Veterans’ Pharmaceutical Reimbursement Scheme
The Veterans’ Pharmaceutical Reimbursement Scheme (VPRS), reimburses eligible veterans for out–of-pocket costs associated with the concessional pharmaceutical co-payment.
The second annual payment under the Scheme will be made in the last week of March 2014 for out-of-pocket costs incurred in 2013. Future payments will be made in March of each year for the previous calendar year.
Questions & Answers
- What is the Veterans’ Pharmaceutical Reimbursement Scheme?
- Do I need to register to be eligible for the VPRS?
- How do I claim for the reimbursement?
- Does my doctor or pharmacist need to do anything for me to be eligible for a VPRS payment?
- How do I know if I will get a VPRS payment?
- When will I receive a VPRS payment?
- What is the concessional pharmaceutical co-payment?
- How much is my pharmaceutical allowance?
- What is the Safety Net Threshold?
- How much will I get paid?
- How will the reimbursement be calculated?
- Why do you include my partner’s pharmaceutical allowance when calculating my reimbursement?
- Does the reimbursement include prescriptions used by my partner?
- What happens to the VPRS payment if the co-payment is increased?
- How will the reimbursements be paid?
- Is the VPRS reimbursement payable to people outside Australia?
- Does the scheme reimburse deceased estates?
- Is the reimbursement taxable or means tested?
Fact Sheet HSV132 (PDF 21KB)
1. What is the Veterans’ Pharmaceutical Reimbursement Scheme?
The Veterans’ Pharmaceutical Reimbursement Scheme (VPRS) provides an annual reimbursement to eligible veterans for the cost of the concessional pharmaceutical co-payments not covered by existing Department of Veterans’ Affairs (DVA) entitlements.
2. Do I need to register to be eligible for the VPRS?
You do not need to register to be eligible for the VPRS. You will be eligible for the VPRS if you are a:
- veteran under the Veterans’ Entitlements Act 1986 (VEA) who has a Gold or White Card, and is in receipt of a DVA disability pension and has qualifying service (QS); or
- member under the Military Rehabilitation and Compensation Act 2004 (MRCA) who has a Gold or White Card and is in receipt of permanent impairment (PI) compensation (or would be receiving PI compensation if the member had not chosen to convert their periodic payment to a lump sum) and has rendered warlike service; or
- veterans under the Safety, Rehabilitation and Compensation Act 1988 (SRCA) assessed as having PI and who also have either QS or warlike service under the VEA or MRCA respectively, will be eligible under the VPRS from 10 December 2013.
3. How do I claim for the reimbursement?
No claim is necessary. DVA uses the claims data already provided by pharmacies to assess your medication use. The reimbursement amount will be calculated automatically using this data and paid into your normal bank account.
4. Does my doctor or pharmacist need to do anything for me to be eligible for a VPRS payment?
No, your doctor and pharmacist do not need to do anything for you to be eligible for a VPRS payment.
5. How do I know if I will get a VPRS payment?
You will get a reimbursement if you have spent more on concessional co-payments than the amount of pharmaceutical allowance you received. The pharmaceutical allowance is paid as part of your Pension, Veterans or MRCA Supplement.
6. When will I receive a VPRS payment?
Your VPRS payment will be made in the week of 24 March 2014 to cover your costs incurred over the 2013 calendar year. You will be sent an advice letter to notify you of the reimbursement and how it was calculated.
7. What is the concessional pharmaceutical co-payment?
The concessional pharmaceutical co-payment is the amount that you pay the pharmacist for each prescription until you reach the Safety Net Threshold. In 2013 the co-payment amount was $5.90 per prescription. If you pay additional amounts to the pharmacist, such as for premium brand medicines, these will only count as equivalent to the concessional co-payment.
8. How much is my pharmaceutical allowance?
In 2013 most veterans, whether single or partnered, received a pharmaceutical allowance of $6.20 per fortnight, or around $161 over the full year. The reason that this payment is the same for both singles and couples is that the Safety Net Threshold for singles and couples is also the same. That is, singles have to bear the same expense as couples to reach the Safety Net and free prescriptions.
To ensure consistency with these existing arrangements, and an equitable basis for the VPRS reimbursement, the standard amount of pharmaceutical allowance considered by the VPRS in the calculation of reimbursements will be $6.20 per fortnight.
In cases where a partnered veteran receives less than this amount because the partner is not receiving income support payments from DVA or Centrelink, this will be factored into the assessment.
9. What is the Safety Net Threshold?
The Safety Net Threshold is the maximum number of prescriptions you and dependent family members pay for in a calendar year. After you reach this limit your medicines are free for the rest of the calendar year.
The threshold in 2013 was 60 prescriptions, which is equivalent to $354 (60 prescriptions at $5.90 each).
10. How much will I get paid?
The amount you will get reimbursed will depend on how many medicines you were prescribed over the year. Generally, the maximum amount that will be reimbursed for 2013 is $192.36.
11. How will the reimbursement be calculated?
The reimbursement amount equals the total cost of the concessional pharmaceutical co-payments paid by each eligible veteran in a calendar year up to the Safety Net Threshold, minus the total annual value of the pharmaceutical allowance received.
In 2013, the value of the pharmaceutical allowance paid in the supplement is $6.20 per fortnight. This value will apply to both single and partnered veterans to provide an equitable basis for the calculation of reimbursements.
The following examples show how the VPRS will be calculated in two common scenarios.
Example 1 – Single veteran
John is a single veteran who used 48 scripts in 2013. He paid the concessional co-payment for 48 scripts at $5.90 each, totalling $283.20. The pharmaceutical allowance he received in his Veterans Supplement was $6.20 per fortnight, or $161.64 for the year.
John is therefore out of pocket by $121.56. This is the difference between what he paid and the pharmaceutical allowance he received ($283.20 less $161.64). Therefore, he will receive a VPRS reimbursement of $121.56.
Example 2 – Married veteran
Bill is a married war veteran and he and his wife receive a combined pharmaceutical allowance of $6.20 per fortnight, or $161.64 for the year in their Pension Supplement.
In 2013, Bill and his wife used a combined total of 60 prescriptions. Bill used 50 scripts and his wife used 10. Bill had to pay the concessional co-payment for 50 scripts at $5.90, or a total of $295.00 for 2013.
Bill is out of pocket by $133.36 ($295.00 less $161.64) and will get a VPRS reimbursement of $133.36.
12. Why do you include my partner’s pharmaceutical allowance when calculating my reimbursement?
The VPRS calculation accommodates the different economic circumstances of singles and couples and is consistent with how broader entitlements are managed.
The current Safety Net Threshold is 60 prescriptions, and this same threshold applies to either a single person or a family unit. For a partnered veteran, the medications used by both the veteran and their spouse count towards the same Safety Net. So the family unit will likely reach the Safety Net quicker and receive free prescriptions sooner than a single veteran would.
The partnered veteran is, in effect, treated like a single veteran in terms of the VPRS calculation. This is the most equitable and simple arrangement for calculating payments under the VPRS.
13. Does the reimbursement include prescriptions used by my partner?
No. Only prescriptions used by the veteran will count for the VPRS.
14. What happens to the VPRS payment if the co-payment is increased?
Any future changes in the value of the concessional pharmaceutical co-payment, the pharmaceutical allowance and the level of the Safety Net Threshold will be accommodated by the VPRS.
15. How will the reimbursements be paid?
Any reimbursement will be paid into the veteran’s bank account where current DVA payments are made.
16. Is the VPRS reimbursement payable to people outside Australia?
The VPRS reimbursement only applies to out of pocket expenses for pharmaceuticals purchased in Australia. The VPRS reimbursement can be paid if you live outside of Australia, but only if you lived in Australia for part of a calendar year and purchased pharmaceuticals using your Gold or White Card while you resided in Australia
17. Does the scheme reimburse deceased estates?
Yes, should an eligible veteran die, any VPRS reimbursement will be paid two weeks after notification of death into the bank account of the deceased veteran.
18. Is the reimbursement taxable or means tested?
No, reimbursement payments are non-taxable and not subject to the income test.