Medicines Appropriation

The introduction of a parliamentary medicines appropriation would increase transparency in what is currently a complex and non-transparent area.

This supports triple aim objectives for value, equity and quality by recognising that medicines innovation is growing and should be compared to other health expenditure choices, free of DHB incentives/pressures to fund the services they own.

A specific medicines appropriation means that discussion on what the ‘optimal’ allocation of the health budget to medicines budget should be. This change would be in line with the New Zealand Treasury Guide to Appropriations and supports effective administration of the Public Finance Act. An appropriation will increase the transparency of current and future budgets. Strategic allocation and technology assessment are not a focus or function of the 20 geographically based DHBs as service funders and providers. A medicines appropriation can be informed by improved horizon scanning and forecasting.

Importantly, an appropriation allows transparent consideration of how large the medicines budget should be in relation to other strategic health expenditure choices. Over time, transparency helps with decisions to optimise health expenditure and assist with public trust and confidence that New Zealanders have access to a fair and modern health service. Read more here.

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Sources:

  1. NZIER (May 2020). A new generation medicines policy. Wellington, New Zealand. Available from https://www.medicinesnz.co.nz/fileadmin/user_upload/A_new_generation_medicines_policy_-_FINAL.pdf
  2. NZIER (January 2020). Establishment of a medicines appropriation. Wellington New Zealand. Available from https://www.medicinesnz.co.nz/fileadmin/user_upload/Medicines_New_Zealand_Case_for_Medicines_Appropriation_Jan_2020_Final.pdf