What are Non-PHARMAC funded drugs?

PHARMAC, New Zealand's Pharmaceutical Management Agency, is the gatekeeper of the nation's medicine cabinet. Established in 1993, its mission is to ensure Kiwis have access to affordable medicines by deciding which pharmaceuticals and medical devices receive public funding. Operating within a fixed budget, PHARMAC negotiates prices with pharmaceutical companies, striving to balance cost-effectiveness with public health needs. Sadly this can lead to New Zealanders being denied treatment and the pharmaceuticals they need are non-PHARMAC funded. This leaves little option but to either go private or go without.

Pros of PHARMAC:

1. Cost Containment: By negotiating drug prices, PHARMAC keeps healthcare spending in check, ensuring the sustainability of New Zealand's healthcare system.
2. Equitable Access: PHARMAC's centralized funding decisions aim to provide all New Zealanders with equal access to essential medicines, regardless of their financial status.
3. Evidence-Based Decisions: Funding choices are grounded in rigorous analysis, ensuring that taxpayer money is spent on treatments with proven effectiveness.

Cons of PHARMAC:

1. Limited Drug Availability: Some innovative or specialized treatments, especially for conditions like cancer, may not be funded promptly, leading patients to seek alternatives.
2. Slow Approval Process: The thorough evaluation process can delay the availability of new medicines, potentially impacting patient outcomes.
3. One-Size-Fits-All Approach: A centralized system may not always accommodate individual patient needs, particularly for rare or complex conditions.

Only 1 in 10 new Cancer Treatments were made available to New Zealand.

A shocking statistic but it's true. Between 2011 and 2020 only 10% of new cancer treatments across the OECD were available in Aotearoa. It's not just cancer treatment that is impacted though. Between 2011 and 2020 only 35% of treatments covered in Australia were made available to New Zealanders.

Most Kiwis only become aware of PHARMAC's funding decisions when they hear a story or see a report in the news or online of someone denied potentially life extending treatments. This is most widely reported in cancer treatments. While many standard therapies are funded, access to newer, potentially more effective treatments can be limited. Very recently drugs like carfilzomib, pomalidomide, and daratumumab for multiple myeloma remained unfunded, despite their availability in other countries.

Don't take it from an insurance adviser though, here is an article written by an oncologist. It is clear that restricted treatment option takes a toll not only on the patients and their families but also the clinicians who's hands are tied.

This funding gap has led some patients to seek private treatment, incurring substantial personal costs. Reports indicate that private clinics charge varying fees for administering unfunded cancer drugs, with additional fees ranging significantly, adding to the financial burden on patients.

How much will treatment cost privately?

Private medical treatment can be expensive. Many people can afford to spend a few hundred dollars a year on prescriptions for an illness, some can even afford thousands a year for chronic treatments but very few can afford over $100,000 a year for chemotherapy. Some treatments cost even more than that, as outlined here.

In response to funding limitations, some patients turn to crowdfunding platforms like GoFundMe to raise money for treatments. For example, a terminal cancer patient spent $5,000 a month on unfunded medication to prolong her life, depleting her savings and relying on community support. I think most people would rather spend their time focusing on their family or recovery than fundraising.

How Many Patients Are Impacted By Non-Funded Drugs?

Quantifying the exact number of patients denied chemotherapy solely due to PHARMAC's funding decisions is challenging. It involves various factors, including clinical assessments and patient choices. However, the lack of funding for certain drugs has undeniably led to situations where patients cannot access specific treatments without incurring significant personal costs or seeking alternative funding methods.

While PHARMAC plays a crucial role in managing New Zealand's pharmaceutical funding and ensuring equitable access to many treatments, its limitations can have profound impacts on cancer patients, sometimes necessitating personal financial sacrifices or community fundraising efforts to obtain necessary care.

How Do I Access Non-PHARMAC funded drugs?

What can you do if the oncologist says, "Sorry, this chemotherapy isn't funded."?

• Private Health Insurance: Private health insurance it might cover non-PHARMAC funded drugs. If this is something that concerns you then give us a call and we can review your health insurance to make sure that it meets those needs. Policies for non-Pharmac funded chemotherapy can be quite affordable.
• Trauma Insurance: A lump sum from a successful Trauma Insurance claim can be used towards non-funded drugs.
• Out of Pocket: If you have the money then you can buy these treatments. Many people remortgage, downsize or sell investments to meet the costs. It can be more cost effective to get health insurance policies in place before disaster strikes.
• Crowd Funding/Charity: An alarming number of people have to rely on their local community to raise funds. It takes a lot of work and effort from family and friends to raise enough for treatments, especially if they are long term or very expensive.
• Nothing: Opting to just accept the state treatment, even if it impacts on your lifestyle, health and survivability, is common. This is not acceptable for many family and friends who may try crowd funding and fundraising to help.

What Can Cover Yours Do?

At Cover Yours we offer fully independent advice on Health Insurance and we can guide you to the right policy for you and your family. There are household names in the insurance industry that don't offer any cover for non-funded drugs unless extra is paid. This causes great upset when people try to claim and find out they are not covered. When it comes to health insurance all companies are definately not created equally and it takes a fully independent expert to sort the wheat from the chaf. If you want to know if your insurer will help you get in touch. A 10 minute chat could make a huge difference.

Cover Yours Ltd (FSP769531) and Marc Hamilton (FSP306046) have registered as Financial Service Providers, and you can search the register here. Marc Hamilton belongs to the FSCL Disputes Resolution Service. You can find disclosures for Cover Yours Ltd and Marc Hamilton here or by emailing marc@coveryours.co.nz.