EXPLANATORY STATEMENT
NATIONAL HEALTH ACT 1953
DETERMINATION UNDER PARAGRAPH 98B (1) (a)
Paragraph 98B (1) (a) of the National Health Act 1953 (“the Act”) provides that a function of the Pharmaceutical Benefits Remuneration Tribunal (“the PBRT”) is to determine the manner in which the Commonwealth price 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, 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 to 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), 13 March 2007 (with effect from 1 April 2007), 12 April 2007 (with effect 1 May 2007) and 20 June 2007 (with effect from 1 July 2007).
The purpose of this Determination is to amend the Principal Determination to reflect the necessary changes to the references to the legislative instruments which are incorporated by reference into the Principal Determination and changes to the pharmacists’ dispensing fees. 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.
Part 2 of the Fourth Agreement sets out the manner in which the Commonwealth price for pharmaceutical benefits is to be calculated. A component of the Commonwealth price is the pharmacists’ dispensing fees. The method by which the pharmacists’ dispensing fees are to be adjusted, with effect from 1 July of each year (from the 2006-07 financial year to the 2009-10 financial year) is also set out in the Fourth Agreement. As part of the Fourth Agreement, the Minister for Health and Ageing (on behalf of the Commonwealth) and the Pharmacy Guild of Australia have agreed to the amount of the pharmacists’ dispensing fees to have effect from 1 July 2007. This Determination is made pursuant to paragraph 98B (1) (a) of the Act and gives effect to the terms of the Fourth Agreement concerning the Commonwealth price for pharmaceutical benefits. The dispensing fee for ready-prepared pharmaceutical benefits will increase by 17 cents to $5.32, and the dispensing fee for extemporaneously-prepared pharmaceutical benefits will increase by 17 cents to $7.36.
Further details of the Determination are set out in the Attachment.
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.
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. 7.
Clause 2 – Commencement
Clause 2 provided that the Determination commences on 1 July 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 – Paragraph 6 ‑ provides that the amount of the prepared dispensing fee referred to in the definition of “extemporaneously-prepared dispensing fee” in paragraph 6 of the Principal Determination is increased by 17 cents to $7.36.
Item 2 – Paragraph 6 ‑ provides that the amount of the dispensing fee referred to in the definition of “ready-prepared dispensing fee” in paragraph 6 of the Principal Determination is increased by 17 cents to $5.32.
Item 3 – provides that all references in the Principal Determination to ‘determination under subsection 85(6) of the Act as set out in PB 20 of 2007’ are amended to ‘determination under subsection 85(6) of the Act as set out in PB 45 of 2007’.
Item 4 – provides that all references in the Principal Determination to ‘determination under paragraph 85A(2)(a) of the Act as set out in PB 31 of 2007’ are amended to ‘determination under paragraph 85A(2)(a) of the Act as set out in PB 45 of 2007’.
Item 5 – provides that all references in the Principal Determination to ‘determination under paragraph 98C(1)(b) of the Act as set out in PB 34 of 2007’ are amended to ‘determination under paragraph 98C(1)(b) of the Act as set out in PB 46 of 2007’.
Item 6 – Paragraph 37 – provides that the reference in paragraph 37 to ‘determinations under sections 85, 85A and 88 of the Act as set out in PB 31 of 2007’ is amended to ‘determinations under sections 85, 85A and 88 of the Act as set out in PB 45 of 2007’.