National Health (Price and Special Patient Contribution) Amendment Determination 2015 (No 1) (PB 11 of 2015) [F2015L00208]-New matters [2015] AUSStaCSDLM 43 (18 March 2015)

• National Health (Price and Special Patient Contribution) Amendment Determination 2015 (No. 1) (PB 11 of 2015) [F2015L00208]

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National Health (Price and Special Patient Contribution) Amendment Determination 2015 (No. 1) (PB 11 of 2015) [F2015L00208]

Purpose	Amends the National Health (Price and Special Patient Contribution) Determination 2010 (PB 109 of 2010) to provide for price determinations under section 85B of the National Health Act 1953 in relation to brands of pharmaceutical items for which the Minister and the responsible person have not been able to make a price agreement. It also provides for the circumstances in which the Commonwealth will pay the special patient contribution resulting from these price determinations
Last day to disallow	15 June 2015
Authorising legislation	National Health Act 1953
Department	Health

Issue:

Consultation

Section 17 of the Legislative Instruments Act 2003 directs a rule-maker to be satisfied that appropriate consultation, as is reasonably practicable, has been undertaken in relation to a proposed instrument, particularly where that instrument is likely to have an effect on business. Section 18, however, provides that in some circumstances such consultation may be unnecessary or inappropriate. The ES which must accompany an instrument is required to describe the nature of any consultation that has been carried out or, if there has been no consultation, to explain why none was undertaken (section 26). With reference to these requirements, the committee notes that the ES for this instrument states:

This determination affects certain responsible persons with medicines listed on the PBS. Before a pharmaceutical benefit is listed on the PBS, and from time to time thereafter, price negotiations occur between the responsible person and the Minister for the purpose of reaching a price agreement for section 85AD of the Act. If the Minister and the responsible person cannot agree on a price, further consultation occurs with the responsible person, and thereafter the Minister determines the price that will be the approved ex-manufacturer price for the brand. The Minister also determines the corresponding price claimed by the responsible person which is used to calculate the special patient contribution that will apply to the brand.

In the committee's view, the statement above describes the process of negotiation between the minister and the responsible person, as opposed to a process of consultation. In effect, it appears that consultation (within the general meaning of public consultation or consultation with relevant stakeholders) was unnecessary in this instance because the price determination was essentially a process of negotiation (rather than consultation). In terms of complying with section 18 of the Legislative Instruments Act 2003, the committee considers it would be useful for the ES to have explicitly stated that consultation was considered unnecessary (or inappropriate) because the instrument essentially involves a price negotiation between the minister and the responsible person. The committee therefore draws the matter to the minister's attention.