On 19 June 2014, the Senate referred the provisions of the National
Health Amendment (Pharmaceutical Benefits) Bill 2014 (Bill) to the Community
Affairs Legislation Committee (committee) for inquiry and report by 26 August
The reporting date was subsequently extended until 27 August 2014.
Purpose of the Bill
The Bill proposes to amend the National Health Act 1953 (Cth) (Act)
to increase patient co-payments and safety net thresholds for the Pharmaceutical
Benefits Scheme (PBS) and the Repatriation Pharmaceutical Benefits Scheme (RPBS).
These changes are in line with broader budget measures announced as part
of the 2014–15 Budget.
The Minister for Health (Minister), the Hon Peter Dutton MP, stated that
the measures are an example of the government protecting the best interests of
Australians and making necessary decisions to improve Australia's budget
The PBS and RPBS advance Australians' interests through access to
subsidised medicines. Co-payments and safety net thresholds have been features
of the schemes for many years.
Conduct of the inquiry
Details of the inquiry, including a link to the Bill and associated
documents were placed on the committee's website.
The committee also wrote to 41 organisations and individuals, inviting
submissions by 23 July 2014. Submissions continued to be accepted after that
The committee received 12 submissions which are listed at Appendix 1.
All submissions were published on the committee's website.
The committee held a public hearing on 19 August 2014 at Parliament
House in Canberra. A list of witnesses who appeared at the hearing is at
Appendix 2, and the Hansard transcript is available through the
The PBS and RPBS provide access for Australians to necessary medicines
through the Australian Government's National Medicines Policy (NMP). The aim of
the NMP is to optimise health outcomes through the provision of medicines and
services supported by government subsidies.
The PBS was established as a limited scheme in 1948, providing
Australian citizens with access to a range of medicines for the treatment of
illnesses. The PBS is administered under the National Health Act 1953 (Cth).
The PBS currently provides for access to subsidised medicines to Australian
residents who hold a valid Medicare card, with co-payments required for most
medicines. Most medicines available under the PBS cost more than the amount
required as a co-payment.
From 1 January 2014, most medicines available under the PBS cost $36.90
or $6 with a valid concession card, with the Australian Government paying the
rest of the cost.
The RPBS contains additional medicines and services at concessional
rates for the treatment of eligible veterans, war widows/widowers and their
dependents. Persons eligible for RPBS may also apply for approval of medicines
and services not listed under either scheme.
Key provisions of the Bill
The Bill is comprised of five schedules, each containing provisions with
staggered commencement dates over the period 2015–2019:
The Bill includes measures that:
increase co-payments by $5.00 for general patients and by 80
cents for concessional card holders, with effect from 1 January 2015;
increase the concessional safety net threshold by two
prescriptions each year for four years, from 2015 to 2018;
increase the general patient safety net threshold by 10 per cent
each year for four years, from 2015 to 2018.
Consideration by other committees
The bill has been considered by both the Senate Standing Committee for
the Scrutiny of Bills (Scrutiny Committee) and the Parliamentary Joint
Committee on Human Rights (Human Rights Committee).
The Scrutiny Committee made no comment on the provisions of the bill.
The Human Rights Committee expressed concern that, notwithstanding
assurances in the Explanatory Memorandum, the Bill may result in retrogressive
consequences, especially for people accessing or reliant upon social security
and sought clarification from the Minister as to whether increases in
co-payments for medicines under the PBS and RPBS are compatible with the right
The committee thanks those organisations who made submissions and who
gave evidence at the public hearing.
Note on references
References to the committee Hansard are to the proof Hansard.
Page numbers may vary between the proof and the official Hansard
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