Cruellest tax: ticket clipping on unfunded cancer drugs
One line in Jo McKenzie-McLean’s $200,000 bill stood out. Along with having to pay for cancer treatment not funded by the public health system, the Government was charging her tax.
It was one number on a long list of invoices. Right at the bottom. Something most of us might have skipped over as our eyes darted to the final total.
Jo McKenzie-McLean, who has bowel cancer, has paid hundreds of thousands of dollars for lifeextending drugs. This particular number represented part of that cost. But it was what it was for that she found the most galling: in addition to not covering the cost of her drugs, the New Zealand Government was charging her GST. ‘‘We were quite stunned,’’ she said. ‘‘The [list] that we looked at, $21,000 had come from GST.
‘‘And we were kind of like: oh my God, that could have paid for one of my treatments.’’
McKenzie-McLean, who shares her story in Stuff’s new podcast Jo vs Cancer, was diagnosed with stage 4 bowel cancer last year.
She estimates she has spent $200,000 on such treatments.
Some of the drugs she has used are publicly funded but because she chose private treatment soon after her diagnosis nothing is covered, to prevent doubledipping. Paying the full cost of such expensive drugs is one thing.
Watching the Government do nothing but clip the ticket is another. ‘‘I was thinking, shit, that money could extend someone’s life,’’ she said. ‘‘And I think it’s really unfair and quite outrageous that the Government won’t fund drugs that can improve the quality and quantity of somebody’s life.’’ McKenzie-McLean is not alone. The issue of GST exemptions for unfunded drugs has come up before but the Government is resolute in its resistance.
‘‘There are no plans to make changes to GST to allow more exemptions,’’ Finance Minister Grant Robertson said.
‘‘GST exemptions are complex, create distortions and would take some time to implement.’’
The debate is really a digression within a wider one: New Zealand’s comparatively poor public funding of medicine which, critics claim, forces people with advanced cancer into an unenviable dilemma: ‘‘Do I die early or do I die in debt?’’ as one advocate put it.
In New Zealand, drugs are funded through Crown agency Pharmac. Each year it has to decide which medicines, vaccines and devices will be covered by the taxpayer. For 2021-22 its budget was $1.085 billion. Inevitably, some miss out. One hundred and thirteen funding proposals sit on Pharmac’s options for investment list – assessed but unfunded.
Pharmac does not venture an opinion on GST exemptions for medicines – ‘‘We do not have oversight of the private market,’’ director of operations Lisa Williams said – but noted that its budget increase this year was its largest ever. ‘‘It means that we can keep making more medicines available to more New Zealanders,’’ Williams said. Boosts of $71 million and $120m are planned for the next two financial years.
Critics, like Patient Voice Aotearoa chairperson Malcolm Mulholland, are cynical about this.
Parroting raw funding increases, Mulholland said, deliberately missed the point.
‘‘I want us to get to a point where we can agree by what metric we are measuring how much money Pharmac should be receiving,’’ he said. Mulholland has a petition before Parliament calling for the Government to double, then triple, Pharmac’s budget.
‘‘If we were to do that, we would then be average in terms of spend with the rest of the developed world.’’ In the meantime, he doesn’t buy the ‘‘too complicated’’ line for dismissing GST exemptions. ‘‘Nobody would begrudge the Government doing this,’’ he said. ‘‘I don’t think you are going to open up a Pandora’s Box and see a massive queue outside the door of the Beehive [of people saying]: We want GST removed for X, Y and Z.’’
McKenzie-McLean has relied on fundraising and crowdfunding campaigns to raise the money she needs to pay for her treatment. ‘‘The Government is taking the cream off that,’’ she said. ‘‘They are taking thousands of dollars from . . . people [that] have donated for our treatment.’’
Initially, she was embarrassed asking friends, and strangers, for help but softened once she accepted there was no alternative if she wanted to extend her life.
But one ill feeling was replaced by another: she would be one of the lucky few who didn’t have to die early, or in debt.
‘‘My oncologist said that the majority of people are not in my position,’’ McKenzie-McLean said. ‘‘It is awful. I almost felt guilty.’’
* A friend of Jo’s has set up a Givealittle page for those who would like to contribute to her treatment-related costs.