National Health Act 1953 - Determination under paragraph 98C(1)(b) (No. PB 24 of 2007)

EXPLANATORY STATEMENT

NATIONAL HEALTH ACT 1953

DETERMINATION UNDER PARAGRAPH 98C(1)(b)

No. PB 24 OF 2007

Purpose and operation

1. The purpose of the Australian Pharmaceutical Benefits Scheme (PBS) is to provide timely, reliable and affordable access for the Australian community to necessary and cost-effective medicines.

2. The PBS is regulated by Part VII of the National Health Act 1953 (the Act), which provides for the supply of listed drugs and medicinal preparations as pharmaceutical benefits.

3. “Pharmaceutical benefit” is defined under subsection 84(1) of the Act as a drug or medicinal preparation in relation to which, by virtue of section 85 of the Act, Part VII of the Act applies.

4. Paragraph 98C(1)(b) of the Act provides that the Minister may, from time to time, determine the conditions subject to which payments will be made by the Commonwealth in respect of the supply of pharmaceutical benefits by approved pharmacists and approved medical practitioners.

5. The determination under paragraph 98C(1)(b) of the Act sets out the conditions under which payments will be made in respect of the supply of pharmaceutical benefits by approved pharmacists and approved medical practitioners.

6. The determination, made under paragraph 98C(1)(b) of the Act on 14 February 2007 with effect from 1 March 2007 (No. PB 14 of 2007), is repealed and substituted with this determination.

7. This determination is remade to give effect, as from 1 April 2007, to changes to the list of drugs and medicinal preparations available as pharmaceutical benefits, as recommended by the Pharmaceutical Benefits Advisory Committee. Changes to Schedule 3 of the determination are detailed in the attached summary of changes.

Consultations

8. The Pharmaceutical Benefits Advisory Committee (PBAC) is the independent expert body, established by section 100A of the Act, which makes recommendations to the Minister for Health and Ageing about which drugs and medicinal preparations should be available as pharmaceutical benefits. Under subsection 101(4) of the Act, a drug or medicinal preparation may not be declared to be a drug or medicinal preparation to which Part VII of the Act applies unless the PBAC has recommended that it be so declared. When recommending a medicine be listed on the PBS, the PBAC takes into account the medical conditions for which the medicine has been approved for use in Australia, its clinical effectiveness, safety and cost-effectiveness compared with other treatments.

9. The determination gives effect to recommendations made by the PBAC. PBAC members are selected from consumers, health economists, practising community pharmacists, general practitioners, clinical pharmacologists and specialists, with at least one member selected from each of those interests or professions. Remaining members are persons whom the Minister is satisfied have qualifications and experience in a field relevant to the functions of the PBAC, and that would enable them to contribute meaningfully to the deliberations of the PBAC.

10. Details of the determination are set out in the Attachment.

11. This determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

12. The determination was made on 12 March 2007 and commenced on 1 April 2007.

SUMMARY OF CHANGES

SCHEDULE 3

Forms Added

Items Deleted

ATTACHMENT

Paragraph 1 provides that the Determination commences on 1 April 2007.

Paragraph 2 provides that the Determination under paragraph 98C(1)(b) of the National Health Act 1953 (the Act) made on 14 February 2007 with effect from 1 March 2007 (No. PB 14 of 2007), is repealed.

Paragraph 3 defines the following terms for the purposes of the determination:

• “Act”;

• “approved price to pharmacists”;

• “Commonwealth price”;

• “extemporaneously-prepared pharmaceutical benefit”;

• “prescription”;

• “ready-prepared pharmaceutical benefit”;

• “Regulations”; and

• “standard formula preparation”.

Paragraph 4 provides that:

(a) Schedule 1 lists those pharmaceutical benefits that involve the admixture of ready-prepared ingredients;

(b) Schedule 2 lists those drugs that are used in the preparation of extemporaneously prepared pharmaceutical benefits and that are unstable or packed sterile and unused quantities of which are unsuitable for future use;

(c) Schedule 3 lists those pharmaceutical benefits that are classified as dangerous drugs for the purpose of payment of a dangerous drug fee; and

(d) Schedule 4 lists those pharmaceutical benefits that must be supplied in a complete pack, regardless of any lesser quantity ordered.

Paragraph 5 provides that where a prescription identifies that a particular brand of a ready-prepared pharmaceutical benefit should be supplied, the amount payable shall be based on that brand’s approved price to pharmacists.

Paragraph 6 provides that, where a prescription does not identify a particular brand of ready-prepared pharmaceutical benefit to be supplied, the amount payable shall be based on the approved price to pharmacist of a brand which is:

• available from a wholesaler in the capital city of the State in which the benefit is supplied; and

• for which the Commonwealth price for the supply of the benefit is lowest.

Paragraph 7 provides that, for those pharmaceutical benefits listed in Schedule 4, a complete pack shall be supplied, regardless of a lesser quantity ordered.

Paragraph 8 provides that a medicinal preparation is not a standard formula preparation if an ingredient is added or deleted, or if there is a variation to the dose, or there is a combination of standard formula preparations.

Paragraph 9 provides that an election under paragraph 38 of the determination made under subsection 98B(1) of the Act shall be made in writing to the Chief Executive Officer of Medicare Australia and shall remain in force for a period of at least 3 months from, and including, the date of election.

The election may be revoked at any time after the three month period has expired.  While the election remains in force, the amount payable to the approved pharmacist or approved medical practitioner for supply of an extemporaneously-prepared pharmaceutical benefit that is not a standard formula preparation, shall be calculated according to paragraph 21 of the determination made under subsection 98B(1) of the Act.

The Schedules

Schedule 1 to the determination lists those pharmaceutical benefits that involve the admixture of ready-prepared ingredients.

Schedule 2 to the determination lists those drugs that are to be used in the preparation of extemporaneously-prepared pharmaceutical benefits and that are unstable or packed sterile and unused quantities of which are unsuitable for future use.

Schedule 3 to the determination lists those pharmaceutical benefits that are classified as dangerous drugs for the purpose of payment of a dangerous drug fee.

Schedule 4 to the determination lists those pharmaceutical benefits the complete pack of which shall be supplied regardless of any lesser quantity ordered in the prescription.