EXPLANATORY STATEMENT
NATIONAL HEALTH ACT 1953
AMENDMENT DETERMINATION UNDER PARAGRAPH 98B (1) (a) No. 2
The Pharmaceutical Benefits Remuneration Tribunal (“the PBRT”) is established under section 98A of the National Health Act 1953 (“the Act”). Paragraph 98B(1)(a) of the Act provides that a function of the PBRT is to determine the manner in which the Commonwealth price (as defined in section 84 of the Act) for all or any pharmaceutical benefits is to be worked out for the purpose of payments to approved pharmacists for the supply of pharmaceutical benefits.
Subsection 98BAA(1) of the Act requires that, where the Commonwealth and the Pharmacy Guild of Australia (or another pharmacists’ organisation representing a majority of approved pharmacists) enter into an agreement relating to the manner in which the Commonwealth price for pharmaceutical benefits is to be calculated, the PBRT, when making a determination pursuant to paragraph 98B(1)(a) of the Act, is to give effect to the terms of that agreement.
The current agreement is the Fourth Community Pharmacy Agreement (“the Fourth Agreement”) between the Commonwealth and the Pharmacy Guild of Australia, which was signed on 16 November 2005 and commenced on 1 December 2005.
On 23 June 2006 the PBRT made the National Health Act 1953 Pharmaceutical Benefits Determination under paragraph 98B(1)(a) which commenced on 1 July 2006 (“the Principal Determination”). The Principal Determination gives effect the terms of the Fourth Agreement that set out the fees that are to be paid to pharmacists for the supply of pharmaceutical benefits. The Principal Determination was previously amended on 26 July 2006 with effect from 1 August 2006.
Effective from 1 October 2006, various legislative instruments which are incorporated by reference into the Principal Determination are revoked and remade. The purpose of this determination is to amend the Principal Determination to reflect necessary changes to the references to the legislative instruments which are incorporated by reference into the Principal Determination. The amendments to the Principal Determination are necessary to ensure that the remade legislative instruments are incorporated by reference under section 14 of the Legislative Instruments Act 2003.
Consultation
The Principal Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003. Amendments to the Principal Determination have been made in consultation with the Pharmacy Guild of Australia, an organisation representing a majority of approved pharmacists. The Pharmacy Guild of Australia is a party to the Fourth Agreement and supports this Determination.
Further details of the Determination are set out in the Attachment.
ATTACHMENT
NOTES ON CLAUSES TO THE DETERMINATION
Clause 1 – Name of Determination
Clause 1 provides that the name of the Determination is the National Health Act 1953 Pharmaceutical Benefits Amendment Determination under paragraph 98B(1)(a) No. 2
Clause 2 – Commencement
Clause 2 provides that the Determination commences on 1 October 2006. The Determination is expressed to commence (with retrospective effect) on 1 October 2006 to ensure that the manner for working out the Commonwealth price will apply to the drugs that were added to the Pharmaceutical Benefits Scheme by PB 40 of 2006. PB 40 of 2006 commenced on 1 October 2006 and increased the list of drugs that may be supplied as pharmaceutical benefits from that date. It is therefore necessary to ensure that from 1 October 2006 the Commonwealth price can be calculated for these additional pharmaceutical benefits so that payments may be made to approved pharmacists for the supply of these pharmaceutical benefits.
Clause 3 – Amendment of the Determination under paragraph 98B(1)(a)
Clause 3 provides that the National Health Act 1953 Pharmaceutical Benefits Determination under paragraph 98B(1)(a) made on 23 June 2006 (“the Principal Determination”) is amended as set out in the Schedule.
Schedule – Amendments
Item 1 – provides that all references in the Principal Determination to ‘the determination under paragraph 85A(2)(a) of the Act as set out in PB 33 of 2006’ are amended to ‘the determination under paragraph 85A(2)(a) of the Act as set out in PB 40 of 2006.
Item 2 – provides that all references in the Principal Determination to ‘the determination under subsection 85(6) of the Act as set out in PB 33 of 2006’ are amended to ‘the determination under subsection 85(6) of the Act as set out in PB 40 of 2006’.
Item 3 – Paragraph 37 – provides that the reference in paragraph 37 to ‘the determinations under sections 85, 85A and 88 of the Act as set out in PB 33 of 2006’ is amended to ‘the determinations under sections 85, 85A and 88 of the Act as set out in PB 40 of 2006.
Overview
The National Health Act 1953, enacted by the Australian Parliament, governs the provision of healthcare services in Australia, including the regulation of pharmaceutical benefits. To ensure the effective administration and remuneration of pharmacists supplying pharmaceutical benefits, the Pharmaceutical Benefits Remuneration Tribunal (PBRT) was established under the Act. The PBRT's function is to determine the Commonwealth price for pharmaceutical benefits, which is essential for payments to approved pharmacists. This role is outlined in the National Health Act 1953 Pharmaceutical Benefits Remuneration Tribunal Determination, which ensures that any agreements between the Commonwealth and pharmacists' organisations, such as the Pharmacy Guild of Australia, are implemented. The determination also reflects the necessary changes to the legislative instruments that are incorporated by reference into the Principal Determination to comply with the Legislative Instruments Act 2003. Amendments to this determination are made in consultation with the Pharmacy Guild of Australia, reflecting a collaborative approach to maintaining the integrity of the Pharmaceutical Benefits Scheme.
Scope and Application
The Pharmaceutical Benefits Remuneration Tribunal (PBRT) established under the National Health Act 1953 determines the Commonwealth price for pharmaceutical benefits, which applies to payments made to approved pharmacists for supplying pharmaceutical benefits. This Act applies to the Commonwealth, approved pharmacists, and the Pharmacy Guild of Australia, which represents a majority of approved pharmacists. The amendments to the Principal Determination, made under the authority of paragraph 98B(1)(a) of the Act, aim to reflect necessary changes to the legislative instruments incorporated by reference into the Principal Determination, ensuring these instruments are updated in line with the Legislative Instruments Act 2003. The amendments, effective from 1 October 2006, adjust references from PB 33 of 2006 to PB 40 of 2006, ensuring the calculation of the Commonwealth price is applicable to the additional drugs listed in the Pharmaceutical Benefits Scheme from that date. This ensures payments to pharmacists for the supply of these new pharmaceutical benefits are correctly calculated and processed.
Key Provisions
The National Health Act 1953 Pharmaceutical Benefits Amendment Determination under paragraph 98B(1)(a) No. 2, made on 23 June 2006, amends the Principal Determination which was established to give effect to the terms of the Fourth Community Pharmacy Agreement (the Fourth Agreement). The Fourth Agreement, signed on 16 November 2005, is an agreement between the Commonwealth and the Pharmacy Guild of Australia, an organisation representing a majority of approved pharmacists. The Amendment Determination is effective from 1 October 2006 and serves to correct references within the Principal Determination to ensure that the remade legislative instruments are correctly incorporated by reference under section 14 of the Legislative Instruments Act 2003. This ensures that the Commonwealth price for pharmaceutical benefits can be accurately calculated for drugs added to the Pharmaceutical Benefits Scheme by PB 40 of 2006, which also commenced on 1 October 2006.
The obligations and requirements imposed by this Act on the parties involved, primarily the Commonwealth and the Pharmacy Guild of Australia, include adhering to the terms of the Fourth Agreement as they are reflected in the Principal Determination and subsequently amended by the Amendment Determination. The Commonwealth is obligated to ensure that the prices set for pharmaceutical benefits are paid to approved pharmacists in accordance with the determinations made by the Pharmaceutical Benefits Remuneration Tribunal (PBRT). The Pharmacy Guild of Australia, as a party to the Fourth Agreement, must ensure that its members are aware of and comply with the payment terms outlined in the determinations. Both parties are required to consult and cooperate in making any amendments to these determinations, ensuring that the changes are made with due regard to the interests of all stakeholders.
Breaches of the provisions outlined in the National Health Act 1953 and its amendments can lead to various penalties and consequences. While the specific offences and penalties are not detailed within the text of the Amendment Determination, breaches of the Act generally can result in civil or criminal penalties. For civil penalties, fines can be imposed as specified by the relevant sections of the Act or other applicable legislation. In criminal cases, penalties can include fines and imprisonment, the maximum amounts of which are defined by the relevant statutes. It is essential for all parties to adhere to the determinations to avoid any legal repercussions.