Prescription fees — a stealth tax on illness
THE Jim Bolgerled governments, elected in 1990 on a “Decent Society” platform (!), 1993 and 1996, made many people, especially beneficiaries, worse off. A major cause was Ruth Richardson’s ‘‘Mother of all Budgets’’, which brutally slashed benefits — a move that, shamefully, has effectively been endorsed by every government since, by their refusing to address, in a meaningful way, the poverty suffered by beneficiaries, even despite the recommendations of the Welfare Expert Advisory Group set up by the 2017 coalition government.
Prime Minister Jacinda Ardern and Finance Minister Grant Robertson should be ashamed of their inaction, especially now that a majority Labour government is in power and the economic effects of Covid19 have made the rich (and anyone owning a house) richer and the poor poorer.
But there were other, less well publicised changes that discriminated against the poor.
One such was the progressive increase in size and scope of the “prescription fee” on each subsidised medication prescribed by a doctor, which had, since 1941, been free to the patient until 1985, when the first fee (collected by chemists and passed on to the government) was introduced by the ‘‘Rogernomic’’ Labour government.
Civis remembers Jenny Shipley, then Minister of Social Welfare, when interviewed on National Radio, playing down the effect a universal fee would have on the poor, pointing out that the fee would only be paid on the first 25 items prescribed per family, per year, so, after paying $125, prescriptions would be free for the rest of the year (that provision still remains). It demonstrated chillingly her lack of insight into the daily cashflow problems faced by the poor, where every dollar matters, and paying for a child’s medications (an eczematous, asthmatic child with a chest infection might have needed four regular medications plus an antibiotic) could mean the parents not collecting their own prescription(s), or not eating.
Prescription fees still exist, currently claiming $5 per item until the family reaches 25 payments a year. As do the problems the fee causes — in the days before the Southern DHB axed the nine locally based Primary Health Organisations in a destructive economy drive, one PHO used some of its funding, for improving patient access to care, to pay prescription fees for those who couldn’t afford to do so.
Now the fee has become a weapon in the expansion plans of ‘‘bargain’’ pharmacy chains. At least two such chains (one Australian) are not charging the fee to those presenting prescriptions to be filled (though still paying it to the government), using that lure as a loss leader to entice customers into their stores, where they can be seduced into buying a huge variety of items, many not pharmaceutical, through “alternative medicine” (ie: no evidence of therapeutic effect) substances, to standard overthecounter licensed drugs, such as paracetamol.
In doing so they threaten the very existence of community pharmacies, which provide an essential local service, especially to those without their own transport
Lacking the buying power of the chains’ huge scale, community pharmacies struggle to compete in nonprescription sales and can’t afford to pay the prescription fee themselves. If enough customers are drawn to the bargain chains by nofee prescriptions, community pharmacies will die.
If the government abolished the prescription fee, not only would it help the poor who need prescriptions (and poverty brings illness in its train), but community pharmacies would have a better chance of survival, for the benefit of all.
Prescription fees — a tax on illness, and now a weapon for big business against community pharmacy small businesses — should go.
Andrew Little, Grant Robertson, and Jacinda Ardern: the ball’s in your court.
It was a surprise to realise that another generation — old friends’ grandchildren — has reached university. It added a personal frisson to seeing the university and polytech quarter full of life, heaving with bright, lively, interesting, young people.
Welcome, new students; welcome back, those returning (and please pick up your rubbish).