Mapped out: How the discounters intersect with high-need communities

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Mapped out: How the discounters intersect with high-need communities

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Discount pharmacies key

The common reason DHBs give for granting contracts to pharmacies offering free prescriptions is that they improve access to medicine, often for high-needs communities. Reporter Jonathan Chilton-Towle takes a hard look at the data across New Zealand

62 pharmacies out of 74 discount pharmacies are located in, or near, a deprivation area of decile 7 or higher

Most discount pharmacies are located in high-deprivation areas, but there are still many high-deprivation areas, especially in rural locations, with no access to free prescriptions.

There are now 74 pharmacies in New Zealand operating under a discount brand: 24 Chemist Warehouses, 11 Bargain Chemists and 39 Countdown Pharmacies.

Pharmacy Today compared the locations of each of these pharmacies to the New Zealand Index of Deprivation – an area-based measure of socioeconomic deprivation in New Zealand carried out by Environmental Health Intelligence New Zealand that ranks areas from decile 1 (lowest deprivation) to decile 10 (highest deprivation). The most up-to-date information is from 2018.

Of the 74 discount pharmacies, 62 pharmacies (or 84 per cent) are located in or near a deprivation area of decile 7 or higher.

Discount pharmacies across New Zealand

Looking at each brand individually, 20 out of 24 Chemist Warehouses are in high-deprivation areas, as are nine out of 11 Bargain Chemists and 33 out of 39 Countdown Pharmacies.

Only two of the pharmacies are in the lowest-deprivation areas – Countdown Rolleston in Christchurch is in a decile 1 area and Countdown Greenlane in Auckland is in a decile 2 area.

All the others range between deciles 4–6, including Chemist Warehouse Lambton Quay in central Wellington (decile 5), Chemist Warehouse Westfield Newmarket in Auckland (decile 6), Bargain Chemist Shirley in Christchurch (decile 4) and Countdown Browns Bay in Auckland (decile 4).

Rural residents missing out

Discount pharmacies are largely restricted to New Zealand’s major population centres which house enough customers to support the model.

Auckland with the largest population, where the first Chemist Warehouse opened in October 2017, has the most with 26 stores, Christchurch is next with 14, then the greater Wellington region with nine.

There are also discounters in Hamilton, Whangārei, New Plymouth, Tauranga, Dunedin, Cambridge, Whanganui, Rotorua, Palmerston North, Gisborne, Ashburton, Nelson and Invercargill.

However, there are many rural centres, including notable areas of high deprivation such as the rural East Cape, the West Coast of the South Island and the northern tip of Northland, where there are no discounters and therefore no free medicines. This has led to criticisms that a two-tier health system has been allowed to form, where city people can access free medicines while rural people cannot.

Areas ‘too small’ for discounters

Countdown pharmacy boss Jeremy Armes says Countdown’s goal is for every Countdown supermarket capable of supporting a pharmacy to have one.

When deciding if a supermarket can support a pharmacy, the company looks at whether a supermarket has enough physical floor space to fit a pharmacy, and whether enough foot traffic comes into the store to justify it.

The deprivation of a community is not considered, and Mr Armes says Countdown “does not discriminate” on the basis of deprivation when deciding whether to install a pharmacy.

“As a supermarket retailer we want to provide value and do our best to serve all our customers.” While Mr Armes could not say exactly how much foot traffic justifies a pharmacy, he does say that Countdown has determined between 100 and 120 of its 180 stores are suitable.

The pharmacies will be added to suitable stores as they are upgraded in the future or when new stores are built.

In the case of the high-deprivation area in the East Cape, Mr Armes does not predict any more Countdown pharmacies will open there as the existing supermarkets outside Gisborne, which now has a Countdown pharmacy, are “too small”.

Bargain Chemist and Chemist Warehouse were approached for comment but had not responded by press time.