Television interview with Minister Butler, ABC 7:30 – 28 July 2025

SARAH FERGUSON, HOST: All things Medicare were central to Labor's victorious election campaign - now the rubber hits the road. This week, first off, the Government introduces a new bill lowering the cost of prescription medicines. The Health Minister Mark Butler joined me earlier. Mark Butler, welcome to 7.30.
 
MARK BUTLER, MINISTER FOR HEALTH AND AGEING, MINISTER FOR DISABILITY AND THE NDIS: Thanks, Sarah.
 
FERGUSON: You're introducing legislation to cut the cost of medicine on the PBS. When can people expect to see the impact of that new legislation at their local pharmacy?
 
BUTLER: They'll see this fifth wave of cheaper medicines take effect on January 1, 2026. The important thing is that builds on four different waves of cheaper medicines policies that have already saved Australians about $1.5 billion at the pharmacy, delivered tens of millions of additional free scripts to pensioners. And because we now have 60-day scripts delivering twice the amount of medicine for the price of a single script. We know that there have been about 35 million fewer visits to the pharmacy, saving people time as well as money.
 
FERGUSON: Now, the central promise of Labor's campaign was really built around access to bulk billing. The Prime Minister brandished his Medicare card on numerous occasions as we know, saying, this is all you will need. Whatever the fine print that was detailed during the campaign, that's what people understood. Did he exaggerate?
 
BUTLER: No, we were very clear about what this would mean. We're confident this will get bulk billing back up to 90 per cent for people who don't have a concession card. So, because of the investments we made a couple of years ago, bulk billing has returned to more than 90 per cent for pensioners and people who have a concession card, but it's continuing to slide for all of the other Australians. We're confident we'll get to 90 per cent. We've said that we'd do that over the course of the rest of this decade. It was very carefully modelled on the basis of exactly what GPs are charging right now, so we calibrated the policy to make sure that the overwhelming bulk of them would be better off financially. And I'm confident we’ll get there.
 
FERGUSON: Now, bearing in mind the Prime Minister's promise, you said that this is due to come in by 2030. But the incoming brief to Government that we saw released last week said that 23 per cent of clinics won't join the program. How do you meet the target if so many clinics aren't participating?
 
BUTLER: That was in our media release as well. That's the modelling we based the policy on when we announced the policy. I said that about three-quarters of general practices we were confident would go to full bulk billing because it would be in their financial interests as well as in the interests of their patients. The other quarter, we think, will probably continue to mix bill, so they’ll bulk bill their pensioners, the kids who come through their door. On average, a practice that doesn't fully bulk bill is still bulk billing about 70 per cent of their consults. Three-quarters at 100 per cent, a quarter at about 70 per cent gets us to 90 per cent over the course of the coming years.
 
FERGUSON: You make it sound very straightforward, but there's still a lot of reluctance to embrace this within the medical profession. I want to take you to a specific part of it, the scheme also offers a 12.5 per cent loading if a practice is 100 per cent bulk billed. Who gets that money? The practice or the doctors?
 
BUTLER: We're working through that question with the sector very closely. I've had meetings myself, certainly my department is consulting with individual GPs and their representatives, but also with practice and practice representatives as well. We'll make a call on that. Some are saying that the practice should get the whole lot. Someone’s saying that the doctors should get the whole lot. Some are saying that it should be divided evenly. We've had a very good process of consultation on that and I'll make a call on it over coming weeks.
 
FERGUSON: But then how can you be certain about the earnings that people have if you haven't yet decided who gets that very significant extra 12.5 per cent on top of the incentives already on offer.
 
BUTLER: Yeah. To be conservative we've assumed the practice is broadly split evenly between practices and practitioners themselves. If that changed at the margins, again, that might change the salary that a GP fully bulk billing might get, but only at the margins. The real answer is that, in two years a full-time bulk billing doctor will have received a salary increase of about $125,000, just in two years. For a doctor in the bush, that would be about $155,000 additional money for bulk billing all of their patients.
 
FERGUSON: Let me ask you a simple question, if it is as simple as this, and if your modelling is as secure as you claim, why would anybody be unwilling to do this?
 
BUTLER: This is a hard sector to make change in. That’s been the case -
 
FERGUSON: Yeah, but if you're offering people over $100,000, I can’t think of many cases where people are going to say no. So, what are we missing here? There's got to be a bit missing for so many people to be pushing back on these changes.
 
BUTLER: I think that the proof of the pudding will be in the eating for the practices. Really crunching the numbers over coming months, making the decisions before 1 November. For all of the practice or doctors that might be sort of talking sceptically about this, I'm talking to lots of doctors and lots of practices who have taken the decision that they'll go back to full bulk billing from 1 November. All we can do, given that I don't employ doctors, it's not like the UK NHS, these are private businesses, is to calibrate the policy carefully to make sure that as many practices were better off as I could afford responsibly using taxpayer dollars. And I think that we've done that.
 
FERGUSON: I want to ask you one question about Donald Trump. Now, he signed an executive order last month on drug pricing. We're trying to understand what the consequences are for Australia. I know, at the moment, that you are looking at including on the PBS a very exciting new early Alzheimer's drug. Is it possible that that drug could be affected by Donald Trump's order?
 
BUTLER: We're working to continue good medicines policy on behalf of Australian patients. We're still a little unclear about what the US Administration has in mind for pharmaceuticals. Early last week, there was a view from the administration they'd make a decision over the coming 12 to 24 months about potential tariffs, not just on Australia but on the rest of the world. Then in the middle of last week, the President said that it might be towards the end of this month. I think that we are, all around the world, trying to understand the nature and the timing of anything in the pharmaceutical sector.

In the meantime, we're getting on with the job of looking after Australian patients. That drug you're talking about, Donanemab, is really exciting in a space, the dementia space, that has not seen any really successful drug innovations in 40 years since we first discovered the role of the amyloid protein on the brain in driving Alzheimer's. It's already been approved by the Therapeutic Goods Administration. It's being considered by our PBS experts. I think at this month's meeting we'll hear more about that in coming weeks when they publicise their decisions. But we're getting on with the job, making medicines cheaper and listing new medicines on the PBS.
 
FERGUSON: But are you worried that Donald Trump's orders of trying to impact drug pricing could mean that a US manufacturer of a drug like that could say no to the price that you want it at in Australia?
 
BUTLER: US manufacturers, European manufacturers, they want bigger profits for their drugs that they sell all around the world, including in Australia. That's not new, it didn't come along with President Trump. Twenty years ago, John Howard was dealing with this issue in negotiating the US Free Trade Agreement. Our job is to use our buying power as a Federal Government, others countries do this as well, to negotiate the best possible price for medicines for taxpayers here in the country. We've been doing that. I get that US Big Pharma want more profits from their products. My job is to get the best possible price and then lower that price for Australian consumers. That's what we're doing.
 
FERGUSON: Mark Butler, thank you very much indeed for joining us.
 
BUTLER: Thanks, Sarah.