House debates

Wednesday, 11 September 2019


National Health Amendment (Safety Net Thresholds) Bill 2019; Second Reading

9:45 am

Photo of Greg HuntGreg Hunt (Flinders, Liberal Party, Minister for Health) Share this | | Hansard source

I move:

That this bill be now read a second time.

The National Health Amendment (Safety Net Thresholds) Bill 2019 (the bill) amends the National Health Act 1953 to implement the Morrison government's election commitment to reduce the safety net thresholds that apply to the Pharmaceutical Benefits Scheme (PBS) medicines.

The PBS has been providing affordable access to medicines for Australians for over 60 years and is rightly respected and valued for the high-quality, cost-effective services it delivers. It is one of the signature health programs that sets the Australian health system apart.

The Morrison government is committed to supporting the PBS with every fibre of its being and, above all else, the patients it serves. We have a deep and profound commitment to list every new medicine recommended by the independent expert Pharmaceutical Benefits Advisory Committee.

Since 2013 we have made more than 2,100 new or amended medicines listings on the PBS through an additional investment of around $10.6 billion dollars.

Through the PBS, patients can access medicines that in some cases would cost tens or even hundreds of thousands of dollars per year for a maximum of $6.50 per script for concession card holders, or a maximum of $40.30 for non-concessional patients. Patients receive free or reduced cost scripts once they reach their safety net.

Ninety-one percent of PBS scripts each year (186 million) are dispensed to concession card holders, including pensioners and low-income earners, meaning they pay no more than $6.50 per script for medicines that without subsidy would cost much more than that. Twenty percent of concession scripts (37 million scripts) are free of charge because patients have reached their safety net.

The bill

This bill, in that context, proposes amendments which will reduce the PBS safety net threshold amounts from 1 January 2020 for all Australians who use the PBS. In effect, it will make the acquisition of medicines cheaper for patients who have chronic needs and who are frequent users of the PBS to meet their health requirements. The bill will enable PBS patients to reach the safety net earlier in the calendar year and provide them earlier access to free or reduced-cost PBS medicines.

Specifically, the safety net threshold for concessional patients will be reduced from 60 PBS concessional co-payments to 48 PBS concessional co-payments. This will reduce the concessional safety net threshold to an estimated $316.80 in 2020. Without this proposal, the 2020 concessional safety net threshold would have risen to an estimated $396.

The safety net threshold for general patients will reduce from the 2019 level of $1,550.70 to $1,486.80. Without this proposal, the 2020 general safety net threshold would have risen to $1,586.40. It's an effective saving of $100.

These changes will benefit approximately 1.6 million concessional patients and 129,000 general patients, allowing them to reach the PBS safety net sooner and reduce their out-of-pocket health costs by $80 per year for the majority of patients who are on the concessional scheme, and up to $100 per year for patients who are not on the concessional scheme.

This will be particularly helpful for Australians whose treatment requires a larger number of PBS prescription medicines every year—for example, patients with chronic conditions such as heart disease, high cholesterol, arthritis, asthma, diabetes and cancer.

In particular it will assist more vulnerable Australians, such as those with a pensioner concession card, Australian seniors health card or a healthcare card. It will also provide benefit for gold-, white- and orange-card holders under the Repatriation Pharmaceutical Benefits Scheme.


The Morrison government's commitment to the PBS is rock solid. It is a fundamental pillar of our belief as a party, as a movement and as a government. Together with Medicare, it is a foundation of our world-class health system.

The changes proposed in this bill will further improve affordability of PBS medicines, and I am confident they will be welcomed by all Australians.

The aim of this government is to ensure that Australians have timely access to affordable medicines. This bill and these changes will directly benefit the people who most need access to medically-necessary and often life-saving prescription medicines.

The ability to list medicines such as Orkambi for cystic fibrosis, which would otherwise have cost a quarter of a million dollars a year, or Spinraza for spinal muscular atrophy at well over $300,000 a year or Kalydeco for beautiful young children between 12 and 24 months with cystic fibrosis, which would cost in the order of $300,000 a year, is, in my belief, one of the hallmarks of a great society. It is something which is fundamental to our belief and is something which we will continue.

Our government, therefore, has a commitment to list all medicines on the PBS when recommended to do so by the medical experts. That recommendation is, however, a legal precondition before we can make such recommendations, and it's a precondition that those recommendations are complied with before we can complete the listing process.

We will continue, therefore, to list all new medicines on the PBS. I have to say that this is in contrast to the previous government, who in 2011 stopped the listing of some new medicines for the simple reason that they could not manage the economy. As the budget papers of the day said, due to fiscal circumstances the government will defer the listing of some new medicines until fiscal circumstances permit. Under us, fiscal circumstances will always permit the listing of new medicines.

Changes to the PBS safety net were a fundamental commitment to the Australian people at the recent election, and we are delivering on that commitment today.

Due to our strong economic management we are able to make these changes, reducing the out-of-pocket costs for patients who access the medicines they need through the PBS. I am delighted to commend this bill to the House.

Debate adjourned.