Health leaders agree Australian health system unsustainable
Health industry and business leaders agreed that Australia’s health system requires urgent reform to ensure its sustainability, at a breakfast panel discussion held by The George Institute for Global Health at the Museum of Sydney to mark World Health Day.
The panel included Chair of the House of Representatives Standing Committee on Health and Ageing Steve Irons MP, AMA president Dr Steve Hambleton, George Institute board member and Chairman of Myer Holdings Paul McClintock AO, Professor Andrew Wilson, director of the Menzies Institute for Health Policy, and Professor Vlado Perkovic, director of The George Institute Australia.
The panel MC was ABC radio presenter Norman Swan.
The panel discussion took place against a backdrop of the run-up to the 2014 Budget, on the 30th anniversary of Medicare, and in a climate where elements within the Federal Government have repeatedly signalled an intention to focus on changes to Medicare.
Paul McClintock pointed out the Federal Government alone was spending $65b this year, including $19b on Medicare, with the Medicare levy raising just $9b of that amount. He said these programs had growth rates well in excess of CPI, and at the moment well in excess of the growth in tax revenue.
Two things could prompt Government action on creating a sustainable health system for Australia, he said.
“Firstly, the Commonwealth Government has a medium term fiscal challenge which will force it to spend considerable political capital educating the population to the idea that resources are limited.
“Secondly, the same government is committed to a fundamental review of the federal system, leading to a white paper during this term. As soon as you start that process you hit the health system, and that will throw up an opportunity to look at the issues through a different lens.”
He said Australia should look to Dutch health reforms as a path forward, he said, as had been suggested by the 2009 National Health and Hospitals Reform Commission report.
Vlado Perkovic said health reform should begin now, as changes could take years to take effect. “What’s important is not what’s being spent now, it’s how much we will be spending as percentage of GDP in 10 or 20 years.”
He said it was important not just to rein in spiralling health costs, but also to improve the quality of health care, and reduce the colossal amount of waste. He pointed to a survey carried out by the ANZ Intensive Care Society, that found only five per cent of treatments given to an intensive care patient were supported by reasonable evidence.
Steve Hambleton said that Australia’s health care crisis was currently hidden behind comparisons to other countries, where the percentage of health spending was higher than in Australia. For example, Canada spends 12 per cent of GDP on health, compared to Australia’s nine per cent.
With the Australian Government saying it currently cannot afford to spend more on health, Dr Hambleton said the key was being smarter with health funding by concentrating on programmes and services where there is clear evidence of patient benefit. He said health care costs were rising because of an ageing population, more people with chronic and complex conditions, and high costs of new technology and hospital care.
Andrew Wilson said the crunch point that would finally prompt action on health care reform would come when it was recognised that Australia’s states, which have very limited revenue raising capacity, could no longer afford to run hospitals.
He was also concerned he said, about the affordability of healthcare for consumers, with rising out-of-pocket expenses, and a two-tiered health system that saw insured consumers able to access more extensive health care through the private system than those who used the public health system, even though 60+% of private health care costs were funded directly or indirectly by the public purse.
He suggested that it was important to look at the costs of the whole health care system and not just the public sector services. “Private health care services are experiencing the highest growth in the Australian health care system and if government is concerned about the total cost of health care, it needs to have strategies to look at this and not just to transfer these increasing costs to individuals through increased out-of-pocket expenses”.
Steve Irons said a current priority for the Government was a sustainable health system. “Research is a major part of our health system.” He said consultation was an important part of the Government’s approach, and it would be necessary to engage with the health industry. “We have to be mindful that health is such a big part of the Budget, and we have to get it right.”