Like many aspects of the healthcare system, medicines funding in Australian hospitals is complex, with multiple sources of funding. This depends on many factors, including: what the medicine is, and what it is used for; whether the patient is a public or private patient; and where the patient is being treated. There have been a number of partial reforms over time that have contributed to fragmentation of funding.
Funding fragmentation may compromise the cost-effectiveness and value of the medicines use within the health system as a whole. It also inhibits achievement of the objectives of the National Medicines Policy though not being patient-centered. Medicines funding reform has the potential to improve quality of care for patients, improve effectiveness of medicines use, reduce government expenditure, and enable more timely and equitable access to cost-effective and safe medicines.