Minister for Health and Aged Care – doorstop in Canberra – 7 August 2023

Read the transcript of Minister Butler's doorstop in Canberra about cheaper medicines.

The Hon Mark Butler MP
Minister for Health and Aged Care

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MINISTER FOR HEALTH AND AGED CARE, MARK BUTLER: Three months ago now I announced the Government's fourth wave of cheaper medicines reform, having already delivered three waves in our first 12 months, reducing the maximum amount pensioners pay for their medicines across the year by 25%. We did that last July. In September, we cut the price of 2,000 brands of medicines - $130 million back into the pockets of patients. And on the 1st of January delivered the biggest cut to the price of medicines in the 75-year history of the PBS, which has already delivered in just six months: $120 million in savings to patients. This is incredibly important during this global cost of living shock that we're experiencing. But in May I announced that there was more to do, and that's why we accepted the advice of the medicines experts who manage the PBS. Advice they delivered to the former government five years ago, but advice that would allow doctors to issue 60-day prescriptions for certain common medicines to treat ongoing health conditions. We did that and we did it for good reason. It will halve the cost of medicines for people who are not on a medicine for a short period of time, but are on these medicines for years, if not decades, if not the rest of their lives. It will also be good to free up millions of GP consults, which we all know are desperately needed right now - free them up from routine repeats script appointments to much more complex needs that are out there in the community with long waiting lists. And it will also be good for health. We know from overseas evidence given that most countries we compare ourselves to already do this, that it improves medication compliance.


Now over the course of this three months, we've seen some pretty desperate scare campaigns from the pharmacy lobby, most of them supported by the Coalition. First of all, we saw a scare campaign that this would be unsafe for patients - debunked by doctors, debunked by the medicines experts, and I'm glad since dropped. We then saw a scare campaign that this would somehow create medicine shortages - again debunked by industry, by the medicines experts who run the PBS system themselves. But now we've plumbed new depths with this scare campaign today that suggests that aged care residents will have to pay some new fee depicted by some as some new tax for medicines that they receive in aged care facilities. Now, not only is this base, not only is it self-serving and cynical, it's also complete rubbish. Aged care facilities are funded to take responsibility for medication management for their residents. The Guiding Principles make it very clear that facilities are expected to have medicine packaging arrangements in place so that their residents get the right medicine, at the right dose, at the right time, every single day. Now, some facilities have effectively outsourced that responsibility to their local community pharmacy to do the Webster packs - to package the medicine needs for every day. And that, no doubt, reflects the fact that being the supplier of medicines to an aged care facility as a pharmacy can be a pretty lucrative source of revenue for pharmacies. For a 100-bed facility, for example, it might mean as much as $150,000 a year in income just for the dispensing and handling fees for those medicines.


But let me be clear, these arrangements are the responsibility of an aged care facility. And any cynical attempt by the pharmacy lobby or anyone else to create a loophole to start charging aged care residents for this will be shut down by this Government very quickly. This is the responsibility of facilities whether they do it themselves, or they outsource it to pharmacies. And it is an absolutely new, awful low for the pharmacy lobby to try to scare older people and their families that they might have to pay a fee that, frankly, is the responsibility of their facility. Happy to take questions.


JOURNALIST: Minister, this is - the pharmacists lobby say - removing some of the grants or subsidies that's paid by the Government, therefore, forcing up costs. Isn't the only result going to be more cost for the consumer.


BUTLER: This is, across the four years as this is being introduced, depending on your estimates, somewhere between 1% and 2.5% of revenue. Put in context, the fact that the pharmacy industry grew their revenue by 30% over the last four years. So, it's not nothing. But let's put that put this in context. We've also committed to reinvesting every single dollar of the $1.2 billion that taxpayers will save from this measure: every single dollar reinvested back into community pharmacy. And on top of that, we've been we're investing an additional $350 million in response to recommendations from the Aged Care Royal Commission to improve medication management in aged care. So, look, this is just another scare campaign from the pharmacy lobby. The question of medication packaging for aged care residents which is covered by aged care funding, clearly the responsibility of aged care facilities has nothing to do with 60-day prescriptions or 30-day prescriptions. This is just the latest attempt to create fear and to scare older Australians and their families who are currently in aged care facilities.


JOURNALIST: You've called it the scare campaign. What happens if it comes true?


BUTLER: I've made very clear what the existing funding arrangements are. Aged care facilities are funded for this service. The Guiding Principles for medication management issued to every aged care facility, make it clear that their responsibility is to have in place packaging arrangements. So that's dose set aids or Webster packs. Now, they might outsource that to pharmacies, they might do it in house, that's not really a matter for the aged care resident. The issue is: Government funds aged care facilities to do it, they've got a responsibility to do it. So, this idea of a new fee or a new tax on aged care residents is just rubbish. It is just rubbish that ignores the reality of aged care funding arrangements and seeks to instill fear in some of our most vulnerable members of the community.


JOURNALIST: So, you can guarantee then that no aged care residents will be forced to pay any more, any extra dollar, as a result of 60-day prescriptions?


BUTLER: I've set out very clearly what the what the funding arrangements are in aged care. Facilities are funded to do this service. The Guiding Principles make it clear that that includes packaging to make sure that residents get the right dose, the right medicine at the right time. If the Pharmacy Guild is determined to create some new loophole, can't say quite how they do it, but some new loophole to lob a fee on our most vulnerable members of the community. And I'll tell you what, we will shut down that route. This is a responsibility of the facility not of the resident.


JOURNALIST: Why do you think the Pharmacy Guild has specifically brought up aged care residents today?


BUTLER: Because it touches a hot button issue for the community. I mean, obviously, this is the most vulnerable group in our community, more than 200,000 older Australians who worked hard, paid their taxes, raised their families, now need the support of their community in their later years. There's no more sensitive issue for the community than people who are living in aged care. So, if you want to create a scare campaign, which clearly the pharmacy lobby wants to do, that's a good area to go to. I just point out; it is what it is: it's a scare campaign. And it's rubbish. These arrangements are covered by existing funding, which has nothing to do with 60-day prescriptions, nothing to do with direct funding arrangements to pharmacy. That's why, for example, this is specifically excluded from the existing Community Pharmacy Agreement that the Pharmacy Guild signed with the last with the last government. Because they understand, when they've been honest with themselves, they understand that these funding arrangements are covered by aged care, not by the community pharmacy.


JOURNALIST: Is there any chance that the rollout of 60-days is delayed? And on the dispensing fee: is there a possibility that to compensate the Pharmacy Guild and kind of compromise on this, that it's increased by more than the expected, I think, indexed increase?


BUTLER: I’ll make a couple of points about that. Firstly, we indexed pharmacy payments by 7% on the 1st of July, that is twice the indexation that the rest of the Medicare system received – in spite of the fact that that was the biggest indexation to Medicare in more than 30 years. So, a very solid indexation for those dispensing and handling fees paid to every community pharmacy in Australia. I can't think of any other part of the health system that got 7% indexation this year – very, very substantial indexation. Now, we've outlined all of our reinvestment arrangements. I said that $1.2 billion that we will save as a Commonwealth will be reinvested into community pharmacy, I announced the latest installment in that I think the week before last which particularly targets support to smaller rural pharmacies. And in the broader sense, we are determined to push ahead with our commitment to deliver cheaper medicines, starting on the 1st of September. This will roll out in three tranches. But the first tranche will roll out as far as the Government's concerned in the first on the first of September.


JOURNALIST: So, can you rule out another increase in the dispensing fee to compromise with the Guild, because you've cut it in half effectively?


BUTLER: Let’s be clear that there is less handling when you're only actually dispensing a medicine once every 60 days, instead of once every 30 days. This will only cover 300 medicines and only where a doctor has decided to issue a 60-day script to a patient that they consider to be stable. This is a sensible arrangement; it was advised to the former government five years ago. In terms of future arrangements for dispensing fees, I've also announced this morning that we would bring forward negotiations for the next Community Pharmacy Agreement. I’ve seen a somewhat strange response to that from the Pharmacy Guild. I mean, they had asked for this, they now seem to be a bit ambivalent about whether they want those negotiations to proceed or not. But we are determined to bring forward those negotiations if the Guild is interested in sitting down with us. Because we think there's a lot of change happening in the pharmacy sector, we're honest about that.


This move to 60-day prescriptions is long overdue. Other countries do it. It reflects - as I've tried to do in the Medicare system - the fact that health needs of the community are different now to what they were 40 years ago. 30-day dispensing makes sense when you go to a doctor for a single course of medicine, because you’ve got a single infectious disease or something like that. 30-day dispensing does not make sense when you're on the same medicine year after year, decade after decade, sometimes for your entire life. That's why we're doing it. But we know it's a substantial change to the way in which pharmacy operates. We also know there is big change coming around the scope of practice, all governments want pharmacists to be able to deliver more health services to their community. That's why there's a National Scope of Practice Review. So, we think it's important to bring forward those negotiations to give the pharmacy sector a sense of confidence and certainty over the next five years instead of waiting another year or two for the new Agreement. And we hope that the Guild is willing to sit down with us, as well as other members of the pharmacy sector and obviously, importantly, consumers. We're committed to making sure there's a consumer patient voice in these negotiations as well.


JOURNALIST: Minister, on another matter if I may, four Urgent Care Clinics in Victoria are not operating at the extended hours that were promised at the election. What kind of support are you offering those facilities, especially where doctor shortages are the issue?


BUTLER: Obviously, we've committed to 50 Urgent Care Clinics and are committed to them rolling out over the course of calendar 2023. We think we will deliver substantially more than 50. But obviously, like every health service in the country, whether you're talking standard general practices or hospitals, everyone in the health care system is struggling with staff shortages right now. This is a global issue, not just an issue across the Australian health care system. So, we committed to these being extended hour clinics, to being fully bulk billed, to operating seven days a week, because that's what a meaningful urgent care service does. But we're not always going to be able to click our fingers and from day one, have every service operating those hours from the outset. We're working with all of our urgent care service providers to make sure that those arrangements that were made very clear in the request for tender, will be able to be introduced very quickly.


JOURNALIST: So, what kind of support are you providing?


BUTLER: We're working with them, obviously, you know, we can't just conjure up doctors, particularly in the cities where there are recruitment restrictions - for example, for overseas trained doctors - there will have to be bespoke approaches. Not only are there challenges in finding doctors, there are challenges in finding nurses to work in primary care as well as hospital settings. So, we're committed to making sure this service is in place, it's going to deliver a great service to members of the community who need urgent care for non-life-threatening emergencies. But importantly, it's also going to take much needed pressure off our emergency departments.


JOURNALIST: Sorry, what is an example of a bespoke arrangement?


BUTLER: Look at what the supply of doctors are in particular regions: this is very patchy across different parts of the country. Even from city to city, these arrangements are patchy. So, we'll work with Primary Health Networks, with rural workforce agencies who have responsibility for making sure that practices are supported in recruiting doctors. But we're committed to making sure this model works.


JOURNALIST: We're seeing less and less Australians actually going to their GPs compared to pre-pandemic times, just purely because it's they can't afford it with cost of living pressures. Bulk billing isn't an option at many GPs these days. So, what can be done to fix this issue?


BUTLER: We tripled the bulk billing incentive in the May Budget. That will come in, in the usual cycle of changes to the Medicare schedule, in November. The College of GPs has described that as a game changer. It really is going to take a lot of financial pressure off general practices that built up, particularly over the last decade, where there were substantial freezes to the rebate. So, this will take pressure off practices in a financial sense, but also give confidence to parents of children who should be eligible for bulk billing and pensioners, concession card holders, that there will be bulk billing arrangements available to them. We also know, though, that there is a challenge out there in general practice. I've been talking, I think candidly, about that since before the election. Not enough medical graduates are choosing general practice as their preferred career. Which means, as general practitioners are retiring, we're struggling to get new GPs into the system, particularly in rural Australia, but increasingly, in the cities as well. That's why we're working in a comprehensive way to try and make sure that Medicare is fit for the needs of patients today, but also working with state governments through the National Cabinet process on how we get more general practitioners, medical graduates, general practitioners from overseas in rural areas into the system more quickly and more effectively. Thanks, everyone.


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