Communist Party of Australia

We acknowledge the Sovereignty of the First Nations’ Peoples.


Journal of the Communist Party of Australia

ISSUE 52July 2010

Rudd’s regressive health reforms

Dismantling Medicare and the public provision of health and welfare by stealth

by Con Costa

“The criticism of the lack of mental health funding from Mr Rudd’s top advisor on mental health underlies a more general failure of health reform,” said Dr Tim Woodruff, President, Doctors Reform Society. “The Prime Minister has failed to deliver even a plan to fairly address a system of comprehensive, community based public mental health services — despite his proposals for the ‘biggest change to our health system since Medicare was introduced’”.

“Instead we are left with a very expensive system of taxpayer funded private psychologists — introduced by the Howard Government — which means that the least needy i.e. those who can access and afford to pay for their care (including large co-payments), are now well served, whilst the majority of serious mental illness continues to miss out.”

“Most mental illness continues to go without proper care in an increasingly privatised health system,” said Dr Woodruff. “Most of the mentally ill cannot afford care in such a system. They end up getting sicker and fill the Emergency Departments or acute care beds in our public hospitals, or left to their own devices on the streets, in our state prisons or in run-down boarding houses. This is a sick way to run a health system. It is no wonder the PM’s advisors are leaving a sinking ship,” said Dr Woodruff.

DRS press release June 2010

Major problems are arising in the provision of ALL of our health and welfare services. It is not just because of an increasing and/or ageing population, as our politicians and the vested interests would have you believe. Essential health services are being handed over to the private sector with an emphasis on individual provision and a move away from the system of solidarity and public provision with which we have grown up, and which we have always taken for granted.

Private provision of health services and individual responsibility for health care does not work, other than for the vested interests, the wealthy and the powerful. It certainly does not work in countries with privatised health systems such as the United States. As the system becomes more privatised, increasing numbers of Australians are missing out and the health system is becoming more dysfunctional. We are spending more and more money on less and less care.

The following analysis examines the phenomenon of creeping privatisation in our health and welfare system and attempts to answer questions such as: Why are we are having an increasingly privatised system of individual responsibility and private health insurance foisted upon us?

Why is it being implemented by stealth and without a vigorous open public debate even within the Labor Party itself?

Where we are coming from?

Western medical systems usually have a mixture of private and public provision and the balance between private and public is in constant flux because there is only a finite number of resources in a health system. Thus as one side grows in size and strength, the other shrinks. Australia has always had a strong private health sector (private hospitals, GPs and specialists) working side by side with a strong public hospital system.

In spite of the fact that in Australia, as in Great Britain, “public belief in solidarity, at least for health care, seems virtually undiminished, despite almost three decades of consumerist brainwashing,” over the last twenty years we have a bipartisan policy of the major parties leading to creeping privatisation of health services, including a 30% public subsidy for private health insurance which is accelerating the transfer of specialists and administration to the private hospital system.

The private health system is growing while the public sector is shrinking. Current figures show that Australians now have around 30% out-of-pocket costs for health care. Increasingly the system is based around private provision such as doctors charging for episodic care on a fee-for-service basis and less and less salaried doctors working in team-based care. It is difficult to afford care or even to access a family GP.

The public health system is under pressure because of a bipartisan approach by the major political parties to privatisation and implementation of neo-liberal policies, including in health, aged care and welfare services.

Residential aged care services have been largely “outsourced” or privatised and are now self-regulated (= non-regulated?). Large taxpayer subsidies to private profit-making players is leading to a coalescing of residential aged care into cash-cow mega-institutions for the aged, with the emphasis on profit rather than on care. There is no mandating of staffing levels which have been reported as high as one staff member per 80 to 150 patients and qualified staff such as nurses or nursing aides are passed over in favour of much lower waged non-qualified staff.

Similar regressive changes have been taking place in mental health over the last 30 years and began with the closure of mental institutions and the sell-off of the public land to private developers.

This meant the dumping of the mentally ill into the community and on to an underdeveloped and unprepared primary care system. De-institutionalisation of the mentally ill was a progressive reform BUT no funds or resources followed the mentally ill into the community. Mental health services remain severely under funded and under resourced, with an emphasis on acute beds over early treatment in the community, and most of those beds and psychiatrists are in the private sector (user pays).

Increased health and hospital costs are directly related to such federal privatisation policies. What should be a cost to residential aged care (caring for the elderly in the nursing home) is transferred to the fixed state hospital budgets (caring for the elderly in hospital). Expensive hospital and ambulance care is being substituted for relatively cheap and cost effective care in the nursing home. (It costs $1200 per day to treat the frail elderly in hospital versus $60 for a GP to visit the nursing home.)

At the same time, the Commonwealth is severely under funding its share of public hospitals and diverting taxpayer dollars into expensive and wasteful public subsidies to the private sector and the wealthy (the 30% Private Health Insurance Rebate and the Extended Medicare Safety Net), as well as under funding Medicare through politically engineered cutbacks to the medical workforce.

Crisis in health care — the Australian experience

The introduction of Medicare (universal national health insurance paid through taxation) had several big advantages for users of the health system. It guaranteed access for all Australians to a doctor without the need to pay at the point of service and it led to a more equitable distribution of doctors in the community. Doctors moved into outer suburban areas knowing they would get paid for their services. Working class women gained access to preventive and other GP services for themselves and their children. Medicare also greatly simplified a complicated and expensive private health insurance system, which to that time excluded many Australians.

What Medicare did NOT do was to reform the underlying private nature of GP services and change them over to team-based primary care for the 21st Century. It simply subsidised the small businessmen model of GPs working alone in the community, separated and isolated from other community services. Reforms to the way we pay the doctor, and thus how the service was provided, were supposed to come later but never did. Medicare was never meant to indefinitely underwrite the private fee-for-service system of private GPs.

“My patients very commonly don’t have one GP. They either have none or a mixture — the doctor who does the women’s health stuff, the old family doctor they go to when things are tough but not regularly ‘cos he’s too far away and charges AMA rates’, together with a motley assortment of 24 hour clinics to which they take the kids. This often ends up in massive over investigation and treatment (antibiotics) and a pattern of care with no real thread running through it, especially if multiple specialists involved. Everybody thinks that everybody else is responsible for communication and overall management and it ends up being done by nobody.

“In the UK all access to anything in NHS is through one GP. No GP, no access, except for emergencies. One has one GP and can change only with some bureaucracy and occasional difficulty. All specialists automatically write back to the GP, so there is one common chokepoint, through which all information must pass. GP has no incentive for turnstile medicine, as if he does not get it right the first time, he has to do it again for no money. Incentive is very strongly in the direction of prevention and the presence of a documented population allows good documentation of preventive care and a system of payments to reward performance if targets are met”.

Doctors Reform Society member in Victoria

Busy GPs working in isolation have to do everything themselves so the wait to see a doctor increases and they are often overwhelmed — albeit well paid through Medicare and private fees — but often “doing stuff” that could be done by another member of a health team. Thus the demand to see a doctor increases inversely proportional to the efficiency of the doctor’s work and compounded by a politically engineered doctor shortage over the last twenty years. The long wait to see a doctor in the community further compounds the “hospital crisis”, with many Australians not having a regular family GP and ending up attending at the Emergency Department (ED) of their local hospital or 24-hour corporate medical centres.

Around 30% of people requiring palliative care (the dying) cannot name a family GP to their palliative care service!

Speaker at AGM Central Division of GPs in Sydney, 2010

Ascribing the “health crisis” as due to a growing or ageing population is simplistic and makes little sense, other than alarmist propaganda to create a crisis in confidence in the community.

Privatisation policies in health and welfare and lack of true primary care reform has meant our under funded public hospitals having becoming “the default” in the system. Our public hospitals are under pressure because they are being forced to act as a safety net as well as being responsible for acute services and most elective surgery.

Thus the crisis is being artificially created as a pre-condition to privatisation of health services, to “encourage” Australians away from solidarity with the public system and into taking “individual responsibility” for their health needs through a privatised health system. Sadly, many sick and elderly Australians are being forced to suffer slowly and painfully, enduring a lack of compassionate care as a form of collective punishment on a society which still believes in solidarity over the private market and the private health insurance companies.

Rudd politics: Dismantling Medicare by stealth, with a little help from our friends at BUPA

Decades of under funding by Labour and Liberal Governments alike, State and Federal, have already produced a creeping privatisation of health care, with ordinary people under increasing pressure to buy expensive private insurance in the hope of securing better care in private facilities. The Federal Government directly subsidised the private sector, particularly through the 30% Health Insurance Rebate which grew from $1.4 billion in 1999/2000 to $3.8 billion in 2008/2009.

Mike Head, World Socialist Website, March 2010

The Rudd Labour Government assumed office three years ago promising to “fix hospitals”.

Mr Rudd built up public expectation by setting up the National Health and Hospitals Reform Commission (NHHRC) promising a “root and branch” analysis of the health system. He went out of his way to convince us that any reforms that followed would be what the public and the health professionals wanted.

But none of the main issues affecting the health system have been addressed. It remains largely unreformed, creeping privatisation of the health system continues and, worse still, Mr Rudd has managed to perpetuate the severe under funding of the public system that was the legacy of the Howard/Abbott years. Even following the global financial crisis and the government’s “mad scramble” to spend billions of taxpayer dollars into the economy — including insulation, new school buildings, massive taxpayer subsidies to business — and massive taxpayer subsidies for new cars for all small business, it was very notable that public hospitals would NOT be getting any of the spend!

Any hopes of a thorough and genuine review of the health system quickly evaporated with:

a) the appointment of Christine Bennett (whose background is from the private health insurance sector in Great Britain/BUPA) to head the NHHRC (Mr Rudd’s reform proposals — supposedly as a result of a thorough consultation process with the Australian public — are a carbon copy of the failed neo-liberal “reforms” introduced by Mr Blair and New Labour in Great Britain a decade earlier.)

According to its website, BUPA was established more than 60 years ago in the UK and is now an international healthcare company with customers in over 190 countries:

We insure more than 10 million members in over 190 countries. We serve members living in their own country or abroad and provide cover for individuals, families and companies. We serve more than six million members internationally. We are the largest private medical insurer in the UK, with over three million members. We are the world’s largest provider of expatriate health insurance with 800,000 members.

We delivered a number of major operational programmes including a new operating platform for our UK insurance business and the integration and rebranding of our recently acquired care home operations in Australasia. The integration of MBF remains on track with projected synergies ahead of original estimates. The markets in which BUPA operates offer excellent opportunities for long-term growth, driven by customers’ desire to access better healthcare. The global trends of ageing populations, rising affluence, the increasing incidence of chronic disease and advances in medical technology will drive demand for our services. BUPA is well positioned to take advantage of these trends given our geographic breadth, strong balance sheet, trusted brands and excellent market positions. We are investing in our portfolio in pursuit of organic growth and remain focused on delivering our strategy of helping customers live longer, healthier, happier lives.

b) the 30% PHI rebate quarantined from the health reform discussions by Mr Rudd, and

c) doctors’ private fee-for-service payment system, with all its perverse incentives in primary care, also quarantined from the reform discussions into primary care.

Mr Rudd built up expectations of health reform with a “National Health Debate” and he also set up a “nationwide consultation process”, but significantly most of Rudd’s personal consultations were with hospital-based clinicians. This in itself also sounded alarm bells, as even the OECD accepts that health reform needs to occur at the grassroots or primary care level (which means taking on the powerful vested interests including the hospital-based medical empires).

Astoundingly, after two years of deliberations with health experts and community consultation, there are no plans to strengthen frontline care, primary care. Instead, Mr Rudd has announced a limited and hospital-centric plan — changes to the way we fund our hospitals from the current system of block funding to the case-mix funding system used in a more limited form in Victoria.

What started off as the promise of a “root and branch” review of the public health system has either fizzled very badly, thus at best perpetuating under funding and creeping privatisation in the public system or at worst, the naked implementation of neo-liberal economic policy in health and hospital policy. There is also regressive reform of hospital financing to encourage “efficiencies” and cost savings through early discharge (patients discharged “quicker and sicker” into the community) and encouraging (as already occurs in private hospitals) cherry picking of “profitable” episodic surgical cases over chronic and complex illness or the frail elderly. These cases would lead to unpredictable costs and could prove to be loss making for the hospital under case-mix method of payment.

Case-mix funding

Critics immediately sounded the call that Mr. Rudd’s:

most significant reform of the health system for the last 25 years, case-mix funding, would result in rationing of patients access to care, and could lead to the closure or amalgamation of hospitals and the expansion of profit making activities of private hospitals and insurance funds. Networks that overspent on caring for a patient would be at a loss, placing doctors and nurses under pressure to cut corners and push patients through more quickly. In fact, if a cost were 10% over the “efficient” cost, budget, the network would bear a 25% budget overrun, because of the 60-40 allocation.

The down side of case-mix funding is that it encourages doctors to push patients through quicker and sicker through the hospital system as they are not well paid for chronic or unusual cases and also it makes it much harder for smaller hospitals to compete with larger hospitals in the provision of services and can result in the closure of smaller “non-economic” hospitals particularly in rural areas or working class areas around Newcastle and Wollongong. Under Mr Rudd’s new system the private hospitals would be allowed to compete for services with the public hospitals.

According to the government’s estimate, a national case-mix style regimen would save $1.3 billion per year. It also cites Productivity Commission findings that some hospitals are 20% less efficient than others. These calculations ignore the fact that smaller hospitals cannot match the efficiencies of scale in major hospitals, and at hospitals in working class and regional centres, and those with higher indigenous populations, often have patients with more chronic, complex and costly health needs.


It has been admitted that these regressive reforms are designed to open up public hospitals to more competition from private hospitals, thus leaving the public hospitals with a high burden of complex care and thus chronic under funding of public hospitals under a case-mix funding model.

The changes are to make public hospitals a more attractive target to the private sector, eventually handing public hospitals over to be run by the private sector and private insurance companies as profitable going concerns.

Without major restructuring of primary (and aged and community) care, the current Rudd “hospital reform agenda” is simply a regressive plan to corporatise the public hospital system, with eventual transfer of hospital costs from government (taxation) to private health insurance and the individual.

Under a corporate or case-mix funding model hospitals will favour simple episodic care, which will be well rewarded under the case-mix system and avoid chronic complex care which has high and unpredictable costs, and likely to cost them money.

The Rudd agenda mirrors events in Great Britain and Europe and the BUPA agenda:

A struggle has been going on since November 2004 in the European Union between its Competitiveness Council led by Fritz Bolkestein, which wants a single market for all service industries, and defenders of EU Treaty Article 52 insisting that member states must each retain responsibility for their health services. Effectively, bankers have replaced health professionals as directors of global health policy, where together with the World Trade Organisation, they opposed the consistent general direction of WHO policy from 1946-1990 favoring socialisation of health care, not because the WHO was wedded to an ideology, but because this policy manifestly worked.

p 211, Political Economy of Health — a clinical perspective, Julian Tudor Hart, 2006

Rudd’s plan includes the Commonwealth taking over the majority of funding — but only through a trade off with the states and using the states’ GST money — thus no new money for hospitals until 2014 and three quarters of any new money not until 2017! (Even with all the announcements of new incremental money to “bribe” the states to go along with the Rudd deal, the real Commonwealth share of hospital funding will probably rise from a historical low of 35% to say around 37%.)

As it stands, Mr. Rudd’s health reform plan emphasises commercialism over professional care, corporatism over people’s needs. Just as in the primary care system, expensive episodic care will now be promoted in our hospitals, over the provision of chronic and complex care. Private provision is being promoted over a public sharing of burden, personal responsibility over solidarity.

The Rudd plan is consistent with an “Americanisation” of our health system because our health and welfare systems now already extensively privatised. It is only the public hospitals which are the last stumbling block for the privateers. It is consistent with Rudd’s choice of Christine Bennett from BUPA to head the NHHRC and the re-opening of the US-Australia Free Trade Agreement, now broadened to the Trans-Pacific Partnership Agreement (TPPA). It contains proposals to include health and welfare services with the Pharmaceutical Benefits Scheme (PBS) opened up to competition from transnational drug companies, US conglomerates such as Humana, international health insurance companies such as BUPA.

In fact, the “Rudd solution” — a Commonwealth “takeover of public hospitals” is only a sleight of hand arrangement. The Commonwealth will increase its share of funding of public hospitals to 60%, but only by clawing it back 25% (to add to its abysmal 35%) from the states GST money! The “Rudd solution” is to entrench under funding of public hospitals up to 2017 and beyond.

What Mr Rudd appears to have done is to set up a smokescreen behind which there is to be no significant reform of the health system and no major extra funding of public hospitals for at least the next five to ten years. Thus Rudd is perpetuating the Howard/Abbott under funding of public hospitals for at least the whole of his term in office (including if he wins the next election!) The only “achievement” appears to be the proposed introduction of case-mix funding of our public hospitals!

The Great Health Debate: “Government is becoming increasingly deceptive and dishonest in implementing its agenda”

In the “Great Health Debate”, Kevin Rudd announced that he would fund 60% of public hospitals and 100% of out-of-hospital care in return for 30% of the states GST money or $90 billion over five years. This was simply sleight of hand, taking existing money from the states and laundering it into Commonwealth funds. None of this is new money for a hospital system desperately short of cash and already brought to its knees by the previous Howard Government with Abbott as Health Minister. And all of the new money scheduled to come into effect only after 2014 and, as noted by the Victorian Premier Mr Brumby, three-quarters of the any new funding would not occur until 2017!

After two years of supposed “public consultation”, involving most of the wider community and health professionals (who became a willing backdrop to the Rudd health reform side-show) and not much discussion within the Labor Party, neither in Parliamentary, the union movement, on the floor of Labor Conference or with ordinary rank and file Labor Party members, we are none the wiser about the Rudd reform plans. Everyone is being asked to take the PM on trust!

Mr Rudd has done everything but take an honest approach with the electorate. He has not come up with any new ideas. He is not taking on any of the vested interests in health. He appears to be simply implementing neo-liberal economic policy, a handing over of public assets to the private sector. He has not challenged the vested interests such as private doctors or the big hospital clinical empires. He has ignored primary care doctors and community health workers, mental health reform, nurses and dental reform.

Mr Rudd does not appear interested in true health reform. It seems too difficult for him. He appears to simply trust the private sector to run the health system better than the government, despite all the evidence to the contrary. This makes his tactic of setting up a national health inquiry (NHHRC) and going through the motions of a national debate and consultation process even more dishonest.

If there are no major health reforms coming, then he has simply used the NHHRC and the national health consultation process as a smokescreen to implement the global neo-liberal agenda on health care and a BUPA takeover of Australia’s health system i.e. to hide the fact that there is not going to be any more money for government run public hospitals for many years to come, not while he is PM and and certainly not while they remain block funded or not open to “competition with the private sector” (privatisation).

In effect our hospitals will struggle on until 2014 before any new money enters the system, (and 3/4 of any new money not until 2017), i.e. with the same funding shortfalls introduced and maintained by Mr Abbott when he was a part of the Howard Government. Yet Mr Abbott rightly pointed out (albeit dishonestly, given he was the Health Minister when the money was ripped out of public hospitals), that under the Rudd plan, there would be “no extra dollars for health, no extra doctors, no extra beds” until 2014. So what is to happen to our hospitals and the health system in the interim?

It would seem all Mr Rudd was after in the short term was to entrench the under funding of the public hospitals while putting public hospitals on a commercial footing via implementation of case-mix funding over the current system of “block funding”, thus making it easier for the private sector to compete in the public system in the future.

Officially, no one seems to know all of “the Rudd plan”, except perhaps Mr Rudd, Ms Roxon and Christine Bennett. Probably not even Mr Rudd’s Cabinet, nor the Parliamentary nor Labour Party union officials, nor the rank and file of the Labor Party.

New Labour has developed all its policies on the NHS form the Conservative agenda rather than its own annual conferences, or the policy forums offered to the membership as token alternatives to conference voting.

Ibid. p 181

At the very least Rudd’s plan is commercialisation of our public hospitals i.e. putting them on a business footing. We all know this does not work. Medicine runs on a care model not a business model. The British have found this out with their recent neo-liberal reforms to the NHS and where the bureaucracy is now taking the lion’s share of the funding Commercialisation of the health environment has never worked and it is not working in Britain. Why is Mr Rudd importing it here?

Commercialisation of public services is a worldwide process reaching every nation accessible to global investment and disinvestments through the World Bank, International Monetary Fund (IMF), and the World Trade Organisation (WTO), their policies applied through the General Agreement on Trade in Services (GATS) legislation.

Though different arguments have been presented to voters in different countries, the motivation everywhere is the same: to expand the scope for profitable investment by multinational corporations (based mainly in the US) and transform national care systems from their traditional role as public service planners and providers, into bulk procurers in the health care market.

Ibid. p 178

Where to from here?

Kevin Rudd and his Health Minister, Nicola Roxon, have made some positive sounding noises in regard to primary care and aged care services (more smokescreen) as well as some minor incremental funding allocation for these areas. The proposal that all diabetics should be involved with a GP who would receive block funding on a per capita basis for their care is a quantum leap in the right direction. It would encourage team-based primary care of diabetics outside of expensive and inappropriate hospital care.

However, most of these proposals seem piecemeal and lacking in detail, including how to successfully implement such proposals while the doctors are still heavily focussed on their private fee-for-service patients. How will block funded diabetics compete with the majority of patients who would be still paying the doctor under fee-for-service? How do you charge a diabetic who presents with “flu” symptoms? Is this episode covered by block funding or fee-for-service?

This is hardly a “root and branch” approach to reform as had been promised, and not surprisingly, the suggestion of putting GPs on some form of salaried payment has already been angrily opposed by the AMA and the College of GPs. They fear the decline of private fee-for-service payment as an attack on their right to private practice and see it as a “creeping socialism”.

The contradiction seems fairly obvious. If it is admitted by Mr Rudd and Ms Roxon, that block funding is best way to provide comprehensive team based care in the community “for those who really need it“, why introduce block funding only for diabetics? Why not for ALL chronic complex care conditions. Why not block fund medical care for the frail elderly in residential care? Why not block funding for ALL of primary care? Block funding of all complex conditions and the elderly would enable comprehensive care in the community and help keep people out of hospital. And isn’t that what a health system should be about? A team based approach of doctors and nurses and allied health/community care delivering comprehensive care at much lower cost in the community, where it is more appropriate. Just as we have team-based care in hospitals.

And, if block funding is the best way to provide funding because it promotes team based care, why change from block funding to a case-mix method of funding in our hospitals?

What is needed: progressive reform to strengthen and extend Medicare with a greatly expanded system of PUBLIC frontline care services, including team based primary care, aged care, mental health services and homecare.

Mr Rudd’s hospital-centric approach to health reform is the way of the past. It is a dead end that will take us down a path to expensive user-pays American system of health care. It is a BUPA takeover of Australia’s health system pitched to Australia’s middle class affluence. It can only lead to rationing of care.

The real solution is a strong and invigorated public system, building and extending on the access and equity provided by Medicare through comprehensive team-based frontline care in the community. The real problem is the failure of primary health care, aged care and mental health services. Increasing hospital costs and crisis is just one symptom of this failure. Fixing primary care and frontline services is the only way to fix the hospitals in a sustainable fashion i.e. without eventually leading to rationing and privatisation in the future. Treating people in the community means that our hospitals are left to deal with more appropriate cases such as major trauma, severe illness or elective surgery.

Put another way, any “solution” for public hospitals that focuses only on the hospitals, is a non-solution. If we do not fix the primary care system increasing numbers of patients will continue to flood into the hospitals. A focus on hospital funding reform can only mean an underlying agenda to privatise the public hospitals, public hospitals being the last stumbling bock for a privatised health system.

Mr Rudd is not only coming up with the wrong solution for public health, he is addressing the wrong part of the problem. He is focussing on the wrong target if true health reform is intended. The state premiers are not without blame. They have been gaming the system for years, particularly running down community services, which further compounds primary care failure. But they are stuck with fixed budgets in an increasingly under funded and privatised federal landscape and public pressure on state governments has at least meant that the state premiers are forced to “find” money for the public hospitals.

Mr Rudd should be encouraging doctors into comprehensive frontline services and away from corporate 24-hour medical centres. He should be giving frontline services the support to provide for the frail elderly and the mentally ill, those with complex illness and the dying. Team-based frontline services should be strengthened so that people’s health needs are met in the community and away from costly and dangerous hospital institutions.

Mr Rudd should be opening up the closed shop of the specialists, the Royal Colleges of the specialist doctors who continue to dictate to the public system where and when specialist trainee positions will be filled. They maintain strict control of specialist numbers to maximise their own incomes. There needs to be many more salaried staff specialist positions in our public hospitals with a role to play also in the community, so that specialist care is accessible to all Australians where it is needed most.

Particularly, he needs to take on an organised medical profession which maintains a united stance against any watering down of their private payment system. They form a major stumbling block for any true reform towards the system of comprehensive integrated health care.

Unfortunately, Mr Rudd’s approach is to side with hospital specialists, private health insurance and the private sector. This will result in a much more expensive system with less care and a system mainly concerned with profit making for shareholders.

Mr Rudd is playing a double game, putting himself forward as a reformer, when all he really wants to do is implement the neo-liberal agenda. Perhaps this is a very negative picture and perhaps real reforms to the health system are somewhere in the pipeline. However, it is way past the time that Mr Rudd needs to be frank with the Australian electorate. Without real reforms and by entrenching the Howard/Abbott years of severe under funding of public hospitals, the fate of the public health system appears sealed.

Steps towards real reform of health and welfare:

  1. First and foremost we need to stabilise our public hospital system, call for an immediate boost in real Commonwealth funding of hospitals to at least the traditional 50% mark so that they can better cope with being a safety net in addition to delivering acute care.
  2. We should oppose case-mix funding and corporatism of hospitals because it places episodic care ahead of the management of chronic and complex care and promotes commercialism over professionalism in hospitals and because the Rudd policies are only a smokescreen to continue Commonwealth under funding of public hospitals.
  3. An urgent strengthening and extending Medicare, which includes transforming primary care to team-based frontline services i.e. extending Roxon’s suggestion to introduce block funding for diabetics to ALL chronic and complex primary care. GPs could be initially on say 60% block funding for chronic and complex care and 40% fee-for-service for episodic care. Dental care to be added as part of Medicare but not by churning dental through the private health insurance funds as was proposed in Denticare.
  4. Remove regressive health measures introduced by the Howard Government whose only purpose is to redistribute scarce health dollars to the wealthy i.e. the 30% private health insurance rebates and the extended Medicare safety net.
  5. Address better aged care in the community including a review of privatised and profit-making residential aged care. As a minimum there would need to be mandating of staffing levels in nursing homes and putting trained nursing staff back into residential aged care. Residential aged care and boarding houses for mentally ill to be twinned with block-funded GP primary care teams so they have immediate and priority access to a doctor’s (and nurse’s) time. What is really needed is a massive expansion of homecare and support services in the community to help keep people independent in the community and out of expensive hospital based care. This is the way of the future.
  6. Oppose the revival of the free trade discussions and the extension of any US Free Trade Agreement/Trans-Pacific Partnership Agreement with the US. Hands off the PBS! Hands off our public hospitals!

Mr Rudd could immediately set guidelines that make it obligatory for privatised aged care facilities to have trained nursing staff present at all times, and a plan whereby all GPs would be integrated into aged care and boarding houses for the mentally ill. As an initial move away from rapid turnstile medicine, the large number of new doctors that have been announced should be on salaried payments while in training in primary care (just as are all the medical and surgical trainees in our hospitals). This would encourage new younger doctors to spend time with their patients and to care for patients in the community setting i.e. remove the perverse fee-for-service disincentives faced by doctors in provision of care for the housebound and the frail elderly population in nursing homes.

We need to expose our politicians’ duplicity on health care reform. There is a lot of misinformation currently circulating including television ads being paid with our own taxes. We need to expose the bipartisan approach to regressive health reform by the major parties and their implementation of the neo-liberal agenda, their less than honest approach with the population and their abuse of the community consultation process.

Ultimately a national health system, including comprehensive team-based primary care, a greatly expanded home and residential aged care system, and the Commonwealth as the monopoly purchaser of drugs and equipment, is the only way to secure first rate, affordable and sustainable health care for all Australians into the future.

And finally, a society which provides for all of its citizens, and reduces inequality, is the best way to alleviate the health burden on the system.


NHS — National Health Service (Great Britain)

NHHRC — National Health and Hospitals Reform Commission set up by the Rudd Government to enquire into “root and branch” reform of Australia’s health system.

PHIR — Private Health Insurance Rebate

PBS — Pharmaceutical Benefits Scheme, guarantees affordable medications for all Australians

TPPA — Trans-Pacific Partnership Agreement (new form of Australia-US Free Trade Agreement)

BUPA — British United Provident Association Limited

BUPA is a leading international healthcare company. Established in 1947, it has over ten million customers in more than 190 countries and employs nearly 52,000 people around the world. Its main interests are health insurance, care homes for young disabled and older people, workplace health services, health assessments and chronic disease management services, including health coaching and healthcare services in the home. While BUPA’s original business is in the UK, it has significant operations around the world including Sanitas in Spain, MBF, HBA and Mutual Community in Australia and Health Dialog in the US. BUPA also has businesses in Hong Kong, Thailand, Saudi Arabia, India, Latin America and Scandinavia. In addition, BUPA Care Services has care homes in Spain, Australia and New Zealand. BUPA has no shareholders. We reinvest our surplus to provide better healthcare for our customers, helping them to live longer, happier, healthier lives.

Back to index page