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Wednesday, 14 September 1983
Page: 795


Mr SPENDER(8.0) —As other members have remarked, the debate on the Medicare legislation now before the House is a most important debate. Undoubtedly, for different reasons, one can approach the legislation from the point of view that it is all good, from the point of view that it is all bad, or from some point somewhere between those two extremes. I do not for a moment suggest that the previous system was an ideal system. I am not here to propose what would be the ideal system. But with the greatest of respect to those on the Government side who have spoken with sincerity about the legislative proposals, it seems to me that when they extol what is before the House, when they speak of the simple nature of these proposals, when they talk about equity, they are using the buzz words which spring to the mind of the Australian Labor Party when it looks for neat and tidy solutions to human problems-after all, medicine and the provision of medical services is a very major human problem. Their tidy, if unoriginal, minds opt for what appears to be a tidy solution. But in doing so, they have forgotten or put to one side some major defects in their proposals.

I should like to say something about funding, about nationalisation by indirection, about the essentially anti-democratic nature of what is proposed, and about the consequences of these proposals, if enacted, for the quality of health care. No one in this House would pretend that the one per cent levy is other than a convenient fiction. The Minister for Health (Dr Blewett), in his second reading speech, in contrasting the proposed system with the Fraser Government's system, said this:

Medicare will be substantially self-funding through the one per cent levy and a rearrangement of existing health insurance subsidies, whereas Medibank placed a considerable strain on Consolidated Revenue.

Let me make two points. First of all, it could never be said that Medicare will be substantially self-funding through a one per cent levy; secondly, in contradiction to Medibank placing a considerable strain on Consolidated Revenue, or by contrast, this proposal now before the House is in effect to be financed exclusively out of Consolidated Revenue. The Minister for Health would be the last person to deny that one's estimates of the costs of his proposals could vary. On 16 December of last year he was reported as having altered his proposals because of an increase in the expected cost of running the scheme. To refer briefly to an article in the Age of that date, it says:

Labor's health spokesman, Dr Blewett, announced yesterday that the main source of finance for the scheme-a proposed levy on people's taxable income-would have to be increased by a third to cover the costs. Dr Blewett said substantial increases in hospital charges during the past six months had made the changes necessary.

That, of course, repeats this convenient fiction that we are here only concerned and that the public is only concerned really, with the one per cent levy. But it makes the point very clearly that the Minister for Health there had to reorder his thinking on estimates, and that the making in advance of an estimate of the cost of these kinds of proposals is a difficult and sometimes dangerous exercise . One might turn back to the British health scheme introduced in 1948. The British Civil Service-a civil service of equal competence, one would think, to the Australian Public Service-estimated that it would cost $150m in its first year. The actual expenditure for the first complete year, 1949-50, was $436m, or 190 per cent over the estimate. When we look at what is proposed, let us bear in mind that what we are really talking about is government control, indirect nationalisation, of the bulk of the medical services which are to be provided in this country. I remind the House of something that was said by Dr E. Grey-Turner , former Secretary of the British Medical Association, in May 1980. He said:

The demand of treatment is infinite and any government which nationalises the bulk of its medical services as the British Government did in 1946-48 saddles itself with an economic liability which is practically impossible to control.

Of course, the economic liability flows from the nature of what is offered. Any service which is offered as free, be it postal, be it the telephone service, be it the train service, be it an air service, will be used, over-used and abused. It is human nature.

Here we shall face a situation in which doctors will be under very heavy pressure to engage in bulk billing, and in which patients, in cases in which the doctors charge 85 per cent of the schedule fee, will not have to pay. What will that do? That will provide an inbuilt momentum to the extension of the uses of medical services. When the Minister says-as I believe he has; certainly it has been raised in the debate-that one can, as it were, check the overcharging, and that he proposes to spend much more money for the purpose of detecting medical fraud, let him bear in mind that it is one thing if one can distinguish between the profiles of services provided by various doctors; it is another thing when the whole profile of the service itself changes.

If one takes a group of doctors and one sees that, of a group, one, two or three are doing 50 per cent more work or sending out 50 per cent more bills from the same area, one can come to a fairly sensible conclusion that something needs to be looked at. But if one finds that the system itself is just increasing in the work load that it gets through, that the servicing charges are increasing throughout the country, then one is up against a problem of a different kind, which is precisely the kind of problem that has been faced in England. The British National Health Service is now Western Europe's largest single employer. It employs about one million people, and its budget for 1981-82 was #11 billion. In the decade to 1981-82 spending had increased by six times. That gives us a glimpse of the kind of road down which this Government apparently proposes to travel.

Let me now say something about nationalisation by indirection. Controls can be so extensive, so pervasive and so rigorous as to amount in effect to nationalisation. That is precisely what is taking place here. As the Minister very directly admits, we have the creation of what is effectively a state monopoly on the provision of insurance. Of course, it is insurance which underpins the provision of services, the whole of the medical scheme in this country. Once one creates that kind of monopoly, effectively one is creating a state monopoly, and state monopolies are not only as bad as other monopolies, they are worse. Established by the state, they can only be disestablished by the state. Nourished, supported and protected by the state, their privileges and powers become entrenched and, as the Minister would understand, they are difficult to remove except by drastic action.

It is bad enough to have a state monopoly. It is worse when what we get is a highly undemocratic system, and that is what is proposed in this scheme. These kinds of proposals are often justified as being efficient, egalitarian and democratic. The proposal before the House is not democratic. It pretends to be egalitarian and its efficiencies remain to be tested but, judging on the British experience, the likelihood of efficiency is not good. Let me concentrate upon the democratic nature of what is proposed. Democracy implies choice and, fundamentally, if one does not have choice then to that extent one's democratic rights are eroded. In this proposal one is not free to choose another form of insurance. There is to be only one form of insurance. One will not be free to make other arrangements to finance one's medical care. One will have to pay the levy, which will go some little distance to the financing of the scheme, whether one likes it or not. Nor will people be free to take out gap insurance, and this is a denial of what must be a basic democratic right-the right to insure. Why should people not be permitted to insure for the difference between the 85 per cent of the schedule fee and what may be charged above that? The Minister in his second reading speech stated:

In line with the recommendations of the 1980 Jamison Commission of Inquiry into the Efficiency and Administration of Hospitals appointed by the previous Government we will be legislating to prevent both private health funds and general insurers from offering cover for the 'gap' between the Medicare benefit and the schedule fee. The reason for this is quite simple and practical. As the AMA stated in evidence to the Jamison inquiry--

One might think that calling on the Australian Medical Association is somewhat ironic--

'Doctors generally believe that there should be a charge at the point of service'

The Minister went on to state:

In this report Jamison noted that 'it'-gap insurance-'underpins the practice of fixing charges above the schedule fee'.

After making some other observations, he went on to state that effectively, overall, 'people are financially better off without gap insurance'. Further, he stated:

It is only doctors who would be financially better off if gap insurance were permitted.

Therefore, the Government knows better than people, people should do what the Government tells them and, of course, doctors are the kind of people who would rip off any system at all. Let us go back to the Minister's real justification. The Minister quoted that the AMA stated in evidence to the Jamison inquiry:

'Doctors generally believe that there should be a charge at the point of service'.

The Minister called that statement in aid for his proposal for a law that would prevent a citizen of this country from taking out insurance against the gap. He accepts the rationale of the AMA:

'Doctors generally believe that there should be a charge at the point of service'.

Yet that is inconsistent with the plain intent of his proposal, which is, effectively, to force doctors to bulk bill. The reasons for that have been explained by those on this side of the House. The economic pressures upon the doctors will be great. The pressures on doctors from those who go to the doctors for treatment will be great. If the Minister's intent is successfully carried through, as he plans that it should be, the rationale will disappear because there will be no charge at the point of service.

I wish to say something briefly about two other matters, private practice and the consequences for quality care. The Government proposals on private practice have been laid out. What is essentially wrong about the Government's proposals for control of private practices in hospitals is that control, effectively, will be reposed in the Federal Government. As the Minister said in his second reading speech, the form of contract between the doctor and the hospital will be a form acceptable to the Commonwealth. That is the beginning of a Commonwealth takeover of private practice by doctors in hospitals and nothing else. The Minister would know that that is inherent in this proposal.

Lastly, let us consider the consequences for quality care. It has been said by other speakers from this side of the House that these proposals are not concerned with quality of care. Certainly they are not. They are concerned with administration, with insurance, with financing, and with controls; controls on how health services should operate, controls on how they should be funded, controls on how the services rendered by doctors should be paid for, controls over doctors, controls over hospitals; controls in effects, over most aspects of the provision of medical services in this country. One ties in the control to the source of funding and that, of course, is always the best way of securing control. We are not concerned with quality, but if we look to the consequences we see that it is now proposed that the Government will be virtually the sole provider of funds for the provision of medical services in this country. There will be some form of private insurance but one would expect that that will be of a relatively small nature and, certainly for the great majority of people, the Government will be providing the funds for the services they need.

This has happened in the United Kingdom. One of the things we have seen there is that decisions on what services should be provided become part of the budgetary process. When, in the budgetary process, bids are put in for the purposes of expenditures, there are winners and losers. In the field of providing medical services the losers are those who need those services. Take as an example a case where a decision has to be made as to what kind of treatment should be provided on a priority basis. This problem has appeared in England. I think the honourable member for Mackellar (Mr Carlton) referred to an example of a man with a hernia who is denied treatment for a long time because it is not considered to be particularly essential treatment. It may not be essential for the healthy bureaucrat, the healthy government official, or the healthy Minister but it is exceedingly essential to the person who suffers. Those kinds of instances could be multiplied.

What will that mean? It will mean that in the end, because virtually there will be little outside finance coming in-under the present system there is the mix of what the Government provides and what comes in through the private insurance system, which is a very flexible system-decisions will have to be made as to what can be done, what treatment is to get priority, and the quality of treatment. Within budgetary constraints the decisions are adverse. That means that the amount available to be spent on providing medical services will be limited. That limitation will be felt in the quality of the medical service and by people who require that medical service but cannot get it because the government of the day decides that the funds simply are not there. That is one of the major problems when governments get fully involved in health care. Quality suffers and those who need the care suffer as a result of that quality suffering.

Debate interrupted.