EXPLANATORY STATEMENT
NATIONAL HEALTH ACT 1953
AMENDMENT DETERMINATION UNDER PARAGRAPH 98B (1) (a) No. 6
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 has been previously amended on 26 July 2006 (with effect from 1 August 2006), 4 October 2006 (with effect from 1 October 2006), 24 November 2006 (with effect from 1 December 2006), 28 February 2007 (with effect from 1 March 2007) and 13 March 2007 (with effect from 1 April 2007).
Effective from 1 May 2007, 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. 6
Clause 2 – Commencement
Clause 2 provides that the Determination commences on 1 May 2007.
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 98C(1)(b) of the Act as set out in PB 24 of 2007’ are amended to ‘the determination under paragraph 98C(1)(b) of the Act as set out in PB 34 of 2007.
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 20 of 2007’ are amended to ‘the determination under paragraph 85A(2)(a) of the Act as set out in PB 31 of 2007.
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 20 of 2007’ are amended to ‘the determination under subsection 85(6) of the Act as set out in PB 31 of 2007’.
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 20 of 2007’ is amended to ‘the determinations under sections 85, 85A and 88 of the Act as set out in PB 31 of 2007.
Overview
The National Health Act 1953 was enacted to establish a framework for the administration and delivery of health services in Australia, and it was subsequently amended to address various gaps and issues related to the provision of healthcare. The Pharmaceutical Benefits Remuneration Tribunal (PBRT), established under the Act, was tasked with determining the Commonwealth price for pharmaceutical benefits. This role was crucial in ensuring that pharmacists were adequately compensated for their services. The 2007 amendment, introduced by the Parliament of Australia, aimed to update the references to certain legislative instruments that were incorporated by reference into the Principal Determination, thereby ensuring compliance with the Legislative Instruments Act 2003. This amendment was made in consultation with the Pharmacy Guild of Australia, which represents the majority of approved pharmacists and is a party to the Fourth Community Pharmacy Agreement. The policy objective of these amendments was to maintain the integrity and effectiveness of the Pharmaceutical Benefits Scheme by ensuring that the remuneration mechanisms for pharmacists were clearly defined and legally compliant.
Scope and Application
The Pharmaceutical Benefits Amendment Determination under the National Health Act 1953 governs the remuneration for pharmacists who supply pharmaceutical benefits to the public under the Commonwealth price, as defined in the Act. This legislation applies to approved pharmacists and the Pharmacy Guild of Australia, which represents a majority of these pharmacists. The amendment pertains to the manner in which the Commonwealth price for pharmaceutical benefits is determined and paid, ensuring compliance with the terms of the Fourth Community Pharmacy Agreement between the Commonwealth and the Pharmacy Guild of Australia. The geographic reach of this Act is national, as it pertains to the implementation of the agreement across Australia. The Act does not explicitly state exclusions or thresholds but is instead focused on the administrative adjustments necessary to incorporate updated legislative instruments. The amendments extend the application of the Principal Determination through the incorporation of remade legislative instruments, which are governed by the Legislative Instruments Act 2003.
Key Provisions
The primary focus of this Amendment Determination under the National Health Act 1953 is to revise the references within the Principal Determination made by the Pharmaceutical Benefits Remuneration Tribunal (PBRT) to various legislative instruments. The PBRT is tasked with determining the Commonwealth price for pharmaceutical benefits, and this process is governed by the Act (s 98A). Specifically, paragraph 98B(1)(a) of the Act mandates that the PBRT establish the method for calculating the Commonwealth price for pharmaceutical benefits, which is to be paid to approved pharmacists. When an agreement is in place between the Commonwealth and the Pharmacy Guild of Australia or another pharmacists’ organisation representing the majority of approved pharmacists, the PBRT must give effect to the terms of that agreement in its determinations (s 98BAA(1)). This is currently reflected in the Fourth Community Pharmacy Agreement, which came into effect on 1 December 2005. The Principal Determination, which commenced on 1 July 2006, incorporates the terms of the Fourth Agreement and has been amended several times since then.
The Amendment Determination, effective from 1 May 2007, is designed to ensure that the Principal Determination accurately reflects the current legislative instruments. This involves updating references to specific legislative instruments, as detailed in the Schedule. For instance, references to "PB 24 of 2007" are to be changed to "PB 34 of 2007", and similarly, references to "PB 20 of 2007" are to be updated to "PB 31 of 2007". These changes are crucial to maintaining the integrity and applicability of the Principal Determination under the Legislative Instruments Act 2003.
Entities governed by this Amendment Determination must ensure that their practices align with the updated references within the Principal Determination. This involves careful review and amendment of any documentation, agreements, or processes that depend on the specified legislative instruments. Failure to comply with these updated references may lead to discrepancies in the calculation and payment of pharmaceutical benefits, potentially impacting the operations of approved pharmacists.
The Amendment Determination does not introduce new offences or penalties. However, non-compliance with the updated references in the Principal Determination could lead to financial discrepancies or operational inefficiencies. These issues may need to be addressed through internal reviews or corrections, but they do not inherently result in statutory penalties. The importance of adhering to these updates lies in maintaining the smooth functioning of the pharmaceutical benefits system, ensuring that approved pharmacists are fairly compensated according to the agreed terms.