Medicine prices to rise
New pharmacy agreement has consumers dishing out for ‘handling fee’
HALF the medicines on the drug subsidy scheme will rise in price on July 1 in a secret bombshell hidden in the new pharmacy agreement signed with chemists last week.
Any medicine that currently costs consumers less than $36 will be hit by the rise, the full impact of which was only revealed by Health Department officials in a Senate estimates committee yesterday.
The price rises result from the introduction of a new $3.49 handling fee paid to chemists that replaces a 15 per cent mark-up under the new fiveyear pharmacy agreement signed last week.
The price rises – as much as $3.46 or 41 per cent – will affect nine of the 10 most prescribed medicines in Australia including the anti-cholesterol pills atorvastatin, rosuvastatin and simvastatin, blood pressure medicines perindopril and irbesartan and diabetes medicine metformin.
Thousands of other medicines including antibiotics, osteoporosis medicine alendronate, depression medicine fluoxetine, arthritis drug meloxicam and breast cancer drug tamoxifen will also be hit. Analysis shows the price of these medicines will rise by about $2-$3 per script.
Some of these medicines will go down in price 14 months later when other changes to the drug subsidy scheme kick in.
For example anti-cholesterol medicine rosuvastatin will cost $1.10 more from July 1 but then its price will fall by $11.49 in October 2016. Atorvastatin will cost $2.42 more from July 1 but fall in price by $3.92 from October next year.
However, the government will save money as a result of the change when the dispensed price for the maximum quantity of the medicine costs more than $36. This is because the $3.49 handling fee is less than the current mark-up the government pays for the medicine.
General consumers will have to pay the extra out of their own pocket.
Unlike the government, general consumers are unlikely to make any savings when their drugs cost more than $36 because that is around the point where the PBS subsidy kicks in at $37.70 and this is the maximum they can pay for a medicine.
The price rises were not mentioned by Health Minister Sussan Ley in her press releases or material made public about the agreement last week.
Her announcement focused on the optional $1 discount chemists can now make to the medicine co-payment and that some drugs will fall in price.
Australian Medical Association GP spokesman Dr Brian Morton says some of his patients with diabetes and heart problems are taking up to seven medications. News Corp has calculated the price rises could add about $18 a month to the prescription bills of such patients or $218 a year.
National Seniors chief Michael O’Neil said “the power of the Pharmacy Guild has been exercised at the cost of the consumer who is going to have to pay more”.
“The guild has won again and it is consumers who will pay for it, it’s a complete failure of reform,” he said.
NATIONAL SENIORS CHIEF MICHAEL
O’NEIL