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Factsheet HSV132 - Veterans’ Pharmaceutical Reimbursement Scheme

Purpose

This Factsheet describes the Veterans' Pharmaceutical Reimbursement Scheme (VPRS) and who is entitled to receive an annual reimbursement for out-of-pocket costs associated with the concessional pharmaceutical co-payment under the VPRS.

What is the Veterans’ Pharmaceutical Reimbursement Scheme?

The VPRS reimburses eligible veterans for out-of-pocket costs associated with the concessional pharmaceutical co-payment. Reimbursements are made annually each March for the previous calendar year.

Who is eligible?

Veterans under the Veterans’ Entitlements Act 1986 (VEA) who have a Gold Card or White Card, and are in receipt of a DVA disability pension and have qualifying service (QS); or

Members under the Military Rehabilitation and Compensation Act 2004 (MRCA) who have a Gold or White Card and are 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 who have rendered qualifying service; or

Veterans assessed under the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) assessed as having permanent impairment and who also have either qualifying service under the VEA or MRCA respectively.  

For information on Gold Cards please see Factsheet HSV60 - Using the DVA Health Card — All Conditions (Gold Card) or DVA Health Card Totally & Permanently Incapacitated (Gold Card). For information on White Cards please see Factsheet HSV61 - DVA Health Card Specific Conditions (White Card).

What if I don’t know my qualifying service status?

Qualifying service generally means service on active operations during a war conflict. It is one of the criteria used to determine if you are eligible for a service pension.

You can contact the DVA and enquire whether a decision on your qualifying service has been made. If you would like DVA to make a decision regarding your qualifying service you should lodge an application to determine qualifying service. The following Factsheets have further information on qualifying service and indicate the applicable application forms based on the circumstances of your service. You can also apply using MyService or using the Online claims link on the DVA website. A decision will be made on your qualifying service if the information is available when you create a MyService account.  For further information see DVA Factsheet IS57 - Australian, Commonwealth and Allied World War 2 Veterans Qualifying Service or IS58 – Qualifying Service in Post-Second World War Conflicts.

Only those veterans who hold an All Conditions (Gold), Totally & Permanently Incapacitated (Gold) or Specific Conditions (White) Card are eligible to receive reimbursement payments through the VPRS.

What is the concessional co-payment?

The concessional pharmaceutical co-payment is the amount you pay the pharmacist for each prescription until you reach the Safety Net Threshold. In 2019, the maximum concessional pharmaceutical co-payment amount is $6.50 per prescription. 

What is the Safety Net Threshold?

The Safety Net Threshold is the maximum amount you and your dependant 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 Safety Net Threshold for concessional beneficiaries in 2019 is $390.

What is the discounted co-payment?

From January 2016, pharmacists have been able to discount co-payment amounts by up to $1.00 for each dispensed medicine. Pharmacists can choose whether to offer a discount, and the amount up to the $1.00 maximum. A discounted co-payment will impact the Safety Net Threshold, as the amount charged by the pharmacist (discounted co-payment included or not) is accrued to the Safety Net Threshold. Talk to your pharmacist who will assist you with your Safety Net entitlements. For more information on the Safety Net Threshold, please see Factsheet HSV92 - Repatriation Pharmaceutical Benefits Scheme .

What is the pharmaceutical allowance?

The pharmaceutical allowance (PA) is a contribution towards the cost of your medicines and is paid as part of the Pension, Veterans' and MRCA supplements. It is also paid as part of the DRCA supplement from 10 December 2013.

How is the reimbursement calculated?

The reimbursement amount equals the total cost of the concessional pharmaceutical co-payments made by each eligible veteran in a calendar year up to the Safety Net Threshold, minus the total annual value of the PA received.

In 2017, the PA component was $166.86 per annum for the Pensions Supplement, and $161.64 per annum for the Veterans', MRCA and DRCA Supplements.

The following examples show how the VPRS is calculated in two common scenarios.

Example 1 – Single veteran

John is a single veteran who paid the concessional co-payment at $6.30 for each of his pharmaceutical scripts in 2016, totalling $302.40. The PA he received in his Veterans' Supplement was $161.64 for the year.

The difference between what John paid for and the PA he received is $140.76 ($302.40 less $161.64). John will therefore receive a VPRS reimbursement of $140.76.

Example 2 – Married veteran

Bill is a married war veteran and he and his wife receive a combined PA of $166.86 for the year in their Pension Supplement.

In 2017, Bill and his wife reached the Safety Net Threshold of $378, the maximum amount that they have to pay for prescriptions in a calendar year.  Bill paid the concessional co-payment of $5.30 per script to a total of $318, with his pharmacy applying a $1.00 discount to the co-payment for each script. Bill's wife paid a total of $60 for her pharmaceutical scripts.

The difference between what Bill paid for and the PA he received is $151.14 ($318 less $166.86). Bill will therefore get a VPRS reimbursement of $151.14.

Is the reimbursement for all pharmaceuticals costs, or just those related to accepted disabilities?

For eligible veterans with Gold Cards, the VPRS reimburses all out-of-pocket pharmaceutical costs, not just those related to a veteran’s accepted conditions.

Eligible veterans with White Cards are reimbursed for out-of-pocket costs for pharmaceuticals relating to their accepted conditions.

What is a Prescription Record Form?

You use a Prescription Record Form (PRF) to keep track of how much you and your dependant family have spent on medicines for Safety Net entitlement purposes. It is your responsibility to keep track of how much has been spent and to know when the Safety Net Threshold has been reached to ensure you get the full benefit of the VPRS and other Repatriation Pharmaceutical Benefits Scheme (RPBS) entitlements. PRFs are available from your pharmacist.

Is the reimbursement taxable or means tested?

No, reimbursement payments are non-taxable and not subject to the income test.

Will I have to make a claim?

No, when accessing medicines under the RPBS, you should present your DVA Health Card - All Conditions (Gold Card), Totally & Permanently Incapacitated (Gold Card), Special Conditions (White Card) or Pharmaceuticals Only (Orange Card) to the pharmacist to ensure your purchase is accurately recorded under the RPBS. DVA will then use this information to automatically calculate your reimbursement and pay it into your nominated bank account.

Will veterans be reimbursed for the additional cost of Brand Price premium pharmaceuticals?

No, the scheme reimburses only standard costs associated with the pharmaceutical concessional co-payment.

More Information

DVA General Enquiries

Phone: 1800 555 254 *

Email: GeneralEnquiries@dva.gov.au

DVA Website: www.dva.gov.au

Factsheet Website: www.dva.gov.au/factsheets

* Calls from mobile phones and pay phones may incur additional charges.

Related Factsheets

Other Factsheets related to this topic include:

Disclaimer

The information contained in this Factsheet is general in nature and does not take into account individual circumstances. You should not make important decisions, such as those that affect your financial or lifestyle position on the basis of information contained in this Factsheet. Where you are required to lodge a written claim for a benefit, you must take full responsibility for your decisions prior to the written claim being determined. You should seek confirmation in writing of any oral advice you receive from DVA relating to complex or important matters.

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22 January 2019