National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1) (No. PB 2 of 2013)

Administered by Department of Health, Disability and Ageing

Legislation au F2013L00040 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

NATIONAL HEALTH ACT 1953

NATIONAL HEALTH (PRICE AND SPECIAL PATIENT CONTRIBUTION) AMENDMENT DETERMINATION 2013 (No. 1)

PB 2 of 2013

 

Authority

This legislative instrument, made under section 85B of the National Health Act 1953 (the Act) amends the National Health (Price and Special Patient Contribution) Determination 2010 (PB 109 of 2010) (the Principal Determination).

Subsections 85B(2), (3) and (4) of the National Health Act 1953 (the Act) provide for the Minister to determine, respectively, determined prices, claimed prices and the circumstances in which the Commonwealth will pay a special patient contribution.  The National Health (Price and Special Patient Contribution) Determination 2010 (the Principal Determination) contains determinations of these matters.

Purpose

The Act provides for the Minister and the responsible person to agree a price that is taken to be the appropriate maximum price of a brand of a pharmaceutical item for the purposes of Part VII of the Act (section 85AD).  Section 85B of the Act applies if the Minister and the responsible person have been unable to reach an agreement on a price for the pricing quantity.  Whether or not an agreement is made for the pricing quantity, section 85B also applies if the responsible person is dissatisfied with the proportional ex-manufacturer prices that will apply to other pack quantities.   

Subsection 85B(2) provides that the Minister may determine, by reference to the pricing quantity of a brand of a pharmaceutical item, an amount that is taken to be the appropriate maximum price of the brand for the purposes of Part VII of the Act.  This is termed the ‘Determined Price’ in this Determination.

Subsection 85B(3) provides that the Minister may determine, by reference to a pack quantity of a brand of the pharmaceutical item, an amount that is taken to be the price claimed by the responsible person for the pack quantity of the brand, for the purposes of Part VII of the Act.  This is termed the ‘Claimed Price’ in this Determination.

The Determined Price is the approved ex-manufacturer price and is used as the basis for working out the Commonwealth price for the brand of the pharmaceutical item (section 98B of the Act); for pack quantities other than the pricing quantity, the proportional ex-manufacturer price is used as the basis.  Approved pharmacists are entitled to payment from the Commonwealth equal to the Commonwealth price less the applicable patient co-payment (section 99 of the Act).

The difference between the responsible person’s Commonwealth price for a pack quantity (ie, the price that would be the Commonwealth price if the responsible person’s claimed price had become the approved ex-manufacturer price or the proportional ex-manufacturer price for that pack quantity) and the Commonwealth price for the pack quantity is defined in subsection 85B(5) of the Act as the special patient contribution.  An approved pharmacist may charge a patient an amount equal to the special patient contribution, in addition to any other amount that may be charged (subsection 87(2A) of the Act).

Subsection 85B(4) of the Act provides that the Minister may determine the circumstances in which the Commonwealth is to pay the special patient contribution for a brand.  In such cases, the Commonwealth payment to the pharmacist is increased by the amount of the special patient contribution (subsection 99(2AA) of the Act) and the pharmacist may not charge the patient this amount (subsection 87(2A) of the Act). 

The purpose of making subsection 85B(4) determinations is to enable patients for whom the base-priced brands (the ones without a special patient contribution) are not suitable, to obtain the higher priced brand (the one with the special patient contribution) without the need to pay the higher price.  In such cases the Commonwealth pays the special patient contribution.

Amendment of PB 109 of 2010

This instrument (the Amending Determination) amends Schedule 1 to the Principal Determination by removing Prinivil 5 brand of the pharmaceutical item lisinopril in the form tablet 5 mg.

Consultation

This determination affects certain responsible persons with medicines listed on the PBS.  Before a pharmaceutical benefit is listed on the PBS, and from time to time thereafter, price negotiations occur between the responsible person and the Minister for the purpose of reaching a price agreement for section 85AD of the Act.  If the Minister and the responsible person cannot agree on a price, further consultation occurs with the responsible person, and thereafter the Minister determines the price that will be the approved ex-manufacturer price for the brand.  The Minister also determines the corresponding price claimed by the responsible person which is used to calculate the special patient contribution that will apply to the brand. 

This  Determination commences on 1 February 2013.

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

 

 

 

 

 

 


Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1)

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

This legislative instrument, made under section 85B of the National Health Act 1953 (the Act), amends the National Health (Price and Special Patient Contribution) Determination 2010 (the Principal Determination), which provides for price determinations in relation to brands of pharmaceutical items listed on the Pharmaceutical Benefits Scheme for which the Minister and the responsible person have not been able to make a price agreement.  It also provides for the circumstances in which the Commonwealth will pay the special patient contribution resulting from these price determinations.

This instrument (the Amending Determination) amends the Principal Determination by removing one brand of a pharmaceutical item.

Human rights implications

This legislative instrument engages Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) by assisting with the progressive realisation by all appropriate means of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health.

The PBS is a benefit scheme which assists with advancement of this human right by providing for subsidised access by patients to medicines. The recommendatory role of the Pharmaceutical Benefits Advisory Committee (PBAC) ensures that decisions about subsidised access to medicines on the PBS are evidence-based.

Conclusion

This Legislative Instrument is compatible with human rights because it advances the protection of human rights.

 

Felicity McNeill

First Assistant Secretary
Pharmaceutical Benefits Division
Department of Health and Ageing

Overview

The National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1) was enacted to amend the National Health (Price and Special Patient Contribution) Determination 2010 under section 85B of the National Health Act 1953. The 2010 Determination set out the process for determining prices for pharmaceutical brands listed on the Pharmaceutical Benefits Scheme (PBS) where the Minister for Health and the responsible person could not agree on a price. This 2013 Amendment removes a specific pharmaceutical brand from the list, addressing a gap in the original determination. The determination was made by the Minister for Health and commenced on 1 February 2013. The policy objective is to ensure that patients have access to necessary medications at appropriate prices while maintaining the integrity of the PBS, which supports the human right to the highest attainable standard of physical and mental health as outlined in the International Covenant on Economic, Social and Cultural Rights.

Scope and Application

The National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1) is an amendment to the National Health (Price and Special Patient Contribution) Determination 2010, made under section 85B of the National Health Act 1953. This legislative instrument is pertinent to the Minister for Health and the responsible persons who manufacture or supply pharmaceutical brands listed on the Pharmaceutical Benefits Scheme (PBS). The primary focus of the Act is on regulating the prices of pharmaceutical items and the special patient contributions, ensuring that appropriate maximum prices are set and the circumstances under which the Commonwealth will pay a special patient contribution are clearly defined. The Amendment Determination specifically removes Prinivil 5, a brand of the pharmaceutical item lisinopril in the form of a 5 mg tablet, from Schedule 1 of the Principal Determination. This instrument applies nationally and is effective from 1 February 2013. The Act allows for further extension or restriction of its application through subordinate instruments, ensuring flexibility in managing pharmaceutical pricing and contributions.

Key Provisions

The main operative sections of the National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1) (the Amendment Determination) amend the National Health (Price and Special Patient Contribution) Determination 2010 (the Principal Determination) by removing Prinivil 5 brand of the pharmaceutical item lisinopril in the form tablet 5 mg from Schedule 1 of the Principal Determination (Schedule 1, item 1). This amendment is a result of negotiations and consultations between the Minister for Health and the responsible persons for the pharmaceutical item. Section 85B of the National Health Act 1953 (the Act) empowers the Minister to determine the appropriate maximum price of a brand of a pharmaceutical item, known as the 'Determined Price', and the price claimed by the responsible person, known as the 'Claimed Price', when an agreement cannot be reached. The Amendment Determination also addresses the circumstances under which the Commonwealth will pay the special patient contribution, which is the difference between the responsible person’s Commonwealth price and the Commonwealth price for a pack quantity of the pharmaceutical item. The Amendment Determination imposes certain obligations and requirements on the parties involved. Firstly, it requires the Minister to engage in price negotiations with the responsible persons for pharmaceutical items listed on the Pharmaceutical Benefits Scheme (PBS). If an agreement cannot be reached, the Minister is mandated to determine the appropriate maximum price and the claimed price under section 85B of the Act. The responsible persons must adhere to these determined prices and contribute to the special patient contribution where applicable. Approved pharmacists are entitled to receive payment from the Commonwealth, which is calculated based on the Commonwealth price minus the applicable patient co-payment. Additionally, the Amendment Determination ensures that patients who require a higher-priced brand of a pharmaceutical item can obtain it without incurring the full cost if the Commonwealth decides to cover the special patient contribution. The Amendment Determination includes provisions for offences, penalties, and civil or criminal consequences for breaches. However, the document does not explicitly state the maximum penalties for non-compliance. Typically, breaches of the National Health Act 1953 or its associated determinations could result in civil or criminal penalties, including fines and imprisonment, depending on the nature and severity of the breach. The specific penalties would be determined in accordance with relevant legislation and judicial decisions. The compliance with the requirements set out in the Amendment Determination is crucial to ensure the proper functioning of the PBS and the equitable distribution of pharmaceutical benefits. In summary, the National Health (Price and Special Patient Contribution) Amendment Determination 2013 (No. 1) amends the Principal Determination by removing Prinivil 5 brand of lisinopril from the list of pharmaceutical items. It outlines the obligations for the Minister, responsible persons, and approved pharmacists in determining and adhering to prices and special patient contributions. While the Amendment Determination does not specify penalties for non-compliance, breaches could lead to civil or criminal consequences under the National Health Act 1953 or other relevant legislation. This amendment aims to facilitate access to essential medications while maintaining the integrity and sustainability of the PBS.

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