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Cabinet keeps PBS under its thumb

The Federal Government has knocked back attempts to reduce political interference in the listing of medicines, reaffirming its power to have final say in the approval of subsidies for low-cost medicines. The Commonwealth has rejected the recommendation of a Senate inquiry that medicines costing less than $10 million a year that have been approved by the Pharmaceutical Benefits Advisory Committee (PBAC) be listed on the Pharmaceutical Benefits Schedule without requiring Cabinet approval – the so-called $10 million rule.

19 Aug 2012

The Federal Government has knocked back attempts to reduce political interference in the listing of medicines, reaffirming its power to have final say in the approval of subsidies for low-cost medicines.

The Commonwealth has rejected the recommendation of a Senate inquiry that medicines costing less than $10 million a year that have been approved by the Pharmaceutical Benefits Advisory Committee (PBAC) be listed on the Pharmaceutical Benefits Schedule without requiring Cabinet approval – the so-called $10 million rule.

In a contentious decision, the Government told the Senate’s Finance and Public Administration References Committee that it was appropriate for it to “apply responsible fiscal scrutiny to proposed new PBS listings, as it does for all new expenditure”.

“The Government will continue to consider all new PBS drug listings in a timely manner, and how these listings compare with other health spending priorities such as training new doctors and nurses, opening new hospital beds and investing in new preventative health programs,” it said.

AMA President Dr Steve Hambleton told The Australian Financial Review the Government’s position undermined the work of the PBAC, which recommended only drugs that were found to be cost effective.

The Senate inquiry was triggered by the Government’s decision last year to defer the listing of several new drugs recommended by the PBAC, and to make all new listings subject to Cabinet consideration.

The AMA led a chorus of outrage at the decision, which led to a 12-month moratorium on the move to scrap the $10 million rule, which is due to expire at the end of next month.

The Government also refused a committee recommendation to drop its requirement that new PBS listings be offset by savings.

“The Government is committed to supporting a strong economy and continues to apply responsible fiscal scrutiny to all new expenditure, including those relating to PBS listings,” it said. “It has always been the Government’s role to consider where finite resources would best be directed, and to weigh expenditure decisions against competing pressures in the Budget.”

AR

 


Published: 19 Aug 2012