Government u-turns on prescription co-payment fees
RNZ photo
Patients would still need to collect their medicines every three months.
In a policy u-turn, people will only need to pay a single $5 co-payment fee for the new 12-month prescriptions coming into effect from February.
The year-long prescriptions were announced as part of the 2025 Budget as a way to reduce the cost of seeing GPs.
Patients would still need to collect their medicines every three months, and at the time it was thought they would have to pay a $5 fee each time but that will no longer be case.
The backtrack is revealed in a series of Health Ministry documents proactively released three days before Christmas, titled "Cabinet material: Rescinding a prescription co-payment decision".
They show the initial decision for repeat co-payments every three months was made in May, ahead of the 2025 Budget, "to mitigate the financial impact on Health New Zealand".
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However, the documents show a Cabinet committee on 17 September agreed with the minister's recommendation to change course and only have the $5 fee apply at the first collection.
"The previous decision does not align with the policy intent to reduce costs to patients," the Cabinet paper in Health Minister Simeon Brown's name said.
"I consider that, to achieve this policy intent, the additional co-payment every three months needs to be removed."
Health Minister Simeon Brown. (Mark Papalii/RNZ)
The paper says the co-payment is a financial barrier, with about 191,000 adults in 2023/24 not filling a prescription because of the cost.
"After further consideration, I am seeking agreement to rescind the decision," it says.
"This has the potential to reduce the cost to a patient by up to $15 over the course of a 12-month prescription."
The committee noted this would mean extra yearly costs to Health NZ of between $6 million and $23m.
"For outyears, this is estimated to grow over the previous year by around 5 percent," the minute of decision states.
Cabinet confirmed the decision on 22 September.
Other details under subheadings about how the decision would also reduce complexity for Health NZ and curb financial implications for both Health NZ and Pharmac were largely redacted.
The Cabinet paper shows Brown has instructed the Health Ministry to get the policy ready to take effect by 1 February.
Responding to questions from RNZ about the move, Brown said the decision supported the aim of removing financial and administrative barriers for New Zealanders and improving access to medicines.
"The removal of co-payments will also reduce the complexity of implementing the initiative, including changes required to external IT systems for prescribing and dispensing," he said.
"The increased maximum prescription length will come into effect on 1 February 2026. Health New Zealand is working with the primary care and community pharmacy sectors to support implementation ahead of that date, with the Ministry of Health and Pharmac also supporting the rollout."
He said the extended prescriptions would make a real difference for people managing long-term conditions like asthma, diabetes, epilepsy and high blood pressure.
Brown's office also pointed to bullet points sent to reporters at the end of a media release in November celebrating the passage of the Medicines Amendment Bill.
"Patients will only be required to pay the $5 co-payment once when collecting their initial three-month supply. No further co-payments will be charged for the remaining repeats," one said.
While that conflicted with earlier reports, no other comments made clear it was a change from the previous approach, and the bullet points were absent from the version released publicly on the Beehive website.
Pharmacy Guild chief executive Andrew Gaudin told RNZ the change was a great thing, ensuring more affordable access for patients to medicines, GPs, and community pharmacies.
He also welcomed a separate decision arrived at with the government last year, where Health NZ would "fully mitigate" a previously planned reduction in the fee it paid to pharmacists for dispensing services.
He said that meant "community pharmacy will not be adversely financially impacted for dispensing services under 12-month/extended scripts. So two very good things here", he said.
In another change taking effect from 1 February, more pharmacists will be able to also be prescribers, although pharmacists are unlikely to be ready by then, according to a pharmacy group.
