The Australian Pharmaceuticals Benefit Scheme and older Australians: changes in government outlays and consumer costs from the 2002-03 federal budget measures

Finding ways of curbing government expenditure on the PBS while maintaining social equity and access to \u27essential\u27 medicines is at the centre of ongoing public debate. In the 2002-03 federal budget, the government aimed to introduce an increase of close to 28 per cent in PBS copayments and safety net thresholds; this paper examines the impact on the costs to government and patients and estimates the distributional effects of this policy change, particularly for older Australians.Finding ways of curbing government expenditure on the PBS while maintaining social equity and access to \u27essential\u27 medicines is at the centre of ongoing public debate. The PBS is highly progressive, with 80 per cent of total PBS government outlays being directed at concessional patients, the majority of whom are elderly. Older Australians receive far greater PBS benefits than any other user group: an estimated 16 per cent of total PBS government outlays are directed towards persons aged 75 years and over. In the 2002-03 federal budget, the government aimed to introduce an increase of close to 28 per cent in PBS copayments and safety net thresholds. Using PharmaSim, a microsimulation model of the PBS, Laurie Brown, Annie Abello, Ben Phillips and Ann Harding examine the impact on the costs to government and patients of PBS listed medicines and estimates the distributional effects of this policy change, particularly for older Australians