There is an Australia-wide shortage of rapid antigen tests (RATs) after tens of thousands attempt to side-step testing clinics by testing themselves at home.
Pharmacies across the country have run out of stock over the holiday period after RATs were made a requirement for interstate travel.
The short supply is causing a price war, with RATs climbing to as much as $20 a test. While RATs are free in some European nations, Prime Minister Scott Morrison has ruled out spending public money on making the tests ‘free’ or heavily subsidised.
“Leadership would be making those tests free and widely available and not allowing individual businesses to be profiteering out of this,” said Michele O’Neil, President of the Australian Council of Trade Unions.
Morrison is reluctant to increase the Covid bill, with both the state and federal governments saddled with debt after two years of pandemic management.
“The governments of Australia – commonwealth, state, federal – are not going to do that,” said the Prime Minister.
“It was agreed today that will not be the policy in Australia. Rapid antigen tests will be provided publicly at those testing centres for those who require one according to the rules I have set down and have been taken out of National Cabinet today.”
Anyone who wishes to test themselves will have to pay the market price.
Dean Whiting, Chief Executive of Pathology Technology Australia, represents 70% of all Australian RATs suppliers.
“It doesn’t matter to us whether they’re free, subsidised or some other thing. What we as an industry have been more concerned about is having a clear role for rapid testing in managing infections, in keeping the economy going and in keeping people safe.
“In a sense, I don’t think we really care if they are free or not in terms of supply of the tests, as long as there is a clear position from governments on the role of tests. The industry doesn’t have a position because we sell to the government for market price and we don’t care if they are free or not. I am on the record saying that if they were free it would improve access and equity in testing and access to tests. But that isn’t a point about market supply.”
As with the manufacturers of Covid vaccines, suppliers of RATs get paid either way. Introducing free tests would almost certainly lift the overall bulk orders for RATs from suppliers – something which remains limited while the public have to part with their own money.
The biggest problem has been the needless testing of people without symptoms. After the government spent the best part of a year encouraging everyone to get tested for Covid, regardless of whether or not they had symptoms, premiers are now begging them to stop unless directed.
The RATs shortage is therefore politically self-inflicted – just as the spike in unnecessary ambulance call-outs where people in New South Wales have been urged not to call 000 for minor flu symptoms.
Omicron’s virulence has meant thousands of people are coming into contact with Covid. Traditional testing clinics were quickly overwhelmed, with premiers changing their health directions to allow self-administered RATs.
In response, New South Wales has secured 50 million RATs for distribution for free at the end of January, showing a clear divide between state politics and federal direction.
“To ease the pressure on Covid testing clinics, we are exploring options to provide all residents with free rapid antigen self-testing kits,” says the NSW website.
Victoria has bought 34 million RATs, even though the state government admit that PCR testing remains the gold standard. Victorian Health Minister Martin Foley insisted that using RATs would give Victorians confidence when ‘going about their day’.
“Rapid antigen tests should be free, and we will be making them free,” Mr Foley said. “Rapid antigen tests should be widely available, and we will be making them widely available.”
Mr Foley did not say how he would solve the national shortage, especially as making them free would almost certainly increase market demand and put additional pressure on supply.
“We would much prefer a national approach … failing that, as per usual the states have had to step up.”
Victoria have also decided to include RATs positive cases in their Covid figures, despite wide acknowledgement that RATs are not as accurate in determining a positive Covid infection as a PCR test.
Only approved manufacturers can sell RATs inside Australia.
As of October 2021, over 41.5 million PCR tests had been performed, with private companies being paid a Medicare rebate of $85 per test attracting substantial profits. Sonic Healthcare, for example, grew by 149% in the 2020-2021 period, an increase of $1.3 billion with much of that stemming from Covid testing.
The introduction of RATs shifts the profits for Covid testing onto different Covid industries. While they are cheaper than PCR testing, the sheer volume could see RATs quickly surpass PCR profit margins.