Paracetamol, antacids, aspirin and other basic medicines could soon be removed from the list of subsidised medicines.
But the budget measure to strip some over-the-counter drugs from the Pharmaceutical Benefits Scheme will mean a better deal for consumers, the federal government says.
Health Minister Sussan Ley said the government was paying too much for people to access basic drugs on script at their chemist.
The government wanted to make way for expensive, new-generation cancer and other life-saving drugs on the scheme.
"We have to look at over-the-counter medications such as paracetamol that are being accessed on script at high cost to government," Ms Ley said on Sunday.
For example, removing aspirin from the scheme would cover the cost of listing anti-cancer drug crizotinib.
The minister also hinted all scripts could be slashed by up to $1 as part of a package of measures being negotiated with the Pharmacy Guild and due to start on July 1.
Doctors wanted to see more details about the proposed changes, concerned concession card holders could be affected.
The Australian Medical Association also warned if the primary goal was to simply cut dollars, it could result in adverse clinical outcomes.
"We want to make sure that the most vulnerable groups are protected," AMA vice president Stephen Parnis told reporters in Melbourne.
Labor said it was "sensible" to the review of the Pharmaceutical Benefits Scheme.
HOW MUCH TAXPAYERS PAID FOR OVER-THE-COUNTER DRUGS IN 2013-14:
* Paracetamol - 6.7 million scripts, $73 million
* Aspirin - 1.1 million scripts, $4 million
* Antacids - 219,000 scripts, $2.6 million
LIFE-SAVING DRUGS
* Scrapping paracetamol, at a cost of $73 million, could make way for he life-saving drug ipilimumab for late stage melanoma, at a cost of $65 million.
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