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Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Outcome 2
Access to cost-effective medicines, including through the Pharmaceutical Benefits
Scheme and related subsidies, and assistance for medication management through
industry partnerships
Outcome Strategy
The Australian Government, through Outcome 2, aims to provide reliable, timely
and affordable access to cost-effective, sustainable and high quality pharmaceutical
services and medicines. The Government is committed to achieving this outcome
by subsidising the cost of medicines through the Pharmaceutical Benefits Scheme
(PBS), providing free access to expensive and ‘life saving’ drugs, and the provision
of aids and appliances. The Government provides advice to health professionals
and consumers on the quality use of medicines, and works with the
pharmaceutical industry to ensure the supply of medicines under the PBS.
The Government continues to collaborate with community pharmacy and peak
bodies, such as the Pharmacy Guild of Australia, the Pharmaceutical Society of
Australia, and others through the Programs Reference Group to implement the
Fifth Community Pharmacy Agreement (the Fifth Agreement) over five years to
30 June 2015. Around 5,000 pharmacies continue to be remunerated for dispensing
PBS medicines and providing pharmacy programs and services. The Community
Service Obligation arrangements with pharmaceutical wholesalers will also
continue to be funded through the Fifth Agreement. The location rules for Section
90 approved community pharmacies are maintained under the Agreement but will
be streamlined.
The Government will continue to collaborate with industry and consumer groups
on the ongoing implementation and monitoring of the further pricing reforms and
other initiatives agreed to under the Memorandum of Understanding (MoU) with
industry, such as the Managed Entry Scheme and Parallel Processing. Key
stakeholder groups include Medicines Australia, the Generics Medicines Industry
Association and the Consumers Health Forum.
Together, both the Fifth Agreement and the MoU are delivering savings of over
$2.5 billion over five years to support the ongoing sustainability of the PBS.
The National Medicines Policy provides an overarching framework for the
activities in Outcome 2. The policy seeks to produce better health outcomes
through improved access to, and quality use of medicines. There are four central
objectives of the policy: timely access to medicines at an affordable cost to
individuals and the community; medicines should meet quality, safety and efficacy
standards; quality use of medicines; and maintaining a responsible and viable
medicines industry.
In order to ensure the quality use of medicines, it is essential that consumers have
information about the medicine they are taking. The Australian Government,
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Outcome | 02
ACCESS TO PHARMACEUTICAL SERVICES
Budget Statements – Department of Health and Ageing
through a number of initiatives, provides Australians with facts they need to make
informed decisions about the medicines they take and ensure their safe and
effective use.
In 2011-12, the Government will establish a systematic data collection of postmarket medicine use and enhance the National Medicines Policy framework to
provide evidenced-based advice for decision and action on medicines post-PBS
listing. This post-market data will improve cost-effectiveness reviews and
education and feedback to consumers, medical practitioners, pharmacists and
governing bodies of areas where medicine use may be less than optimal.
Outcome 2 is the responsibility of Pharmaceutical Benefits Division.
Programs Contributing to Outcome 2
Program 2.1: Community pharmacy and pharmaceutical awareness
Program 2.2: Pharmaceuticals and pharmaceutical services
Program 2.3: Targeted assistance – pharmaceuticals
Program 2.4: Targeted assistance – aids and appliances
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Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Outcome 2 Budgeted Expenses and Resources
Table 2.1 provides an overview of the total expenses for Outcome 2 by Program.
2010-11
2011-12
Estim ated Estim ated
actual1 expenses 1
$'000
$'000
Program 2.1: Com m unity pharm acy and pharm aceutical aw areness
Administered expenses
Ordinary annual services (Appropriation Bill No. 1)
244,226
311,173
Departmental expenses
Departmental appropriation2
Expenses not requiring appropriation in the budget year 3
Total for Program 2.1
Program 2.2: Pharm aceuticals and pharm aceutical services
Administered expenses
Ordinary annual services (Appropriation Bill No. 1)
Special appropriations
National Health Act 1953 - pharmaceutical benefits
Departmental expenses
Departmental appropriation2
Expenses not requiring appropriation in the budget year 3
Total for Program 2.2
Program 2.3: Targeted assistance - pharm aceuticals
Administered expenses
Ordinary annual services (Appropriation Bill No. 1)
Departmental expenses
Departmental appropriation2
Expenses not requiring appropriation in the budget year 3
Total for Program 2.3
Program 2.4: Targeted assistance - aids and appliances
Administered expenses
Ordinary annual services (Appropriation Bill No. 1)
Special appropriations
National Health Act 1953 - aids and appliances
Departmental expenses
Departmental appropriation2
Expenses not requiring appropriation in the budget year 3
Total for Program 2.4
113
11,803
371
10,685
636
256,400
322,494
182,816
186,235
9,041,971
9,646,858
35,568
1,119
32,200
1,917
9,261,474
9,867,210
137,648
159,428
1,769
56
1,602
95
139,473
161,125
621
802
246,113
266,319
1,868
59
1,691
101
248,661
268,913
Outcome | 02
Table 2.1: Budgeted Expenses and Resources for Outcome 2
Budget Statements – Department of Health and Ageing
Table 2.1: Budgeted Expenses and Resources for Outcome 2 (Cont.)
2010-11
2011-12
Estim ated Estim ated
actual1 expenses 1
$'000
$'000
Outcom e 2 totals by appropriation type
Administered expenses
Ordinary annual services (Appropriation Bill No. 1)
Special appropriations
Departmental expenses
Departmental appropriation2
Expenses not requiring appropriation in the budget year 3
Total expenses for Outcom e 2
Average staffing level (num ber)
1
2
3
565,311
9,288,084
657,638
9,913,177
51,008
1,605
46,178
2,749
9,906,008
10,619,742
2010-11
261
2011-12
249
The 2010-11 estimated actual and the 2011-12 estimated expenses are based on the new program structure to be
implemented 1 July 2011 by the department as part of the Health and Ageing Portfolio - administrative efficiencies
measure.
Departmental appropriation combines ‘Ordinary annual services (Appropriation Bill No 1)’ and ‘Revenue from
independent sources (s31)’.
‘Expenses not requiring appropriation in the Budget year’ is made up of depreciation expense, amortisation
expense, make good expense and audit fees.
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Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Program 2.1: Community pharmacy and pharmaceutical
awareness
Program Objectives

support timely access to medicines and professional pharmacy services
through the implementation of the Fifth Community Pharmacy Agreement.
Major Activities
Fifth Community Pharmacy Agreement
The Australian Government will work to ensure all eligible Australians continue
to have timely access to PBS medicines and other professional services through
the Fifth Community Pharmacy Agreement (the Fifth Agreement). The Fifth
Agreement provides funding over five years, from 2010-11 to 2014-15, to
remunerate pharmacists for dispensing PBS medicines and provides pharmacists
with a range of professional programs and services, including services to support
medication management, programs to assist the pharmacy workforce, activities to
support improved service quality, and ongoing research and development work.
In addition to six new programs that will be introduced as part of the Fifth
Agreement, nine existing programs will continue, many with enhancements such
as improved accountability and greater focus on patient outcomes. These
enhancements are based on reviews conducted as part of the Fourth Community
Pharmacy Agreement.
In support of these programs, the Programs Reference Group, established in
2010-11, will continue to provide advice to the Minister for Health and Ageing on
the design, implementation and evaluation of elements of the Fifth Agreement.
In addition, the department will continue to work with consumers, Medicare
Australia, the Pharmacy Guild of Australia, and other peak pharmacy,
accreditation and standards setting organisations to enhance services, improve
health literacy and decrease the risk of medicine-related harm.
In 2011-12, the department, in conjunction with the Pharmacy Guild of Australia,
will pilot eligibility for in-pharmacy medicines checks for consumers. To be known
as a MedsCheck and Diabetes MedsCheck, these new services will be targeted at
people on a complex regimen of medications or who have type 2 diabetes, and will
provide users with information about their medical conditions and medicines, and
instruction on how to use their medicines safely and effectively. These services will
be rolled out nationally from 1 July 2012.
In 2011-12, the Rural Pharmacy Workforce program will continue to provide
education, training and other initiatives which provide access to pharmacists in
rural and remote areas, such as locum schemes. The program will continue to
financially support pharmacies in rural and remote areas to assist rural
communities maintain access to PBS medicines by recognising the additional costs
and difficulties associated with operating services in these areas.
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Outcome | 02
Through Program 2.1, the Australian Government aims to:
Budget Statements – Department of Health and Ageing
The Australian Government is committed to improving the health outcomes for
Aboriginal and Torres Strait Islander peoples through improving the quality use of
medicines and medication compliance, and by improving access to PBS medicines
by addressing cultural, transport and financial barriers to access. Under the
Quality Use of Medicines for Aboriginal and Torres Strait Islander peoples
(QUMAX) program, participating Aboriginal Community Controlled Health
Services (ACCHS) may access funding for Dose Administration Aids, Home
Medication Review models of support, pharmacist support, devices such as
asthma spacers and blood glucose monitors, education and cultural awareness
support, and transport.
The department will work closely with the Pharmacy Guild of Australia and the
National Aboriginal Community Controlled Health Organisation to ensure these
activities continue to meet the needs of the clients at participating ACCHS during
2011-12.
From 1 July 2011, the Pharmacy Practice Incentives Program will provide incentive
payments to all eligible community pharmacies that meet new accreditation
requirements that include displaying and complying with a patient service charter
that outlines the quality of services a consumer can expect from their pharmacy.
The program also offers pharmacies a range of incentives to deliver services that
improve a person’s ability to manage their medication regimen, and through this,
improve their health. The department will work with key stakeholders to provide
ongoing education and training and support for pharmacies in implementing these
new services, including clinical interventions to identify, manage and document
medicine-related problems, and staged supply medicines where PBS medicines are
delivered in instalments when requested by the prescriber.
In 2011-12, the department will streamline the Pharmacy Location Rules to make it
easier for pharmacists to apply for a new, or relocate an existing pharmacy,
approved to supply PBS medicines in areas of community need. The Pharmacy
Location Rules will continue to facilitate a sustainable network of community
pharmacies to ensure all Australians have access to PBS medicines. The rules
include criteria to support the geographical spread of approved pharmacies in
areas of community need and also encourage the establishment of new pharmacies
in rural areas.
From 1 April 2012, under arrangements formalised as part of the Fifth Agreement,
pharmacists will provide the Australian Government with data on PBS
prescriptions that are priced below the general co-payment. Collecting this data
will provide access to a wider range of data for enhanced PBS research, policy
development and program implementation activities.
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Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Program 2.1 Expenses
2010-11
Estim ated
actual
$'000
2011-12
Budget
244,226
Annual administered expenses
Ordinary annual services
Program support
Total Program 2.1 expenses
$'000
2012-13
Forw ard
year 1
$'000
2013-14
Forw ard
year 2
$'000
2014-15
Forw ard
year 3
$'000
311,173
314,971
347,070
366,542
12,174
11,321
10,988
10,748
10,182
256,400
322,494
325,959
357,818
376,724
Program 2.1: Deliverables1
The department will produce the following ‘deliverables’ to achieve the objectives
of Program 2.1.
Table 2.3: Qualitative Deliverables for Program 2.1
Qualitative Deliverables
2011-12 Reference Point or Target
Produce relevant and timely evidence-based
policy research
Relevant evidence-based policy research
produced in a timely manner
Stakeholders participate in program and/or
policy development
Stakeholders participate in program and/or
policy development through avenues such
as regular consultative committees,
conferences, stakeholder engagement
forums, surveys, submissions on
departmental discussion papers and
meetings
Fifth Community Pharmacy Agreement
Implement new accreditation requirements
for community pharmacies that support
quality services, quality infrastructure and
increased inter-professional communication
New accreditation requirements in place
from July 2011
Provide funding to community pharmacies
in rural and remote areas to support the
delivery professional services
Community pharmacies in rural and remote
areas are provided with funding options to
support the delivery of professional services
Implement revisions to professional
programs and services under the Fifth
Community Pharmacy Agreement
Agreement based on reviews of these
programs under the Fourth Agreement
Revisions to improve professional programs
and services under the Fifth Community
Pharmacy Agreement are implemented
within agreed timeframes
Completion of the Medscheck and Diabetes
MedsCheck pilot
Pilot undertaken and evaluated to inform
national rollout from 1 July 2012
1
As a result of the Strategic Review, deliverables may have changed from the 2010-11 Portfolio Budget Statements.
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Outcome | 02
Table 2.2: Program Expenses
Budget Statements – Department of Health and Ageing
Qualitative Deliverables
Streamline the Pharmacy Location Rules
2011-12 Reference Point or Target
Amendments to the rules implemented by
December 2011
Table 2.4: Quantitative Deliverables for Program 2.1
Quantitative
Deliverables
Percentage of variance
between actual and
budgeted expenses
2010-11
Revised
Budget
2011-12
Budget
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
≤0.5%
≤0.5%
≤0.5%
≤0.5%
≤0.5%
61,500
63,000
64,500
66,000
Fifth Community Pharmacy Agreement
Number of medication
management services
provided under the Fifth
Agreement
60,000
Program 2.1: Key Performance Indicators2
The following ‘key performance indicators’ measure the effectiveness of
Program 2.1 in meeting its objectives thereby contributing to the outcome.
Table 2.5: Quantitative Key Performance Indicators for Program 2.1
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
65%
70%
75%
75%
Fifth Community Pharmacy Agreement
Percentage of rural
community pharmacies
accessing targeted
programs to ensure
accessibility of
community pharmacy in
rural and remote
Australia
2
60%
As a result of the Strategic Review, key performance indicators may have changed from the 2010-11 Portfolio
Budget Statements.
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Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
Percentage of
community pharmacies
participating in the
Pharmacy Practice
Incentives Program3
N/A
40%
45%
50%
55%
Program 2.2: Pharmaceuticals and pharmaceutical services
Program Objectives
Through Program 2.2, the Australian Government aims to:


list cost-effective, innovative, clinically effective medicines on the PBS; and
improve health outcomes and the sustainability of the PBS by improving the
evidence base for prescribing decisions and assessing the effectiveness of listed
PBS medicines.
Major Activities
New medicine listings
The Australian Government subsidises the cost of prescription medicines through
the PBS for all eligible general or concessional patients. Patients contribute to the
cost of their PBS prescription medicines through a co-payment. The co-payment
rate in 2011 is $5.60 for a concessional patient and up to $34.20 for a general
patient, with the Government paying the remaining cost of the medicine. The PBS
safety net is designed to assist families and individuals who require a large
number of medicines in a calendar year. In 2011, the PBS safety net threshold for
general patients is $1,317.20, while the concessional patient threshold is $336.00.
After reaching the threshold, general patients usually pay for PBS prescriptions at
the concessional co-payment rate of $5.60, and concessional patients are usually
supplied with PBS prescriptions without charge for the remainder of the calendar
year.
The listing of medicines on the PBS is based on the advice of the Pharmaceutical
Benefits Advisory Committee (PBAC). The PBAC assesses the therapeutic benefits
and cost-effectiveness of medicines, including comparisons with other treatments.
The PBAC is an independent advisory body of medical specialists, general
practitioners and other health professionals, and also includes consumer
representation. The PBAC meets three times a year in March, July and November,
and the agenda is published on the department’s website 4 six weeks prior to each
meeting.
3
The Pharmacy Practice Incentives Program commences in 2011-12.
4
Available at: <www.health.gov.au>.
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Outcome | 02
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Budget Statements – Department of Health and Ageing
In 2011-12, the PBAC will continue to consider and recommend medicines for
listing on the PBS. New listings on the PBS must be both clinically and costeffective. A medicine cannot be included on the PBS unless the PBAC recommends
to the Australian Government that it be listed. Therefore, a positive PBAC
recommendation is a very important step in the listing process. In 2010-11, the
PBAC considered 189 submissions, of which 63 were major submissions 5 requiring
cost-effectiveness analysis. A similar number of submissions are expected to be
considered in 2011-12.
In November 2010 following broad consultation and clinical input from key
stakeholders, nurse practitioners and midwives were given access to prescribe
certain medicines on the PBS deemed appropriate by the PBAC. In 2011-12, the
PBAC will continue to consider whether authorised nurse practitioners and
midwives should prescribe a medicine each time a new listing, or change to an
existing listing, is recommended by the Committee
New listings
Since 1 November 2010, there have been over 101 new listings or alterations to
current listings of medicines, at a cost of $376.4 million over five years.
Following a Government announcement on 9 December 2010, four high cost drugs
were listed on the PBS on 1 February 2011. Dutasteride was listed for the treatment
of benign prostrate enlargement, at a total cost of $77.1 million over five years. It is
expected to assist over 84,000 people in the first full financial year. Azacitidine was
listed to help extend the lives of people suffering from bone marrow disorders, at a
total cost of $124.2 million over five years. It is expected to assist over 670 people
each year.
An extension to the listing of nicotine transdermal patches to cover all Australians
and an extension to the listing of varenicline also commenced on 1 February 2011
and will cost $103.4 million over five years. These listing are expected to assist over
80,000 people a year to quit smoking.
On 25 February 2011, the Government announced the listing of six new medicines
and vaccines on the PBS at a total cost of $127.1 million over five years. The first of
these listings to come into effect was romiplostim which was listed on the PBS on
1 April 2011 and levodopa with carbidopa which was listed on 1 May 2011.
Romiplostim is used for the treatment of idiopathic thrombocytopenic purpura, a
rare blood disorder where the blood does not clot as it should due to a low number
of blood cell fragments called platelets. Complications from the disease are serious
and can include splenectomy, or even death. The listing of this medicine is
expected to benefit around 300 people a year at an estimated cost of $73.0 million
over five years. Levodopa with carbidopa intestinal gel was listed on the PBS as a
specialised last line drug therapy for patients with advanced Parkinson disease. At
an estimated cost of $49.2 million over five years, this listing is expected to benefit
around 190 people a year.
5
Major submissions are those for new medicines or new medical indications for existing medicines that are
required to present comprehensive clinical and economic data which require evaluation before they are
considered by the PBAC.
120
In announcing the listing of these new medicines, the Government also announced
that given the current fiscal environment, the listing of some medicines would be
deferred until fiscal circumstances permit. Deferred listings will be automatically
reconsidered by Government when appropriate to do so, and do not need to be
reconsidered by the PBAC or the Pharmaceutical Benefits Pricing Authority
(PBPA), unless a sponsor seeks a price cut or presents further clinical evidence to
support a new price. Given the need for fiscal discipline to achieve the
Government’s intention to return the Budget to surplus in 2012-13, all changes to
the PBS with financial implications will be considered by the Cabinet.
The Australian Government’s funding arrangement for the provision of
chemotherapy medicines announced in the 2008-09 Budget was deferred from
1 September 2009, to allow consideration of the measure in the context of the
negotiations with the Pharmacy Guild of Australia for the Fifth Agreement. The
measure has been revised in line with a proposal received from community
pharmacy and other stakeholders. The measure, which is due to commence on
1 December 2011, will eliminate wastage caused by excess dispensing of whole
vials, and requires individual patient doses to be dispensed in combinations of vial
sizes that will produce the least cost to the taxpayer. The measure includes new
fees for pharmacists which recognise the specialist activities undertaken to prepare
cancer chemotherapy infusions.
Increase sustainability of the Pharmaceutical Benefits Scheme
The Australian Government is committed to ensuring Australians continue to have
ongoing access to existing, new and innovative medicines, now and into the future
through the PBS. However, the cost of the program is significant.
The Australian Government has added around 500 new medicines or brands of
medicines to the PBS, Life Savings Drugs Program and National Immunisation
Program over the last four years, at a cost of around $4 billion.
In 2008-09, PBS growth was 9.2 per cent, and in 2009-10 PBS growth was
9.0 per cent. For 2010-11 and 2011-12, PBS growth is estimated to be 7.7 per cent
and 6.5 per cent respectively. This growth takes into account the impact of PBS
reform measures implemented in 2007 and 2010. PBS growth is influenced by a
number of factors, including the prices of existing PBS medicines and changes in
price over time. Factors also include the number and cost of new medicines added
to the PBS, population growth, the level of coverage by concession cards, the
number of prescriptions dispensed and the amount that patients contribute
towards the cost of prescriptions.
In 2010, the Government signed a four year Memorandum of Understanding
(MoU) with Medicines Australia, the peak body for the innovative medicines
industry in Australia, to improve the sustainability of the PBS. Along with the Fifth
Community Pharmacy Agreement, this MoU will provide the Government with
net total savings of $2.5 billion from 2010-11 to 2014-15.
While the first round of savings (statutory price reductions), were implemented in
2010-11, the major savings component of the MoU, accelerated and expanded price
disclosure, will be introduced from 1 April 2012. The prices paid by pharmacists to
suppliers for medicines are often less than those paid by the PBS to pharmacists.
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Outcome | 02
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Budget Statements – Department of Health and Ageing
Price disclosure requires suppliers of medicines to advise the prices they charge to
pharmacies. Prices paid under the PBS are being revised to reflect weighted
average prices actually being charged in the market. Medicines Australia has
agreed, through the MoU, to an arrangement whereby a minimum level of
23 per cent savings under price disclosure is assured. No prices will rise for
consumers as a result of this policy. In fact, in some cases it will result in lower
prices for some consumers, as some medicines fall under the co-payment level.
Increased efficiency of the medicine assessment process
In 2011-12, the Australian Government will continue to work with Medicines
Australia through the Access to Medicines Working Group to advise the Minister
for Health and Ageing on how medicines can be supplied more effectively through
the PBS. The group provides strategic oversight of joint activities undertaken by
the department and Medicines Australia to enhance the PBS processes.
On 1 January 2011, the department introduced Parallel Processing and the
Managed Entry Scheme to increase the efficiency of the medicines assessment
process. The implementation of parallel assessment processes will allow sponsors
to seek the PBAC and the Therapeutic Goods Administration (TGA) assessment of
possible PBS listings concurrently instead of sequentially, resulting in streamlined
regulatory and reimbursements approvals. The same rigour and analysis will be
applied by both bodies in the assessment of these drugs but efficiencies will be
gained through earlier engagement with the PBAC processes. At its July 2011
meeting, the PBAC will consider the first submissions lodged under the new
Parallel Processing arrangements.
The Managed Entry Scheme was introduced by the department for drugs with a
high clinical need but where a PBS listing price is yet to be established. Through
the scheme, the PBAC may recommend PBS coverage of a drug at a price justified
by existing evidence, pending submission of more conclusive evidence of
cost-effectiveness which may justify a higher future price. This will allow some
medicines to be listed on the PBS earlier.
During 2011, the department will hold information sessions about both Parallel
Processing and the Managed Entry Scheme. In addition, the Access to Medicines
Working Group will monitor the take-up and use of both of these new policies to
assess their effectiveness.
National Medicines Policy
The National Medicines Policy advisory structure plays a key role in improving
the structure of the PBS and its listing processes. The advisory structure
(Executive, Committee and Partnerships Forum) engages individual experts,
related organisations and committees, Government representatives and
stakeholders to develop National Medicines Policy. Timely and responsive advice
is provided to the Government on medicines policy issues. In 2011-12, the five key
priorities are: integrating the medicines policy framework into health system
reform; better informed and active consumers; translating evidence into practice
and policy; monitoring medicines in use; and informing the research agenda.
Sustainability and cost-effectiveness will be a theme across these priority areas. The
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Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
In 2011-12, the Government will expand the scope of the National Medicines Policy
advisory structure to capture and review currently unavailable clinical practice
data and rigorously assess medicines use post-listing on the PBS. This will improve
health outcomes and patient safety, through the better targeting of education and
support for health professionals and consumers. Improvements to the quality use
of medicines, as a result of better informed decision making by both prescribers
and consumers, will also help to ensure the on-going cost-effective use of
medicines on the PBS, supporting its fiscal sustainability.
Program 2.2 is linked as follows:

Department of Human Services (Medicare Australia) to administer the PBS,
including payment of script benefits, authority approvals, new and other PBS
items under the Delivery of Pharmaceutical Benefits and Services.
Program 2.2 Expenses
Table 2.6: Program Expenses
Annual administered expenses
Ordinary annual services
Special appropriations
National Health Act 1953 pharmaceutical benefits
Program support
Total Program 2.2 expenses
2010-11
Estim ated
actual
$'000
2011-12
Budget
182,816
9,041,971
2013-14
Forw ard
year 2
$'000
2014-15
Forw ard
year 3
$'000
186,235
189,958
193,755
197,628
9,646,858 10,107,915 10,895,071 11,685,838
36,687
9,261,474
$'000
2012-13
Forw ard
year 1
$'000
34,117
33,114
32,388
30,687
9,867,210 10,330,987 11,121,214 11,914,153
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Outcome | 02
Executive and Committee meet at least three times a year and the Partnerships
Forum is an annual event.
Budget Statements – Department of Health and Ageing
Program 2.2: Deliverables6
The department will produce the following ‘deliverables’ to achieve the objectives
of Program 2.2.
Table 2.7: Qualitative Deliverables for Program 2.2
Qualitative Deliverables
2011-12 Reference Point or Target
New medicine listings
The PBAC meets at least three times a year
and provides recommendations to the
Minister on new listings for the PBS
The PBAC recommendations for listing on
the PBS are based on the clinical
effectiveness and the cost-effectiveness of
new medicines, and provided in a timely
manner
Price negotiations with sponsors and
conditions for listing finalised, and quality
and availability checks undertaken for new
PBS listings
All negotiations and listing activity
completed in a timely manner
Increase sustainability of the Pharmaceutical Benefits Scheme
Implement and monitor progress under the
MoU between the Australian Government
and Medicines Australia, including the
implementation of price disclosure, the
Managed Entry Scheme and Parallel
Processing
The Access to Medicines Working Group
will monitor progress on the
implementation of the MoU, and report as
required to the Minister and Parliament on
this progress
Implement changes to the National
Medicines Policy Framework, establishing a
structure to systematically and rigorously
assess medicines use post-listing on the PBS
Implementation completed in a timely
manner, to allow systematic review in
specified timeframes
Provide Government with advice on
medicines policy issues
The National Medicines Policy advisory
structure reports to Government with timely
and responsive advice on medicines policy
issues as appropriate
6
As a result of the Strategic Review, deliverables may have changed from the 2010-11 Portfolio Budget Statements.
124
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Quantitative
Deliverables
Percentage of variance
between actual and
budgeted expenses
2010-11
Revised
Budget
2011-12
Budget
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
≤0.5%
≤0.5%
≤0.5%
≤0.5%
≤0.5%
100%
100%
100%
100%
100%
New medicine listings
Percentage of
submissions to the
Pharmaceutical Benefits
Advisory Committee for
PBS listings that are
considered within
17 weeks of lodgement
Increase sustainability of the Pharmaceutical Benefits Scheme
Percentage of
notifications to affected
sponsors of outcomes
from price disclosure
calculations
100%
100%
100%
100%
100%
Percentage of Public
Summary Documents,
including
recommendations,
released 16 weeks after
each Pharmaceutical
Benefits Advisory
Committee meeting
100%
100%
100%
100%
100%
Percentage of
applications for
consideration at next
Pharmaceutical Benefits
Advisory Committee
meeting published on
the department’s
website to allow for
public comment
100%
100%
100%
100%
100%
125
Outcome | 02
Table 2.8: Quantitative Deliverables for Program 2.2
Budget Statements – Department of Health and Ageing
Program 2.2: Key Performance Indicators7
The following ‘key performance indicators’ measure the effectiveness of
Program 2.2 in meeting its objectives thereby contributing to the outcome.
Table 2.9: Qualitative Key Performance Indicators for Program 2.2
Qualitative Indicator
2011-12 Reference Point or Target
Increase sustainability of the Pharmaceutical Benefits Scheme
Generate savings through price reduction
across non exempt F2 drugs in the First
Main Cycle of Expanded and Accelerated
Price Disclosure
Achieve the guaranteed average savings of a
23 per cent price reduction across non
exempt F2 drugs as stipulated in the
Memorandum of Understanding with
Medicines Australia
Quality of comments on submissions being
considered by the PBAC
Increase in the quality of consumer input
during 2011-12
All data received and calculations
undertaken by the agreed timelines and
where applicable, result in lower prices for
drugs affected by the price disclosure policy
Implementation of price reductions, based
on data supplied by drug sponsors
Table 2.10: Quantitative Key Performance Indicators for Program 2.2
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
100%
100%
100%
100%
100%
$121.0m
$296.0m
New medicine listings
All medicines
recommended for
listing by the PBAC
are both cost-effective
and clinically effective
Increase sustainability of the Pharmaceutical Benefits Scheme
Estimated savings to
Government from the
price disclosure
program per annum8
7
8
$9.0m
$38.0m
$62.0m
As a result of the Strategic Review, key performance indicators may have changed from the 2010-11 Portfolio
Budget Statements.
PricewaterhouseCoopers, 2010. The Impacts of Pharmaceutical Benefits Scheme Reform, Report for the Department of
Health and Ageing, page 91, Appendix A Table 3; Savings to Government by year.
126
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
Percentage of
prescriptions listed on
the Schedule of
Pharmaceutical Benefits
subsidised under the
PBS
80%
80%
80%
80%
80%
Number of
prescriptions
subsidised through the
PBS
201m
211m
221m
232m
243m
Revenue received from
the cost recovery of the
PBS listing process
$14.0m
$14.1m
$14.1m
$14.1m
$14.1m
Program 2.3: Targeted assistance – pharmaceuticals
Program Objective
Through Program 2.3, the Australian Government aims to:

improve access to new and existing medicines for patients with life threatening
conditions.
Major Activities
Access to life saving medicines
The Australian Government will continue to provide free access to expensive and
life saving medicines for eligible Australians through the Life Saving Drugs
Program. The program provides patients with financial assistance to access
expensive and ‘life saving’ drugs for serious and very rare medical conditions.
Nine drugs are currently funded through the program to treat seven serious and
very rare medical conditions. These conditions are: Fabry, Gaucher,
Mucopolysaccharidosis Types I, II and VI, Infantile Pompe and Paroxysmal
Nocturnal Haemoglubinuria (PNH). Each condition has separate eligibility
guidelines, developed and administered with the advice of an expert advisory
committee. Guidelines are reviewed regularly in consultation with the expert
disease advisory committees and any amendments are submitted to the PBAC for
consideration. Currently, 207 patients are being assisted through the program.
In 2010-11, the Government agreed to fund Soliris ® (eculizumab) to treat PNH
through the Life Saving Drugs Program from 1 January 2011, following a positive
recommendation from the PBAC in August 2010.
In 2011-12, the department will continue to facilitate and monitor access for new
and continuing patients to these medicines. The department will also continue to
127
Outcome | 02
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Budget Statements – Department of Health and Ageing
provide support to the expert disease advisory committees that provide clinical
review and assessment of patient applications.
Program 2.3 Expenses
Table 2.11: Program Expenses
2010-11
Estim ated
actual
$'000
2011-12
Budget
Annual administered expenses
Ordinary annual services
Program support
Total Program 2.3 expenses
$'000
2012-13
Forw ard
year 1
$'000
2013-14
Forw ard
year 2
$'000
2014-15
Forw ard
year 3
$'000
137,648
159,428
159,654
165,484
171,561
1,825
1,697
1,647
1,611
1,527
139,473
161,125
161,301
167,095
173,088
Program 2.3: Deliverables
The department will produce the following ‘deliverables’ to achieve the objectives
of Program 2.3.
Table 2.12: Qualitative Deliverables for Program 2.39
Qualitative Deliverables
2011-12 Reference Point or Target
Produce relevant and timely evidence-based
policy research
Relevant evidence-based policy research
produced in a timely manner
Stakeholders participate in program and/or
policy development
Stakeholders participate in program and/or
policy development through avenues such
as regular consultative committees,
conferences, stakeholder engagement
forums, surveys, submissions on
departmental discussion papers and
meetings
Access to life saving medicines
Provide funding to facilitate the treatment of
eligible patients through the Life Saving
Drugs Program
Timely allocation and expenditure of
funding
Review program guidelines to ensure they
are up to date and relevant
Program guidelines reviewed within agreed
timeframes
9
The Quantitative Deliverables ‘Number of patients assisted to receive Zavesca through the Life Saving Drugs
program’ and ‘Number of patients assisted to receive Myozyme through the Life Saving Drugs program’ were
removed in the Portfolio Additional Estimates Statements 2010-11, as the figures they report on are captured in
the deliverable ‘Number of patients assisted through the Life Saving Drugs Program’.
128
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Quantitative
Deliverables
2010-11
Revised
Budget
2011-12
Budget
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
Percentage of variance
between actual and
budgeted expenses
≤0.5%
≤0.5%
≤0.5%
≤0.5%
≤0.5%
231
225
279
303
Access to life saving medicines
Number of patients
assisted through the
Life Saving Drugs
Program 10
207
Program 2.3: Key Performance Indicators
The following ‘key performance indicators’ measure the effectiveness of
Program 2.3 in meeting its objectives thereby contributing to the outcome.
Table 2.14: Qualitative Key Performance Indicators for Program 2.3
Qualitative Indicator
2011-12 Reference Point or Target
Access to life saving medicines
Eligible patients have timely access to the
Life Saving Drugs Program 11
Patient applications are processed within 30
calendar days of receipt
10
The Life Saving Drugs Program is demand driven and estimated patient numbers are updated when new drugs
are approved.
11
The Life Saving Drugs includes eight drugs for six conditions. Patient numbers for all LSDP drugs are captured in
the ‘Percentage of eligible patients with access to fully subsidised medicines through the Life Saving Drugs
program’.
129
Outcome | 02
Table 2.13: Quantitative Deliverables for Program 2.3
Budget Statements – Department of Health and Ageing
Table 2.15: Quantitative Key Performance Indicators for Program 2.312
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
100%
100%
100%
100%
Access to life saving medicines
Percentage of eligible
patients with access to
fully subsidised
medicines through the
Life Saving Drugs
program
100%
Program 2.4: Targeted assistance – aids and appliances
Program Objectives
Through Program 2.4, the Australian Government aims to:



provide support for people with diabetes;
continue to assist people with a stoma by providing free stoma related
products; and
ensure continued access to necessary and clinically appropriate dressings, and
improve the quality of life for people with Epidermolysis Bullosa.
Major Activities
Support people with diabetes
National Diabetes Services Scheme
The Australian Government is committed to assisting people manage their
diabetes through the subsidy of products such as syringes, insulin infusion pump
consumables, and blood and urine glucose testing strips.
The department will continue to work with diabetes organisations such as the
Australian Diabetes Society, the Australian Diabetes Educators Association and
Diabetes Australia to develop and deliver a range of educational and information
services to people with diabetes to assist in the best use of products and effective
self management of diabetes. In addition, the department will implement a new
five year agreement to administer the National Diabetes Services Scheme, ensuring
continued provision of products and services to people with diabetes.
In 2011-12, the Government will expand the National Diabetes Services Scheme to
provide access to needles and syringes for people with non-insulin dependent
12
The Quantitative Key Performance Indicator ‘Percentage of patients with access to fully subsidised Zavesca
through the Life Saving Drugs program’ and ‘Percentage of patients with access to fully subsidised Myozyme
through the Life Saving Drugs program’ were removed in the Portfolio Additional Estimates Statements 2010-11,
as the figures they report on are captured in the Quantitative Key Performance Indicator ‘Percentage of elegible
patients with access to fully subsidised medicines through the Life Saving Drugs program’.
130
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
type 2 diabetes for the delivery of injectable non-insulin blood glucose lowering
medication.
The type 1 diabetes insulin pump program, administered by the Juvenile Diabetes
Research Foundation (JDRF) on behalf of the Australian Government, aims to
increase the affordability of insulin pumps and associated consumables for families
with children under eighteen with type 1 diabetes who do not have access to other
means of reimbursement, such as private health insurance. The Australian
Government, through the program, subsidises up to 80 per cent of the cost of a
clinically recommended insulin pump (capped at $6,400) for young people with
type 1 diabetes.
In 2011-12, the department will evaluate the effectiveness of the type 1 diabetes
insulin pump program and work with JDRF to ensure that it continues to provide
appropriate assistance to families of children with type 1 diabetes.
Stoma Appliance Scheme
The Australian Government aims to assist eligible people with stomas 13 by
providing them with free stoma related appliances. The department works with
stoma associations across Australia to help people better manage their condition by
providing access to stoma related appliances, such as pouches, skin protectors,
flow filters and creams.
In 2011-12, the department will continue to implement a new pricing framework
and listing process for the Stoma Appliance Scheme as recommended by a review
conducted in 2009-10. The pricing framework introduces consistent pricing across
appliances containing similar features. The listing process includes the
establishment of a new expert advisory panel to assess applications for the listing
of appliances
National Epidermolysis Bullosa Dressing Scheme
The Australian Government aims to improve the quality of life for people with
Epidermolysis Bullosa14 through the National Epidermolysis Bullosa Dressing
Scheme, which provides for subsidisation of clinically appropriate dressings and
bandages. The National Epidermolysis Bullosa Dressing Scheme is administered
by BrightSky Australia. The department works with clinical experts from across
Australia to ensure dressing treatment methods are consistent with best-practice
and patients are educated in using subsidised dressings.
In 2011-12, the department will consider a post implementation review of the
scheme conducted in 2011 and work with BrightSky Australia to ensure the
scheme continues to meet the needs of stakeholders.
13
An opening in the abdomen for evacuation of products from the bowel or bladder.
14
A genetic disease characterised by extremely fragile and blister prone skin.
131
Outcome | 02
Type 1 diabetes insulin pump program
Budget Statements – Department of Health and Ageing
Program 2.4 Expenses
Table 2.16: Program Expenses
2010-11
Estim ated
actual
$'000
2011-12
Budget
Annual administered expenses
Ordinary annual services
Special appropriations
National Health Act 1953 aids and appliances
Program support
Total Program 2.4 expenses
$'000
2012-13
Forw ard
year 1
$'000
2013-14
Forw ard
year 2
$'000
2014-15
Forw ard
year 3
$'000
621
802
528
522
522
246,113
266,319
287,043
308,894
332,174
1,927
1,792
1,739
1,701
1,612
248,661
268,913
289,310
311,117
334,308
Program 2.4: Deliverables
The department will produce the following ‘deliverables’ to achieve the objectives
of Program 2.4.
Table 2.17: Qualitative Deliverables for Program 2.4
Qualitative Deliverables
2011-12 Reference Point or Target
Produce relevant and timely evidence-based
policy research
Relevant evidence-based policy research
produced in a timely manner
Stakeholders participate in program and/or
policy development
Stakeholders participate in program and/or
development through avenues such as
regular consultative committees,
conferences, stakeholder engagement
forums, surveys, submissions on
departmental discussion papers and
meetings
Support people with diabetes
Implement a new agreement to provide
services under the National Diabetes
Services Scheme
New agreement to be executed at the
expiration of the current agreement
Expand the National Diabetes Services
Scheme to provide access to needles and
syringes for eligible people with non-insulin
dependent type 2 diabetes, for the delivery
of injectable non-insulin blood glucose
lowering medications
Needles and syringes to be available to
eligible people from 1 July 2011
132
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Qualitative Deliverables
2011-12 Reference Point or Target
Continued supply of necessary and
clinically appropriate dressings and
educational support for eligible people with
Epidermolysis Bullosa
Work closely with BrightSky Australia to
ensure efficient administration of the
National Epidermolysis Bullosa Dressing
Scheme
Table 2.18: Quantitative Deliverables for Program 2.4
Quantitative
Deliverables
Percentage of variance
between actual and
budgeted expenses
2010-11
Revised
Budget
2011-12
Budget
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
≤0.5%
≤0.5%
≤0.5%
≤0.5%
≤0.5%
990,000
1,080,000
1,180,000
1,280,000
1,400,000
233
108
62
59
59
38,500
39,250
41,000
41,750
43,500
168
171
174
Support people with diabetes
Number of people with
diabetes receiving
benefit from the
National Diabetes
Services Scheme
Number of people under
18 years of age with
type 1 diabetes receiving
a subsidised insulin
pump
Stoma Appliance Scheme
Number of people
receiving stoma related
products
National Epidermolysis Bullosa Dressing Scheme
Number of people with
Epidermolysis Bullosa
receiving subsidised
dressings15
15
55
166
The number of people with Epidermolysis Bullosa receiving subsidised dressings has been revised in the 2010-11
Budget to more accurately estimate the number of eligible people. Recommendations from a review in 2011 will
be considered to ensure that those in most need are accessing the National Epidermolysis Bullosa Dressing
Scheme.
133
Outcome | 02
National Epidermolysis Bullosa Dressing Scheme
Budget Statements – Department of Health and Ageing
Program 2.4: Key Performance Indicators
The following ‘key performance indicators’ measure the effectiveness of Program
2.4 in meeting its objectives thereby contributing to the outcome.
Table 2.19: Qualitative Key Performance Indicators for Program 2.4
Qualitative Indicator
2011-12 Reference Point or Target
Support people with diabetes
The type 1 diabetes insulin pump program
meets the needs of stakeholders
Stakeholders satisfied with the
administration of the scheme
Stoma Appliance Scheme
New appliances are assessed as being
clinically effective and cost effective by a
technical advice panel
New appliances to be listed are assessed as
being clinically effective and cost effective
National Epidermolysis Bullosa Dressing Scheme
The National Epidermolysis Bullosa
Dressing Scheme meets the needs of
stakeholders
Stakeholders satisfied with the
administration of the scheme
Table 2.20: Quantitative Key Performance Indicators for Program 2.4
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
Support people with diabetes
Percentage of eligible
people with non-insulin
dependent type 2
diabetes accessing
needles and syringes
through the scheme
N/A
100%
100%
100%
100%
Percentage of eligible
applicants receiving
subsidised insulin
pumps
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Stoma Appliance Scheme
Assessment of new
product applications
completed in accordance
with the new pricing
and listing process
134
Section 2 – Department Outcomes – 2 Access to Pharmaceutical Services
Quantitative
Indicators
2010-11
Revised
Budget
2011-12
Budget
Target
2012-13
Forward
Year 1
2013-14
Forward
Year 2
2014-15
Forward
Year 3
100%
100%
100%
Percentage of eligible
applicants receiving
subsidised dressings
100%
100%
135
Outcome | 02
National Epidermolysis Bullosa Dressing Scheme
Budget Statements – Department of Health and Ageing
136