National Health (Subsection 84C(7)) Amendment Determination 2012 (No. 2) (No. PB 85 of 2012)

Administered by Department of Health, Disability and Ageing

Legislation au F2012L01958 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

National Health Act 1953

National Health (Subsection 84C(7)) Amendment Determination 2012 (No. 2)

PB 85 of 2012

Authority

Subsection 84C(7) of the National Health Act 1953 (the Act) provides that the Minister may determine the manner in which the price for all or any pharmaceutical benefits and repatriation pharmaceutical benefits is to be ascertained for the purpose of the Safety Net.

This price is determined in the National Health (Subsection 84C(7)) Determination 2010 (the Principal Determination) as being the sum of the Commonwealth price for a pharmaceutical benefit, calculated in accordance with the determination by the Pharmaceutical Benefits Remuneration Tribunal under paragraph 98B(1)(a) of the Act, and certain additional fees.

Purpose

The purpose of this Amendment Determination is to amend the Principal Determination to reflect amendments to the Act made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012 (the Amending Act) which commence on 1 October 2012.

Background

Part VII of the Act is the legislative basis of the Pharmaceutical Benefits Scheme (PBS) by which the Commonwealth provides reliable, timely, and affordable access to a wide range of medicines for all Australians.

Division 1A of Part VII the Act provides for the Safety Net arrangements for the PBS and Repatriation Pharmaceutical Benefits Scheme (RPBS).  The Safety Net is designed to reduce the cost of medicines for individuals and families who require a large number of pharmaceutical benefits.

Section 84C of the Act provides that a person is eligible to receive a Safety Net concession card or entitlement card when expenditure on pharmaceutical benefits for the person and their family during an entitlement period reaches a certain amount (the Safety Net amount).  A Safety Net concession card or entitlement card enables access to PBS or RPBS medicines at a reduced rate or free of charge for the remainder of the entitlement period.  An entitlement period for the Safety Net is a calendar year from 1 January to 31 December.

Section 84C also sets out the amounts which can be taken into account for the purpose of the Safety Net.  Where the Commonwealth price for a medicine is equal to or greater than the maximum amount the patient may be charged (the patient co-payment), the amount for Safety Net purposes is the amount charged as the patient co-payment.  Where the Commonwealth price for a pharmaceutical benefit is less than the patient co-payment, subsection 84C(4)(e) of the Act provides that the amount to be taken into account for Safety Net purposes will not exceed the sum of the subsection 84C(7) price for the pharmaceutical benefit or repatriation pharmaceutical benefit and any charges (where applicable) for supplying the pharmaceutical benefit outside of normal trading hours and/or by delivery to premises other than the approved pharmacy.

Subsection 84C(7) of the Act provides that the Minister may determine the manner in which the price for all or any pharmaceutical benefits or repatriation pharmaceutical benefits (including those referred to in subsection 84C(4)(e)) is to be ascertained for the purpose of the Safety Net.  Subsection 87C(8) provides that the manner determined under subsection (7) shall accord with the requirements set out in subsection (8).

Amendments

Prior to 1 October 2012, paragraph 84C(8)(a) of the Act provided that a manner determined under subsection 84C(7) in relation to a listed brand of a pharmaceutical item, shall take as its base the approved price to pharmacists of the brand.  The Amending Act substitutes the “approved ex‑manufacturer price or a proportional ex-manufacturer price” for the “approved price to pharmacists” from 1 October 2012.  This Amendment Determination makes the same substitution in the explanation of subsection 84C(8) of the Act in paragraph (a) of Note 1 to section 5 of the Principal Determination.

The subsection 84C(7) price is determined in the Principal Determination to be the sum of the Commonwealth price for a pharmaceutical benefit, calculated in accordance with a determination made under paragraph 98B(1)(a) of the Act, and certain additional amounts.  Prior to 1 October 2012, that determination of the Commonwealth price took as its base the approved price to pharmacists of the benefit, but from 1 October 2012 the base is the approved ex-manufacturer price or a proportional ex-manufacturer price of the benefit, reflecting amendments to paragraph 98B(2)(a) of the Act made by the Amending Act.  This Amendment Determination makes the same substitution in the explanation of the Commonwealth price in Note 1 to section 5 of the Principal Determination.

Consultation

Consultation was not necessary for this Determination as the amendments are consequential to amendments to the Act and for which consultation was undertaken.  There are no changes to substantive provisions in the Principal Determination.  The amendments are to explanations in Notes only and are minor and technical in nature.

This Determination commences on 1 October 2012.

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 (Subsection 84C(7)) Amendment Determination 2012 (No. 2)

PB 85 of 2012

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

The purpose of this legislative instrument, made under subsection 84C(7) of the National Health Act 1953 (the Act), is to amend the National Health (Subsection 84C(7)) Determination 2010 (the Principal Determination) to reflect amendments to the Act commencing on 1 October 2012.

The Principal Determination sets out the manner of determining the price of pharmaceutical benefits for the purposes of the Pharmaceutical Benefits Scheme Safety Net.

This instrument contains no amendments to substantive provisions of the Principal Determination; the amendments are to explanations in Notes only; they are minor and technical in nature, reflecting amendments to the Act.

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 Pharmaceutical Benefits Scheme is a benefit scheme which assists with advancement of this human right by providing for subsidised access for patients to medicines.

Conclusion

The legislative instrument is compatible with human rights because it advances the protection of human rights.

 

Tanya Plibersek

Minister for Health

Overview

The National Health (Subsection 84C(7)) Amendment Determination 2012 (No. 2) was introduced to amend the National Health (Subsection 84C(7)) Determination 2010 in response to changes made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012, which commenced on 1 October 2012. The National Health Act 1953, enacted by the Commonwealth Parliament, establishes the Pharmaceutical Benefits Scheme (PBS) and Repatriation Pharmaceutical Benefits Scheme (RPBS) to provide Australians with reliable, timely, and affordable access to a range of medicines. The Safety Net, outlined in Division 1A of Part VII of the Act, is designed to reduce the cost of medicines for individuals and families who require a large number of pharmaceutical benefits. This Amendment Determination was made under subsection 84C(7) of the Act and serves to update the Principal Determination to reflect the legislative changes, ensuring that the manner of determining the price of pharmaceutical benefits for the purposes of the Safety Net remains aligned with the updated Act. The amendments are minor and technical, involving substitutions in explanations in the Notes rather than substantive provisions, and were deemed not to require further consultation due to their consequential nature.

Scope and Application

The National Health (Subsection 84C(7)) Amendment Determination 2012 (No. 2) is a legislative instrument made under subsection 84C(7) of the National Health Act 1953. This instrument amends the National Health (Subsection 84C(7)) Determination 2010 to reflect amendments to the National Health Act made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012, which commenced on 1 October 2012. The purpose of the amendment is to update the explanation of certain terms in the Principal Determination to align with the changes in the Act, ensuring that the manner in which the price for pharmaceutical benefits and repatriation pharmaceutical benefits is ascertained for the Safety Net remains consistent with the legislative framework. The amendment is technical and does not alter the substantive provisions of the Principal Determination, which continues to outline the methodology for determining the price of pharmaceutical benefits for the purposes of the Pharmaceutical Benefits Scheme Safety Net. This instrument applies to the calculation of pharmaceutical prices under the Safety Net for the Pharmaceutical Benefits Scheme, impacting entities and individuals who are eligible for Safety Net concessions on their pharmaceutical expenses. The geographic and jurisdictional reach of this Amendment Determination is national, as it pertains to the operation of the Pharmaceutical Benefits Scheme across Australia, which is administered under the National Health Act 1953 by the Commonwealth. The changes apply to all entities and individuals who are subject to the Safety Net provisions within the Pharmaceutical Benefits Scheme. There are no specific exclusions or thresholds mentioned in the instrument; however, it should be noted that the amendments pertain specifically to the calculation of prices for the purposes of the Safety Net and do not affect other aspects of the Pharmaceutical Benefits Scheme. The application of this Amendment Determination may be further refined through subordinate instruments, although the current instrument itself does not extend or restrict application beyond its stated purpose.

Key Provisions

The National Health (Subsection 84C(7)) Amendment Determination 2012 (No. 2) (the Determination) amends the National Health (Subsection 84C(7)) Determination 2010 (the Principal Determination) to reflect amendments to the National Health Act 1953 (the Act) made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012 (the Amending Act) that commenced on 1 October 2012. This amendment ensures the manner in which the price for pharmaceutical benefits is ascertained for the purpose of the Pharmaceutical Benefits Scheme Safety Net (subsection 84C(7)(a) of the Act). The determination specifies that the price should be based on the approved ex-manufacturer price or a proportional ex-manufacturer price, rather than the approved price to pharmacists, as previously set out in the Principal Determination. The Act, through Division 1A, establishes the Safety Net arrangements for the Pharmaceutical Benefits Scheme (PBS) and Repatriation Pharmaceutical Benefits Scheme (RPBS), designed to reduce the cost of medicines for individuals and families who require a large number of pharmaceutical benefits. Section 84C of the Act provides that a person is eligible to receive a Safety Net concession card or entitlement card when their expenditure on pharmaceutical benefits for the person and their family during an entitlement period reaches a certain amount (the Safety Net amount). The Safety Net concession card or entitlement card enables access to PBS or RPBS medicines at a reduced rate or free of charge for the remainder of the entitlement period, which is a calendar year from 1 January to 31 December. The Determination imposes obligations on parties and entities governed by the Act to ensure compliance with the amended manner of ascertaining the price for pharmaceutical benefits for the purpose of the Safety Net. This involves using the approved ex-manufacturer price or a proportional ex-manufacturer price as the base for determining the Commonwealth price for a pharmaceutical benefit, rather than the approved price to pharmacists. This change is necessary to align with the amendments made by the Amending Act. There are no offences, penalties, or civil/criminal consequences for breach of this Determination as it is a technical amendment to the Principal Determination. The amendments are minor and do not alter the substantive provisions of the Principal Determination. Instead, they reflect the legislative changes made by the Amending Act and are intended to ensure that the manner of determining the price for pharmaceutical benefits is consistent with the updated legislative framework. The Determination is compatible with human rights as it engages Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) by assisting with the progressive realisation of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health. The Pharmaceutical Benefits Scheme, which the Determination supports, provides for subsidised access to medicines, thereby advancing this human right.

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