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National Health Amendment (Safety Net Thresholds) Bill 2019

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2019

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

National Health Amendment (SAFETY NET THRESHOLDS) Bill 2019

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Health, the Hon Greg Hunt MP)



 

 



National Health Amendment (SAFETY NET THRESHOLDS) Bill 2019

 

OUTLINE

 

The Pharmaceutical Benefits Scheme (PBS) operates under Part VII of the National Health Act 1953 (the Act) and provides Australians with timely, reliable and affordable access to necessary and cost-effective medicines.

 

The National Health Amendment (Safety Net Thresholds) Bill 2019 (the Bill) amends the Act to implement a Government election commitment to lower the Pharmaceutical Benefits Scheme (PBS) Safety Net threshold amounts that apply to general and concessional patients.

 

Reducing the safety net threshold

The amendment in Schedule 1 will make changes to effect reductions in the PBS Safety Net threshold amounts for concessional and general patients. This will implement a 2019 election commitment.

 

Schedule 1 will amend the definition of ‘concessional beneficiary safety net’ to lower the concessional beneficiary charge multiplier, and ‘general patient safety net’, to establish a lower safety net amount.

 

This amendment will improve community access to affordable medicines, as threshold amounts will be reached sooner by patients, allowing them to qualify earlier each year for access to PBS medicines either at no cost or at a cheaper price.

 

The measure to lower the PBS Safety Net thresholds was announced as an election commitment and at the time was welcomed by stakeholders for its benefits to consumers of PBS medicines. Ongoing consultation has occurred with Services Australia and the Department of Veterans’ Affairs to ensure successful implementation of the legislation from the date of commencement.

 

Financial Impact Statement

The amendments in Schedule 1 are estimated to result in the following costs over the forward estimates period:

 

Impact on

2018-19

2019-20

2020-21

2021-22

2022-23

Underlying Cash Balance ($m)

0.0

-6.0

-104.3

-107.5

-111.0

Fiscal Balance ($m)

0.0

-6.4

-109.8

-107.7

-111.2

 

 

 



 

Statement of Compatibility with Human Rights

 

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

 

NATIONAL HEALTH AMENDMENT (SAFETY NET THRESHOLDS) BILL 2019

 

This Bill 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 Bill

The National Health Amendment (Safety Net Thresholds) Bill 2019 (the Bill) amends the National Health Act 1953 (the Act) to implement a 2019 Government election commitment to lower the Pharmaceutical Benefits Scheme (PBS) Safety Net threshold amounts that apply to general and concessional patients.

 

Human rights implications

This Bill is compatible with Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights 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 assists with advancement of this human right by providing subsidised access to medicines for Australians.

 

The amendment to lower the PBS Safety Net threshold amounts will improve community access to affordable medicines. The threshold amounts will be reached sooner by patients, allowing them to qualify earlier each year for access to PBS medicines either at no cost or at a cheaper price.

 

Conclusion

This Bill is compatible with human rights as it does not raise any human rights issues. The amendments made by this Bill will have a beneficial impact on human rights, through reduced out of pocket health costs and improved access to PBS medicines.

 

The Hon Greg Hunt MP, the Minister for Health

 



 

NATIONAL HEALTH AMENDMENT (SAFETY NET THRESHOLDS) BILL 2019

 

NOTES ON CLAUSES

 

Clause 1 - Short Title

Clause 1 provides for the short title of the Act to be the National Health Amendment (Safety Net Thresholds) Act 2019 .

 

Clause 2 - Commencement

This clause provides for the whole of the Act to commence on 1 January 2020.

 

Clause 3 - Schedule(s)

This clause provides that legislation that is specified in a Schedule to the Bill is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule has effect according to its terms. The Schedule to the Bill amends the National Health Act 1953 (the Act).



 

SCHEDULE 1 — Safety Net Thresholds

 

Item 1

This item amends the definition of concessional beneficiary safety net in section 99F of the Act, revising the amount from being the equivalent of 60 PBS co-payments to the equivalent of 48 co-payments.

 

When this amendment takes effect for the entitlement period commencing 1 January 2020, the concessional beneficiary safety net will be the new concessional beneficiary charge (as defined in section 99F of the Act) as indexed on 1 January 2020, multiplied by 48.

 

The concessional beneficiary charge for the entitlement period commencing 1 January 2020 is estimated to be $6.60. Based on this estimate, and subject to variation in indexation, the concessional beneficiary safety net is expected to be $316.80.

 

Item 2

This item amends the definition of general patient safety net to be $1,486.80. The general patient safety net is currently defined as the amount that was the general patient safety net immediately before 31 December 2009. The amount of $1,486.80 is based on the successive annual indexation of the amount that was the general patient safety net immediately before 31 December 2009. It is appropriate to state its current amount for clarity.

 

Item 3

This item inserts a new subsection 99G(1A) into the Act, to provide that the general patient safety net as amended by item 2 is not indexed on 1 January 2020. The amount of $1,486.80 for the general patient safety net is based on the expected PBS general co-payment amount for 2020 and is not intended to be subject to the usual indexation process on 1 January 2020.

 

The effect of this amendment is that this general patient safety net amount will not be subject to indexation on 1 January 2020. Indexation will next take place on 1 January 2021, when the amount of $1,486.80 will be understood as the Current figure as defined in section 99G(3)(a) of the Act - “an amount that has not yet been indexed” under section 99G - and should thereafter be indexed in accordance with section 99G.