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News & Trends - Pharmaceuticals

Government analysis unveils verdict on 60-day dispensing policy: Adequate but not good practice

Health Industry Hub | May 15, 2023 |

Pharma News: In a recent assessment, the quality of the analysis on the new 60-day medicine dispensing arrangements have been deemed ‘adequate’ as opposed to ‘good practice’.

The findings conducted by the Office of Impact Analysis (OIA) suggest that the analysis provided sufficient information to inform the policy decision to increases the maximum dispensed quantities of 325 medicines from one to two months’ supply. However, the OIA highlighted areas where the analysis could have been improved, particularly in terms of more recent public consultations on stakeholder impacts, specifically for small businesses and pharmacies in rural and remote areas.

Concerns have been raised by the Pharmacy Guild and Pharmaceutical Society of Australia (PSA) about the potential unintended consequences and the impact on pharmacies. Andrew Topp, Capital Chemist group business manager, questioned the assessment of unintended consequences and called the proposed medicines policy disastrous, expressing worries about the potential impact on the pharmacy profession.

The government’s decision to implement the changes in three stages aims to mitigate immediate financial repercussions and allow businesses time to adjust to changes in revenue. In the first year of implementation starting 1 September 2023, the estimated average impact per pharmacy, based on the three-stage approach, could be a reduction of up to $49,000 – 6% of the baseline remuneration derived from government-paid PBS fees. By the fourth year following implementation, the estimated average impact per pharmacy for the two-month option could reach up to $158,000, approximately 18% reduction in remuneration derived from government-paid PBS fees.

Last week’s Federal Budget announcements indicated that the government plans to reinvest the savings generated from the proposed changes into supporting the development of new pharmacy programs and services. Pharmacists will be funded to administer National Immunisation Program vaccines and the opioid dependency program. The budget for the Regional Pharmacy Maintenance Allowance will be doubled and patients will have continued access to medication management programs, with funding for community pharmacy programs increased.

The 60-day dispensing changes are also expected to affect the six Community Service Obligation (CSO) wholesalers that supply a majority share of PBS medicines to community pharmacies. Due to the way remuneration is calculated, these wholesalers will experience a reduction in remuneration. The wholesaler mark-up for pharmaceutical benefits falls within a specific price range, and any medicines dispensed beyond this range receive a flat fee as remuneration. Therefore, increasing the maximum dispensed amount for PBS-listed medicines may lead to a decrease in the overall wholesaler mark-up.

Despite the escalating concerns from pharmacists, the Consumer Health Forum (CHF), Australian Medical Association (AMA) and Royal Australian College of General Practitioners (RACGP) have welcomed the move to increase the maximum dispensed quantities of over 300 medicines to two months’ supply.

Research revealed that affordability has been a rising issue, with approximately one in five Australians aged 18-64 finding prescription medicines to be unaffordable. Moreover, 900,000 Australians postponed or neglected to fill their prescriptions in 2019-2020 due to cost concerns. The Australian Bureau of Statistics further indicated that the proportion of people who delayed or skipped prescription medication due to cost increased to 5.6% in 2021-22, compared to 4.4% in the previous year. Individuals with long-term health conditions were more likely to face difficulties accessing medication, with 6.4% experiencing delays or non-dispensation, compared to 3.8% among those without such conditions.

The Australian Patient’s Association (APA) 2022 Australian Healthcare Index Report demonstrated that 24% of people taking prescription medicine found it unaffordable, marking an increase from 19% in the previous survey. Affordability concerns affect both the non-concessional population and the older population, with 29% of individuals aged 50 to 64 and 13% of those aged 65 or over disagreeing that medicines were affordable.

As the new arrangements continue to unfold, further discussions are expected to take place between policymakers, stakeholders and the public. The decision will ultimately impact millions of Australians who rely on prescription medications to manage their health conditions, and the government aims to strike a balance between affordability for consumers and sustainability for healthcare providers.

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