In a move aimed at improving accessibility to healthcare services, the New Zealand government announced the removal of the $5 co-payment in Budget 2023. This decision is set to have a significant positive impact on community pharmacies across the country. The $5 patient co-payment, previously required for prescriptions, not only acted as a barrier for patients seeking necessary medications, but also created commercial competition in the pharmacy landscape. Its removal not only ensures that essential healthcare is more affordable for individuals, but also supports the viability and growth of community pharmacies.
Community pharmacies stand to benefit greatly from the removal of the $5 co-payment. These pharmacies serve as crucial front line healthcare providers within their communities, acting as an integral part of the health-care system. However, the financial strain of the co-payment could sometimes lead patients to seek lower-cost options from larger competitors or delay collecting their prescriptions, impacting the profitability of community pharmacies.
From our recent 2022 national pharmacy benchmarking survey, the average co-payments received per pharmacy included in the survey was $93,462 excluding GST. This will now be funded by the government and with the co-payment no longer a concern, community pharmacies can anticipate increased foot traffic and prescription volume, which will bolster their financial sustainability and allow them to continue delivering essential services to their communities.
Exciting times for pharmacies
This removal of the $5 co-payment in Budget 2023 marks an exciting time for pharmacies of all sizes, presenting them with new opportunities for growth and success.
This positive policy change opens doors for pharmacies to enhance their services, invest in technology and infrastructure, and explore strategic partnerships to further strengthen their position in the healthcare sector. Additionally, it prompts pharmacy owners to think about long-term plans, such as succession arrangements, to ensure the continued provision of quality care to their communities. Now is the time for pharmacies to seize this moment, adapt to changing dynamics, and position themselves for a sustainable future in the evolving healthcare industry.
Plan for business success with a strategic partner
During this exciting time for pharmacies in New Zealand, Moore Markhams is ready to provide invaluable support and guidance to pharmacy owners. As a leading accounting and advisory network with extensive experience in the healthcare industry, Moore Markhams understands the unique challenges and opportunities that pharmacies face. We can assist pharmacies in navigating the financial implications of the removal of the $5 co-payment, offering tailored solutions to optimise profitability and cash flow. Our team of experts can provide strategic advice on growth strategies, such as expanding services and exploring new revenue streams.
Moreover, Moore Markhams can offer valuable insights into succession planning, assisting pharmacy owners in developing comprehensive strategies for a smooth transition of ownership and ensuring the continued success of the business.
With our specialised knowledge and commitment to client success, partnering with Moore Markhams can empower pharmacies to maximise the benefits of the policy change and help them thrive in the evolving healthcare landscape.
To find your nearest Moore Markhams firm
click here