More than 900 medicines listed on the Pharmaceuticals Benefit Scheme (PBS) will be capped at $25 from 2026.
The Government has passed legislation to reduce the consumer cost of PBS medicines, after first announcing the plan during the election campaign.
The Coalition matched Labor’s PBS pitch during the election campaign and supported the measure.
Here’s what you need to know.
PBS
Under the PBS, the Government subsidises a range of prescription medicines for any Australian resident with a Medicare card.
The independent Pharmaceutical Benefits Advisory Committee (PBAC) recommends which drugs are listed. Currently, there are more than 900.
Medicines include common antibiotics to fight infections, and more targeted treatments like Visanne, prescribed for endometriosis.
Reduction
The current PBS limits the maximum payment of listed medicines at $31.60 at a pharmacy.
Ahead of the 3 May election, the Government pledged to cut the maximum price to $25. This promise was matched by the Coalition.
The cost for pensioners and concession card holders (such as welfare recipients) will still be capped at $7.70 per prescription.
The concession cost freeze will apply until 2030.
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Legislation
The Government has now passed legislation that would reduce the cost of PBS medicines.
The change is scheduled to come into effect from 1 January 2026.
Health Minister Mark Butler said: “For general patients, medicines haven’t been this cheap since 2004.”
“Cheaper medicines are good for the hip pocket and good for your health.“
Labor doesn’t have a majority in the Senate, meaning the legislation needed broader support from either the Greens or the Coalition to pass.
Ahead of the legislation passing, Shadow Health Minister Anne Ruston told TDA the Coalition “strongly supports Australians having more affordable access to medicines.”
The bill passed with broad support on Monday night.
Reaction
Health groups welcomed the Government’s move to reduce PBS medicine costs.
President of the Pharmacy Guild of Australia Trent Twomey said he pushed for lower cost medicines, adding: “Community pharmacies are at the coal face of the tough decisions patients make every day.”
The top doctors’ body, the Royal Australian College of GPs, said: “It’s rare for the cost of something essential to decrease”.
