Free medicines under proposed plan to slash PBS co-payment

One of Australia’s leading pharmacy chains wants to offer some medicines for free and others at a discount. See how it would affect you. Have your say in our poll.

Australians would be able to get some medicines for free and others at drastically discounted prices under a plan by Chemist Warehouse to ease skyrocketing cost of living pressures.

The discount chemist chain provides all government-subsidised medicines free-of-charge to New Zealanders because the government there allows it to fully discount the government’s $5 medicines co-payment charge.

It wants to do the same thing in Australia.

The New Zealand Government subsidises common prescription medicines such as diabetes drug metformin, cholesterol drugs Lorstat and Rosuvastatin, and blood pressure medicine Coversyl.

Patients must pay a $5 co-payment for each script, but because Chemist Warehouse chooses not to charge this co-payment in New Zealand, it can provide medicines free of charge.

In Australia our government subsidises the price of high cost medicines but Australians must pay a co-payment that is $6.80 if they are a concession card holder or $42.50 if they are a general patient.

Pharmacies here are only allowed to discount that co-payment by $1 and Chemist Warehouse chief operating officer Mario Tascone wants the government to change the law so it can offer a bigger discount.

“We offer free prescriptions in New Zealand because we are allowed to discount the co-payment and we take the whole co-payment off,” Mr Tascone told News Corp.

“We would like to choose what we can discount the co-payment to here, and if the rules changed for certain drugs we would forfeit the co-payment,” he said.

Chemist Warehouse Chief Operating Officer Mario Tascone wants to make medicines cheaper. Picture: Michael Dodge/AFL Media / Getty Images

He stressed the discount chain would not provide all medicine for free but it might be able to slash the general patient co-payment to $20 on some medicines and reduce the $6.80 co-payment pensioners pay to $2.

“We might be able to do some things for free. We might be able to do some things for $5. We want that flexibility,” he said.

Nearly a million Australians delayed filling or did not fill a prescription due to cost in 2019-20 – and that figure is expected to rise as inflation and interest rate hikes eat into family budgets.

The Federal Government last week legislated changes that would drop the general patient co-payment from $42.50 to $30 from January 1 next year in a cost of living measure.

Health Minister Mark Butler has claimed a general patient taking two medicines per month will save $300 per year and a family will save $600 a year on their medicine costs under the change.

However, the reality is most patients will not benefit at all from this measure.

The reason is the $6.80 co-payment for concession card holders will not change at all and 66.3 per cent of all medicines dispensed under the PBS go to concessional patients.

General patients who shop at discount pharmacies are already accessing most scripts for less than $30 and just six of the nation’s 50 top selling medicines will get cheaper as a result of this policy.

The Minister for Health and Aged Care Mark Butler Picture: NCA NewsWire / Martin Ollman

Allowing chemists to discount the new lower $30 co-payments as well as the $6.80 concessional co-payment would ensure every consumer, including pensioners, would get cheaper medicines.

It would cost the government nothing because it would be the chemist that bore the loss from reducing the patient co-payment.

“We took a policy to the election to lower the maximum co-pay for $30. That’s our policy,” a spokesman for Mr Butler said.

“No patient is worse off under this change.”

The Pharmacy Guild of Australia already opposes the $1 discount and many suburban pharmacies fail to pass it on to customers.

A spokesman for the Guild said in its pre-Budget submission it had “called for the PBS general co-payment to be further reduced to $19 in a way that can be cost neutral to the taxpayer and the government”.

“The optional $1 co-payment does not promote universality of access to patients for more affordable medicines as it can mean patients pay different amounts depending on their location and which pharmacy they visit,” the Pharmacy Guild spokesman said.

Consumers Health Forum chief Elizabeth Deveny said there were many ways the government could further reduce the cost of medicines, including changing the PBS rules so pharmacies could discount or, in some cases remove, any co-payment for consumers.

“However, even if this measure was agreed, it would not ensure every consumer would get cheaper medicines – only those consumers who shopped at pharmacies that could afford to offer the discounts would benefit,” she said.

“While the larger pharmacy chains may well be able to afford to implement these discounts, large chains are not located in every community across Australia. It would be unfair if all Australians, especially those living in rural and remote areas, could not access such discounted medicines via their local pharmacy,” she said.