Julia Gillard (Lalor, Australian Labor Party, Shadow Minister for Health and Manager of Opposition Business in the House) Share this | Hansard source

The amendments in the Health Legislation Amendment (Pharmacy Location Arrangements) Bill 2006 are the result of the fourth community pharmacy agreement between the Commonwealth and the Pharmacy Guild of Australia. I am sure, Mr Deputy Speaker, you are familiar with the arrangements that the Commonwealth makes with the Pharmacy Guild whereby it enters into an agreement for five-yearly periods.

The most recent agreement commenced on 1 December 2005 and will terminate on 30 June 2010. The agreement provides for new pharmacy location arrangements, to commence on 1 July 2006. This bill gives effect to some of the issues around those arrangements. Specifically, this bill will do the following.

Firstly, it will extend the operation of the Australian Community Pharmacy Authority until 30 June 2010. The authority’s role is to consider applications made by pharmacists for approval to supply benefits under the Pharmaceutical Benefits Scheme, to determine if such applications comply with the pharmacy location rules and to make recommendations to the Secretary of the Department of Health and Ageing as to whether such applications should be approved.

Secondly, this bill increases the membership of the Australian Community Pharmacy Authority from five to six members by including a consumer representative appointed by the minister. As I am sure the House is aware, obviously there are increasing demands for consumer representatives in various bodies in the health sector and on this occasion the demands of those representatives have been agreed to, with a consumer representative being included on the authority.

Thirdly, the bill provides the minister with a new discretionary power to overrule a decision of the secretary made in accordance with the pharmacy location rules if that decision will have the unintended or unforeseen consequence of leaving a community without reasonable access to pharmacy services. Affected parties may seek a review of any decision made by the minister under this power, under the Administrative Decisions (Judicial Review) Act 1977.

Fourthly, the bill provides for the processes associated with this discretionary power, such as how an applicant may make a request to the minister for consideration of the secretary’s decision.

Fifthly, the bill deals with clarifying the ability of the secretary to approve more than one pharmacist to supply PBS benefits from a particular premise.

Finally, the bill provides that the secretary can approve a pharmacist’s application to expand or contract their premises without prior recommendation by the Australian Community Pharmacy Authority.

The actual changes in the pharmacy location rules will ensure that the following can occur. The new rules will permit co-location of pharmacies with large medical centres that operate extended hours. The new rules will allow the location of pharmacies in small shopping centres. The new rules will allow the relocation of an additional pharmacy to one-pharmacy rural towns and one-pharmacy high-growth areas without regard to the usual distance criteria. The new rules will remove the requirement that a specified number of commercial establishments are open and trading before an approved pharmacy can relocate to a shopping centre. And the new rules will provide greater flexibility for pharmacies located in private hospitals by allowing the establishment of satellite dispensaries for hospital in-patients. It should be noted that these changes do not require legislative change, but will be put into effect by being exercised through a set of regulations authorised by ministerial determinations under section 99L of the National Health Act 1953.

The changes to the rules will have a number of benefits, especially in rural and remote areas and growing suburban communities. Obviously, it makes sense to permit the co-location of pharmacies with large medical centres that operate extended hours. I think each of us receive many complaints in our local electorates and more broadly and would be aware that the Howard government inspired crisis in the medical workforce, particularly the government’s 1996 cutback in the number of GP training places, is now showing in our communities, with many communities not having anywhere near enough GPs. That situation shows at all times of the day and night, but tends to particularly show after hours, when accessing a GP can be very difficult. If it is possible for a large medical centre to provide extended hours of operation, that clearly is a benefit to local community members and enables them to at least access a GP after hours.

However, such an arrangement is no substitute for having the right number of doctors across the country or for doing what the Howard government should be doing, which is properly investing in after-hours care. Around the country we have some very successful models for how to do that, particularly the Hunter division model of after-hours care, which has been a leader. None of the arrangements in this bill and none of the more general arrangements the government has made to date are in any way substitutes for doing the proper job, which is about that kind of investment.

As we know, the Howard government has no intention of doing the proper job. The vision of the minister for health in this area is confined to picking up from the United Kingdom a National Health Service model—NHS Direct. The minister, who in the past has railed against the National Health Service, and indeed against the British health model, is not ashamed to pick up NHS Direct entirely and put it somewhere in Australia. But, as we know, NHS Direct is just a big call centre. You can ring and get some preliminary health advice but, because it is not connected with local services, it cannot actually find you a GP. That is why it is an inadequate model and why it is no substitute for making the proper investment right round the country.

Nevertheless, with the Howard government here and largely ignoring the need for after-hours care, obviously, for those communities that do get some after-hours coverage with large medical centres that operate extended hours, it makes sense to have co-located pharmacies so that people can not only access a GP but also, effectively in the same visit, after hours, access the medications that they need.

The change to permit the location of pharmacies within small shopping centres recognises the retailing trend for smaller centres with large supermarkets. Currently the requirement for large shopping centres with at least 30 commercial establishments gives limited access to pharmacy services in many retail developments. This is a sensible change. Each of us would be aware from our experience and our own locations that there are many suburban shopping centres now that have very large supermarket developments but not necessarily many associated shops—certainly not 30 or more. Yet the shopping centre may attract considerable patronage because of the supermarket, and it makes sense for pharmacy to be available in such locations.

Then there is the change to allow the relocation of an additional pharmacy to one-pharmacy rural towns and one-pharmacy high-growth areas without regard to the usual distance criteria. That is a sensible measure to make sure that we are not left in a situation where Australians in such areas miss out on fair access to pharmacy because the usual distance criteria preclude them from having a second pharmacy in the area.

The removal of the requirement that there be a specified number of commercial establishments open and trading before an approved pharmacy can relocate to a shopping centre is once again a recognition of reality. Not all commercial establishments in a shopping centre need to be open and trading at the time of an application approval. We do note that this restriction in the past has in fact delayed access to pharmacy services in new shopping centres where shops are being progressively leased and taken up but the shopping centre as a whole is not opened, with every shop trading on a given start date. So it makes sense to have such flexibility in the arrangements. Finally, it does make some sense to have greater flexibilities for pharmacies located in private hospitals.

Given the nature of these requirements, I doubt that it will surprise you that Labor will support this bill. I do note—and I think it is a very important omission—that there is nothing in this bill that will ensure that Aboriginal and Torres Strait Islander people have better access to Pharmaceutical Benefits Scheme medicines and pharmacy services, despite the fact that PBS spending per capita on Indigenous people is only one-third of that spent on the non-Indigenous population.

I know, for example, the member for Lingiari, who is in the House, would be only too familiar with the fact that many of his Indigenous constituents do not get fair access to pharmacy services or to the PBS. The fact that this matter is being omitted yet again from this bill gives us cause for concern about the ongoing pattern of disadvantage and despair that surrounds the issue of Indigenous health in this nation. It is another lost opportunity to perhaps have made some difference in that regard. I think that that is an unfortunate oversight with this bill.

More broadly, Labor is very concerned that the Howard government is generally failing to properly manage the Pharmaceutical Benefits Scheme, and I foreshadow that at the conclusion of my speech I will move a second reading amendment that deals with some of the areas of greatest concern. However, we are here to deal with this very bill because of the fourth pharmacy agreement and the new pharmacy location rules. We should note that, in this whole process of striking the fourth pharmacy agreement and the new pharmacy location rules, the Howard government and the Minister for Health and Ageing, Tony Abbott, have not in any way, shape or form covered themselves in glory.

As we know, pharmacy services are important to all Australians. They are important to all of us. They are a vital part of our access to primary care and to medicines that not only assist us when we are unwell but help us maintain our health. The pharmacy agreement is not an insubstantial document. The pharmacy agreement covers some 22 per cent of Pharmaceutical Benefits Scheme spending. When negotiations about the pharmacy agreement go badly, that spells bad news for the PBS. Of course, what we know about the negotiations for the fourth pharmacy agreement is that the negotiations were protracted, they were sometimes acrimonious and they were always hidden behind closed doors.

The minister for health was on some days belligerent and on some days cowed during the course of these negotiations. One can track from his media statements the days on which he was belligerent and the days on which he was cowed. On a belligerent day he would say that he was intending to undermine community pharmacy by opening up the rules allowing pharmacy to go into supermarkets. This was the sort of threat that he would hold over the heads of the Pharmacy Guild and pharmacists when in a belligerent mode. But then on other days he was completely cowed, completely giving in and certainly making every sympathetic noise to pharmacists that he properly could.

I have had occasion to speak on this matter in the House before, and in a very unseemly short period one could track completely contradictory ministerial statements on the question of whether or not pharmacy should be in supermarkets. On one day the minister for health would say something entirely different from what he would say on another day. I have had occasion in the past to go through that matter in quite some detail in Hansard. That is no way to conduct a set of negotiations, when the people with whom you are negotiating cannot even tell what your position is because apparently you do not know yourself. That was the position that the Pharmacy Guild was in when dealing with the minister for health, who would have wildly different positions on different days.

The problem here is that, because of the way the minister for health dealt with this matter, it took a great deal of time to strike the new pharmacy agreement. It might surprise you to know, Mr Deputy Speaker Barresi—and I believe you should be quite shocked at this—that this is the third time in less than 12 months that the parliament has been required to deal in this House with a bill that relates to these pharmacy location rules. The negotiations were so protracted because the minister for health had so little idea of what he was doing that on three occasions he had to rush into this parliament saying: ‘I need more time. I need help with an extension of time on these pharmacy location rules. They are going to be out of date. There are going to be sunset clauses. Can you give me an extension? Can you help me out?’

This is the third time it has happened. On the two other occasions, because the Labor Party are interested in making sure people have fair access to pharmacy services, we did bail out the minister for health and we did deal with this legislation—one, by supporting it; and, two, by dealing with it in an expeditious way—but it is no way to run the health sector of this country. It reeks of incompetence. The problem for the minister for health is that he is not a competent minister on the details, and something that is about 22 per cent of PBS spending is a pretty big detail. Those other bills were dealt with in May 2005, when we extended the pharmacy location rules to 31 December 2005 through the Health Legislation Amendment (Australian Community Pharmacy Authority) Bill 2005. Then in October 2005 we had to do it all again, and the provisions were further extended until 30 June 2006 through the passage of the Health Legislation Amendment Bill.

I should note that, whilst the minister for health was dithering back and forth, rushing into this parliament to get pharmacy location rules extended and not knowing what to do next, Labor, apart from bailing him out by dealing with his legislation in a supportive and expeditious way, had a consistent position on the question of pharmacies and supermarkets. Unlike the Howard government, which did not know whether it was coming or going, whether it was Arthur or Martha on the issue, Labor had a consistent position. We consistently said that we gave an undertaking to community pharmacists before the last election and we were honouring that undertaking.

Given that the Prime Minister wrote a letter to community pharmacists across the country, giving an undertaking before the last election, one wonders why the Howard government could not be as simple and true as the word its Prime Minister had given and had a consistent position on this. I think it should be noted that, on a day on which we have had cause to debate issues about the honesty and credibility of this government, this was another issue going to honesty and credibility. What better form of promise could one have than a personally signed letter from the Prime Minister? The community pharmacists of Australia were in possession of such a letter. Even being in possession of such a letter did not matter, because that does not stop the Howard government breaking its word. It is a salutary lesson for anybody who relies on a representation from the Howard government about any area of policy during this parliament and particularly in the run-up to the next election.

We are also concerned, on the question of management and incompetence, that there is a clear incompetence in the way in which the Howard government is managing the Pharmaceutical Benefits Scheme. All of the rhetoric of the Howard government about the PBS, forever and a day, has been that the costs of the Pharmaceutical Benefits Scheme are out of control, that they are sky rocketing, that this is going to be an imposition on the community in the future and that it is particularly going to be an imposition when we deal with the challenges of an ageing society. When the Treasurer did his much vaunted—by him—Intergenerational report, the single biggest thing he said he was concerned about and going to act on was the escalating costs, the growth rates, in the Pharmaceutical Benefits Scheme. So all of the imagery was of a crisis. I believe there are real challenges in having a sustainable PBS over the longer term, but I also think there is a need for real honesty about where we are with the PBS and growth rates today. I suspect that the statistics I am going to give people now will shock them a little bit, because they are so contrary to the imagery that the Howard government seeks to create of a Pharmaceutical Benefits Scheme out of control.

Since the Howard government increased the PBS copayments by 21 per cent last January, and since it introduced its 12.5 per cent cuts in the price of generics in the middle of the year, the growth rate for PBS spending has now fallen on our calculations—and they are calculations supported by others—to around one per cent, and it is expected to drop even lower. The growth in prescription numbers, which is a good measure of whether or not people can afford to get their prescriptions filled, is already in negative territory. So, far from the crisis imagery of the Treasurer, the one year that he was dealing with all of these issues in his Intergenerational report and was shocked by a 22 per cent growth rate in PBS spending, he never actually identified the various things that the Howard government had done that contributed to that special one-off effect of a 22 per cent growth rate. There was an atmosphere of crisis, but now the Howard government has cut back and cut back and we are seeing extraordinarily low rates of growth—in fact, a reduction in the number of prescriptions.

I would like to think that that is because there has been some outbreak of wellness in our community, and fewer people need prescription medicine, but that is not the case in my estimation. The government’s own figures show clearly that fewer prescriptions are being filled in some crucial categories. In particular, fewer prescriptions are being filled for medicines that deal with cardiovascular conditions; for anaemia and blood clotting problems; for hormone replacement therapy needed because of thyroid, pituitary or pancreatic problems; and for mental illness, epilepsy, Parkinson’s disease and Alzheimer’s disease. You do not need to be a doctor—and I am most certainly not—to realise when you go through that list that we are talking about chronic conditions for which people take their medicines for a lifetime. They are not the sorts of conditions where you have an episodic illness, you go and get a course of antibiotics or whatever, you finish the course and that is the end of your need for prescription medicine. They are chronic conditions which people manage over a lifetime with the assistance of prescription medicine. If we know that fewer prescriptions are being filled in these crucial categories, that does not mean that those people have got better; that means that those people are going without their medication. Just to make sure that people understand: that means people with chronic ailments like cardiovascular conditions; anaemia and blood clotting problems; hormone replacement therapy needed because of thyroid, pituitary or pancreatic problems; and mental illness, epilepsy, Parkinson’s disease and Alzheimer’s disease are taking less medicine not because they do not need it but because they cannot afford it.

If you were confining your world view only to the columns of the federal budget you might say, ‘That’s okay; I’ve saved some money in columns in my federal budget, which makes the budget papers look nicer.’ As I have said before, sustainability in the PBS is a real issue, but you do not fix sustainability in the PBS by ending up with a situation where people with chronic and complex conditions go off their medication—because their health problems have not gone away. What will happen is that their health problems will turn up in some other part of the health system. Those people were taking their prescription medications for a reason. If they do not take them, their conditions will become more acute and they are very likely to end up in our hospital system or having some other sort of acute health episode.

If you were really looking at this as a sensible economist—not the Treasurer, but a sensible economist—taking a view across our health system about what is good for costs and what is bad for costs, you would see that it is crazy to deny people access to medication only to have them end up paying for much more expensive acute hospital care somewhere down the track. To take a simple example, it is much better for all of us if someone continues to take their cardiovascular medication rather than have a heart attack. It is much better for the person involved—there is no doubt about that—but also much better for the health system, because acute coronary care is expensive, and we do not want people in acute care hospitals if they do not need to be there.

The officers of the Minister for Health and Ageing have tried to say that the fall in prescriptions is not serious because it does not include drugs dispensed through the highly specialised and high-cost schemes. But an analysis of the data shows that this explanation is wrong. That is, there were some special factors coming out of the highly specialised and high-cost schemes which would explain this result. Then the Department of Health and Ageing, knowing that its first explanation was a stupid one, tried to come up with a second explanation and said that it was something to do with Vioxx being taken off the PBS. But this is again wrong. There is a clear and unambiguous decline in PBS growth rates regardless of the Vioxx effect.

Furthermore, what Health has tried to say—which is that it is all okay: ‘Don’t worry about it; it doesn’t matter’—is directly contradicted by the Treasury papers, particularly the Mid-Year Economic and Fiscal Outlook, MYEFO. That paper now states that the growth rate in PBS expenditure in 2005-06 will be 2.2 per cent less than the budget projection of 7.4 per cent. MYEFO states that that will see a windfall for the government of $283 million. That is money that would have been spent on the PBS that is no longer going to be spent on the PBS.

There is a big issue here about affordability. It is an issue that has occurred whilst the government has made it harder to reach the PBS safety net, and it is an issue that is going to be made worse with the new 20-day rule, which is yet to kick in. With the new 20-day rule, it is much more difficult for people to get the cost of their prescription medicine counted towards the safety net. So we have got a pincer movement here: costs are going up, the PBS safety net is not as good as it used to be, and the 20-day rule is going to make that even more the case. There will be artificial counting of which of your medications ought to be counted for your safety net costs. That means that there will be people who should be taking their medications who are not taking them.

This is a serious issue. It is an issue that the government cannot even be bothered analysing, let alone addressing. We have suggested to the minister for health that he actually take a look at this, that he have some sort of study, some sort of investigation, to ascertain whether or not there is an issue with affordability that is preventing people from taking their medications. He has just brushed these concerns aside. They are too serious to be brushed aside. Again today I call on the minister for health and the Treasurer to look at the full impact of their short-sighted and short-term policies to cut the PBS.

With that, may I conclude by moving the second reading amendment standing in my name:

That all words after “That” be omitted with a view to substituting the following words: “whilst not declining to give the bill a second reading, the House condemns the Government for:

(1)

failure to investigate the impact of PBS co-payment increases on patients’ access to needed medicines;

(2)

recent changes to the PBS safety net which mean patients must pay more out-of-pocket; and  

(3)

the confusion and difficulties presented to patients, doctors and pharmacists by the new 20-day rule on repeat prescriptions”.

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