Behind the PBS – the real cost of prescription medication.

Pills2Ever wondered how much your prescription is really costing? Figures show that Australian taxpayers are forking out huge amounts of money each year for prescription drugs.

Statin drugs like Lipitor, topped the list at a total cost of $1.66 billion. This medication costs around $65 in total, but concession card holders are paying a mere $5.90, which then becomes free after the Safety Net is reached.  Also high up there were blood pressure tablets like ACE inhitors at $567 million, and proton-pump inhibitors (anti-acid drugs) like Nexium at $514 million. The huge cost of these drugs is putting enormous pressure on the government and taxpayers, leaving many asking where it ends. [1] Imagine if a multivitamin was subsidised by the PBS…each bottle would only cost $5-6 to the end user!

Some panels of experts say that in addition to Australia’s growing health crisis, the government is paying too much for drugs. Currently, when pharmaceutical drugs become available and are listed for government subsidy on the PBS, the government negotiates a price with the manufacturer, which pharmacists then pay when they buy the medication and dispense it. However, when patents on these drugs end, then cheaper generic versions become available for pharmacies to buy, the government can still be left reimbursing them for the higher pre-negotiated amount, unaware that the price has dropped. Pharmacists get to keep the difference.

According to Consumer Health Forum Australia, this delay in passing on the price difference can result in overpayments of up to $3 million per day. This equates to 55 GP visits per minute, or 90,000 full time nurses per year. [2] Fortunately, this process is currently under review by the Abbott government.

With a healthcare system in crisis, the high amount of prescriptions for preventable health problems is a burden that may end up being too heavy for the PBS to carry.

[2] Prescription medicine: Australia spends $1bn too much,, Tuesday 24 September 2013

Photo credit: tacit requiem (joanneQEscober ) / Foter / CC BY