Priceline Pharmacy Dubbo partner Mark Rugendyke said he was already seeing people prioritise prescriptions and juggle when they renewed them and he was expecting that would get worse.

He said the best outcome for everyone would be if the government scrapped the plan to introduce the increases on January 1, 2017.

Under the proposal, tabled in the federal budget on Tuesday, pensioners would be asked to pay an extra 80 cents per prescription, while other consumers would be slugged an additional $5.

The same proposal was made in the 2015-16 budget but Health Minister Sussan Ley said it was scrapped because it wasn't going to make it through the senate.

Mr Rugendyke said the increases would place a strain on some customers.

"I go back to the days when prescriptions cost $3.20 and for a pensioner, they cost nothing," he said.

"We are already seeing people who come in and say they can afford this one but I will have to skip this one until next week which is a sub-optimal situation. This is just going to lead to other health complications and put more pressure on the hospital system."

Families could be among those who are hardest hit by the increases, with the possibility of a paying hundreds of dollars extra per year if there are several prescriptions required.

"If you have somebody who needs four scripts a month, and we see plenty in that situation, that is an extra $20 a month and $240 a year. If you are on a fairly limited income and have children at school, that places a lot of pressure on the budget," Mr Rugendyke said.

Mr Rugendyke said script numbers and pharmacy income were down but said he was more concerned with the social impact.

"We don't want to end up in the same situation as the [United] States where if people can't afford a medication they just don't use it.

"If people end up in hospital because they haven't been able to afford medication then that is moving the costs to the hospital, which is funded by the state government, that's not solution either.

What is being listed as a $650 million saving for the government could end up costing them much more if it does lead to more hospitalisations.

"We saw when paracetamol came off the PBS list, people started buying the paracetamol plus codeine, which had its own side effects, but also cost significantly more so down the track the government ended up putting paracetamol back on the PBS," Mr Rugendyke said.

"There are parallels between the two and it shows there can be a sting in the tail of these policies with the net effect that it ends up costing the government more."

Health Minister Sussan Ley said the government was looking at alternative ways to save money rather than trying to push through the prescription increase.

“Quite simply a replacement policy had to be put on the table before the measure can be officially removed," Ms Ley said.

“We obviously have to find new ways to pay for the savings and we continue work to find a common sense alternative.

"However, our priority over the past 12 months has been implementing new reforms that make medicines cheaper by as much as $20 per script and listing $3 billion worth of new medicines."