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‘Price-fixing’ debacle affects health of Minister’s budget

Maryan Street
Health Spokesperson

21 February 2013

‘Price-fixing’ debacle affects health of Minister’s budget

The Government may not be pocketing the revenue or savings it had hoped for from its increased prescription charges, Labour’s Health spokesperson Maryan Street says.

“Tony Ryall tried to tell the House last week that ‘the increase in the prescription charge was implemented quite smoothly’.

“On the contrary, it was anything but smooth. The DHBs wrote a clause into their contract with pharmacies requiring them to charge $5, something that had never been done before.

“A complaint was taken to the Commerce Commission which came back with the ‘strongly held view’ that the requirement to charge $5 was price-fixing and was in breach of S.27 of the Commerce Act.

“The DHBs then wrote to all pharmacies saying they did not have to observe the related clauses in their contract any more.

“This is part of the chaos which exists in the pharmacy sector. It has not gone smoothly at all.

“Mr Ryall’s projected savings are imagined.

“Not only that, but cash-strapped patients who can’t afford to pick up their prescriptions are doing just that – not picking them up - meaning less revenue by way of the $5 per script co-payment, along with more sickness and higher rates of much more expensive hospitalisation.

“Even if Tony Ryall doesn’t care about the health of New Zealanders, he should care about the health of his own budget.”


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