The recent Commission of Audit report suggests big changes are on the way for Australian healthcare.

With nothing set in stone until the budget is released next week, speculation abounds as to the size and shape of cuts many deem inevitable.

The audit report includes suggestions to change to the Pharmaceutical Benefits Scheme (PBS), which provides life-saving medications for many Australians, but costs the federal government billions.

The Commission of Audit proposal would see most patients pay an extra $5 a script for their medications.

President of the Royal Australian College of GPs, Dr Elizabeth Marles, says what seems like a small change could have resounding negative consequences

“I think it’s counterproductive,” she said in an interview with ABC Radio.

“If people actually stopped taking medication that are keeping them well and they then develop complications or acute illnesses or have their heart attacks or whatever it may be, the cost associated with treating those conditions are way higher.”

The reasoning goes that if people are less likely to take their medications, then they become more likely to suffer serious consequences, which in turn require a more extensive level of treatment and burden on the health system.

But Philip Clarke, a professor of Health Economics at the University of Melbourne, told reporters that there is some sense to the idea.

He says it would be good to foster competition by capping PBS spending.

“Where Australia tends to fall down is that we pay way too much for our older medications and we tend to find it hard to take drugs off the list once they're listed,” he said.

“Australian doctors often prescribe the most expensive drugs within a category when cheaper drugs would actually be, work almost as well and if you take a class like the statins which are for lowering cholesterol, 80 per cent of the prescriptions in Australian are for atorva and rosuvastatin which have historically been the most expensive in the category.

“If you had an independent authority that's managing a fixed budget, there would be very strong incentives then to basically manage that very efficiently.”

Medicines Australia chief executive Brendan Shaw said PBS should not be touched.

“We have a clear example across the Tasman that those policies have not worked,” he said.

“They have damaged patient access to medicines, they've meant that cancer patients had to wait longer for treatments in other countries and that we've also seen the impact that those policies have had on industry where basically the medicines industry has packed up and left New Zealand.

“The PBS is sustainable and in fact, across all the health spending, it's one of the areas of spending that's going down not up at the moment,” he said.