Outcry over Health Department idea to save money by making people pay more for subsidised medical services and drugs
Many of Australia’s oldest, sickest and poorest patients will stop taking important and potentially life-saving medications if expenditure advice provided by the Department of Health to the Commission of Audit is adopted by the government, leading health economists say.
The department recommended people be made to pay more for government-subsidised medical services and drugs, the Australian reported on Monday, because it would lead them to cut spending on unproven and discretionary treatments. Forcing consumers to cut their discretionary spending could reduce pressure on the federal health budget, the department’s recommendations said.
But an assistant professor from the Centre for Health Services at the University of Western Australia, Anna Kemp, said there was no evidence for the relationship between spending on prescription medicines and on unproven drugs.
“The department is assuming that those people using prescription medicines are the same people using unproven treatments, but there isn’t any evidence to support that and we don’t know how much overlap there is between the two groups,” she told Guardian Australia.
“But what we do know is that when there is an increase in the cost of subsidised medicines, there are big decreases in the amount people spend on those medicines.”
It was true that making drugs more expensive led to some waste reduction, Kemp said. But this did not tell the full story because the use of important prescription drugs went down too. This was particularly the case for people with more than one condition who took multiple medicines, she said. They often stopped taking some when the price of drugs increased.
“The recommendations are based on the assumption that people know enough about what their drugs do to make good, informed decisions about which drugs they can do without, but we know that’s not the case,” Kemp said.
In the federal budget the government proposed to increase existing drug co-payments and introduce a $7 co-payment for GP visits.
Kemp’s own research revealed that changes to the prescription drugs co-payment in 2005 had a significant effect on the ability of patients to afford essential medications. Concession card holders were worst affected, Kemp found, because they often took the most medications. An increase of about 90 cents per script became too much of a cost burden over time. Dispensing volumes fell in 12 out of 17 medicine categories, with anti-epileptics, anti-Parkinson’s treatments, combination asthma medicines, eye-drops and glaucoma treatments among those falling in use.
The drugs people were most likely to stop taking were those they didn’t immediately feel benefit from, Kemp said.
“So they might stop taking their osteoporosis medication for strengthening their bones, because they won’t notice any difference – until they fall and get a broken hip.
“You can either have a waste-proof system that is unaffordable [for patients], or an affordable system that is prone to waste, and our research found the government was heading too far towards the former.”
A more sensible approach would be to increase the cost to the patient of newer medicines for which cheaper, sometimes only slightly less effective substitutes existed, said Professor Philip Clarke, a leading health economist at the University of Melbourne’s school of population and global health.
“The department hasn’t made any differentiation between subsidised expensive drugs and cheaper drugs,” he said.
“Why not introduce differential co-payments, where people pay more for drugs with less benefit, or for less proven, newer drugs? This whole issue of co-payments needs a more rational debate.”
The chief executive of the Consumer Health Forum, Adam Stankevicius, said it would be “very concerning” if advice from the department suggested that out-of-pocket health costs by individuals were discretionary.
“It would be very surprising if the government were suggesting that wheelchairs, oxygen tanks, dental services and prescribed medications are discretionary,” he said. “For health consumers, they are considered essential to their daily lives.”
A Health Department spokeswoman, Kay McNeice, told Guardian Australia that contrary to the report in the Australian, the information the department had provided to the Committee of Audit was not a submission.
“Instead, on request, the department provided information on a range of issues,” she said.
The department did not immediately respond to specific questions on its recommendations from Guardian Australia.