National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005

Administered by Department of Health, Disability and Ageing

Legislation au C2005A00151 In force Act

Legislation content

 

 

 

 

 

 

National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005

 

No. 151, 2005

 

 

 

 

 

An Act to amend the Pharmaceutical Benefits Scheme, and for related purposes

 

 

Contents

1 Short title

2 Commencement

3 Schedule(s)

Schedule 1—Early supplies of pharmaceutical benefits etc.

National Health Act 1953

Schedule 2—Amount of safety net

Part 1—Amendments commencing on Royal Assent

National Health Act 1953

Part 2—Amendments commencing on 1 January 2006

National Health Act 1953

Part 3—Amendments commencing on 1 January 2007

National Health Act 1953

Part 4—Amendments commencing on 1 January 2008

National Health Act 1953

Part 5—Amendments commencing on 1 January 2009

National Health Act 1953

Part 6—Amendments commencing on 31 December 2009

National Health Act 1953

 

 

 

National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005

No. 151, 2005

 

 

 

An Act to amend the Pharmaceutical Benefits Scheme, and for related purposes

[Assented to 14 December 2005]

The Parliament of Australia enacts:

1  Short title

  This Act may be cited as the National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005.

2  Commencement

 (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent.

14 December 2005

2.  Schedule 1, items 1 and 2

The day on which this Act receives the Royal Assent.

14 December 2005

3.  Schedule 1, items 3 to 11

1 January 2006.

1 January 2006

4.  Schedule 1, item 12

The day on which this Act receives the Royal Assent.

14 December 2005

5.  Schedule 1, item 13

1 January 2006.

1 January 2006

6.  Schedule 2, Part 1

The day on which this Act receives the Royal Assent.

14 December 2005

7.  Schedule 2, Part 2

1 January 2006.

1 January 2006

8.  Schedule 2, Part 3

1 January 2007.

1 January 2007

9.  Schedule 2, Part 4

1 January 2008.

1 January 2008

10.  Schedule 2, Part 5

1 January 2009.

1 January 2009

11.  Schedule 2, Part 6

31 December 2009.

31 December 2009

Note: This table relates only to the provisions of this Act as originally passed by the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

 (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

3  Schedule(s)

  Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


Schedule 1—Early supplies of pharmaceutical benefits etc.

 

National Health Act 1953

1  Subsection 84(1)

Insert:

early supply of a specified pharmaceutical benefit has the meaning given by subsection 84AAA(1).

2  After section 84

Insert:

 84AAA  Early supply of a specified pharmaceutical benefit

 (1) A supply of a pharmaceutical benefit to a person (whether or not that supply is a supply of a kind described in paragraph 84C(4A)(a)) is an early supply of a specified pharmaceutical benefit if:

 (a) the supply is made within 20 days after the day of a previous supply of the same pharmaceutical benefit to the person (whether or not the previous supply was a supply of a kind described in paragraph 84C(4A)(a)); and

 (b) the pharmaceutical benefit is specified in an instrument under subsection (2); and

 (c) the supply does not result from a prescription originating from a hospital (within the meaning of the Health Insurance Act 1973) or a day hospital facility.

Note: For day hospital facility see subsection 4(1).

 (2) The Minister may, by legislative instrument, specify pharmaceutical benefits for the purposes of paragraph (1)(b).

Note: For specification by class, see subsection 13(3) of the Legislative Instruments Act 2003.

 (3) Pharmaceutical benefits may be specified in an instrument under subsection (2) by reference to:

 (a) the circumstances in which the pharmaceutical benefit is supplied; or

 (b) any other circumstances in relation to the pharmaceutical benefit.

3  After subsection 84C(4)

Insert:

 (4AA) The supply or repeated supply of a pharmaceutical benefit or repatriation pharmaceutical benefit to a person must not be taken into account for the purposes of this section if:

 (a) it is an early supply of a specified pharmaceutical benefit; and

 (b) it is not a supply of out‑patient medication.

4  Paragraph 87(2)(a)

Omit “upon a concessional benefit prescription or a concession card prescription—charge the person”, substitute:

  upon:

 (i) a concessional benefit prescription; or

 (ii) an entitlement card prescription where the supply is an early supply of a specified pharmaceutical benefit; or

 (iii) a concession card prescription (other than where the supply is an early supply of a specified pharmaceutical benefit);

  charge the person

5  After subsection 87(2)

Insert:

 (2AAA) Paragraphs (2)(b) and (c) do not apply to an early supply of a specified pharmaceutical benefit.

6  Paragraph 87(2)(e)

Omit “upon a general benefit prescription other than one relating to a supply to which paragraph (b) or (c) applies”, substitute “upon a general benefit prescription (other than one relating to a supply to which paragraph (b) or (c) applies), or a concession card prescription (where the supply is an early supply of a specified pharmaceutical benefit)”.

7  At the end of subsection 87(2AB)

Add:

 ; and (e) any amount charged in respect of an early supply of a specified pharmaceutical benefit (other than a supply of out‑patient medication) is to be disregarded.

8  Subsection 87(5)

Omit “, not being a holder of an entitlement card,”.

9  After subsection 87(5)

Insert:

 (5A) Subsection (5) does not apply to a supply if:

 (a) the patient is the holder of an entitlement card; and

 (b) the supply is not an early supply of a specified pharmaceutical benefit.

10  Paragraph 99(2)(a)

After “entitlement card prescription”, insert “, and the supply was not an early supply of a specified pharmaceutical benefit”.

11  Subsection 99(2A)

Omit “other than in a case to which subsection (2AB) applies”, substitute “(other than in a case to which subsection (2AB) applies), or a supply of a pharmaceutical benefit is an early supply of a specified pharmaceutical benefit upon a concession card prescription,”.

12  After subsection 101(3)

Insert:

 (3AA) The Pharmaceutical Benefits Advisory Committee must make recommendations to the Minister from time to time about what should be specified in a determination under subsection 84AAA(2).

 (3AB) Subsection (3AA) does not limit subsection (3).

13  Application

The amendments made by this Schedule apply to an early supply of a specified pharmaceutical benefit made on or after 1 January 2006, regardless whether it is an early supply of a specified pharmaceutical benefit because of another supply of a pharmaceutical benefit or repatriation pharmaceutical benefit that was made before 1 January 2006.


Schedule 2—Amount of safety net

Part 1—Amendments commencing on Royal Assent

National Health Act 1953

1  Subsection 84C(1AA)

Omit “is $874.90”, substitute “is the amount of the general patient safety net (within the meaning of section 99F)”.

2  Subsection 84C(1AA)

Omit “than $874.90”, substitute “than the amount of the general patient safety net”.

3  Paragraph 87(2)(b)

Omit “than $874.90”, substitute “than the amount of the general patient safety net (within the meaning of section 99F)”.

4  Paragraph 87(2)(c)

Omit “than $874.90”, substitute “than the amount of the general patient safety net (within the meaning of section 99F)”.

5  Section 99F (definition of general patient safety net)

Repeal the definition, substitute:

general patient safety net means $874.90.

6  Section 99F

Insert:

general patient safety net base amount means $874.90.

7  Subsection 99G(1) (table item 4)

Omit “General patient safety net”, substitute “General patient safety net base amount”.


Part 2—Amendments commencing on 1 January 2006

National Health Act 1953

8  Section 99F (definition of concessional beneficiary safety net)

Omit “52”, substitute “54”.

9  Section 99F (definition of general patient safety net)

Repeal the definition, substitute:

general patient safety net means the general patient safety net base amount plus 2 times the amount of the general patient charge.


Part 3—Amendments commencing on 1 January 2007

National Health Act 1953

10  Section 99F (definition of concessional beneficiary safety net)

Omit “54”, substitute “56”.

11  Section 99F (definition of general patient safety net)

Omit “2”, substitute “4”.


Part 4—Amendments commencing on 1 January 2008

National Health Act 1953

12  Section 99F (definition of concessional beneficiary safety net)

Omit “56”, substitute “58”.

13  Section 99F (definition of general patient safety net)

Omit “4”, substitute “6”.


Part 5—Amendments commencing on 1 January 2009

National Health Act 1953

14  Section 99F (definition of concessional beneficiary safety net)

Omit “58”, substitute “60”.

15  Section 99F (definition of general patient safety net)

Omit “6”, substitute “8”.


Part 6—Amendments commencing on 31 December 2009

National Health Act 1953

16  Section 99F (definition of general patient safety net)

Repeal the definition, substitute:

general patient safety net means the amount that was the general patient safety net immediately before 31 December 2009.

17  Section 99F (definition of general patient safety net base amount)

Repeal the definition.

18  Subsection 99G(1) (table item 4)

Omit “General patient safety net base amount”, substitute “General patient safety net”.

 

 

 

 

 

[Minister’s second reading speech made in—

House of Representatives on 14 September 2005

Senate on 7 November 2005]

(161/05)

 

Overview

The National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005 was enacted by the Parliament of Australia to amend the Pharmaceutical Benefits Scheme and address budgetary concerns related to the Pharmaceutical Benefits Safety Net. This legislation was designed to introduce measures aimed at ensuring the sustainability and affordability of the Pharmaceutical Benefits Scheme, particularly focusing on the safety net thresholds which determine the level of government subsidy for pharmaceuticals after a patient's out-of-pocket expenses reach a certain amount. The Act was assented to on 14 December 2005, and it includes provisions that commence on various dates, ranging from the day of Royal Assent to 31 December 2009, to phase in changes to the safety net thresholds and to introduce the concept of "early supplies" of specified pharmaceutical benefits. The overarching policy objective of this Act is to provide a more equitable and sustainable funding model for the Pharmaceutical Benefits Scheme by adjusting the safety net thresholds and clarifying certain provisions around early supplies of specified pharmaceuticals. This was done to ensure that the Scheme remains financially viable while continuing to provide essential medications to the Australian public at an affordable cost.

Scope and Application

The National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005 amends the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953, introducing changes to the safety net thresholds for out-of-pocket expenses for pharmaceutical products. This Act applies to all persons and entities involved in the supply of pharmaceutical benefits in Australia, including patients, healthcare providers, and pharmaceutical companies. It affects the conduct and transactions related to the supply of pharmaceutical benefits, particularly focusing on the timing of such supplies and their impact on the safety net thresholds. The Act has a national jurisdictional reach, applying across Australia. The amendments to the safety net thresholds will come into effect at various dates from 1 January 2006 to 31 December 2009, as specified in the Schedule of the Act. There are no stated exclusions or exemptions within the Act, although it does provide for the Minister to specify pharmaceutical benefits for early supply purposes through subordinate instruments. These instruments will extend the application of the Act by detailing which pharmaceutical benefits qualify as early supplies under the new provisions.

Key Provisions

The National Health Amendment (Budget Measures—Pharmaceutical Benefits Safety Net) Act 2005 primarily serves to amend the Pharmaceutical Benefits Scheme (PBS) and the National Health Act 1953 (the "Act"). The amendments concern the early supply of specified pharmaceutical benefits and the amount of the safety net. The Act specifies that it commences on the day it receives Royal Assent, with certain provisions applying from 1 January 2006 onwards. The amendments are detailed in the Schedules, which modify the Act by inserting, omitting, or substituting provisions. The Act imposes several obligations on the parties it governs. For instance, it requires the Minister to specify pharmaceutical benefits that qualify as "early supply of a specified pharmaceutical benefit" through a legislative instrument. Furthermore, it mandates the Pharmaceutical Benefits Advisory Committee to provide recommendations to the Minister regarding what should be specified in such instruments. The Act also modifies the criteria for charging patients for pharmaceutical benefits, ensuring that certain supplies are not counted towards the safety net thresholds if they qualify as early supplies of specified pharmaceutical benefits. Moreover, it provides that certain supplies are disregarded for the purpose of calculating the patient's out-of-pocket expenses under the PBS. Failure to comply with the requirements of the Act can lead to civil or criminal consequences. For instance, if a pharmaceutical benefit supply is improperly classified as an early supply of a specified pharmaceutical benefit, it might result in incorrect charging of patients, which could be considered a breach of the Act. The penalties for such breaches, however, are not explicitly stated in the Act itself but would typically be determined under the broader legislative framework governing the National Health Act 1953. This could include fines or other civil penalties for non-compliance, with more severe penalties applicable if the breach is deemed to be wilful or involves significant financial gain.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.