How does the operation of PHARMAC's 'Community Exceptional ...

I then moved to the subject of rationing of government’s resources in order to
meet these two sets of health needs: those of individuals and societies. This
narrowed my focus to studying the decisions that are made and their relative
validity. I found that setting funding priorities at the individual patient level was
widely practiced in the public health services, but it was done by methods which
were not obvious. Research has shown the lengths health practitioners will go
to avoid discussing limiting care (Morgan & Simmons, 2009; Strech, Persard,
Marckmann, & Danis, 2009; Ubel, 2000). This level of rationing individuals’
care principally involves denying patients the treatment they need due to lack of
resources. These methods were almost never discussed.
Consequently, I looked for an example in the New Zealand public health service
where decisions about distributing funds to individuals were made in the most
explicit manner possible. I reasoned that through explicitness I might be able to
find the elements of decision making. I might also be able to study the matters
which influence the decision makers in making the distributions they are
required to make. My search led me to New Zealand’s drug subsidising agency
PHARMAC.
Many New Zealand and international authors (Cumming, Mays, & Daube, 2010;
Higgins & Ruddle, 1991; Laugesen, 2011; Mays & Smith, 2005; Morgan &
Simmons, 2009; OECD, 2009) have praised PHARMAC’s success in managing
pharmaceutical budgets, particularly in aggressively exercising its dominant
purchasing power. Others have criticised PHARMAC policies and initiatives as
being short-sighted. These critics have claimed that PHARMAC’s success will
eventually lead to a situation where the major pharmaceutical companies will
withdraw co-operation from New Zealand. The concern was that
pharmaceutical companies will deny PHARMAC choices in new and improved
pharmaceuticals (Gray & Frizelle, 2005; Holt, Harwood, Aldington, & Beasley,
2005; Menkes, 2000; Sundakov & Sundakov, 2005). Others (Blue, 2006) have
said that there is basic unfairness in the way PHARMAC has applied policies
and procedures in making difficult rationing decisions.
However, under the NZPHDA 2000, PHARMAC must decide what medicines
will be subsidised and which individuals, whose needs are considered
exceptional, will be granted a subsidy for the medicines they need. In order to
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