Caoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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I have sought this debate because the Health Service Executive, on the direction of the Minister for Health and Children, Deputy Harney, intends to proceed with the unilateral imposition of new scales of payment for community pharmacists from 1 March next. This will pour petrol on the flames of the prolonged dispute between the HSE and the Irish Pharmaceutical Union. Tens of thousands of patients will be adversely affected if the imposition goes ahead and the IPU withdraws from the medical card and drug payment schemes. There was no need for the Minister and the HSE to escalate the dispute in this way. The IPU has welcomed the announcement by the Minister that an independent body will be established to review the contract issues between the HSE and the pharmacists. When the IPU welcomed that announcement, it asked the Minister and the HSE to avoid making unilateral changes to existing payment arrangements pending the outcome of the agreed independent review. The Minister and the HSE carried on regardless.

There is no dispute about the need for better value for money when drugs are purchased within the health service, as prices are far too high. Given that the big multinational pharmaceutical manufacturers and wholesalers have got away with charging exorbitant prices for medicines over many years, why are pharmacists being confronted so aggressively? The Minister is trying to shirk her responsibilities, including her duty to show some accountability, in this crisis. The Joint Committee on Health and Children has asked her to attend a meeting in advance of the 1 March deadline, but she has not agreed to do so. When the committee met over three days last week, it heard thorough submissions from the HSE and the IPU, followed by detailed questions and answers. The seriousness of the situation and the concerns of pharmacists and patients are clear to all Deputies from the many representations we have received. The Minister has not treated the committee, the House and, most importantly, the issue with the seriousness and constructive engagement that is needed.

On the eve of the joint committee's meeting of 14 February last, the chairman of the committee circulated a draft motion which was set to receive all-party support at the meeting. The motion proposed:

That no changes be made to contracts between the HSE and community pharmacists in advance of the setting up, and reporting, of an independent body whose remit will be to make recommendations on the reimbursement to pharmacists for drugs supplied under the State's Community Drugs Schemes, in consultation with the interests concerned;

That the committee recognises the vital role that community-based pharmacies play in the delivery of the health service;

That the committee further recognises that the proposed changes to the contracts between the HSE and the pharmacies should be designed to allow financial sustainability; and

That no changes in the current contract or remuneration will take place until such a body reports and likewise pharmacists will refrain from any reduction in services.

The basis of a solution is in that motion. The Chairman of the joint committee withdrew the motion at the 14 February meeting. In its place, the Fianna Fáil members of the committee proposed a bland motion simply calling on the HSE and the IPU to resolve the dispute. They divided the committee so the motion would be passed. The Government spurned another opportunity to help to resolve the dispute. It seems to have decided to follow a course of confrontation with pharmacists. The Government has doggedly stuck to the position that competition legislation precludes negotiations between the HSE and the IPU on fees. It has spurned every opportunity to amend that legislation to allow such negotiations.

Patients fear that their access to vital medication will be disrupted from 1 March. Medical card patients and everyone who has signed up for the drug payments scheme, especially elderly and infirm people, are particularly concerned. The Minister for Health and Children should immediately require the HSE to defer its 1 March deadline for the imposition of new fees for pharmacists. She should facilitate direct dialogue between the HSE and the IPU on all elements of the new contract, including the cost elements. She must act now to ensure a full and uninterrupted service for all patients. I hope this further appeal does not land on deaf ears. This is a crisis waiting to happen. The Minister must act now.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I am responding on behalf of the Minister for Health and Children, Deputy Harney. I emphasise that 1 March next is not the deadline for the imposition of a new contract for pharmacists — it is the date for the introduction of the new wholesaler pricing arrangements. The Government believes the wholesale mark-up paid on the price of drugs should be reduced to a level that is fair to taxpayers and wholesalers. The existing mark-up of between 15% and 17.6% is neither reasonable nor sustainable. The HSE will proceed with its plan to pay an 8% mark-up from 1 March next and a 7% mark-up from 1 January 2009. The Minister is keen to support pharmacies which have a high proportion of medical card patients and to which a dispensing fee of €3.27 applies for most transactions. As many such pharmacies are in rural or inner city areas, they provide an important social and health service. With the support of the Minister, the HSE has indicated that it is prepared to offer a higher fee of at least €5 per item dispensed to community pharmacists, on the basis of an interim contract which would be essentially the same as the existing contract. The interim contract is being offered on a voluntary basis — community pharmacists can opt to remain on their existing contract if they wish.

When the Minister met representatives of the Irish Pharmaceutical Union last week, she was advised that an independent assessment of the fees offered should be undertaken. In an effort to resolve this situation, the Minister announced that she is establishing an independent body to begin work immediately on assessing an interim, fair community pharmacy dispensing fee of at least €5 to be paid in respect of the medical card scheme, the drug payment scheme and the other community drug schemes covered by the present pharmacy contract. This body will be chaired by Sean Dorgan, former head of IDA Ireland. It will take submissions from all sides and will carry out its own analysis. It will be asked to make its recommendations by the end of May 2008 and its recommended fee level, subject to Government approval, will be backdated to 1 March 2008.

The requested date for submission of the report is 31 May 2008. The development of the substantive new contract will get under way immediately and will be completed as soon as possible. This will be done under the auspices of an agreed facilitator and it will be priced by the independent body. The HSE, as the contracting body, and the IPU, as the representative organisation for community pharmacists, with other stakeholders will be entitled to make submissions to the independent body on issues of concern to them. The Minister believes this will provide all concerned with a reasonable way to make the transition to a fair and transparent method of payment for present services and a greatly developed pharmacy service in the near future.