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News & Trends - Pharmaceuticals

Most consumers face highest medicine price increase in nearly 20 years

Health Industry Hub | January 12, 2023 |

Pharma News: January 1 marked the largest increase in the cost of prescriptions in nearly two decades for pensioners, veterans and other healthcare card holders who rely on the Pharmaceutical Benefits Scheme (PBS) for equitable access to medicines.

This means less-than 10% of PBS scripts are ‘cheaper’ under the much-publicised Federal Government plan to lower the non-concessional (general) PBS co-payment from $42.50 to $30 from January 1.

Despite this Professor Trent Twomey, National President of the Pharmacy Guild of Australia said “In 2019-20 we learnt that 900,000 Australian patients did not get a script filled because they could not afford it. As health professionals, this disturbed us immensely and led to our Affordable Medicines Now campaign which pressured both parties to commit to lowering the cost of PBS medicines in the lead up to the last election.”

The Federal Government’s decision to raise the cost of the PBS concessional co-payment from $6.80 to $7.30 is the largest price increase since 2005 and will make an estimated 150 million scripts more expensive for pensioners, veterans and other healthcare card holders in 2023.

The safety net for both concessional and general PBS script holders has also been increased to about $20 and $120 respectively – the highest since 2009. This could negate savings for general patients with multiple medications.

Yet there were no mentions of the planned concessional co-payment or safety net price increases by the Prime Minister or Health Minister in their press releases promoting their ‘Cheaper Medicines’ plan.

The Federal Government’s ‘Cheaper Medicines’ plan to reduce the cost of the general PBS co-payment will only benefit about 8% (18 million) of PBS-subsidised scripts, despite costing taxpayers $786 million over four years. Provocate Electionomics estimates raising the PBS concessional co-payment and safety nets is likely to generate about $300-to-$400 million in revenue – enough to offset up to 50% of ‘Cheaper Medicines’.

Increasing PBS general safety net from $1457.10 in July 2022 to $1,563.50 on January 1, 2023 offsets any of the publicised benefits, and restores its title as the highest general safety net threshold since its introduction nearly 40 years ago (1986).

Professor Twomey said the campaign to make medicines universally affordable is far from over.

“We are now pushing to lower the maximum co-payment of PBS medicines even further, to $19. Reducing the maximum co-payment to $19 will mean an additional 30% of PBS medicines are covered,” he said.

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