses such as their medical costs. A national safety net for sponsors would help to promote this approach.

7. Graduate supply In the medium term— 2006 to 2008— a second tier intervention could come into play. Increased student intake into Schools of Pharmacy in 2003 and 2004 would provide the supply benefits sought in the medium term. In an appropriately managed response, the source of training supply would need to be capable of being turned both on and off. This implies that significant increases in student intake should occur only at educational institutions where increased infrastructure investment was not required. Wherever infrastructure investment is required to facilitate an increase in student numbers, there could be difficulty in flexibly responding to unforeseen demand reductions. Thus, to enable growth to occur in a sustainable way, research needs to be undertaken into how fast and how much graduate growth is sustainable. This would comprise a feasibility study to determine the capacity for a real increase in graduates without a decrease in quality, and include an examination of the training infrastructure available in both hospital and community pharmacy for new graduates, funding for preceptorships, training positions in hospitals, etc. The NPWRG considered that increased financial support and resources were needed to increase enrolment numbers across the board. It suggested that funding issues needed to be pursued with education as well as health ministers, and could be put to the Australian Health Care Agreements Reference Group on Workforce Training. It considered that some universities could increase their number of full-fee paying students. In this context it noted that there is a lack of good teachers at universities, which will limit growth in enrolments. One of the reasons for this, similar to hospital pharmacists, is their poor comparative remuneration. A related strategy suggested by the NPWRG concerns the fast tracking of students. Although those who have related degrees can usually skip part or all of first year, the introduction of professional skills into the first year curriculum means that some science graduates need to attend a summer school to attain a first year credit. It is feasible to do a four year course in a shorter time – this is currently happening in Tasmania with respect to nursing, and could be investigated in relation to pharmacy. Accurate location and tracking of pharmacy graduates and monitoring their career paths are important for developing and evaluating strategies for the retention of pharmacists. Thus, linked to the third intervention discussed below, the NPWRG recommended the development and implementation of a longitudinal tracking system of graduates to determine their subsequent career moves and to more accurately calculate the wastage rate. In this context Professor Chapman from Monash University has advised that he has initiated a research project to collect information on wastage rates39.

39 Personal email from Prof Chapman to Mr Ridoutt, 24 July 2002.

The Guild has agreed to work with the Pharmacy Schools to examine the implementation of these recommendations.

8. Wastage rates Third, in the longer term, a reduction in wastage from the projected 3% - 7% range down to 2% per annum (or lower) is desirable. In the short term, the disproportionate number of pharmacists over sixty years of age remaining in the workforce will continue to feed net workforce loss. Until the overhang of senior pharmacists is gradually depleted, reducing the wastage rate will prove difficult. At that stage, the challenge will be to retain younger, female pharmacists, both in the active workforce, and a in more fully participating capacity. In other similar workforces, female participation rates appear to be enhanced by having an ownership stake in the practice in which they work (HCA, 1998). Enhanced female labour participation in the pharmacy workforce may hence entail relaxing barriers to pharmacy ownership, increasing thereby female ownership in the current stock of pharmacies. This may require targeted loans and removal of possible capital market imperfections that may contribute to discrimination against females. An important aspect in this regard is introducing re-entry strategies for non-working registered pharmacists. The NPWRG noted that there is a huge pool of about 5,000 registered pharmacists not working in pharmacy. The NPWRG has suggested that an increase in re-entry rates would require:

• Research into the characteristics of “ lapsed” pharmacists (age, gender, location, etc), their reasons for leaving (such as long working hours, switching to medical degree, etc), and the types of re-entry courses that would suit their needs;

• A national effort to provide innovative and flexible models for re-entry, including part-time training, on the job training, existence of infrastructure, etc.

The Guild has agreed to work with Pharmaceutical Society of Australia on this issue.

9. Training and labour substitution Increased emphasis on training and labour substitution may constitute an important parallel avenue to augmenting the supply of pharmacy services, through greater efficiencies in the use of a given stock of pharmacy labour. This may be possible through:

• Better, more appropriate use of pharmacy technicians in both community and hospital settings. For example, there are many repetitive, manual tasks involved in providing prescriptions (data input, counting and affixing labels) that technicians could do, thus freeing pharmacists for patient counselling. Currently, substitution of technicians for pharmacy labour is often piecemeal and is happening by default, due to the shortage of pharmacists. Competency standards are in place for community pharmacy at the basic training level which match legal requirements, and there is a move in some states to require technicians to have completed courses at a recognised level. However, for the role of technicians to significantly expand, there needs to be enforceable standards of practice under the jurisdiction of regulatory authorities which can then be linked to technician standards. There are also concerns with the piecemeal approach to training technicians in hospitals. In this context overseas research suggests that introducing technicians must be accompanied by suitable training in their effective use and the

establishment and adherence to proper competency standards, and that training pharmacists in how to supervise technical support should be an important part of the pharmacy school curriculum (DH&HS, 2000; Audit Commission, 2001). The Guild has commissioned a project ‘Workforce and Career Path Options for Pharmacy Assistants” through the Third Community Pharmacy Agreement Research and Development Grants Program and this project will investigate many issues identified in workforce substitution;

• Enhanced use of technology to support a professional service role— for example, the

electronic transmission of prescriptions, increased automation, etc.;

• Streamlining workflow practices in pharmacies to release the time of pharmacists for provision of cognitive services (PGA 2000).

10. Pharmacy rationalisation

The NPWRG has suggested that further amalgamation of community pharmacies, leading to the creation of larger pharmacies, would provide a better platform for the delivery of cognitive services, although it was noted that, in the past, closures meant some pharmacists leaving the profession altogether. Members of the NPWRG have noted that some operators make a commercial decision to open for long trading hours for competitive reasons, not always in response to consumer demand. Supply to hospital pharmacy As nearly a third of all hospital pharmacists have postgraduate qualifications, finding replacements for this highly qualified and experienced workforce is extremely difficult. Training issues make the recruitment of pharmacists from community to hospital practice labour intensive; recruiting from this sector must be viewed as an investment in the future supply of suitably qualified staff, and appropriate retention strategies would be needed to support such a recruitment strategy (O’ Leary et al, 2001). This study has already canvassed labour market phenomena detrimental to the capacity of hospital pharmacy services to attract suitable labour. While these resistances appear intractable, the key to any relief may well lie in apparently counter-intuitive interventions. Thus, instead of attempting to impede the movement of pharmacists from hospital to community practice (that is arrest the ‘leakage’ ), one objective could be to engineer an enhanced ebb and flow of pharmacists between the two forms of practice. Some of the mechanisms for doing this are discussed below:

• hospital pharmacy practice could be marketed to older community pharmacists, in conjunction with refresher training programs. The rationale here is that a proportion of community pharmacists between and 45 and 55 may be interested in seeking a change from their retail pharmacy life, particularly the stress and intensity of demands placed on proprietors. The financial security of the business sale, followed by another decade of work in a salaried and more clinically based practice, might be attractive; and provided the pharmacist’ s competence could be assured, it could serve the purposes of hospital pharmacy services;

• the gap between ‘private’ and ‘public’ sector pharmacy practice could be narrowed. Where possible, public hospital pharmacy services could be outsourced. Private sector ownership of the pharmacy services would in theory, provide greater flexibility for management of remuneration packages. A less radical pathway for introducing some private sector employment practices would be to create ‘visiting pharmacy officer’ positions, along lines similar to current VMO appointments. GP/VMO-type appointments in rural hospitals could provide a suitable employment model, although a financial assessment would be necessary on whether a procedural (linked, for example, to units of dispensing) or sessional contractual arrangement was the most effective basis of payment;

• hospital practice could become an ‘on-the-job training ground’ for community

pharmacists wishing to improve their clinical skills in preparation for advancing their community practice towards delivery of more cognitive pharmacy services. Thus, rather than attending campus-based training, pharmacists could refresh their clinical skills through extended practical training. The benefit gained by the hospital would be the unsupervised labour the trainees would need to contribute. However, additional funding would need to be negotiated for this to occur, possibly through Australian Health Care Agreements;

• joint mentoring programs could be developed for young pharmacists across both the

community and hospital sectors, to equip them for a professionally satisfying role in the future.

From a different philosophical perspective, another approach that is more radical, might be for each Australian registration authority to introduce a compulsory one-year hospital-based internship program. This has the potential to add close to 800 FTE pharmacists to hospital pharmacist supply each year from the initial year of commencement. However, apart from the more obvious political problems associated with this measure, there would also be practical problems in attempting to find sufficient supervised clinical placements. Acting on the main demand variables—community Community pharmacy is the dominant influence on the excess demand for pharmacist labour, in turn associated predominantly with the demand for dispensing services. Workforce policy could hardly provide an intrinsic justification for curtailing the demand for prescriptions, although in so far as manipulation of PBS co-payments to control overall PBS expenditure (as embodied in the 2002/03 Commonwealth Budget) constitutes a tax on the delivery dispensing services, it could have precisely that effect. In keeping with the model developed in the earlier study (HCI, 1999), however, the demand analysis in Chapter 4 assumes that increases in co-payments will not be a mechanism to reduce demand for PBS drugs. The Commonwealth itself avers that its proposed budgetary measure is not a demand management intervention but rather intended to “ spread the cost of the PBS more equitably” . Having regard to the fact that not less than a quarter of the excess demand for labour in community pharmacy is expected to be absorbed by the QCPP and associated activities, it will be important to ensure that use of labour so allocated is purposeful, relevant to patient care and contributes to the public interest. Because of the recommendations of the Galbally Report (2001), the QCPP agenda is about to be rigorously tested (PGA, 2001). In the interests

of effective labour demand management, inter alia, it will be important to proceed to a dispassionate and transparent assessment its net social worth as soon practicable. In Appendix 5 the Pharmacy Guild provides a vision statement for community pharmacists in the future which outlines both changes to their professional roles and strategies required to help bring these changes into effect.

Appendix 1.1 Attendance at first workshop

Attendance at First Pharmacy Workforce Workshop, 5th September, 2001

Name Organisation Designation

Barton, David Dept Health & Ageing

Pharmaceutical Access & Quality Branch

Medical Advisor

Boyling, Dina Health Care Intelligence Project Officer

Brien, Mary-Louise Monash University

Victorian College of Pharmacy

Deputy Director

Bronger, John Pharmacy Guild of Australia National President

Conn, Warwick Australian Institute for Health & Welfare Senior Project Officer

Cook, Kathy Health Care Intelligence Consultant

Coper, Leone Australian Association of Consultant Pharmacy

National Director

Dowling, John Pharmacy Guild of Australia Branch President

Emerson, Lance Pharmacy Guild of Australia Director Professional Services & Research

Gadiel, David Health Care Intelligence Consultant

Gysslink, Paul The Association of Professional Engineers, Scientists and Managers Australia

Professional Issues & Research Pharmacists Branch

Harvey, Donna Pharmacy Guild of Australia Research Manager

Kelly, Bill Pharmaceutical Society of Australia Deputy Chief Executive

Kirsa, Sue SHPA Federal Councillor

Marty, Stephen Pharmacy Board of Victoria Registrar

Ridoutt, Lee Health Care Intelligence Consultant

Thornberry, Fiona Pharmacy Guild of Australia Program Manager (Rural & Remote pharmacy workforce development program)

Appendix 1.2 Attendance at second workshop

Attendance at Second Pharmacy Workforce Workshop, 15 July 2002-

Name

Organisation

Allinson, Yvonne Society of Hospital Pharmacists of Australia

Baker, Dallys Pharmacy Guild of Australia

BouSamra, Michelle QCPP

Bronger, John Pharmacy Guild of Australia

Chapman, Colin Victorian College of Pharmacy

Collison, Chas Association of Professional Engineers, Scientists and Managers, Australia

Cook, Kathy Health Care Intelligence

Dowling, Helen Society of Hospital Pharmacists of Australia

Dowling, John Pharmacy Guild of Australia

Edmondston, Kirrily Commonwealth Department of Health and Ageing

Emerson, Lance Pharmacy Guild of Australia

Gadiel, David Health Care Intelligence

Graves, Jessica Australian Association of Consultant Pharmacy

Harvey, Donna Pharmacy Guild of Australia

Hooper, Jay Pharmaceutical Society of Australia

Kelly, Bill Pharmaceutical Society of Australia

Kirsa, Sue Society of Hospital Pharmacists of Australia

Marty, Steve Pharmacy Board of Victoria

Neate, Allan Commonwealth Department of Health and Ageing

Ridoutt, Lee Health Care Intelligence

Robertson, Bruce Pharmacy Guild of Australia

Sanson, Lloyd Australian Pharmacy Examining Council

Taylor, Glenice Australian Institute of Health and Welfare

Appendix 1.3 National survey questionnaires .

Pharmacists CURRENTLY WORKING

or looking for work in pharmacy

Please return by 23/11/01 to:

Dina Boyling Fax: 02 9484 9746 Ph: 02 9484 9745

Reply paid 2014

Normanhurst NSW 2076

Survey Questionnaire

Q1 Year of birth:

Q2 Gender: Male � Female �

Q3 Postcode of main locality of practice / work:

Q4 Year of graduation:

Q5 Year of first registration in Australia:

Q5b What year did you start practising as a pharmacist?

P/T F/T Q6

How many other pharmacists (part-time and full-time) are employed at the pharmacy where you mainly work? (If none, put down “0”)

Q7 Please estimate the number of weeks and number of hours you worked on average per week for each of the previous 5 years. (If you did not work in pharmacy in some of the years put down "0")

Average hours per week worked 2001 2000 1999 1998 1997

Type of pharmacist work

No.

wee

ks

Hou

rs/w

eek

No.

wee

ks

Hou

rs/w

eek

No.

wee

ks

Hou

rs/w

eek

No.

wee

ks

Hou

rs/w

eek

No.

wee

ks

Hou

rs/w

eek

Community (retail) pharmacist

Hospital/clinic pharmacist

Consultant pharmacist

Pharmaceutical industry

Other pharmacy related work (eg teaching, government, etc)

Q8 If you work more than 40 hours per week, why do you work the extra hours?

a. need the extra income � b. enjoy the work � c. have insufficient relief � d unable to fill permanent vacancies �

e. Other reason Please specify ______________________

�

Q9 Please estimate the average hours you are planning to work in pharmacy per

week in each of the next 10 years. (If you do not plan to work in pharmacy in some of the years put down "0") We realise your intentions could change as your circumstances vary. However your best guess will help.

Predicted average work hours per week Type of pharmacist work

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Community (retail) pharmacist

Hospital/clinic pharmacist

Consultant pharmacist

Pharmaceutical industry

Other pharmacy related work (eg teaching, government, etc)

Q10 Are you intending to permanently cease working/practising as a pharmacist

during the next 10 years?

Yes � Go to Q10a

No � Go to Q10b

Q10a Why are you intending to cease practising as a pharmacist? (you may

select as many reasons as apply)

a. intention to retire from the workforce � b. no longer interested in pharmacy � c. not enough income � d. seeking a more satisfying alternative career � e. impending family responsibilities � f. other reason

please specify ______________________________

�

Q10b What motivates you to continue working in pharmacy?

a. flexible hours � b. enjoyable work tasks � c. good working conditions � d. access to professional activities (eg continuing

education) �

e. good income � e. other reasons

(please specify) _______________________________

�

The following questions are only for COMMUNITY PHARMACISTS

We are aware that people might work in multiple pharmacies. To answer the following questions please use only your main place of employment.

Q11 Please estimate the average number of prescriptions you dispense

per hour in a normal working week

Q12 Please indicate in the table below, the number of hours you devote to the

following activities in an average week.

Activities associated with community pharmacy work Hrs per week

a. Dispensing

b. CMI (Consumer medical information) & CI (Clinical information)

c. Supply of S2 & S3 medication

d. Patient medication review (PMR)

e. Case conferencing/discussions with GP f. QCPP - compliance or work towards g. Other professional activities (including continuing education) h. Business management i. Merchandising and retail activities

j. Other please specify __________________________

Q13 In the next three (3) years, do you see a change occurring in the relative

distribution of your workload between activities listed under Q11 (for instance doing less dispensing )?

Yes � Go to Q13a No � Go to Q15

Q13a (If yes) Only in those areas where you expect a change, please indicate the

approximate number of hours you plan to devote in the following year to each of the following activities.

Activities associated with community pharmacy work Hrs per week

Dispensing

CMI (Consumer medical information) & CI (Clinical information)

Supply of S2 & S3 medication

Patient medication review (PMR)

Case conferencing/discussions with GP QCPP - compliance or work towards Other professional activities (including continuing education) Business management Merchandising and retail activities

a. Other (please specify) __________________________

Q14 What are the factors that are likely to drive the change in the way you will

distribute your workload?

a. accreditation within the QCPP � b. peer pressure within the profession as a result of the

Guild/Commonwealth agreement �

c. new marketing approach leading to more cognitive pharmacy services

�

d. voluntary reduction in dispensing �

e. financial incentives of new services such as RMMR, DMMR, etc �

f. other please specify ________________________________________

�

Q15 Is the main pharmacy where you work:

QCPP accredited �

working towards QCPP accreditation �

not planning to become QCPP accredited � Q16 Please tick the statements that best describe your current position in terms of

pharmacy ownership (tick as many as apply)

a. currently an owner - no plans to change �

b. currently an owner - desire to sell �

c. currently an employee - interested in acquiring ownership � d. currently an employee - no interest in acquiring ownership �

No further questions, thank you.

Please fill in the following to enter the draw for win a cash prize of $1,000.00

Name: _____________________________________________________________ Address: ___________________________________________________________ Phone: _____________________________________________________________ email: ______________________________________________________________

Pharmacists NOT CURRENTLY

in the pharmacy workforce

Please return by 23/11/01 to:

Dina Boyling Fax: 02 9484 9746 Ph: 02 9484 9745

Reply paid 2014

Normanhurst NSW 2076

Survey Questionnaire

Q1 Year of birth:

Q2 Gender: Male � Female �

Q3 Postcode of main locality in which you last practised / worked:

Q4 Year of Graduation:

Q5 Year of first registration in Australia:

Q5b What year did you start practising as a pharmacist? (If you never started practising please mark N/A (not applicable)

Q6 What year did you cease practising as a pharmacist? (If you never started practising please mark N/A (not applicable)

P/T F/T

Q7

How many other pharmacists where employed (full-time & part-time) in the pharmacy where you last worked? (If none, put down “0”, if you never started practising please mark N/A: not applicable)

Q8 Why did you cease practising (or never practise) as a pharmacist? (you may

select as many reasons as apply)

a. dissatisfied with pharmacy work tasks � b. not enough income � c. lack of advancement opportunities � d. unsuitable work hours � e. absence due to child rearing or other family reasons � f. absence for health reasons � g. on extended holiday � h. intention to travel/live overseas � I. retirement form the workforce � j. working in satisfying alternative career

please specify ____________________________

�

k. other please specify______________________________

�

Q9 Please tick the year you intend to return to pharmacy work and your predicted

work participation status (tick one box only)

Predicted year of return to pharmacy work

Part time Full time Approximate number of

hours a. later in 2001 � � b. 2002 � �

c. 2003 � �

d. 2004 � �

e. 2005 � �

f. 2006 � � g. 2007 � �

h. 2008 � �

i. 2009 � �

j. 2010 � � k. 2011 � � l. do not intend to return within the next ten years �

Q10 If you are not currently working but have worked in pharmacy in the last 5 years please estimate how many hours you worked on average per week and how many weeks per year for each of the previous 5 years. (If you did not work in some of the years put down "0")

Average number of hours worked in pharmacy

Community pharmacy

Hospital pharmacy Other pharmacy work

Year

No. of weeks

No. of hours per

week

No. of weeks

No. of hours per

week

No. of weeks

No. of hours per

week a. 2001 b. 2000

c. 1999

d. 1998

e. 1997

f. Have not worked in pharmacy in the last 5 years �

No further questions, thank you

Please fill in the following to enter the draw to win a cash prize of $1,000.00.

Name: _____________________________________________________________ Address: ___________________________________________________________ Phone: _____________________________________________________________ email: ______________________________________________________________

Appendix 2 References Access Economics (2001) Population ageing and the economy Commonwealth Department of Health and Aged Care Allinson, Y (2001) “ Discussion Paper: Funding of pharmaceuticals in public hospitals: PBS under the probe” , Healthcover Vol 11 No 2, April-May 2001 American College of Clinical Pharmacy. (2000). “ White paper: a vision of pharmacy’ s future roles, responsibilities, and manpower needs in the United States” , Pharmacotherapy, 20(8)991-1020 American Journal of Health-System Pharmacy (1999) 56:13: 1309-1314 Audit Commission (2001) A spoonful of sugar. Medicines management in NHS hospitals London, UK Australian Bureau of Statistics (ABS) (1998) Year Book of Australia, Cat No 1301.0 Australian Bureau of Statistics (ABS) (2001) Projections of population by age, Series II (a), Table 2A, cat. no. 3999.0, Canberra Australian Institute of Health and Welfare (AIHW) (2000) Pharmacy labour force 1998 National health labour force series, Number 17, AIHW cat. no. HWL 16 Canberra Australian Institute of Health and Welfare (AIHW) (2000) Pharmacy labour force 1998. AIHW cat. no. HWL 16. Canberra: AIHW (National Health Labour Force Series no. 17). Australian Institute of Health and Welfare Ballenden N (2000) “ The pharmacy, a closed shop” Sydney Morning Herald, 19 May Bennett A, Smith C, Chen T, Johnsen S, Hurst R (2000) A comparative study of two collaborative models for the provision of domiciliary medication review, Executive Report, Faculty of Pharmacy University of Sydney & St George & Canterbury Divisions of General Practice Benrimoj S, Berry G, Collins D, Lauchlan R, Stewart, K (1997) A randomised trial on the effect of education and a professional allowance on clinical intervention rates in pharmacy: clinical and cost evaluation, Final Report, Department of Pharmacy, University of Sydney Benrimoj S, Langford J, Berry G, Collins D, Lauchlan R, Stewart K, Aristides M, Dobson M (2000) “ Economic impact of increased clinical intervention rates in community pharmacy; a randomised trail of the effect of education and a professional allowance” , Pharmacoeconomics, 18:5:459-468

Benrimoj S, Gilbert A et al (Forthcoming) Report of national implementation project for standards of practice for the provision of Schedule 2 (pharmacy only) and Schedule 3 (pharmacist only) medicines, Faculty of Pharmacy, University of Sydney & School of Pharmaceutical, Molecular and Biomedical Sciences, University of South Australia Canadian Pharmacists Association (CPhA) (2001) State of Pharmacy Report – Canada. Pharmintercom 2001 New Zealand Cattell R, Conroy C & Shiekh (2001) “ Pharmacist integration into the discharge process: a qualitative and quantitative impact assessment” , Int J Pharm Pract 2001:9:59-64 Commonwealth of Australia and The Pharmacy Guild of Australia (CWA and PGA) (2000) Third Community Pharmacy Agreement, Canberra Coper, L (2001) “ Consultant Pharmacy Today” , Australian Pharmacist April 2001 Vol 20 No 4 http://www.psa.org.au/ap_journal/apr01_article.cfm Crampton, M, Benrimoj, S, Gilbert, A and Quintel, N (1998) Standards of practice for the provision of pharmacist only and pharmacy medicines in community pharmacy Department of Pharmacy, University of Sydney and School of Pharmacy & Medical Sciences, University of South Australia Daffey, J (2001) “ Dispensing is not for GPs.” Australian Pharmacist Jan 2001 Vol 20 No 1 Department of Employment, Workplace Relations and Small Business (DEWRSB) (2001) Skills shortages - national and state. Skill Shortage List - Professionals - February 2001 http://www.dewrsb.gov.au/employment/publications/skillShortages/ Department of Health & Human Services (DH&HS) (2000) The Pharmacist Workforce: A Study of the Supply and Demand for Pharmacists Report to Congress: Health Resources and Services Administration Bureau of Health Professions December 2000 USA Department of Health and Aged Care (DHAC) (1999) An overview of health status, health care and public health in Australia Occasional papers: Series no 5. Department of Health and Aged Care (DHAC) (2001a) Better Management Medication System – summary. April 2001 Department of Health and Aged Care (DHAC) (2001b) Australian Health Care Agreements—pharmaceutical reform, Woden, Act Donato, R, March, G, Moss J & Gilbert, A (2001) “ Cost implications of the delivery of pharmaceutical care services through Australian community pharmacies” Int J Pharm Pract 2001:9:23-30 Galbally, R (2001) Final report of the review of drugs, poisons and controlled substances legislation (Galbally Report), Secretariat, Review of Drugs, Poisons and Controlled Substances Legislation, Woden, ACT

Gilbert A, Beilby J (2000) Quality use of medicines in the community implementation trial, Report to the Department of Health and Aged Care Health Care Intelligence Pty Ltd (HCI), (1999) A study of the demand and supply of pharmacists, 1995 –2010, project managed by the Pharmacy Guild of Australia on behalf of the National Pharmacy Workforce Reference Group, PGA, Canberra Health Care Intelligence Pty Ltd (HCI) 2000 Discussion paper prepared for Community Pharmacy Summit 10-11 July 2000, Brisbane Health Resources and Services Administration (HRSA) (2000) The pharmacist workforce: a study of the supply and demand for pharmacists, United States Department of Health and Human Services, Md http://www.cdnpharm.ca/cphanew/HotStuff/hsframe27.htm Human Capital Alliance (2002) Planning framework for the public health workforce, Report prepared for Commonwealth Department of Health and Ageing Human Resources Development Canada (HRDC) (2001) A situational analysis of the Human Resource issues in the Pharmacy Profession in Canada, May Industry Commission (1996) The pharmaceutical industry, Report No 51

Kainey, S (2002) Victorian Public Hospital Pharmacy Workforce Analysis

http://www.shpa.org.au/branches/vic.htm http://www.shpa.org.au/branches/vic_workforce_Part1.pdf http://www.shpa.org.au/branches/jobreg.htm Kelly, W (2001) Personal communication, 5 September 2001 Knapp, K (1999) “ Charting the demand for pharmacists in the managed care era” , Kohn, L T, Corrigan, J M & Donaldson, M S (eds) (1999) To err is human: building a safer system. Committee on Quality of Health Care in America, Institute of Medicine. Washington DC: National Academy Press. www.nap.edu KPMG Consulting (2001) Strategic Review of Undergraduate Nursing Education. Report to Nursing Council of New Zealand May 2001. Krass I and Smith C (1999) Cost analysis of medication regimen reviews performed by community pharmacists for ambulatory patients through liaison with local general medical practitioners, Pharmacy Department, University of Sydney Krass, I and Smith, C (2000) “ Impact of medication regimen reviews performed by community pharmacists for ambulatory patients through liaison with general medical practitioners” International Journal of Pharmacy Practice 8:2:111-120 Leversha, A, Ahlgren, K & Gray, M (2001) “ Ward pharmacy technicians assist clinical pharmacists with admissions” , Aust J Hosp Pharm 31:2:130-2.

National Community Pharmacists Association (NCPA) (2001) Independent Community Pharmacy in the United States, 2000-2001 PharmIntercom National Health Service (NHS) (2000) Pharmacy in the Future: Implementing the NHS Plan September 2000 O’ Neil, E H and the Pew Health Professions Commission (PHPC) (1998) Recreating Health Professional Practice for a New Century. The Fourth Report of the Pew Health Professions Commission (1998) San Francisco, CA: Pew Health Professions Commission O’ Leary, K et al (2001) A Demand Model for Hospital Pharmacists http://www.shpa.org.au/documents/demandworkforce.pdf O’ Leary, K et al (2002) Final Report: Snapshot of Hospital Pharmacy Workforce in Australia – Baseline data for use in hospital pharmacy demand model http://www.shpa.org.au/documents/snapshotworkforce.pdf Peterson, G (2001) “ Assuring Quality in Pharmacy Practice: High Time for Action” The Australian Journal of Hospital Pharmacy Vol 31, No 2, 2001 Pharmacy Board of New South Wales (1996) “ Pharmacist workload – a discussion paper” Bulletin, July, 6-7 Pharmacy Guild of Australia (PGA) (2000) Shaping the future for community pharmacy, Community Pharmacy Summit report of proceedings, 10 – 11 July, Heritage Hotel, Brisbane Pharmacy Guild of Australia (PGA) (2000a) Information Releases. Pharmacy Rural Package 9 May 2000 http://www.guild.org.au/inforelease/bud2000.html Pharmacy Guild of Australia (PGA) (2000b) Information Releases National Competition Policy Review of Pharmacy gets it right 18 February 2000 Pharmacy Guild of Australia (PGA) (2001) A cost benefit analysis of Schedule 2 and 3 medicines and risk based evaluation of the standard, RFT E2001-02 Pharmacy Guild of New Zealand (2001) PharmIntercom Report 2001, August Roberts M (1995) Project to optimise the quality of drug use in the elderly in long-term facilities in Australia, University of Queensland Roberts M, and Woodward M (2000) The domiciliary medication review, Quality of Medication Care Group, Brisbane Rutter, P R, Hunt, A J & Jones, I F (2000). “ Exploring the gap: Community Pharmacists’ perceptions of their current role compared with their aspirations.” International Journal of Pharmacy Practice 8 (3): 204-208. Society of Hospital Pharmacists of Australia (SHPA) 2000 Position Statement Pharmaceutical Funding Reforms – Proposed Introduction of the Pharmaceutical Benefits Scheme into Public Hospitals November 2000 www.shpa.org.au

Stanton, C & Pleaner, D (2001) State of Pharmacy in South Africa. PharmIntercom 2001 Report, Community Pharmacist Sector of the Pharmaceutical Society of South Africa Stephenson H (2001), “ Electronic prescribing in hospitals: the road ahead” Aust Prescr; 24:2–3 Stowasser, D A Collins, D M and Stowasser, M (2002) “ A Randomised Controlled Trial of Medication Liaison services – Patient Outcomes,” J Pharm Pract Res 2002; 32: 133-40 Therapeutic Goods Administration (TGA) (2001) Review of Drugs, Poisons and Controlled Substances Legislation Final Report Update: 16 October 2001 http://www.health.gov.au/tga/docs/html/rdpdfr.htm Tully, M P, Seston, E M & Cantrill, J A (2000) “ Motivators and barriers to the implementation of pharmacist-run prescription monitoring and review services in two settings” , Int J Pharm Pract 2000:8 (3):188-97: UK Delegation (2001) PharmIntercom Report 2001, Queenstown, New Zealand, August Victorian Healthcare Association (VHA) (2000) Pharmacy Workforce Survey. Report, 30 June 2000 Warner, M Longley, M Gould, E and Picek, A (1998) Healthcare Futures 2010 Working paper commissioned for the UKCC Education Commission Weingart, S N, Wilson, R M. Gibberd, R W & Harrison, B (2000) “ Epidemiology of medical error” BMJ 2000; 320:774-7 Wilkinson, W (2000) National Competition Policy Review of Pharmacy Final Report 8 February 2000 Wooldridge, M (2001) Speech: Health Insurance Commission IT Industry Briefing, Sydney, 15 August 2001 http://www.health.gov.au/mediarel/yr2001/mw/mwsp

Appendix 3 Projection of supply of all pharmacists - 2000 -2010 Projection of supply of all pharmacists - 2000-2010 (Data from 1997-1999 available HCI 1999 report)

Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1996 Base year actual workforce head count (13,834) 1. LOW SUPPLY PROJECTION

High net loss from participation & separation <2000 - heads, after net/gain loss effect of participation and separation 12,481 12,135 12,302 12,608 12,968 13,347 13,722 14,027 14,337 14,648 14,982 - ADD: heads, after graduate supply effect 13,021 12,679 13,001 13,375 13,766 14,154 14,466 14,786 15,107 15,452 15,828 - ADD: heads, after net migration supply effect 13,048 12,706 13,028 13,402 13,793 14,181 14,493 14,813 15,134 15,479 15,855

DISTRIBUTION OF SERVICE OFFERS, HEAD COUNT Community supply, heads 10,452 10,178 10,435 10,735 11,048 11,359 11,609 11,865 12,123 12,399 12,700 Hospital supply, heads 1,840 1,792 1,837 1,890 1,945 1,999 2,043 2,089 2,134 2,183 2,236 Other supply, heads 718 699 717 737 759 780 797 815 832 851 872 LOW total projected pharmacist workforce supply, head count 13,009 12,668 12,989 13,362 13,752 14,138 14,449 14,769 15,089 15,433 15,807 DISTRIBUTION OF SERVICE FTE OFFERS FTE community supply 8,989 8,753 8,974 9,232 9,502 9,768 9,983 10,204 10,425 10,663 10,922 FTE hospital supply 1,582 1,541 1,580 1,625 1,673 1,720 1,757 1,796 1,835 1,877 1,923 FTE other supply 617 601 616 634 652 671 686 701 716 732 750 LOW total projected FTE pharmacist workforce supply 11,188 10,894 11,170 11,491 11,827 12,159 12,426 12,701 12,976 13,272 13,594

2. HIGH SUPPLY PROJECTION Low net loss from participation and separation, <2000: - Heads, after net / gain loss effect of participation & separation 12,481 12,657 12,831 13,150 13,526 13,921 14,312 14,630 14,954 15,278 15,626 - ADD: Heads, after graduate supply effect 13,021 13,201 13,530 13,917 14,324 14,728 15,056 15,389 15,724 16,082 16,472 - ADD: Heads, after net migration supply effect 13,048 13,228 13,557 13,944 14,351 14,755 15,083 15,416 15,751 16,109 16,499 DISTRIBUTION OF SERVICE OFFERS, HEAD COUNT Community supply, heads 10,452 10,596 10,859 11,169 11,495 11,818 12,081 12,349 12,616 12,904 13,216 Hospital suppy, heads 1,840 1,865 1,912 1,966 2,024 2,080 2,127 2,174 2,221 2,271 2,326 Other supply, heads 718 728 746 767 789 811 830 848 866 886 907 HIGH total projected pharmacist workforce supply, head count 13,009 13,188 13,516 13,903 14,308 14,710 15,038 15,370 15,704 16,061 16,450

Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 DISTRIBUTION OF SERVICE FTE OFFERS FTE community supply 8,989 9,112 9,339 9,606 9,886 10,164 10,390 10,620 10,850 11,097 11,366 FTE hospital suppy 1,582 1,604 1,644 1,691 1,740 1,789 1,829 1,869 1,910 1,953 2,001 FTE other supply 617 626 641 660 679 698 713 729 745 762 780 HIGH total projected FTE pharmacist workforce supply 11,188 11,342 11,624 11,956 12,305 12,651 12,932 13,218 13,505 13,813 14,147

Assumptions Appendix 3

• Base year head count source AIHW (2000) • Net workforce assumptions, PA: 2000 (5.3%), 2001 – 2010 LOW (3.0%), 2001-2010 HIGH (7.0%) • Graduate supply – 2000 (540) , 2001 (544) [HCI (1999)]

2002 (699), 2003 (767), 2004 (798), 2005 (807), 2006 (744), 2007 (759), 2008 (770), 2009 (804), 2010 (846) [Figure 3.6] • Net impact of migration, heads PA: 27 (Chapter 3 pp 49) • Workforce distribution – Community 80.1%, Hospital 14.1%, Other 5.5% • FTE conversion factor: 0.86 (Chapter 3, pp 37)

Appendix 4.1 Projection of demand for community pharmacists, 2000 - 2010 (Data from 1997-1999 available HCI 1999 report)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1. DISPENSING SERVICES DEMAND PROJECTION HEAD COUNT, DEMAND DERIVED FROM DISPENSING SERVICES

Base year 11,1261 - Low 11,860 12,051 12,245 12,442 12,642 12,846 13,053 13,263 13,476 13,693 13,914 - Medium 12,095 12,350 12,611 12,877 13,149 13,426 13,710 13,999 14,294 14,596 14,904 - High 12,315 12,631 12,956 13,289 13,630 13,980 14,340 14,708 15,086 15,474 15,872

FTE DEMAND, DISPENSING SERVICES - Low 10,200 10,364 10,531 10,700 10,872 11,048 11,225 11,406 11,590 11,776 11,966 - Medium 10,402 10,621 10,845 11,074 11,308 11,547 11,790 12,039 12,293 12,552 12,817 - High 10,591 10,863 11,142 11,428 11,722 12,023 12,332 12,649 12,974 13,308 13,650 DISPENSING DEMAND ASSUMPTIONS Low Med High Composite script growth - six factors2 1.61% 2.11% 2,57% 1995/96 total script numbers (PBS + ’private’) 183,508,8753 Scripts dispensed per pharmacist (head) per year 16,4943 Weighted FTE conversion factor (males & females), community pharmacists4 0.86

2. QUALITY & RISK MANAGEMENT PROJECTION

Additional demand for pharmacists for S2/S3 interventions, FTEs 51 111 311 387 412 417 423 428 438 439 445 Additional demand for pharmacists for prescription interventions, FTEs 6 14 38 47 51 51 52 53 54 54 55 Demand for FTE pharmacists, Third Agreement PGA Branch Coordinators for QCPP

0 3 7 7 7 7 7 7 7 7 7

TOTAL, quality & risk management demand 57 128 356 441 469 476 482 488 498 500 506

QUALITY & RISK MANAGEMENT ASSUMPTIONS No. of pharmacies accredited under the QCPP as of 24 Jan 2003 2,5615 No. pharmacists per pharmacy (heads) 2.1328 No FTE pharmacists per pharmacy 1.1665

Addit. scripts / FTE pharmacist PA, intervtn attrib. to QCPP, % 192 6 Addit. S2/S3 pharmacist interventions attrib. to QCPP, per pharmacist per hour 17 Hours per year per FTE pharmacist (38 hours × 48 weeks) 1,824 Pharmacist time per prescription intervention, minutes 2.57498 Pharmacist time per S2/S3 intervention, minutes 2.57499

3. RESIDENTIAL MEDICATION MANAGEMENT PROJECTION

Net demand for FTE pharmacists conducting medication review, NHs & hostels

47 60 60 64 65 66 67 69 70 71 73

RESIDENTIAL MEDICATION MANAGEMENT ASSUMPTIONS Population 70+ (,000)10 1,685 1,728 1,760 1,791 1,821 1,850 1,883 1,920 1,959 1,999 2,043 Reviewed beds 90,032 115,309 115,341 123,590 125,670 127,682 129,922 132,483 135,179 137,945 140,970 Nursing home beds per 1000 persons, 70+ 50 NH and hostel beds reviewed, 1997 – 2002 11 actual Assumed share of NH and hostel beds reviewed, 2003 75% Hours per bed/person reviewed 1.5 Community pharmacist reduction factor (impact of RMM on demand for scripts) 12 375

4. DOMICILIARY MEDICATION MANAGEMENT REVIEW PROJECTION

Demand for FTE pharmacists derived from DMMR pharmacy services: - Low (Medicare funding projection) 0 0 19 39 55 66 75 82 88 92 95 - Medium (median, Low/High) 0 0 44 65 79 89 98 104 109 114 117 - High (Third Agreement funding projection) 0 0 69 91 104 113 121 126 131 135 139 Demand for FTE pharmacists by divisions of GP for DMMR facilitators 0 0 20 34 39 39 39 39 39 39 39

DOMICILIARY MEDICATION MANAGEMENT REVIEW ASSUMPTIONS

No. DMMRs - forward estimates for cost to Commonwealth of MBS item 900, '000s13

0 0 17 36 50 60 68 75 80 84 87

No. DMMRs - median, Medicare / Third Agreement funding, '000s 0 0 40 59 72 82 89 95 100 104 107

No. DMMRs - Third Agreement funding, '000s14 0 0 63 83 95 103 110 115 119 123 127

Hours per DMMR undertaken

2

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Estimated no divisions of GP with DMMR facilitators15 0 0 60 100 115 115 115 115 115 115 115

Hours per week per facilitator per division of GP15 15.2 Proportion of facilitator positions filled by pharmacists15 85%

5. TOTAL FTE DEMAND - DISPENSING + QCPP + RESID. MMR & DMMR

- Low FTE community demand 10,303 10,552 10,986 11,279 11,501 11,694 11,888 12,084 12,285 12,479 12,680 - Medium FTE community demand 10,506 10,809 11,326 11,679 11,961 12,217 12,476 12,739 13,009 13,277 13,553 - High FTE community demand 10,694 11,051 11,648 12,058 12,400 12,717 13,041 13,371 13,712 14,054 14,407

Source: 1 AIHW (2000) 2 HCI (1999) p 123 3 Guild Digest, Financial survey of Australian community pharmacy performance, PGA, Canberra 4 Chapter 3 5 Personal communication, Mr Graham Bridge, PGA, Canberra 6 Mean additional proactive & reactive intervention rate attributable to QCPP; Benrimoj et al (1997) p 24 7 S2/S3 interventions directly attributable to QCPP assumed to be 50% of S2/S3 interventions @ 8 per hour per pharmacy, 25% of which are dealt with by pharmacists and the balance by pharmacy assistants;

Benrimoj S, personal communication 8 Benrimoj et al (2000) 9 S2/S3 intervention time assumed to be similar to prescription intervention time – ie as for 8. 10 ABS (2001) 11 Pharmaceutical Access & Quality Branch, DH&A, Canberra 12 HCI (1999) p 125 13 “ Low” demand for DMMRs for 2002 – 2005, calculated from forward estimates tabulated below; fitted to a logarithmic trend for the period 2002 – 2010.

Year Net provision Gross provision Benefits No of MBS Total pharm No FTE

@ Schedule @ Schedule @ 85% item 900 hrs @ 2 hrs pharmacists

Fee prices, $s Fee prices, $s(a) Sched Fee, $s services per service required

($120) ($120) ($102) @ $102

2001/02 1,800,000 1,980,000 1,683,000 16,500 33,000 18

2002/03 4,300,000 4,730,000 4,020,500 39,417 78,833 43

2003/04 5,500,000 6,050,000 5,142,500 50,417 100,833 55

2004/05 6,500,000 7,150,000 6,077,500 59,583 119,167 65

Total 18,100,000 19,910,000 16,923,500 165,917 331,833 -(a) Net provision × 1.1 – ie net provision allows for 10% savings associated with contribution of MBS item 900 to reduce the use of Standard Consultations (item 23), etc Source: Budget Statement No 2, 2001/02 14 CWA & PGA (2000) 15 Personal communication, Mr Michael Quaass, PGA, Canberra

Appendix 4.2 Projection of demand for hospital pharmacists, FTEs, 2000 - 2010

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1. UNDERLYING SERVICE DEMAND (ADMISSIONS) Overnight admissions - Public 1,427 1,430 1,433 1,437 1,440 1,443 1,446 1,449 1,452 1,456 1,459 - Private 132 134 136 138 140 142 144 146 148 150 153 - Total overnight 1,560 1,565 1,570 1,575 1,580 1,585 1,590 1,596 1,601 1,606 1,611 Same day admissions - Public 86 93 99 106 113 119 124 130 137 143 150 - Private 54 59 64 70 76 80 84 88 93 98 103 - Total same day 140 152 164 176 189 199 209 219 230 241 253 Total public admissions 1,513 1,523 1,532 1,543 1,553 1,562 1,571 1,580 1,589 1,599 1,609 Total private admissions 186 194 201 208 216 222 228 235 241 249 256 GRAND TOTAL, UNDERLYING SERVICE DEMAND 1,699 1,717 1,733 1,751 1,769 1,784 1,799 1,814 1,830 1,847 1,864 UNDERLYING SERVICE DEMAND ASSUMPTIONS1 Baseline actual admissions (1995-96): ‘000 Projected admissions (2000-2010) from baseline actuals on assumed growth rates, adjusted for balance:

1995-96 admissions, public overnight, ’000: 2,154 2,178 2,183 2,187 2,192 2,197 2,202 2,207 2,212 2,216 2,221 2,226

1995-96 admissions, private overnight ‘000 806 865 878 890 903 916 929 942 956 969 983 997 1995-96 admissions, public same day ‘000 1,419 2,037 2,190 2,343 2,507 2,683 2,810 2,944 3,084 3,230 3,383 3,544 1995-96 admissions, private same day ‘000 772 1,272 1,405 1,525 1,654 1,795 1,889 1,988 2,093 2,203 2,318 2,440 Benchmarks for hospital staffing ratios Admissions / pharmacist ratio, public, overnight 1,526, (35.5 beds/pharmacist, distribution of beds = 60% medical, 25% specialist clinics, 15% critical care) Admissions/pharmacist ratio, private overnight 6,534 (161 beds/pharmacist) Admissions/pharmacist ratio, same day 23,632 (80-90 beds/pharmacist) Separation growth rate assumptions Separation growth rate, public overnight – all years 0.23% Separation growth rate, private overnight – all years 1.43% Separation growth rate, public same day (phased reduction)

1996 – 2001 7.50% 2002 – 2004 7.00% 2005 – 2010 4.75%

Separation growth rate, private same day, (phased reduction) 1996-2001 10.50% 2002-2004 8.50% 2005-2010 5.25%

2. CONTRIBUTION OF OTHER SOURCES OF FTE DEMAND2

PBS prescribing in public hospitals 14 15 18 21 26 33 42 52 68 86 106 Risk management and quality of care 30 33 39 47 58 74 92 115 150 190 234

Compliance with APAC discharge guidelines 111 122 144 172 215 273 341 427 557 704 867

SUB TOTAL 155 170 200 240 300 380 475 595 775 980 1,207

TOTAL – ADD Initial vacancy rate = 259 FTE 414 429 459 499 559 639 734 854 1,034 1,239 1,466

GRAND TOTAL UNDERLYING SERVICE DEMAND + OTHER 2,268 2,316 2,392 2,490 2,628 2,803 3,008 3,263 3,639 4,066 4,537

Source: 1. HCI (1999) 2. SHPA, Appendix 4.4

Appendix 4.3 Projection of demand for all pharmacists, FTEs, 2000 - 2010 (Data from 1997-1999 available HCI 1999 report)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Scenario 1 (Low Community, Low Hospital) COMMUNITY - Low dispensing + QCPP + RMM 10,303 10,552 10,947 11,205 11,407 11,589 11,774 11,963 12,158 12,348 12,545 - Low DMMR + Facilitation 0 0 39 73 94 105 114 121 127 131 134 HOSPITAL - Low (underlying service demand) 1,699 1,717 1,733 1,751 1,769 1,784 1,799 1,814 1,830 1,847 1,864 OTHER (industry, administration/government, education, etc) 700 715 742 760 774 786 798 810 823 835 848 GRAND TOTAL 1 12,703 12,984 13,461 13,789 14,044 14,264 14,485 14,709 14,938 15,162 15,392 Scenario 2 (Medium Community, Low Hospital) COMMUNITY - Medium dispensing + QCPP + RMM 10,506 10,809 11,262 11,579 11,842 12,088 12,339 12,595 12,861 13,124 13,397 - Medium DMMR + Facilitation 0 0 64 99 119 129 137 143 148 153 156 HOSPITAL - Low (underlying service demand) 1,669 1,717 1,733 1,751 1,769 1,784 1,799 1,814 1,830 1,847 1,864 OTHER (industry, administration/government, education, etc) 712 730 761 783 800 816 832 848 865 882 899 GRAND TOTAL 2 12,917 13,256 13,820 14,212 14,531 14,817 15,107 15,401 15,705 16,006 16,316 Scenario 3 (High Community, Low Hospital)

COMMUNITY

- High dispensing + QCPP + RMM 10,694 11,051 11,558 11,933 12,256 12,565 12,881 13,206 13,542 13,879 14,229

- High DMMR + Facilitation 0 0 90 125 143 152 160 165 170 174 178

HOSPITAL - Low (underlying service demand) 1,699 1,717 1,733 1,751 1,769 1,784 1,799 1,814 1,830 1,847 1,864 OTHER (industry, administration/government, education, etc) 723 744 780 805 826 845 865 885 906 927 949

GRAND TOTAL 3 Scenario 4 High Community, High Hospital

COMMUNITY

- High dispensing + QCPP + RMM 10,694 11,051 11,558 11,933 12,256 12,565 12,881 13,206 13,542 13,879 14,229 - High DMMR + Facilitation 0 0 90 125 143 152 160 165 170 174 178

HOSPITAL - high (underlying service demand + other sources) 2,268 2,316 2,392 2,490 2,628 2,803 3,008 3,263 3,639 4,066 4,537 OTHER (industry, administration/government, education, etc) 756 779 819 848 876 905 936 970 1,012 1,056 1,104 GRAND TOTAL 4 12,678 13,002 13,334 13,719 14,145 14,858 15,396 15,904 16,425 16,984 17,604

Source: Appendices 4.1 and 4.2 Table 4.1

Appendix 4.4 Extract of Demand Model for Hospital Pharmacists (From “A Demand Model for Hospital Pharmacists dated 12 December 2001”) (http://www.shpa.org.au/documents/demandworkforce.pdf) 1. Introduction The Society of Hospital Pharmacists (SHPA) has undertaken to deliver to Health Care Intelligence Pty Ltd a demand model and associated data for hospital pharmacists to provide information for inclusion in its project on the supply and demand of pharmacists 2000-2006 and 2006-2010. On 14 February 2002, SHPA gave a presentation on “ A Demand Model for Hospital Pharmacists” dated 12 December 2001. At this meeting, it was agreed that further details of the three key drivers of future demand for hospital pharmacists would be provided. This extract document focuses on those three key demand drivers and summarises their cumulative impact on the demand for hospital pharmacists over the next decade. All three drivers relate to the implementation of existing Commonwealth Government policies. It should be noted that this document is an extract only, with minimal additional detail included to still enable it to be read independently. Therefore, for a complete review it is recommended that reference should be made to the document “ A Demand Model for Hospital Pharmacists” version dated 12 December 2001 or subsequent versions thereof. Where ranges are provided in this document the lower figure is based on data from the actual figures provided from 101 responses (unless otherwise stated). The upper figure in the range has been extrapolated from the actual data, within each hospital peer group to give an estimate of national impact for the 279 public and private hospitals with pharmacy departments (unless otherwise stated).

Background There are over 1,000 registered hospitals in Australia; almost a third are private stand alone day facilities. Not all overnight facilities have hospital pharmacy services; community pharmacists service some and others have no identifiable pharmacy services. A total of 279 hospital pharmacy services were identified; 227 in public sector hospitals and 52 in private sector hospitals. A workload questionnaire was sent to 248 hospitals of those identified as having a pharmacy service. The data returned from 101 hospital pharmacy services represented a survey response rate of 40.7% (or 36.2% of the 279 hospitals identified nationwide as having hospital pharmacy departments). The construction of a demand model involves the identification of issues that will impact on the need for the skills that pharmacists can provide and the environment in which they work. Drivers for the future demand for hospital pharmacists were identified through discussion with hospital pharmacists and responses received in the workload questionnaire.

These drivers can be broadly classified as issues that affect or are linked to the external environment (demand drivers 1 to 9); the environment within a hospital (demand drivers 10 to 16) and changes to the practice or delivery of hospital pharmacy (demand drivers 17 and 18). The identified drivers of future demand are listed in the following table. All of the18 demand drivers have been examined and individual impact estimates prepared. However, there are THREE drivers (shown in bold text in the table) that contribute to the majority of future demand.

1. Ageing of the Australian population 2. APAC guidelines 3. Enterprise bargaining agreements 4. Hospital accreditation requirements

5. New medical technologies 6. Number and types of hospitals

7. Number of admitted patients 8. Pre-registration pharmacists

9. Safe dispensing loads 10. Automated drug distribution

11. Electronic prescribing with decision support 12. Outsourcing

13. Patient complexity 14. PBS dispensing in public hospitals 15. Risk management and quality of care issues 16. Service level at private hospitals

17. Changes in pharmacy service delivery 18. Pharmacy support staff

2. PBS Dispensing in public hospitals

Background Over the last decade most public hospitals have withdrawn all services duplicated in the community sector. The impact on hospital pharmacy services has been that outpatient dispensing services and discharge dispensing have both been limited to items not readily available in the community setting; in particular clinical trial medications, medications accessed through the Special Access Scheme and in some medications prescribed for indications not listed on the PBS. The introduction of PBS dispensing in public hospitals is therefore a new service / reintroduction of a withdrawn service.

Identifying the potential workload The Commonwealth Government has estimated that 5% of current PBS workload will transfer to public hospitals when PBS dispensing in public hospitals becomes the norm (Griffin B. Public hospital pharmaceutical reforms associated with the Australian Health Care Agreements. Summary of proposed offer. Canberra, Pharmaceutical Benefits Branch, Commonwealth Department of Health and Family Services; May 2001). SHPA has acknowledged that not all of this would be additional workload. A conservative estimate is that at least half of this activity would be additional workload. In the year ended June 2001, there were 148,050,357 items dispensed through the PBS (www.health.gov.au/pbs/pubs/pbbexp/pbjun/bookp01.htm). Two and a half percent of this figure is 3,701,259 items annually.

• Identifying the FTE required to deliver this workload Attachment A shows a summary from the 101 hospital responses. There were 75 hospitals that were able to provide data on the number of pharmacist and support staff FTE currently devoted to the dispensing of ‘normal’ items. On average there are 34,893.9 items dispensed annually per pharmacist FTE. Therefore, to dispense an additional 3,701,259 ‘normal’ items per year a minimum of an additional 106 hospital pharmacists FTE would be required. This figure assumes that at least the same ratio of support staff currently available would be available to support this new service. Using the same methodology 307 additional support staff FTE would be required. If this number of suitably trained support staff is not available the demand for pharmacists will be higher. Conclusion for this demand driver Over the next decade a minimum of an additional 106 hospital pharmacists FTE are required to support the introduction of the PBS to public sector hospitals. The introduction of this service also requires an additional 307 support staff FTE; if this number of support staff is not available the demand for pharmacists will be higher.

3. Risk management and quality of care issues Background

Medication errors are frequently highlighted as a leading and preventable cause of patient morbidity and mortality. There are at least five steps in the process of medication delivery in a hospital setting, each step carries its own risk of error and error type; both cognitive and physical. Numerous studies have been published on managing and reducing medication errors and most Australian hospitals have policies and procedures designed to manage this issue. However the shortage of appropriate staff and funding reforms have placed limits on resources so that choices have to be made about the intensity of services, the range of services and the patients who receive those services. In particular most hospitals accept admissions seven days a week but many services are available only five days a week. A recent article highlighted that the most dangerous time in a hospital is during weekends and outside ‘normal’ working hours (Bell and Redelmeier, 2001).. It appears reasonable to predict that over the next decade hospital management will demand seven-day a week hospital pharmacy services as part of each hospital’ s approach to reducing medication errors and its associated morbidity and mortality.

Identifying the FTE required to provide seven-day a week services There were 90 hospitals of the 101 that responded, that were able to provide data on the number of pharmacist and support staff FTE currently devoted to the clinical and distribution activity streams. These data describe current service delivery models and therefore represent a minimum estimate for clinical services as not all overnight inpatients currently receive any clinical pharmacy services. As most weekend admissions occur at A1, A2, B1 and B2 hospitals via their emergency departments, a subset of FTE of 307.96 from these hospitals was used, rather than the larger total from all respondents. To estimate the FTE required to deliver a seven-day a week clinical services the total current FTE for this activity stream has been multiplied by 7/5. To estimate additional FTE required the current FTE has been subtracted from this figure.

• Total clinical pharmacist FTE (for A1, A2, B1, B2) = 307.96 • (307.96 x 7) / 5 = 431.14 • 431.14 – 307.96 = additional 123.18 pharmacist FTE

A similar process has been used to estimate the additional pharmacist and support staff FTE to deliver seven day a week distribution services.

• Total distribution pharmacist FTE (for A1, A2, B1, B2) = 277.61 • (277.61 x 7) / 5 = 388.65 • 388.65 – 277.61 = additional 111.04 pharmacist FTE

These figures also assume that the same ratio of support staff currently available would be available to support this new service. Using the same methodology 185.55 additional support staff FTE would be required. If this number of suitably trained support staff is not available the demand for pharmacists may be higher. Conclusion for this demand driver Over the next decade a minimum of an additional 234.23 hospital pharmacists FTE are required to support the introduction of seven day a week services (range 234 to 479 FTE). The introduction of this service also requires an additional 185.55 support staff FTE; if this number of support staff is not available the demand for pharmacists may be higher.

4. APAC guidelines Background

The Australian Pharmaceutical Advisory Council (APAC) released the document National guidelines to achieve the continuum of quality use of medicines between hospital and community in January 1998. The guidelines “ are intended as a broad set of principles to assist hospitals in developing and implementing standard procedures to ensure continuity of medication management through hospital admission and treatment and post-discharge” . The

intent of the APAC document is to provide guidelines on the continuum of care between the community and hospital rather than the standard of service delivery throughout the hospital admission. Few hospitals have exactly the same mode of service delivery, variation between sites is considerable; for this reason we have not applied a standard formula to estimate the level of impact by the APAC guidelines on the demand for hospital pharmacists. Respondents to the questionnaire were asked to identify their hospital’ s current compliance to these guidelines and estimate the number of pharmacist FTE required to meet the guidelines at their hospital. To provide an estimate of minimum impact the scope was restricted to overnight patients. The guidelines apply to all inpatients but few hospitals currently offer the same level of service to same day patients. APAC has not indicated a timeline for the implementation of these guidelines, however in February 2002 the Commonwealth Government called for tenders for interested parties to identify the level of implementation achieved to date, issues impeding their implementation and ways to encourage their implementation in all hospitals. It would seem reasonable to predict that most hospitals would have achieved this level of care for overnight patients by 2010, if not 2006.

Identifying the FTE required to implement the APAC guidelines Attachment A shows a summary from the 101 hospital responses. There were 98 pharmacy managers who were able to provide an estimate of the additional pharmacist and support staff required to fully implement the APAC guidelines for all overnight patients at their hospital. Summing the estimates, an additional 866.91 hospital pharmacists FTE are required at these 98 hospitals. This figure is based on services for 98 hospitals, not the 279 with hospital pharmacy services nationwide. Hospital pharmacy managers noted that additional suitably trained support staff were also required to support additional dispensing associated with the full implementation of the guidelines. Conclusion for this demand driver Over the next decade a minimum of an additional 866.91 hospital pharmacists FTE are required to support the full implementation of the APAC guidelines (range 866 to 1848 FTE).

5. Current unmet demand for hospital pharmacists As well as future demand, it is crucial to consider the current unmet demand for hospital pharmacists. This was also identified as part of the study in order to establish a baseline for future demand. Attachment A shows a summary from the 101 hospital responses and 929.46 establishment pharmacists FTE were identified in the 101 pharmacy services. Funding reforms in the public hospital sector have resulted in a level of establishment FTE to the minimum required to

deliver pharmacy services within the budget constraints of each hospital. Despite this there is a high number of vacant positions: 129.16 for current establishment FTE in the 101 surveyed hospitals. This equates to 258.91 vacant establishment pharmacists FTE across the country. Given the high number of pharmacists working part time in the hospital sector we estimate that approximately 310 qualified pharmacists would be required to fill these 258.91 FTE. 6. Final Summary Three of the main drivers for future demand for services provided by hospital pharmacists are national policy objectives of the Commonwealth Government: the implementation of the APAC guidelines, increased patient safety (surrogate used was as for a seven-day service) and the introduction of PBS dispensing in public hospitals. The impact of each of these drivers is virtually independent. There may be some overlap with the implementation of a seven-day a week service and the implementation of the APAC guidelines. However, as the estimates for both of these drivers are based on changes from only 101 (or less) respondents of the 279 hospitals nationwide with a pharmacy service, the under estimate of the national impact would be much greater than any overlap between these two demand drivers. Similarly there may be some overlap with the implementation of PBS dispensing in public hospitals and the implementation of the APAC guidelines. However, as the estimates for the APAC guidelines are based on changes from only 98 respondents of the 279 hospitals nationwide with a pharmacy service, the under estimate of the national impact would be much greater than any overlap between these two demand drivers. It should be noted that a considerable number of pharmacy support staff are also required to support these initiatives; any deficit in the availability of appropriately trained support staff may increase the demand for hospital pharmacists. In conclusion, the findings are that the demand for hospital pharmacists over the coming decade can be summarised in two points. 1. An additional 258.91 hospital pharmacists will be required to counter the

current unmet demand represented by 258.91 vacant positions in hospitals across Australia.

2. An additional 1207 (106 + 234.23 + 866.91) hospital pharmacists FTE will be required to meet future demand between 2001-2010 (range 1200 to 2200).

References Australian Bureau of Statistics (ABS) (2001) Projections of population by age, Series II (a), Table 2A, cat. no. 3999.0, Canberra Australian Institute of Health and Welfare (AIHW) (2000) Pharmacy labour force 1998 National health labour force series, Number 17, AIHW cat. no. HWL 16 Canberra Ballenden N (2000) “ The pharmacy, a closed shop” Sydney Morning Herald, 19 May Bell CM, Redelmeier DA, Mortality among patients admitted to hospitals on weekends as compared with weekdays. N Engl J Med, 2001: 345(9); 663-668. Benrimoj S, Berry G, Collins D, Lauchlan R, Stewart, K (1997) A randomised trial on the effect of education and a professional allowance on clinical intervention rates in pharmacy: clinical and cost evaluation, Final Report, Department of Pharmacy, University of Sydney Benrimoj S, Langford J, Berry G, Collins D, Lauchlan R, Stewart K, Aristides M, Dobson M (2000) “ Economic impact of increased clinical intervention rates in community pharmacy; a randomised trail of the effect of education and a professional allowance” , Pharmacoeconomics, 18:5:459-468 Bennett A, Smith C, Chen T, Johnsen S, Hurst R (2000) A comparative study of two collaborative models for the provision of domiciliary medication review, Executive Report, Faculty of Pharmacy University of Sydney & St George & Canterbury Divisions of General Practice Commonwealth Department of Health and Aged Care (DHAC) (2001) Australian Health Care Agreements—pharmaceutical reform, Woden, Act Commonwealth of Australia and The Pharmacy Guild of Australia (CWA and PGA) (2000) Third Community Pharmacy Agreement, Canberra Galbally, R (2001) Final report of the review of drugs, poisons and controlled substances legislation (Galbally Review), Secretariat, Review of Drugs, Poisons and Controlled Substances Legislation, Woden, ACT Gilbert A, Beilby J (2000) Quality use of medicines in the community implementation trial, Report to the Department of Health and Aged Care Health Resources and Services Administration (HRSA) (2000) The pharmacist workforce: a study of the supply and demand for pharmacists, United States Department of Health and Human Services, Md Health Care Intelligence (1999) A study of the demand and supply of pharmacists 1999 – 2010, Pharmacy Guild of Australia, PGA, Canberra

Human Capital Alliance (2002) Planning framework for the public health workforce, Report prepared for Commonwealth Department of Health and Ageing Industry Commission (1996) The pharmaceutical industry, Report No 51 Krass I, Smith C (1999) Cost analysis of medication regimen reviews performed by community pharmacists for ambulatory patients through liaison with local general medical practitioners, Pharmacy Department, University of Sydney Pharmacy Board of New South Wales (1996) “ Pharmacist workload – a discussion paper” Bulletin, July, 6-7 Pharmacy Guild of Australia (PGA) (2000) Shaping the future for community pharmacy, Community pharmacy summit report, 10 – 11 July, Heritage Hotel, Brisbane Pharmacy Guild of Australia (PGA) (2001) “ A cost benefit analysis of Schedule 2 and 3 medicines and risk based evaluation of the standards” , RFT E2001-02 Roberts M (1995) Project to optimise the quality of drug use in the elderly in long-term facilities in Australia, University of Queensland Roberts M, and Woodward M (2000) The domiciliary medication review, Quality of Medication Care Group, Brisbane Stephenson H (2001), “ Electronic prescribing in hospitals: the road ahead” Aust Prescr; 24:2–3

Appendix 5 A vision statement for the future In keeping with the recommendations in Chapter 5, the Pharmacy Guild has developed the following vision statement for community pharmacists in the future which outlines both changes to their professional roles and strategies required to help bring these changes into effect. The future of community pharmacy lies in the provision of professional pharmacy services and primary health care services. With 5,000 community pharmacies spread throughout Australia, community pharmacists are well placed to expand their professional health care role in a way which supports the medical practitioner and provides a continuum of care for the patient/consumer. Professional Pharmacy and Health Care Services It is envisaged that the role of the pharmacist therefore will become increasingly focused on providing service rather than just supply of product – both service with product and service unrelated to product:

• the national roll-out of the Quality Care Pharmacy Program (QCPP) will result in there being a standardised requirement that all supply and dispensing of scheduled products be accompanied by professional counselling and/or advice

• there will also be a range of remunerated professional pharmacy and health care services. The provision of MMRs by pharmacists is the first example of this and it is envisaged that there will be many more such services provided which relate to the management of specific chronic illnesses (disease states) or ongoing conditions such as diabetes, asthma, arthritis, incontinence and drugs/tobacco addiction.

Structural changes needed to facilitate this To be able to pursue this development effectively and to obtain remuneration for specific professional services, the following issues need to be addressed. There needs to be:

• a radical change in the work flow arrangements in the pharmacy to free up pharmacists’ time to provide this range of additional services, eg:

- optimum use of pharmacy assistants trained in the dispensary area; - dispensary computers to be relocated so the pharmacist can involve consumers in

examining their medication regimens on screen while providing counselling about the medication being dispensed;

• implementation of IT systems to facilitate the provision and recording of services and care/management plans for consumers;

• implementation of training programs for pharmacists and pharmacy staff in relation to specific diseases or conditions to guarantee clinical competency and product knowledge and to ensure standardised protocols are followed;

• an increase in the number of community pharmacists available to provide these additional services;

• research to demonstrate the value and cost effectiveness of pharmacists providing these services; and

• examination of possible sources of remuneration for these services – private insurance funds, Government or consumer fee for service.

a study of the demand and supply of pharmacists, 2000 -...

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