Healthy Skepticism Library item: 1997

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Growth rate of government outlays on PBS slows
Pharma in Focus ( Australia) 2005 Aug 7

Keywords:
PBS

Notes:

Ralph Faggotter’s Comments: The rate of growth of Federal Government outlays on the PBS has actually slowed down significantly recently. This fact contrasts starkly with attempts by Medicines Australia to paint the PBS as requiring a major overhaul. For example see the speech at Link to long URL

Full text:

Health Insurance Commission statistics for the first six months of 2005
show government outlays on the Pharmaceutical Benefits Scheme grew by
2.85% compared to the first six months of 2004, a cut of over 75% on the
2003-2004 growth rate.

Total government spending on the PBS and RPBS was $2.826 billion from
January to June 2005 compared to $2.747 billion in the same period of
2004 and $2.456 billion in the first six months of 2003.

Although the figures indicate a continuing dampening effect from the
January rise in patient co-payment, they do not account for further
savings expected from the 12.5% price cut policy that came into effect
on August 1 or of WAMTC price reviews implemented at the same time.

The fall in growth means the government is more than likely to meet or
even exceed its reported 5% PBS spending growth target for 2005, halving
the average annual growth over the past decade.

The dramatic reining in of PBS spending was also evident in concessional
ordinary scripts where spending grew by 2.4% but services (scripts
dispensed and recorded by the HIC) grew by only 0.3 per cent. Health
economists consider these scripts a useful barometer of how co-payment
rises effect older and poorer patients.

At 88.57 million, the total number of PBS and RBPS scripts recorded by
the Health Insurance Commission for the first six months of this year
showed almost zero growth with only 53,000 more scripts than the same
period in 2004. This compares to growth in scripts recorded of close to
five million for the same six months between 2003 and 2004 but is
complicated by an unknown number of below co-payment scripts falling out
of calculation.
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