Federal Budget: Government confirms commitment to build a 21st Century health system

9 May 2023: Medicines Australia commends the Federal Government for the significant investment in new health measures and reforms in the 2023 -24 Federal Budget totalling $27.9 billion. The Government’s $6.1 billion commitment to ensure Medicare is ‘fit for the 21st Century’ to support the health of Australians is essential in these uncertain times.

“We appreciate there are many priorities for Government, and balancing inflation while seeking to buffer cost of living pressures, is challenging. The Medicare reforms are important, but also need to be reflected across our health system ‘holistically’ to ensure we are advancing and ‘cutting edge’. This includes innovative medicines,” states Liz de Somer, CEO Medicines Australia. 

Medicines Australia acknowledge the reforms to Medicare and notably the focus on primary healthcare are important to improving health delivery, after the extreme pressures of the pandemic. Securing greater access to primary care – including a tripling of the bulk billing incentives, reducing pressure on hospitals and supporting our hardworking healthcare professionals are all welcomed.  

“As the Minister for Health said, while Australians have changed significantly in the past 40 years, Medicare has not evolved since its introduction in 1984. Reinvigorating our health delivery framework is an important priority, but similarly, we must work now to ensure the Pharmaceutical Benefits Scheme (PBS) – now 75 years old – receives due care and attention to ensure it doesn’t fall even further behind,” adds Ms de Somer.

Medicines Australia also welcomes new funding for the Therapeutic Goods Administration (TGA) to deliver measures in public health worth $61 million over four years. This represents an important start and we encourage further support for the TGA as the Government implement ongoing health reform over the coming years.

The Federal Budget however, confirms the PBS continues to stagnate compared to substantial projected growth in Medicare, Hospital Funding to the States and the NDIS.

Health Area2022-20232023-2024
PBS$19.6 billion$19.1 billion
Medicare$36.9 billion$39.3 billion
NDIS$36 billion$41.9 billion
State Hospital Funding$25.6 billion$28.4 billion

“These flat projections raise significant questions on how our PBS can keep up with the innovative leaps and scientific breakthroughs now arriving – for those facing life threatening acute illness, or managing ongoing chronic health conditions,” states Ms de Somer.

“A strong Medicare needs a strong PBS. Parallel investment that advances healthcare delivery, alongside the harnessing of innovative medicines, is essential. Working together this will build a modern system truly ‘fit for the 21st Century’ – bringing maximum gain for our community and the economy,” she adds.

“Medicare and the PBS must evolve together, and the Government’s first major Health Technology Assessment (HTA) review in 30 years provides a critical opportunity to achieve long overdue PBS reform. Making our HTA ‘fit for the future’, to sit alongside Medicare, must now be our collaborative goal,” states Ms de Somer.

Medicines Australia is disappointed with the decision not to progress the Patent Box, but look forward to working with the Government on future measures that will encourage industry growth and investment in Research & Development. 

We will carefully review the details of the Budget over the coming days to assess the full implications in health and for industry, to ensure consequences from other announcements are considered fully and assessed.

For further information please contact Anne-Marie Sparrow on 0417 421 560.