John Howard was elected not just to run an economy, but also to govern a community. This should be an important consideration when the Government considers what changes, if any it should make to Medicare.
This week, in the silly semantic juggling that goes on between journalists and politicians, the Minister for Health Dr Michael Wooldridge, “”refused to rule out” a co-payment for visitors to the doctor, which are now cost-free to the patient who goes to a bulk-billing doctor.
Medicare is a very large part of government expenditure and medicine in general is a very large segment of gross national product … a little over 8 per cent at present, and not many items would match that. It is subscribed to by nearly all tax-payers and nearly every Australian is a part of the scheme. It is thus both a significant part of the economy and a significant part of the community. The latter is more important than the former.
That is not to say, though, that Medicare should not be subject to efficiency improvements and cost constraints. The brutal fact is that economics is a constraining factor on the provision of health service. Try as he might, Kerry Packer cannot have the equivalent of St Vincent’s Hospital’s cardiac unit at every polo field. Even he has to settle on something less, even if his life one day might depend on it. Economics is a significant factor in health-care choices. Money is not limitless and doctors and health administrators often have to make hard choices about who should get what treatment in the knowledge that extensive and expensive treatment of one patient may rob another patient of treatment to improve quality of life or, indeed, save life itself.
But in making those decisions about the allocation of the health dollar, they should not allow the patient’s ability to pay to be the sole determinant of where money is spent. Very few patients can afford the full cost of treatment for catastrophic accident or illness. That some have been able to afford private insurance or made sacrifices to pay it has some, but not a huge bearing on who should get treated and when. The fact is the vast bulk of medical-treating resources in Australia … especially those for catastrophic accident or illness … have come from the public purse.
In these circumstances, the government’s job is to make Medicare and the public hospital system more efficient, but not to engage in wholesale cost-cutting measures for their own sake. The former can improve health-service delivery; the latter can only impair it.
It would be quite reasonable for the Howard Government to look at Medicare co-payment, provided its implementation fulfils his two crucial election promises … to retain the substance of Medicare and to ensure the poor are not disadvantaged. It can be done, and recent changes to the Pharmaceutical Benefits Scheme show the way. Many fairly well-off people take advantage of bulk-billing, when they could afford to contribute more, but many people … knowing the service is free … over-use it. A co-payment of say $5 per doctor’s visit would help cut over-servicing and rein in overall costs. But it should be accompanied by social-security off-sets and a safety net. Social security should be increased by, say, the equivalent of 12 visits a year, whether used or not. And an annual safety net of a maximum of, say, 12 visits for social-security recipients and, say, 50 visits for others, after which the Medicare would pay all.
This sort of system has worked well with the Pharmaceutical Benefits Scheme by sending price signals to health users to prevent over-using at the same time protecting social-welfare recipients totally and protecting others from excessive outlays.
It would be counterproductive for the Government to treat present arrangements as a sacred cow. If it wants to fulfil its promise to maintain Medicare it will have to be changed with changing circumstances. And circumstances are changing, not lease because Medicare itself has changed the health-delivery environment in a way that threatens its own existence: its very success is causing people to dessert private care and to rely on Medicare. Medicare is its own worst enemy.
The answer does not lie in some silly incentive scheme to private insurance. That will only re-juggle the queue. Private insurance is a very inefficient way of delivering health insurance. Medicare deals with far more items and far lower cost per item than any private insurance company. It would be foolish for the Government to provide taxpayers’ money (through tax concessions) to private insurance.
The answer lies in some fine tuning of Medicare, including a realistic reassessment of the levy (even if offset by other tax reductions).
Those who oppose small-scale reform through short-sighted ideology will ultimately do the cause of public health delivery a disservice.