Pharmaceutical Benefits Scheme

The Australian health care system is not a very complicated one, it is solely based on two main sectors which are the ‘public’ and ‘private’. The public sector allows one to claim health care benefits and payments through the universal health coverage developed by the Australian government, called Medicare. Medicare is completely free and paid by the government through income tax received to help pay for medical, optical and hospital care (Humanservicesgovau, 2016). It also has a sub-division called the ‘Medicare safety net’ which is more so given to those on significantly low incomes to aid in financial distress. Similarly, the private sector is made up of different companies entitling different benefits, usually consisting of two plans, ‘hospital’ and ‘generic’ (Privatehealthgovau, 2016). The private health care system is more so for people who need immediate attention as the public health system has a waiting list for many different types of operations. Private health system is also customisable in circumstances such as

This service now provides the public, access to see health care professionals for free or for subsidised treatments. The Medicare Benefits Schedule (MBS) lists all the services that are included for people to access, the Pharmaceutical Benefit Scheme (PBS) subsidises essential and necessary medications that patients require, any pharmaceuticals that are not covered will be at cost to the patient or through private health insurance. The Federal Government and State governments fund health promotion and disease prevention services throughout Australia.

Since 1984, Canada has established a publicly funded healthcare system through the provisions of the “Canada Health Act,” which states that the objective of Canadian health care policy is to “facilitate reasonable access to health services without financial or other barriers” (“Canada Health Act” 1). However, many Canadians feel Canada’s healthcare system is financially restricting. This system does not cover many prescription drugs or speciality drugs, which are needed for 41% of Canadian citizens aged 6-79 years old (Rotterman, Michelle et al. 1). This excludes elderly citizens who require even more medications. According to the Canadian Institute for Health Information it is estimated the provincial and territorial governments spent $10.4 billion on prescription medications in 2014 (Matteo, Livio Di 2).

Within the formulary the drugs are divided into tiers. Co-payments are based on the tier that the drug is in and range from tier 1, the least expensive drugs, to tier 3 the most expensive drugs. Each insurance company plan is allowed to add or drop drugs from their formularies and move drugs from one tier level to another throughout the year. An insurance company can also drop a drug in the middle of the year, but must continue covering the drug for anyone taking it until the next reenrollment period, at which time a new plan will have to be chosen that covers that drug (Gustaitis, 2007). Although not used a lot there is a fourth tier that is for specialty drugs only. Some plans use a flat-rate or assign a percentage co-pay to the higher tier drugs (Gustaitis, 2007). Other characteristics of the insurance company plans that they have control over are requiring prior authorization for a drug, using step therapy, limiting the quantity, participating at certain pharmacies, and having preferred pharmacies (Gustaitis, 2007).

Medicare is the publicly funded health care system for everyone in Australia. It exists side-by side with private health care system.

The Medicare beneficiaries’ contribution to the coverage gap decreases each year, with the majority of cost absorbed by the government and the drug manufacturers. Drug manufacturers also agreed to pay a fee to the federal government health care programs on branded prescription drugs (BPD), based on its sales of BPD’s. There was an expansion of the Public Health Service Act (PHSA), that required drug manufactures to provide eligible entities with significantly reduced drug price. The PHSA, also expanded those entities such as free-standing cancer centers and critical access hospitals (CAH), that were eligible to participate in the 340B program In, addition they also agreed to increase rebates on sales of prescription drugs to the Medicaid program (Spats, 2010). The rebate was increased from 15.1 percent to 23.1 percent. In addition, drugs, such as those used for pediatric care and clotting factor drugs there was a 17.1% rebate. Perhaps, most importantly, the firms extended the rebates to Medicaid patients enrolled in Managed Care Organizations (MCO). This new agreement allows plans to negotiate rebates in addition to the new ones

A restriction on coverage may be added to a drug or removed if it is already restricted.

The Canadian government must implement an equitable national pharmacare program in which medically necessary prescription drugs are covered

In 2003, President George W. Bush signed a bill called the “Medicare Prescription Drug Improvement and Modernization Act” which provided an optional prescription drug benefit plan. Prescription drugs have come a long way since 1965, meaning that they are much more effective today than ever before and provide greater life-enhancing benefits than ever before. The Medicare program therefore had to be reformed as a result of this additional legislation to allow for access to needed medications while trying to minimize the risk of high expenditures for those affected individuals. The program was reformed once more in 2010, with the aim of attempting to keep the costs low while also increasing the revenue earned by Medicare.

Medicare is a federal health insurance program for people over the age of 65. It also covers particular people who may have a disability and people who have End-Stage Renal Disease. There are four different parts to the Medicare program. These parts include hospital insurance, medical insurance, Medicare advantage plans, and prescription drug coverage. The program, since being created, has helped to fix many different problems, as well as help the elderly and other persons to receive health insurance.

Kirby’s (2002) proposal calls for the federal government to pay for 90% of a person’s prescription drug expenses that exceed $5 000 of out-of-pocket and provincial monies combined (Chapter 7, pp. 9-10). There would also be a personal spending cap of 3% of the individual’s total family income (Kirby, 2002, chapter 7, p.9). Private insurances are also accounted for via formulas that give a patient either a rebate or may deny a person government assistance depending on their drug costs.

In the first Hall Royal Commission, Pharmacare is outlined as recommend in joining the covered benefits for Canadian citizens - Canadians pays slightly less than their U.S. counterparts for Pharmaceuticals (Armstrong, p51). Privatization influences an unequal system - creating significant hindrances for impoverished people in Canada, again creating a rich-poor divide that does not influence equality, which is the essence of the Canadian Health Act. As pointed out in The Canadian Regime, “In European Countries, drugs are covered by public insurance schemes. Why not do the same in Canada?” (Malcolmson, p226). Further, Malcolmson describes the possibility for the government to generate a type of bulk buying scheme - where we as a country can

The Commonwealth Fund, New York. (2006). US Medicare Prescription Drug Coverage. Retrieved from US Me

Australia is a two tiered system including a private and public sector. Medicare is a universal health insurance scheme under the public system. It was introduced on the 1st of February 1984 by the Australian Labor party the principal is for all Australian to have equal access to health. There are three levels of government these include Local, State or territory and Federal, all three have different roles to perform in terms of health care. The local government is responsible for towns and districts, moreover, local councils or shires function is to operate systems and projects such as sewage, garbage disposals and maintenance of the safety food standard. Both state and federal direct different parts of Medicare. State government manages public hospital within their territory or state, the state government receives 40%-50% of the total cost of expenditures for the public hospital from the Federal government. Lastly, Federal role includes payments to primary health services there include GPs, the majority of nurses, medical specialists and allied health professionals. In 1996 Budget guaranteed the renewal of private health insurance.

* Competitive Pricing – Merck is sometimes forced to lower prices of products, either ones that have gone off patent to maintain market share in the product, as well as for products that are still on patent in order to compete with rival products for the same treatment that are marketed by competitors