12 Month Extension 2017 to 2018

The Pharmacy Contract Group has been working together on a contract that will be ready for implementation on 1 July 2017.  Work has been underway on discussions to inform what a new contract should deliver, with the Contract Group meeting eight times since 20 February 2017.

Because these discussions are ongoing, the Contract Group has recommended that the current Agreement should be extended by 12 months to give certainty to the sector as a new contract continues to be developed in readiness for 1 July 2018.  

The Contract Group has also recommended that a number of other changes be made to the current Agreement. 

The Group has worked hard to ensure that these amendments (and initiatives) address some of the key concerns faced by community pharmacy in the delivery of people centred  care - they are aimed at supporting  pharmacy in new service areas that will make a difference for your teams and for consumers.

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Where we are now - Voluntary Variation

Key amendments for the 12-month extension period effective 1 July 2017

Contract Extension webinar recording

Workforce Development


 Where we are now - Voluntary Variation

Community pharmacies received a Variation to the Community Pharmacy Services Agreement 2012.  This sets out the confirmed offer to vary the Agreement.

Below you will find three documents that explain the DHBs offer and the Voluntary Variation. 

Each pharmacy owner received a tailored offer and a Variation. The deadline for signing and returning the Variation was 16 June 2017. This was to allow time for the IT changes necessary for the Contract Extension.

Offer Letter
Voluntary Variation
Quick Guide to the Voluntary Variation
Permitted Pharmacy Charge Rules
Formal Notification


Supporting resources

12 Month Extension Payment Calendar
12 Month Extension Fee Structure


Voluntary Variation and 12 Month Extension  Webinar

Watch the 1 June 2017 webinar recording.

You will be asked to enter your details before the recording will play.

Key amendments for the 12-month extension effective 1 July 2017

DHBs, in line with recommendations made by the Contract Group agreed that the following detail or amendments are implemented from 1 July 2017 as part of the 12 month extension of the current Agreement.

a)   Total funding will be at least actual audited 16/17 year end service fee and margins (excluding Part P) plus $4.1M.

b)   New Services, $4.1M in additional funding allocated by DHBs in 2017/18 for:

  • Smoking Cessation
  • Workforce Development
  • Long-term Conditions Service broadened on Mental Health criteria eligibility

c)   1% increase to service fees to acknowledge Cost Pressure expected to amount to $3.8M in 2017/18 (forecast) - excludes Part P’s which will continue to be managed as per local agreements.   

d)   An increase in the Pack Fee component of the Medicines Margins funding will be in place from July 2017, at additional projected cost to DHBs of $3.5M and will continue to be reviewed quarterly. 

e)   Influenza vaccine for eligible populations 65 years and over and pregnant women has been confirmed as a funded service for 2017/18 Community Pharmacists who are providing vaccination services over and above other contractual   commitments.  Please note that this is an agreed national initiative contracted through Part P and current arrangements will continue. 

In addition to the amendments, there will also be new funded initiatives - Workforce Development and Smoking Cessation - administered at local DHB level.

 Workforce Development 

As part of the 12 Month Contract Extension each pharmacy and their staff are able to undertake workforce development training from 1 July 2017.

A list of pre-approved workforce development activities that pharmacies can participate in is provided below. Please note this is not exclusive. Pharmacies may seek approval from their DHB Portfolio Manager should they wish to undertake other forms of workforce development.

Once the training activity is complete, pharmacies can invoice their DHB for the associated costs.

More information on the workforce development funding process is available in the flowchart below. 

Workforce Training (Expert Advisory Group Recommended List)
Workforce Development Funding Flowchart