The Pharmaceutical Benefits Scheme: Reducing Medication Costs
Imagine this scenario: You weren’t feeling well, so you went to the doctor, were diagnosed and now you’re on the way to the pharmacy. This illness has cost you enough already in lost work time and doctor bills, and now you’ll be paying for the medicines you need. Without any help, paying for basic medicines can be a challenge for most families and an impossibility for some.
Luckily, the Australian government realized how burdensome the cost of necessary drugs can be, and instituted the Pharmaceutical Benefits Scheme (PBS) in 1948. Though it has changed somewhat over the years, the PBS is still designed to help Australians afford the medicines they need even without any private health insurance cover.
Image by Erich Ferdinand
What is the Pharmaceutical Benefits Scheme?
The PBS is a program in which the government subsidises the cost of medicine for most medical conditions. By doing so, the PBS provides reliable and affordable access to necessary medicines. It is part of the broader National Medicines Policy. The Scheme is available to all residents of Australia who hold a current Medicare card.
How Does the PBS Work?
The PBS Schedule is a list of all the medicines available to be given to patients at a government-subsidised price. When a patient goes to the pharmacy to get a drug that is on the Schedule, the subsidy is automatically applied when the drug is dispensed. The patient pays a co-payment instead of the full cost of the medication. This may save the patient a great deal of money. Many military veterans are eligible for even lower co-pays through the Repatriation Pharmaceutical Benefits Scheme. Those who pay the lower co-pays have what are known as concession cards.
In 2011, general patients paid up to $34.20 for medicines on the PBS Schedule. Concession card holders would have paid $5.60. If you choose a more expensive medicine or your doctor prescribes one for you, you may have to pay more. The PBS Schedule can be found on-line and is updated each month. The on-line version includes information on all drugs listed on the PBS, the conditions of use for the prescribing of PBS medicines and what you can expect to pay for medicines.
While the amount you have to pay for medicines is, thankfully, rather small under the PBS, it can add up over time. That’s where the Safety Net comes into play.
What is the Safety Net?
If you or your family end up needing a lot of medicines in a year, the Safety Net will help with the cost of your medicines. Once you or your family reach the Safety Net threshold, you can apply for a PBS Safety Net card. This means your PBS medicine will be less expensive or even free for the rest of the calendar year.
In 2011, the Safety Net threshold was $1,317.20 for general patients and $336 for concession card holders. If you are nearing your Safety Net threshold, talk to your pharmacist about applying for a Safety Net card. Once you have one, you will pay $5.60 in the 2011-12 financial year for your PBS medicines if you are a general patient. Those medicines will be free for concession card holders with a Safety Net card.
Helping Manage the Cost of the PBS Scheme
Since the Pharmaceutical Benefits System began, the costs of running have increased tremendously. The cost of the PBS grew nearly 13% each year over the last ten years alone, and it now costs the government approximately $6.5 billion a year to operate.
The government asks consumers, prescribers, dispensers, wholesalers and the pharmaceutical industry to do what they can to help keep costs down. As a consumer, you are asked to not refill prescriptions earlier than needed, to ask for less expensive brands of medicines, and to not get more medicine than you actually need.
Keeping health care costs down isn’t easy, but the Australian National Medicines Policy attempts to do just that in order to help Australian families. The Pharmaceutical Benefits Scheme is an important part of Australia’s health care program and an important benefit for Australian citizens. If you want to keep your family’s health care costs to a minimum, make sure you understand the PBS.
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