Prescription charge reform signalled

Press, 12 May 1987, Page 21

Prescription charge reform signalled

By

OLIVER RIDDELL

in Wellington

Radical reform of prescription charges and the cost of pharmaceuticals has been signalled by the Prime Minister, Mr Lange.

He told the annual conference of the Labour Party’s Wellington division during the week-end that the Government accepted there could not be limitless choice and limitless funding in the social services. The Government had an obligation to ensure that the services delivered what people really needed.

In the pharmaceutical sector, for example, the bill for prescription drugs was a budgetary nightmare, Mr Lange said. The cost was climbing steadily towards $5OO million a year.

It was a huge cost and there were comparatively few restraints on it. There was an impetus within the system towards writing prescriptions, and evidence showed these were often written when not absolutely needed. In Whangarei, for example. a person going to

the doctor was I*£ times as likely to get a prescription as a person going to the doctor in Invercargill; Whangarei had times as many doctors as Invercargill. He said the Government had to look seriously at the bill for pharmaceuticals. The dollar-a-head prescription charge had been a stop-gap procedure only and could not be a substitute for real reform. Real reform could not involve user-pays, Mr Lange said. The market worked only where a willing seller met a willing buyer, and no-one was a willing buyer when going to a doctor because patients lacked the time and knowledge to shop around. But there were options, and the Government was considering them. He declined to advocate any one approach but said the report of the health benefits review committee had set them out. It had been argued that the State could use its clout as the funder of prescriptions to put stronger incentives to conserve resources into the system.

Administrative changes in the health legislation would allow the Health Department to bargain more effectively with manufacturers, wholesalers and pharmacists to manage the over-all pattern of distribution, Mr Lange said. The crunch came with the doctors; simply telling them what to prescribe, would be counter-produc-ive. What could be done instead was to set pharmaceutical budgets for individual practices, and then let the practice keep a share of savings it made in its drug use, he said. Alternatively, health authorities could take over the pharmaceutical budget on a regional basis to manage it, with the same incentive. There was a great deal more to the pharmaceutical strategy in the report, Mr Lange said. Serious strategies for reforming spending were available. These radical strategies would have to be talked through carefully with the people who provided services because they were being asked to work in I different ways. I