National Health Act 1953 Determination under subsection 99(4) (27/10/2006) (Cth)
National Health Act 1953—Determination under subsection 99(4)
made under subsection 99(4) of the
National Health Act 1953
Compilation No. 3
Compilation date: 1 July 2015
Includes amendments up to: PB 67 of 2015
Registered: 14 July 2015
About this compilation
This compilation
This is a compilation of the National Health Act 1953—Determination under subsection 99(4) that shows the text of the law as amended and in force on 1 July 2015 (the compilation date).
This compilation was prepared on 9 July 2015.
The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.
Uncommenced amendments
The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on ComLaw ( The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the series page on ComLaw for the compiled law.
Application, saving and transitional provisions for provisions and amendments
If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.
Modifications
If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the series page on ComLaw for the compiled law.
Self-repealing provisions
If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.
Payments to approved hospital authorities for the supply of pharmaceutical benefits prescribed by a hospital employee
Part I—General
Note: Special arrangements made under section 100 of the Act may modify the effect of this Determination.
. This Determination commences on 1 October 2006.
2. This Determination consists of the following Parts:
Part I—General
Part II—Ready-Prepared Pharmaceutical Benefits
Part IV—Extemporaneously-Prepared Pharmaceutical Benefits
3. In this Determination:
approved ex-manufacturer price has the same meaning as in subsection 84(1) of the Act.
exceptional prescription means a prescription for an extemporaneously-prepared pharmaceutical benefit which is not a standard formula preparation and for which the price of the ingredients, calculated in accordance with paragraphs 20 to 22, is not less than twice the amount calculated in accordance with paragraph 36 excluding container price, dispensing fee and administration fee.;
extemporaneously-prepared pharmaceutical benefit means a pharmaceutical benefit other than a ready-prepared pharmaceutical benefit.
pack quantity has the same meaning as in subsection 84(1) of the Act.
Note: The Minister may determine one or more pack quantities for a brand of a pharmaceutical item under subsection 84AK(2) of the Act. The quantities determined are the quantities in manufacturer’s PBS packs.
patient co-payment means the charge, if any, that may be made under subsection 87(2) of the Act for the supply of a pharmaceutical benefit by an approved pharmacist or an approved medical practitioner.
proportional ex-manufacturer price has the same meaning as in subsection 84(1) of the Act.
public hospital means a hospital (as defined in subsection 3(1) of the Health Insurance Act 1973) or a day hospital facility (as defined in subsection 4(1) of the National Health Act 1953) that provides public hospital services;.
ready-prepared pharmaceutical benefit means a pharmaceutical benefit in respect of which there is in force a determination under subsection 85(6) of the Act.
standard formula preparation means an extemporaneously-prepared pharmaceutical benefit that is specified in Schedule 5 to the determination in force under paragraph 98C(1)(b) of the Act.
the Act means the National Health Act 1953.
the Regulations means the National Health (Pharmaceutical Benefits) Regulations 1960 made under the Act.
the Secretary means the Secretary to the Commonwealth Department of Health.
4. The amount payable to a hospital authority in respect of the supply of a pharmaceutical benefit to a patient receiving treatment in or at a public hospital in respect of which the hospital authority is approved will be the amount by which the dispensed price for the supply of the pharmaceutical benefit, worked out in accordance with this determination, exceeds the patient co-payment.
5. Where an approved hospital authority supplies a pharmaceutical benefit and the dispensed price for the supply of the pharmaceutical benefit, worked out in accordance with this determination, does not exceed the patient co-payment, the supply and receipt of that pharmaceutical benefit shall be deemed not to be the supply and receipt of a pharmaceutical benefit, other than for the purposes of Division 1A of Part VII of the Act.
6. A payment in respect of the supply of a pharmaceutical benefit will not be made unless supply of that pharmaceutical benefit was made in accordance with the Act, the Regulations and the relevant determinations made under the Act.
7. Where in respect of a drug or medicinal preparation there is a determination in force under subsection 85(6) of the Act of a brand or brands under which that drug or medicinal preparation may be supplied as a pharmaceutical benefit under Part VII of the Act, no payment by the Commonwealth will be made in respect of the supply by an approved hospital authority of any other brand or brands of that drug or medicinal preparation.
Part II—Ready-Prepared Pharmaceutical Benefits
9. The dispensed price of a ready-prepared pharmaceutical benefit will be:
(a) where the quantity of the benefit ordered and supplied is equal to a multiple of a pack quantity of the benefit, the approved ex-manufacturer price or the proportional ex-manufacturer price for each pack quantity, increased by a mark-up of 11.1%; or
(b) where the quantity of the benefit ordered and supplied is less than a pack quantity, the amount worked out in accordance with paragraph 11; or
(c) where the quantity of the benefit ordered and supplied is more than the quantity contained in a multiple of a pack quantity of the benefit, the approved ex-manufacturer price or the proportional ex-manufacturer price for each pack quantity, increased by a mark-up of 11.1%, plus the amount worked out in accordance with paragraph 11 in respect of the remainder of the quantity supplied that is less than a pack quantity.
10. The price for a ready-prepared pharmaceutical benefit will in each case be taken to the nearest cent, one half cent being counted as one cent.
11. Where a quantity of a benefit ordered and supplied is less than the quantity contained in a pack quantity of the benefit (i.e., a broken quantity), the amount referred to in subparagraph 9(b) or (c) will be worked out by:
(a) ascertaining the percentage that the quantity or number of units in the broken quantity bears to the pack quantity; and
(b) taking that percentage of the approved ex-manufacturer price or the proportional ex-manufacturer price for the pack quantity, increased by a mark-up of 11.1%.
12. Notwithstanding anything contained elsewhere in this Determination, the dispensed price in respect of the supply of a quantity of a ready-prepared pharmaceutical benefit will not exceed the dispensed price for a greater quantity of that benefit.
13. Where a prescription calls for a quantity of one of the pharmaceutical benefits specified in Schedule 4 to the determination in force under paragraph 98C(1)(b) of the Act as being a benefit the complete pack of which will be supplied regardless of any lesser quantity ordered, the dispensed price will be worked out on the basis that the complete pack was supplied.
Part IV—Extemporaneously-Prepared Pharmaceutical Benefits
18. In this Part:
agreed purchase quantity, in relation to an ingredient, means the quantity of the ingredient that is agreed upon between the Secretary and the Pharmacy Guild of Australia as the quantity for which the basic wholesale price is to be ascertained;
wastagemeans the combined loss that arises from:
(a) transferring drugs and chemicals from the package in which they are delivered to the approved hospital authority to the dispensing package delivered to the patient; and
(b) deterioration; and
(c) obsolescence.
19. The dispensed price of an extemporaneously-prepared pharmaceutical benefit, including standard formula preparations, will, subject to paragraph 35, be the sum of the following amounts:
(a) the amounts in respect of the ingredients in the quantities supplied, worked out in accordance with paragraphs 20 to 22; and
(b) the amount in respect of the appropriate container, worked out in accordance with paragraph 29.
20. For the purposes of paragraph 19 the amount in respect of an ingredient of an extemporaneously-prepared pharmaceutical benefit, where the quantity of the ingredient is equal to the agreed purchase quantity, will be the sum of:
(a) the basic wholesale price of the ingredient;
(b) mark-up of 10 per cent on (a); and
(c) additional mark-up, where applicable, of 10 per cent, 20 per cent, 30 per cent or 40 per cent, to cover wastage, that is agreed upon between the Secretary and the Pharmacy Guild of Australia.
21. For the purposes of paragraph 19 the amount in respect of an ingredient of an extemporaneously-prepared pharmaceutical benefit, where the quantity of the ingredient is less than the agreed purchase quantity, will be ascertained as follows:
(a) by ascertaining the basic pricing unit to be used for the quantity to be dispensed by reference to the table of basic pricing units in the table shown hereunder;
(b) by ascertaining the cost of the basic pricing unit by reducing the amount ascertained in accordance with paragraph 19 by the quantity factor or factors in the table shown hereunder appropriate to the basic pricing unit required and rounding off the resultant amount to the nearest cent, one half cent being counted as one cent; and
(c) by multiplying the cost of the basic pricing unit by the fraction that the quantity to be dispensed bears to the quantity contained in the basic pricing unit, except for:
(i) quantities exceeding 700 milligrams or 700 microlitres but not exceeding 1 gram or 1 millilitre which will be priced at the amount for 1 gram or 1 millilitre;
(ii) quantities exceeding 7 grams or 7 millilitres but not exceeding 10 grams or 10 millilitres which will be priced at the amount for 10 grams or 10 millilitres; and
(iii) quantities exceeding 80 grams or 80 millilitres but not exceeding 90 grams or 90 millilitres which will be priced at the amount for 80 grams or 80 millilitres.
For the purposes of this paragraph the quantity of the ingredient will be calculated to the next higher 50 milligrams or 50 microlitres.
Quantity Basic Pricing Unit to be Used
Up to and including 700 milligrams or milligrams or 100 microlitres price
700 microlitres
Over 700 milligrams or 700 microlitres and price as 1 gram or 1 millilitre
up to and including 1 gram or 1 millilitre
Over 1 gram or 1 millilitre and up to 1 gram or 1 millilitre price
and including 7 grams or 7 millilitres
Over 7 grams or 7 millilitres and up to price as 10 grams or 10 millilitres
and including 10 grams or 10 millilitres
Over 10 grams or 10 millilitres and up to 10 grams or 10 millilitres price
and including 80 grams or 80 millilitres
Over 80 grams or 80 millilitres and up to price as 80 grams or 80 millilitres
and including 90 grams or 90 millilitres
Over 90 grams or 90 millilitres 100 grams or 100 millilitres price
Quantity Factors
To ascertain the 100 grams or 100 millilitres price, divide the 500 grams or 500 millilitres price by 5 or divide the 1 kilogram or 1 litre price by 10.
To ascertain the 10 grams or 10 millilitres price, divide the 100 grams or 100 millilitres price plus 12½ per cent by 10.
To ascertain the 1 gram or 1 millilitre price, divide the 10 grams or 10 millilitres price plus 25 per cent by 10.
To ascertain the 100 milligrams or 100 microlitres price, divide the 1 gram or 1 millilitre price plus 25 per cent by 10.
To ascertain the 100 milligrams or 100 microlitres price, divide the 1 gram or 1 millilitre price plus 25 per cent by 10.
22. For the purposes of paragraph 19 the amount in respect of an ingredient of an extemporaneously-prepared pharmaceutical benefit, where the quantity of the ingredient is greater than the agreed purchase quantity, will be worked out as follows:
(a) except in the case of drugs which are unstable or packed sterile, as specified in Schedule 3 to the determination under paragraph 98C(1)(b) of the Act, by dividing the quantity dispensed by the quantity contained in the agreed purchase quantity and multiplying by the basic wholesale price of the agreed purchase quantity; or
(b) where the ingredient is one of the drugs which are unstable or packed sterile, as specified in Schedule 3 to the determination under paragraph 98C(1)(b) of the Act, by multiplying the price of the agreed purchase quantity by the number of whole packs of the agreed purchase quantity required to dispense the quantity of the ingredient.
23. The dispensed price in respect of an extemporaneously-prepared pharmaceutical benefit which comprises a vehicle which is specified in the prescription under a particular name and an additional specified ingredient or ingredients will be calculated in accordance with the provisions of paragraph 24 or 25 as applicable.
24. Where the vehicle is a single liquid ingredient and one or more other ingredients are added, displacement of the vehicle by solids (if any) will be disregarded for pricing purposes and the dispensed price for the pharmaceutical benefit as a whole will be calculated in accordance with the provisions of paragraph 19.
25. Where the vehicle is a liquid compounded from two or more ingredients and one or more other ingredients are added, displacement of the vehicle by solids (if any) will be disregarded for pricing purposes and the amounts for the respective ingredients will be the sum of:
(a) the price of each ingredient of the vehicle; and
(b) the price of each ingredient which is added to the vehicle;
calculated in each case in accordance with paragraph 20, 21 or 23 as applicable.
26. The amount worked out in respect of an ingredient in accordance with paragraph 19 will be taken to the nearest cent, one half cent being counted as one cent, provided that the minimum amount in respect of an ingredient will be one cent.
27. The basic wholesale price of a drug used in the preparation of an extemporaneously-prepared pharmaceutical benefit will be calculated as the arithmetic average of wholesale costs of the drug, in a purchase quantity agreed upon by the Secretary and the Pharmacy Guild of Australia and available from wholesale drug distributors. For this purpose the basic wholesale price of a drug will be ascertained as at 15 June in each year and will take effect on 1 August in the same year.
28. In calculating the amount in respect of an ingredient or the basic wholesale price of a basic pricing unit, the amount so calculated will be taken to the nearest cent, one half cent being counted as one cent, provided that the minimum amount in respect of an ingredient will be one cent.
29. The price for each size and type of container for extemporaneously-prepared pharmaceutical benefits will be based on the average of wholesale costs for that container, in the purchase quantity agreed upon between the Secretary and the Pharmacy Guild of Australia and available from wholesale drug distributors, plus 10 per cent of that average, taken to the nearest cent, one half cent being counted as one cent. For this purpose the wholesale costs of the particular containers will be ascertained as at 15 June in each year and will take effect on 1 August in the same year.
30. Where a wholesale drug distributor will not supply containers of a particular size or type in the purchase quantity agreed upon by the Secretary and the Pharmacy Guild of Australia, the price of the purchase quantity will be calculated by multiplying the price of the smallest quantity above the agreed purchase quantity, in which the distributor will supply containers of that size and type, by the fraction that the quantity in the agreed purchase quantity bears to the quantity in which the distributor will supply.
31. In the case of bulk powders the price for the container will be the price for a screw cap jar which is nominally rated to hold at least double the quantity supplied.
32. Where a prescription orders a quantity of an extemporaneously-prepared pharmaceutical benefit in excess of the capacity of the largest size container of the appropriate type for which provision is made, the price for the container will be calculated as if the pharmaceutical benefit had been supplied in more than one of the containers for which provision is made.
33. Notwithstanding anything contained elsewhere in this Determination, the dispensed price in respect of the supply of a quantity of an extemporaneously-prepared pharmaceutical benefit will not exceed the dispensed price for a greater quantity of that benefit.
34. Notwithstanding anything contained elsewhere in this Determination, in calculating the price in respect of the supply of a quantity of an ingredient of an extemporaneously-prepared pharmaceutical benefit, that price will not exceed the price of a greater quantity of that ingredient.
35. Extemporaneously-prepared pharmaceutical benefits that are not standard formula preparations will be classified for pricing purposes according to the type of pharmaceutical benefit in accordance with Part 3 of Schedule 2 to the Minister’s Determination under sections 85 and 85A of the Act. Except in the case of exceptional prescriptions or where the approved hospital authority has made an election pursuant to paragraph 36, the dispensed price for such a pharmaceutical benefit will be worked out as follows:
(a) on the 16th day of the month or as near as practicable thereto the total number of grams or millilitres, as the case may be, priced during the previous four weeks or period as near as practicable thereto, for each form of preparation will be ascertained together with the total amount (exclusive of container costs) paid for each total quantity;
(b) the total amount paid (exclusive of container costs) ascertained in accordance with subparagraph (a) for each type of preparation will be divided by a number equal to one-tenth of the number of grams or millilitres, as the case may be, for that form of preparation ascertained in accordance with subparagraph (a);
(c) the dispensed price will be the average 10 grams or 10 millilitres rate ascertained in accordance with subparagraph (b) calculated at about the 16th day of the month prior to the month of supply for the particular form of preparation, multiplied by one-tenth of the number of grams or millilitres, plus an amount for a container worked out in accordance with paragraph 29;
(d) on the 16th day of the month or as near as practicable thereto, if no prescriptions have been priced during the previous four weeks or period as near as practicable thereto for any of the standard formula preparations listed for a particular form of preparation, the dispensed price will be ascertained by taking the average 10 grams or 10 millilitres rate (exclusive of container costs) of all the standard formula preparations listed for that form of preparation multiplied by one-tenth of the number of grams or millilitres, plus an amount for a container worked out in accordance with paragraph 29;
(e) the dispensed price of a benefit worked out in accordance with subparagraph (c) or (d) will in either case be taken to the nearest cent, one half cent being counted as one cent.
36. An approved hospital authority may elect to calculate dispensed prices of extemporaneously-prepared pharmaceutical benefits that are not standard formula preparations in accordance with paragraph 19 instead of receiving payment in accordance with paragraph 35.
37. Where an approved hospital authority that has not made an election pursuant to paragraph 36 supplies an extemporaneously-prepared pharmaceutical benefit and there is no standard formula preparation of the form supplied (and an average price is therefore not available), the dispensed price will be worked out in accordance with paragraph 19.
38. Where the benefit comprises a standard formula preparation plus an additive, and the approved hospital authority has not made an election pursuant to paragraph 36, the amount payable will be the dispensed price worked out in accordance with paragraph 35, unless the approved hospital authority indicates that the benefit is to be priced as if had specified only the standard formula preparation without the additive, in which case the amount payable will be the dispensed price for the standard formula preparation without the additive worked out in accordance with paragraph 19.
39. Notwithstanding the provisions of paragraph 35, an approved hospital authority that has not made an election pursuant to paragraph 36 may calculate the dispensed price for an exceptional prescription in accordance with paragraph 19.
Endnotes
Endnote 1—About the endnotes
The endnotes provide information about this compilation and the compiled law.
The following endnotes are included in every compilation:
Endnote 1—About the endnotes
Endnote 2—Abbreviation key
Endnote 3—Legislation history
Endnote 4—Amendment history
Endnotes about misdescribed amendments and other matters are included in a compilation only as necessary.
Abbreviation key—Endnote 2
The abbreviation key sets out abbreviations that may be used in the endnotes.
Legislation history and amendment history—Endnotes 3 and 4
Amending laws are annotated in the legislation history and amendment history.
The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.
The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.
Misdescribed amendments
A misdescribed amendment is an amendment that does not accurately describe the amendment to be made. If, despite the misdescription, the amendment can be given effect as intended, the amendment is incorporated into the compiled law and the abbreviation “(md)” added to the details of the amendment included in the amendment history.
If a misdescribed amendment cannot be given effect as intended, the abbreviation “(md not incorp)” is added to the details of the amendment included in the amendment history.
Endnote 2—Abbreviation key
| A = Act | o = order(s) |
| ad = added or inserted | Ord = Ordinance |
| am = amended | orig = original |
| amdt = amendment | par = paragraph(s)/subparagraph(s) |
| c = clause(s) | /sub‑subparagraph(s) |
| C[x] = Compilation No. x | pres = present |
| Ch = Chapter(s) | prev = previous |
| def = definition(s) | (prev…) = previously |
| Dict = Dictionary | Pt = Part(s) |
| disallowed = disallowed by Parliament | r = regulation(s)/rule(s) |
| Div = Division(s) | Reg = Regulation/Regulations |
| exp = expires/expired or ceases/ceased to have | reloc = relocated |
| effect | renum = renumbered |
| F = Federal Register of Legislative Instruments | rep = repealed |
| gaz = gazette | rs = repealed and substituted |
| LI = Legislative Instrument | s = section(s)/subsection(s) |
| LIA = Legislative Instruments Act 2003 | Sch = Schedule(s) |
| (md) = misdescribed amendment can be given | Sdiv = Subdivision(s) |
| effect | SLI = Select Legislative Instrument |
| (md not incorp) = misdescribed amendment | SR = Statutory Rules |
| cannot be given effect | Sub‑Ch = Sub‑Chapter(s) |
| mod = modified/modification | SubPt = Subpart(s) |
| No. = Number(s) | underlining = whole or part not |
| commenced or to be commenced |
Endnote 3—Legislation history
| Name | FRLI registration | Commencement | Application, saving and transitional provisions |
| National Health Act 1953—Determination under subsection 99(4) | 30 Oct 2006 (F2006L03545) | 1 Oct 2006 (s 2) | |
| PB 114 of 2010 | 30 Nov 2010 (F2010L03134) | 1 Dec 2010 (s 2) | — |
| PB 84 of 2012 | 27 Sept 2012 (F2012L01953) | 1 Oct 2012 (s 2) | — |
| PB 67 of 2015 | 1 July 2015 (F2015L01066) | 1 July 2015 (s 2) | — |
Endnote 4—Amendment history
| Provision affected | How affected |
| Part I | |
| Part I.................................... | am PB 114 of 2010 |
| s 2........................................ | am PB 114 of 2010 |
| s 3........................................ | am PB 114 of 2010; PB 84 of 2012; PB 67 of 2015 |
| s 8........................................ | rep PB 84 of 2012 |
| Part II | |
| s 9........................................ | am PB 84 of 2012 |
| s 11...................................... | am PB 84 of 2012 |
| s 13A................................... | rep PB 84 of 2012 |
| Part III................................. | rep PB 114 of 2010 |
| s 14................................... re | rep PB 114 of 2010 |
| s 15................................... re | rep PB 114 of 2010 |
| s 16................................... re | rep PB 114 of 2010 |
| s 17................................... re | rep PB 114 of 2010 |
| Part IV | |
| s 27...................................... | am PB 67 of 2015 |
| s 29...................................... | am PB 67 of 2015 |
| s 35...................................... | am PB 114 of 2010 |
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