$1 discounted medicines will likely cost pensioners a lot more

Since January 1, 2016, for the first time ever, pharmacies have been able to offer pensioners discounted prices on prescription
New Zealand

Since January 1, 2016, for the first time ever, pharmacies have been able to offer pensioners discounted prices on prescription medications subsidised by the Government, however the sweet deal is not as sweet as it looks. In fact it could end up costing you quite a bit more money, according to the Pharmacy Guild.

News.com.au reports that from the beginning of the year, the price pensioners had to pay for prescriptions rose to $6.20, in line with inflation, but chemists were able to choose to offer a $1 discount to pensioners.

Government rules have previously prevented pharmacies from offering discounts to patient co-payments for subsidised prescription medication (PBS). However, this was lifted after the signing of a new five year pharmacy agreement earlier in 2015, which aims to increase competition to the industry.

Although pensioners may be able to save $1 each time they purchase PBS medication, Executive Director of the Pharmacy Guild of Australia, David Quilty, claims it will not save money for those who require regular medication.

During an interview for 702 ABC Sydney, Quilty stated that, “people who are the sickest, and have the greatest need for medicines, they actually get no benefit from this, because they simply get to their Safety Net later.”

Quilty explains that pensioners must spend $372 per year on prescription medications in order to reach their Safety Net, at which point medication becomes free. However, the discounted price pharmacies may offer to pensioners will not be counted towards this total, meaning pensioners will reach their Safety Net later than usual and only benefit from it for a shorter period of time. The Pharmacy Guild claims concessional patients who seek out the $1 discount will need to fill an additional 11 prescriptions per year in order to reach that Safety Net.

Quilty identifies this as one of their biggest concerns for the new scheme, leaving pensioners believing they are saving money from the discount but then later finding out, “they haven’t reached their safety net when they usually do”.

Quilty states that the only pensioners who will benefit from this will be those that don’t need regular medication and who do not usually reach the Safety Net. However, the cost of the discounts will then be passed onto the pharmacies. He estimates that pharmacies with an average number of prescriptions per year could be facing a loss close to $40,000.

News.com.au reports that Chemist Warehouse has already pledged to pass on the discount to all of their customers. However Quilty remains adamant that the Pharmacy Guild strongly opposes the plan. He claims the Government are estimating a saving of $373 million over four years, making them the only ones to benefit from this scheme.

Would you seek out the pharmacies offering the $1 discount, or would you prefer to reach your Safety Net earlier and receive your free prescriptions?