The Albanese government will introduce legislation this week to cap the maximum cost of prescriptions under the Pharmaceutical Benefits Scheme (PBS) at $25, delivering on a key election promise aimed at easing cost-of-living pressures.
The new cap, a reduction from the current price of $31.60, is scheduled to take effect from January 1, 2026.
The change represents a more than 20 per cent reduction in the co-payment for general patients and is forecast to save Australians a collective $200 million annually.
Prime Minister Anthony Albanese said the measure ensures that the “size of your bank balance shouldn’t determine the quality of your healthcare.”
The co-payment for pensioners and concession cardholders will remain unchanged at $7.70.
Legislation Delivers on Election Pledge
Making medicines more affordable was a central part of the government’s re-election campaign earlier this year.
The measure is part of a broader $8.5 billion investment aimed at strengthening the healthcare system, which includes incentives for GPs to bulk bill.
Health Minister Mark Butler stated that the new cap would make general patient medicines the cheapest they have been since 2004.
The announcement comes amid concerns over potential external economic pressures. Earlier this month, US President Donald Trump warned of significant tariffs on pharmaceuticals from other countries.
According to the Australian Bureau of Statistics, Australia exported approximately $2.1 billion of medicinal products to the United States in 2024, and any such tariffs could potentially impact costs and domestic manufacturing.