Australian Regenerative Medicine Institute

The Australian national publicly subsidized Pharmaceutical Benefits Scheme: Any lessons for Canada?(2)

The Australian Pharmaceutical Benefits Scheme (PBS) is interesting for Canadians to examine because of the largely public-funded health system and its federation government. Australia, with a population of 19 million, has a bicameral parliamentary system and is a federation of the Commonwealth (federal), with six states and two territories. Federal and state/territorial governments share responsibility for health care . Australia spends about 8% of its gross domestic product (GDP) on health compared with Canada, where 10% of the GDP is spent on health . Australia also has a mix of public and private funding. The private sector accounts for 32% of health care in Australia and 28% in Canada . However, there is greater spending on drugs in the private sector in Canada, with only 23% of the share of prescription drug volume in Canada covered by provincial drug plans and 15% by hospital plans; the remainder is covered by private plans (44%) and the cash market (12%) . In Australia, less than 10% of prescription drugs used in the community are covered by private payers (Table 1). flovent inhaler

TABLE 1 Please provide heading

Australia* Canada
Structure Federation of six states and two territories Federation of 10 provinces and two territories
Population 19 million 30 million
Health spending per capita $2,360 (AUST$2,145) $2,478*
Health expenditures/GDP (% of GDP) (8.4%*) (9.7%)
Source of funding 45.7% Commonwealth, state and territory governments; 22.8% local authorities; 31.6% nongovernment sources* Federal health transfers 33% provincial or territorial government 67%t
Private HCE/total HCE (%) 32* 28f
Pharmaceutical spending
Coverage Universal coverage <10% of community prescriptions for Coverage varies by province with few drugs not listed on PBS or RPBS and available only provinces providing universal coverage by private prescription* 12% of Canadians have no drug insurance5
Total expenditure $1,887 billion government and $2,156 billion nongovernment sector* $9.2 billion* on pharmaceuticals ($6.5 billion on prescription drugs)
Total HCE for pharmaceuticals 11.8% of total health expenditure* 12.7% of total HCEf

*From reference 8; fFrom reference 1; *From reference 16; ยงFrom reference 33. GDP Gross domestic product; HCE Health care expenditure; PBS Pharmaceutical Benefits Scheme; RPBS Repatriation Pharmaceutical Benefits Scheme

As in Canada, in Australia the licensing or approval of drugs for marketing is separate from the decisions for the public system to fund the drug. Unlike Canada, however, Australia has a single federal purchasing scheme for pharmaceuticals. The Australian system of drug registration and pharmaceutical purchasing and benefits is discussed, with an emphasis on structural and legislative aspects.

Category: Pharmaceutical

Tags: Australian Pharmaceutical Benefits Scheme, Canadian health care, Pharmaceutical policy, Pharmacoeconomics

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