If a medicine is subsidised by the government through the Pharmaceutical Benefits Scheme (PBS) for someone with your medical condition, you will pay up to $40.30 per prescription, or $6.50 if you have a concession card. These prices are current from 1 January 2019.

If a medicine is not subsidised by the PBS for your condition, you will have to pay the full price for it. This will usually be between $10 and $100 per prescription but, in some cases, it can cost hundreds of dollars. Part of the cost for medicines not on the PBS may be covered by some health funds, and prices may vary between pharmacies, so it may be worth shopping around.

If the cost of the medicine is a problem for you, ask your health professional if there are more affordable options.

Many medicines with the same active ingredient are available as different brands. 

When more than one brand of your prescription medicine is subsidised by the government under the Pharmaceutical Benefits Scheme, the scheme will pay no more than the lowest priced brand. If you buy a more expensive brand, you will need to pay the difference in cost — this is called the 'brand price premium'.

You can save money by asking if there is a less expensive brand of your prescription medicine. (Your pharmacist may also offer you a less expensive brand for a non-prescription medicine.)

Although you can save money by choosing less expensive brands, some people should not change brands. If your doctor wants you to stick with the brand they have prescribed, they will tick the 'Brand substitution not permitted' box on your prescription.

PBS-subsidised medicines are available to all Australian residents who hold a current Medicare card. Some overseas visitors are also eligible for PBS-subsidised medicines. When a medicine is subsidised, you pay part of the cost (a co-payment) and the government pays the rest. You can find out what the current co-payment thresholds are on the PBS website. About 80% of prescriptions dispensed in Australia are covered by the PBS.

Make sure you show your Medicare card when having a prescription filled to get a PBS medicine at the subsidised price. Many pharmacies can keep a record of your Medicare number so you only have to show your card once.

Some over-the-counter medicines are also subsidised if you have a prescription and meet the criteria for PBS subsidy (eg, nicotine patches). Ask your doctor to find out whether you can get a prescription for any of the over-the counter medicines you currently take.

When a prescription medicine is not subsidised, you can still obtain it on private prescription, but you will pay the full cost. In some cases, private health funds may pay part of the cost of medicines bought on a private prescription.

Concession cards and PBS medicines

To be eligible for the concession rate for PBS medicines, you need one of the following cards:

• a Pensioner Concession Card
• a Commonwealth Seniors Health Card
• a Health Care Card or
• a Department of Veterans' Affairs (DVA) Gold, White, Orange or Pensioner Concession Card.

Some state and territory governments issue Seniors’ Cards, but these do not entitle you to the concession rate on PBS medicines.

Centrelink is responsible for Pensioner Concession Cards, Commonwealth Seniors Health Cards and Health Care Cards.

The Department of Veterans' Affairs is responsible for Gold, White and Orange Cards as well as DVA Pensioner Concession Cards. The DVA Pensioner Concession Card entitles holders to PBS medicines at the concession rate, but does not give access to RPBS-subsidised medicines.

Read more about DVA Gold, White and Orange Cards and the DVA Pensioner Concession Card.

The Repatriation Pharmaceutical Benefits Scheme (RPBS)

The Repatriation Pharmaceutical Benefits Scheme (RPBS) is available for eligible veterans and their dependents, and includes more medicines than are on the PBS. Read more about eligibility for the different levels of cover.

The PBS Safety Net entitles people to free or cheaper medicines if they spend more than a certain amount on PBS (prescription) medicines in a calendar year. Once you spend this amount, you reach the Safety Net threshold and:

• your payments are reduced to the concessional rate for the rest of the calendar year, or
• if you normally pay the concessional rate, PBS medicines will be free for the rest of the year.

Thresholds for the Safety Net are adjusted annually. You can find out what the current Safety Net thresholds are for eligible Australians on the PBS website.

To be eligible for free or cheaper medicines under the PBS Safety Net scheme, you must have a record of how much you have spent on PBS medicines that year. If you always use the same pharmacy, ask them to record your spending on their computer. You can ask for a printout of your spending at any time.

If you use different pharmacies, you can:

• obtain a printout of your spending from each, or
• record all your spending on a prescription record form, which can be obtained from any pharmacy.

The Safety Net applies to a calendar year, so ask for a form the first time you buy a PBS medicine in a new year and hand it to the pharmacist each time you have a prescription filled. The pharmacist will record the medicine and its cost on the form.

When your record shows that you have spent the required amount on PBS medicines, your pharmacist will give you a Safety Net Card that you can use to obtain free or cheaper medicines for the rest of the calendar year.

If you have a family, ask your pharmacy to combine the amounts spent on medicines into one Safety Net total, or use one prescription record form for the entire family. An eligible family can be made up of you, your spouse (including de facto spouse), dependent children under 16 years and dependent students under 25 years.

Keep in mind that the any amounts you pay on brand price premiums do not count towards your Safety Net threshold.

The Safety Net early supply rule

If you fill your repeat prescriptions too close together, the Safety Net early supply rule applies, meaning even if you are already using a Safety Net Card, you will have to pay your usual PBS patient payment for the medicine, not the Safety Net rate. If you haven't reached the Safety Net threshold, the cost of the medicine will not count towards your Safety Net tally.

This rule is designed to prevent people on a Safety Net Card using their card to obtain additional unnecessary supplies of their medicines at the end of a calendar year.

This rule applies only to certain PBS medicines, depending on the type of medicine and the quantity that can be supplied on a prescription.

If you've been taking several medicines for some time, a review of your medicines may show that you no longer need all of them, or that you're taking more than you need of one or more of them. Stopping unnecessary medicines will save you money and reduce your chances of medication problems.

Of course, you should not stop a medicine to save money without discussing this with your health professional. If you are concerned about the cost, always discuss this with your doctor, who may be able to suggest ways to streamline your medicines that don't put your health in jeopardy.

Your GP can review your medicines or arrange for a qualified pharmacist to conduct a Home Medicines Review. Talk to your GP or pharmacist about getting a Home Medicines Review.

Some medicines are more closely monitored to make sure they are PBS-subsidised only for specific illnesses and particular groups of people. For these 'authority' prescription medicines, the prescriber has to either phone Medicare for approval or enter a special code on the prescription.

Authority prescriptions are also sometimes used if a higher than usual dose of a medicine is required. With an authority prescription, you will only pay the same amount as someone on the standard dose.

Ask your doctor to see if an authority prescription might be an option for you. If your doctor gives you an authority prescription, you can give it to the pharmacist as you would any other prescription.

Many medicines come in different strengths, so sometimes you can save money by buying a different strength of your medicine.

For example, if you usually take two 100 mg tablets of a medicine at a time, and a 200 mg strength is available, you may be able to take just one 200 mg tablet at a time. This may mean that you need fewer prescriptions, which will save you money. If this situation could apply to you, talk to your doctor.

However, splitting higher-dose tablets to obtain your dose at a lower price is not always a good idea. Some tablets should only be taken whole because of their coating, and others are difficult to split accurately, so talk to your doctor or pharmacist before you split tablets.

Where there are groups of medicines that all do similar jobs – that is, they are all about as safe and effective as each other for treating a particular condition – the government pays the cost of the least expensive one.

If you are not buying the least expensive medicine, you will need to pay the difference – this is called the 'therapeutic group premium'. If there is a medical reason you need to take a medicine with this premium, your doctor can ask for an exemption so you don't need to pay.

Only a small number of medicines have a therapeutic group premium. You can check the PBS website to see if your medicine is in this category.

Tax offsets (sometimes also referred to as rebates) reduce the amount of tax you pay. They are not the same as tax deductions.

You can claim part of the eligible net medical expenses spent above a certain amount in a financial year. You need proof that you've spent the required amount, so you must keep all your medical and pharmacy receipts. Net medical expenses are the eligible medical expenses you have paid after any refunds from Medicare or private health insurance.

For more information about which medicine expenses are eligible, visit the Australian Tax Office website, ring them on 132 861, or talk to your tax advisor.