Editorial: No sugar coating for prescription charges

22:14, May 15 2012

Nowhere do costs grow faster than in the health sector. Each year pharmaceutical companies produce new drugs, technology companies invent  new machines and the demand for skilled doctors and nurses continues to outstrip the supply.

The Government's decision to increase prescription charges acknowledges that reality.

Despite the protestations of some politicians who should know better, there is not a magical bucket of money tucked away in some dark recess of the Beehive that is constantly replenishing itself. Money spent by ministers on one thing is money that cannot be spent on another.

As a nation, New Zealand can only buy what it can afford to pay for or borrow what it can convince its creditors it is good for. Both are finite equations.

Health Minister Tony Ryall's Labour predecessors were somewhat insulated from economic reality by the flood of money that poured into the government's coffers in the early part of this century. Each year finance minister Michael Cullen would declare that the government could not keep increasing health spending at twice the rate of inflation and each year Labour's health ministers would prevail upon him to do just that. Mr Ryall does not have that luxury.

With the Government promising a "zero budget''  next week the choice for him was simple: ask people to  pay slightly more for prescription medicines or tell patients needing cancer treatment and elective surgery to wait longer. He has chosen to ask families to pay up to $40 more a year for medicine. Few, apart from those who like to pretend the Government has a limitless supply of money, will disagree with that choice.

The increase, which takes effect next January, will push the price of a single item up from $3 to $5. For a family the maximum payable in a single year will increase from $60 to $100.

Prescriptions for children under the age of six will remain  free and families that cannot afford to pay the increase will be able to obtain assistance from Work and Income NZ and primary health organisations. According to Pharmacy Guild president Karen Crisp, that means that no patient need be denied medicine by cost.

Historically and internationally the charges are still low. Until the Labour-led government cut the fees between 2004 and 2008, the charge for prescription medicines was $15. In Australia the average fee is A$35.40 (NZ$45), although  those on low incomes pay a lesser fee. In England the average charge is NZ$16 and in Finland, Labour's utopia,  Mr Ryall says individuals have to fork out  $1107 each before the cost of prescription medicines is limited to about NZ$2.50.

By any standard New Zealand's fees are reasonable. No one should be denied medical assistance by cost. Prompt treatment of many conditions is in the interests of society as well as individuals. It can stop the spread of disease and avoid the need for costly hospital treatment.

However, pharmaceutical costs are real. A balance has to be struck between prevention and cure. The question being asked should not be whether the minister has gone too far but whether he has gone far enough.