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Tuesday, 27 May 2003
Page: 15100


Mr STEPHEN SMITH (7:42 PM) —I speak tonight on Appropriation Bill (No. 1) 2003-2004 and to support the second reading amendment moved by the member for Fraser and shadow Treasurer, Mr McMullan. In particular I want to focus on the first two paragraphs of that amendment, which read:

... “whilst not declining to give the bill a second reading, the House condemns the government for:

(1) Its obsession with shifting the cost of health and education from the budget to Australian families;

(2) Imposing higher costs of doctors visits on families without concession cards and a 30 per cent hike in essential medicine prices ... ”

In my capacity as shadow minister for health, I want to focus on the shifting of the cost of health from the budget to Australian families, the imposition of higher costs on doctors' visits and the 30 per cent hike in the cost of essential medicines.

The government's so-called Fairer Medicare package is, of course, a package to make Medicare unfair. I recall that, when the Prime Minister, Mr Howard, was elected in 1996, his slogan was `For all of us'. We now know the truth is that, under John Howard, Medicare is for just some of us. When we look at the so-called Fairer Medicare package, the budget papers confirm the government's earlier announcement of its changes to Medicare. This is a budget that John Howard would have been proud to deliver as Malcolm Fraser's Treasurer. We know that when John Howard was Treasurer in the Fraser government, the last changes that the Fraser government made to Medibank gave the Prime Minister the public policy model for what the government is now seeking to achieve. The last of the Fraser Medibank models essentially restricted bulk-billing to pensioners, concession card holders, and what John Howard then described as `disadvantaged people'. That is the central basis of the government's changes to Medicare: to essentially end bulk-billing for Australian families and to restrict bulk-billing to pensioners, concession card holders and the poor.

It is no surprise that this is where John Howard, as Prime Minister, now returns to. It was not just when he was the Treasurer in the Fraser government but when he was opposition leader in the 1980s that his references to Medicare and bulk-billing abound. His comments were that he wanted to destroy Medicare, he wanted to destroy bulk-billing, it was a rort and he wanted to rip it up and tear it apart. But in 1987 his formal election commitment as Leader of the Opposition was a public policy commitment to the Australian people which said that bulk-billing would be restricted to pensioners, concession card holders and poor people, and doctors would be free to charge everyone else whatever they wanted to charge.

That goes to the heart of the second part of the government's Medicare changes: the capacity—which is currently unlawful—for doctors to split the patient rebate from the copayment or the out-of-pocket charge to the patient. That is the device which provides the financial incentives for doctors to bulk-bill pensioners and concession card holders only. That device, which the Prime Minister describes as a convenience for the patients, is simply a convenience for the doctors to increase the costs, bit by bit and visit by visit, so far as Australian families are concerned. That is the device that John Howard uses. We know that it is much easier for a doctor to increase a charge from $10 to $20 than it is to increase a charge from $35 to $45. We also know that it is easier for a doctor to introduce a charge of $5 than a charge of $30. So that device makes it easier for doctors to walk away from bulk-billing, if they are currently bulk-billing, and easier for doctors to increase the cost of their charges, bit by bit and visit by visit, for families. We know that Australian families who earn more than $32,300 are not eligible for a concession card or a health care card. So Australian families on $32,000, on $40,000 or on $50,000 will be whacked, visit by visit and bit by bit, every time they go to the doctor.

It is no surprise that this is where John Howard has ended up. This was the policy approach that he adopted as Malcolm Fraser's Treasurer. This was the policy approach that he adopted as Leader of the Opposition in the 1980s. He made a formal commitment in the 1987 election that bulk-billing should be restricted to pensioners. In that context, he also said that he believed free visits to public hospitals should be restricted to pensioners and concession card holders. We found precisely the same public policy approach in the 1993 commitment by the then opposition, the Liberal and National parties, in their Fightback proposal to restrict bulk-billing—an effective or de facto means testing and an effective destruction of the universality of our Medicare arrangements.

We also know that John Howard recanted all of that. He made two great promises in the 1996 election, when, as I said, his slogan was `For all of us'. His two great promises were that he would never ever introduce a GST—which he subsequently did—and that Medicare and bulk-billing would stay. He gave a litany of guarantees, including an absolute guarantee that Medicare and bulk-billing would stay. When, famously, it was put to him during an interview with Laurie Oakes on the Sunday program that that was what Malcolm Fraser had said about Medibank, he said, `Well, you're not talking to Malcolm Fraser; you are talking to John Howard, and what I say goes.' That commitment to the Australian public—which was repeated formally as part of the 1996 election commitment of the Liberal Party, the 1998 election commitment of the Liberal Party and the 2001 election commitment of the Liberal Party—has now been torn up in the face of the Australian people. This is not John Howard fixing Medicare or bulk-billing; this is a John Howard fix. He is returning to the scene of his public policy crimes of the 1970s and 1980s to destroy the universality of Medicare and bulk-billing, to effectively de facto means test it and to put bulk-billing out of reach as a practical means so far as Australian families are concerned. It is not John Howard fixing the problem; it is a John Howard fix.

How did we get to where we are? In 1996, when the Labor Party left office, bulk-billing rates were at 80 per cent. We know that under Labor, from when Medicare was introduced in February 1984 through to when Labor was defeated and left office in March 1996, bulk-billing rates increased every year. They got to a peak in May 1996, shortly after Labor left office, of 80.5 per cent. Every year that the Howard government has been in office, bulk-billing rates have fallen. We saw on Friday, a week ago, the release of the last set of official statistics, which show that the national bulk-billing rate has fallen to 68.5 per cent—a 12 per cent slide. Dramatically, more than half of that slide has happened over the last 12 to 18 months. We also know that, after the government was re-elected in November 2001, the health department advised the new Minister for Health and Ageing, Senator Patterson, in December 2001 that, unless the government took dramatic steps, bulk-billing would continue to decline dramatically and that the department could not advise the government where the next stable level of bulk-billing would be. That is precisely what has occurred.

As late as December last year, we saw the Prime Minister stand up in this House and say that it was not factually correct to say that there was a problem, a crisis, with bulk-billing. Every time we saw the dramatic decline in the statistics, the new health minister said that this was not a catastrophe or a crisis; it was merely a disappointment. It has only been as a result of an outcry in the community about the adverse consequences for Australian families of the collapse of bulk-billing that we have now seen the government move. It is responding to what it sees as a political need, not responding with a sensible public policy approach. In a classic John Howard fix, it is responding in a way which it pretends is a solution to the problem—but it is a solution which actually destroys Medicare and its universality and will essentially end bulk-billing for Australian families.

After seven years of stealth and attrition—seven years of John Howard mouthing support for Medicare but not putting any resources into it, of effectively keeping the screws on the doctors' rebate and of not responding to the changing nature of doctors' practices and growing work force shortage issues and problems—finally, when it comes to the crunch, what do we see? We do not see a government committed to Medicare; we do not see a government committed to the universality of Medicare; we do not see a government committed to bulk-billing. We see John Howard wanting to return Australia's health care system to a model that he fashioned as Malcolm Fraser's Treasurer, as opposition leader in the 1980s and as part of the Fightback program of the Liberal Party in 1993.

When we look at the government's package in the budget papers, what do we find? We find $917 million over four years in this package. It is no coincidence that when you turn to another part of the budget papers you discover that the draw-down in the forward estimates from the last budget for the funding for the Australian health care agreements is $918 million over four years. So the government funds its package to destroy Medicare by ripping $918 million out of the funding for public hospitals for the states. Over the five-year period of those health care agreements, that is essentially $1 billion to $1.5 billion hand-passed to the states. The government's package is $917 million over four years. Part of that does respond to the work force shortage measures, with commitments for additional training places, additional nurse practitioners and additional university places for doctors. The Leader of the Opposition and I, as shadow minister, have made it clear that we support these measures.

When it goes to those measures that seek to respond—in a pretence of a response—to legitimate claims by doctors that the rebate no longer reflects adequately the capacity on their part to practice quality medicine, to run a small business and to make a reasonable income, what device does the government use? It spends $350 million over four years on increased rebates. That compares with Labor's package, as announced by the Leader of the Opposition in his budget reply, to spend $2 billion over four years—$1.5 billion of which goes to doctor's rebates and incentives for bulk-billing. That is the relative measure of the packages: $350 million by the government over a four-year period to encourage doctors to bulk-bill pensioners only, with nothing for families; and Labor's measures of $1.5 billion to encourage practising doctors to bulk-bill all Australian families, not restrict it to those Australians with an income of $32,300 or less.

There are three insidious measures in the government's package that are wrapped up in part of that funding. The first is to provide doctors with incentives to bulk-bill pensioners and concession card holders only. That effectively destroys the universality of Medicare and will see a second-class safety net for pensioners and poor people in the long term. The second measure will enable a practice which is currently unlawful—doctors splitting the patient rebate from any copayment. That effectively gives the green light to increases in doctor's charges for Australian families. The AMA said on the release of the package that it was inevitable that the costs of visiting a doctor would go up. Thirdly, in an acknowledgement that that proposal could only lead to increased costs for Australian families, the government proposes to introduce a capacity on the part of Australians to, for the first time, take out private health insurance to cover the cost of gap payments of $1,000 or more. That is an acknowledgement that costs will go up—an acknowledgement that that proposal can only be inflationary and, for the first time, introduces private health insurance so far as GP costs are concerned. That is the thin edge of the wedge so far as an American style health system is concerned.

It is not just Labor saying it is inevitable that costs will go up for Australian families. The AMA has said it and, more importantly in some respects, the government's Parliamentary Secretary to the Minister for Family and Community Services, the member for Parramatta, essentially acknowledged that. The member for Parramatta last week acknowledged two very important things. Firstly, he gave the lie to the Prime Minister's pretence that there is no difference between Labor's policy approach and the government's policy approach. Having failed to strike a blow in any way on Labor's budget response in this area, the Prime Minister quickly changed tack and said there was no difference between the two. He was blown out of the water by Rosco, the member for Parramatta, in that respect. Secondly, the member for Parramatta confirmed, in his capacity as Parliamentary Secretary to the Minister for Family and Community Services, that costs would go up for Australian families.

As I said earlier, commonsense tells you that the capacity to split the copayment from the patient rebate will lead to increased charges. It is much easier for a doctor to introduce a charge at $5 than it is for them to introduce a charge at $30, and it is much easier for a doctor to increase a charge from $10 to $20 than it is for them to increase a charge from $35 to $45. Bit by bit, visit by visit, families will end up paying for their visits to the doctor with a credit card, not with their Medicare card—their Medicare card will essentially be irrelevant.

Labor's proposal, on the other hand, seeks to provide a first instalment to get bulk-billing back to respectable rates. It was at 80 per cent nationally when we left office in 1996, and we can get back to that rate again. Under our proposal, Labor will do two things: firstly, increase the patient rebate for bulk-billed transactions to 95 per cent of the rebate, an effective increase per bulk-billed patient of $3.35; and, in the fourth year of the budget cycle, increase the patient rebate to 100 per cent, an effective increase of $5 per bulk-billed patient.

At the same time we will provide incentives for doctors to meet bulk-billing targets. A doctor practising in the metropolitan area would have a bulk-billing target of 80 per cent. A doctor who made that target would get a cheque in the post of $7,500 on an annual basis. A doctor practising in outer metropolitan Australia—as configured by the lines on the government's outer metropolitan work force shortages maps—who reached a bulk-billing target of 75 per cent would receive an incentive payment, a cheque in the post for $15,000 per year. A doctor practising in rural, regional or remote Australia who made a bulk-billing target of 70 per cent would get an incentive payment of $22,500.

These are substantial incentives on the part of Labor—firstly, to stem the dramatic decline in bulk-billing and, secondly, to get bulk-billing back up to respectable rates. That is a $1.5 billion program over four years as far as increases in the rebate and in the incentive payments are concerned. Overall, Labor's package is $2 billion, because we pick up the work force shortage measures of the government that I referred to earlier. Of that $2 billion package, $1 billion is essentially new money funded half by way of savings in other areas and half out of the surplus. It is an affordable, deliverable, responsible package.

I made the point earlier that, when you look at the government's package of $917 million over four years, you find that that funding is ripped out of the health care agreement forward estimates. That is a very important linkage, because we know from state and territory health ministers around the countryside that one of the great problems we now have so far as public hospitals are concerned is that the dramatic collapse and decline of bulk-billing has seen great additional pressure on the emergency departments of our public hospitals.

We know that, if people cannot afford to make a payment to go and see a general practitioner to get the primary preventative care that they need, sooner or later—and it might take two days, it might take two weeks, it might take two months, it might take two years—they will end up in the emergency department of a public hospital. That will be at a far greater personal cost to themselves, because the medical intervention required will be much more substantial, and at a much greater cost to the state and Commonwealth taxpayer, because the medical intervention will be much more costly. It will not be medical intervention given by a GP who can give the primary preventative health care that people need. It is also invariably the case in this area that those people who are most at risk of serious illness or chronic diseases are also those who are least able to make the extra payment.

The second reading amendment moved by the member for Fraser, the shadow Treasurer, picks up these points. There are great adverse consequences for Australian families in shifting the cost of GP visits, and those are compounded by the government's ongoing proposal to increase by 30 per cent the cost of essential medicines so far as Australian families are concerned. On the other hand, Labor has a program to rescue bulk-billing, to restore bulk-billing to respectable rates and to restore Medicare, and that will be of great advantage to Australian families. (Time expired)