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Monday, 16 June 2003
Page: 16447


Mr MOSSFIELD (6:16 PM) —I rise to speak on the Health Legislation Amendment (Medicare and Private Health Insurance) Bill 2003 and to support the amendment moved by the member for Perth. This bill makes the legislative changes that are necessary to give effect to the government's Orwellianly named A Fairer Medicare package. How it can be fairer when it is going to cost most Australian families more for their health treatment is hard to understand, but then that is what newspeak is all about. This bill permits private health insurers to cover 100 per cent of out-of-pocket costs for all out-of-hospital Medicare services above $1,000 per family in a calendar year. In other words, families will have to pay a premium to a private company and then spend $1,000 before any benefit can obtain for a service that used to cost nothing if you were bulk-billed.

The bill also introduces a safety net for the cumulative cost of out-of-hospital medical services for concessional patients, covering 80 per cent of the out-of-pocket costs above $500 per family incurred for Medicare services in a calendar year. The bill permits patients of participating practices who are charged above the Medicare rebate to assign their Medicare benefits to the general practitioner and then pay only the gap amount charged by the GP. This last provision is the thin edge of the wedge that will see the end of bulk-billing as we know it and implement the 1987 election commitment by the coalition, which was soundly rejected at that time. That election commitment was:

Bulk billing will not be permitted for anyone except the pensioners and the disadvantaged. Doctors will be free to charge whatever fees they choose.

These changes are a direct attack on the universal Australian Medicare system. The government claims they are necessary because of the dramatic decline in bulk-billing numbers across Australia. It is a crisis that has been deliberately created by this government through its utter neglect of bulk-billing services. The crisis has been designed precisely so that the government can fully dismantle the Medicare system. As Ross Gittins wrote in the Sydney Morning Herald on 7 May 2003:

Though it has suited Howard to give us an exaggerated impression of the decline in bulk-billing, it's true that a growing number of GPs have shifted to charging ordinary patients more than the schedule fee.

Why? Because, since he came to office, Howard has not kept the GPs' schedule fees (and, hence, the bulk-billing rebate) increasing in line with the rise in the cost of running a practice.

So Howard has been manufacturing the bulk-billing `crisis' since day one. Sneaky.

Where have we heard the word `sneaky' before? Labor's answer to the bulk-billing crisis was outlined in Simon Crean's budget reply speech. Labor's answer is to create viable incentives to restore bulk-billing and to provide support to doctors who continue to bulk-bill everybody. This is one of the fundamental differences between the two sides of politics in Australia. There is a crisis in bulk-billing: on the conservative side of politics the answer is to do away with the system; on our side it is to restore the system. The government created a crisis in order to give itself an excuse to pull the system apart. Labor does not believe in a `it's too hard' basket. It will take on the challenge that this government has thrown down, and it will do what it takes to revive the universal Medicare system.

Labor created universal Medicare, and the conservative parties, led by the current Prime Minister, have been opposed to it since even before it was introduced. Only Labor has solutions that will fix what the government has broken. Labor will immediately lift the Medicare patient rebate for bulk-billing consultations to 95 per cent of the scheduled fee, an average increase of $3.35 per consultation. Subsequently, Labor will lift the Medicare patient rebate for all bulk-billing consultations to 100 per cent of the scheduled fee, an average increase of $5 per consultation. Labor will also offer powerful financial incentives to doctors to not only keep treating their patients without additional costs but extend bulk-billing, especially in outer metropolitan areas and in areas where the collapse of bulk-billing is hurting families. Doctors in metropolitan areas will receive an additional $7,500 each year for bulk-billing 80 per cent or more of their patients. Doctors in outer metropolitan areas and major regional centres will receive an additional $15,000 each year for bulk-billing 75 per cent or more of their patients. Doctors in rural areas will receive an additional $22,500 each year for bulk-billing 70 per cent or more of their patients. This rescue package will be funded by scrapping the $1 billion of tax deductions for big business, as well as by redirecting the $917 million that this government is spending on Medicare destruction packages. You see, it is spending $917 million to destroy Medicare. We will take that money and use it to save Medicare.

The balance of $500 million over four years will come from forecasted surpluses. To emphasise the damage that the proposal in this legislation will cause middle- and low-income earners, let me quote from an article by Mark Metherall headed `Low-income earners will end up as collateral damage from Medicare reforms'. He said:

The role of the Medicare rebate appears doomed to become a steadily smaller proportion of the ordinary patient fee. Unshackled from the restraint on charging above the Medicare rate, doctors can be expected to break away from it for all but their pensioner patients.

This is a very perceptive quote, and it is what lies at the heart of the current debate over the bulk-billing problem. At present, with the dramatic fall-off in bulk-billing numbers, patients are being forced to pay up front. They pay an up-front fee of around $40. They then have to claim the Medicare rebate from their local Medicare office—if the government has not shut the office down already—and therefore their out-of-pocket cost is around $15.

The government's solution sounds very good on the surface of things, but wouldn't it be easier to pay the $15 up front rather than pay $40 and have to fill in forms to get some of that back? On the surface it sounds good, but scratch that surface just a little and you will see the ugliness that lies beneath. Today it is $15, in six months time it will be $20 and pretty soon you will be back to the $40 up-front fee without a way to reclaim any of it. That is what is wrong with this package. It allows doctors to charge whatever they want up front, with no chance for the patient to reclaim any of it.

It is currently unlawful for private health insurance funds to offer insurance for medical services that are provided out of hospitals. Since 1983, Medicare has been the sole insurer for private out-of-hospital medical services, and all Australians have contributed to Medicare through their taxes. This has helped to keep medical costs down. The proposed capacity to privately insure against doctors' fees, apart from being inflationary, is the thin edge of the wedge and is an Americanisation of our health system. It is also an admission that, under the Howard government's package, health care costs will rise.

On the issue of a safety net for concession patients, there are already two safety net arrangements in place to protect Australians who have high out-of-hospital, out-of-pocket expenses. Under the existing Medicare safety net, when a person's gap payment exceeds $319.70 Medicare benefits increase from 85 per cent to 100 per cent of the medical benefits schedule fee for any further out-of-hospital services in the year. As well, the Medicare expenses tax offset allows a person with qualifying out-of-pocket medical expenses of over $1,500 in a financial year to claim a tax offset of 20 per cent of their net expenses above that $1,500. There is no upper limit to the amount that can be claimed. Although these measures exist to assist people who have high out-of-pocket costs, they are available to all Australians and they are not means tested. The proposed concession safety net is an admission that out-of-pocket costs will rise under the government's package. Doctors will be free to charge concession patients higher fees in the knowledge that the government will be responsible for picking up 80 per cent of medical expenses above the $500 threshold. These measures will also create a two-tier system in which eligibility for assistance with health care costs will depend not on medical needs but on the person's income. We will end up with a second-class safety net for the poor. The rich, of course, will be okay but the families in the middle will be squeezed, particularly those families on just a little below the average income.

An average family in Greenway faces mortgage payments of over $1,100 per month, which is higher than at any time in our history. On top of that, there are car payments, registration and running costs, credit card debts, school fees and HECS debts as well as a cost of living that is higher than anywhere else in Australia simply because they live in Sydney. If you add $15 or $20 every time somebody in the family gets sick, all of a sudden the squeeze is really on. Don't forget that that $15 or $20 is only the up-front fee to the doctor. After that, there is the cost of prescribed pharmaceuticals, which under this government have also steadily increased in price. The squeeze is on, and the Howard government is twisting the handle of the vice.

On the issue of allowing participating practices to charge patients copayments and receive the Medicare rebate, doctors who agree to bulk-bill all their concession patients will be allowed to bill Medicare direct for all their other patients and to charge patients a fee on top of that. But as Mark Metherall, writing in the Sydney Morning Herald, states:

The introduction of the modest incentive payments to lock doctors into bulk-billing pensioners in return for helping doctors charge other patients more appears to be swapping one clanging bureaucratic lever with another. Has Medicare been a doomed dream that could never last? Was the idea of underwriting private fees for services with a socialised insurance scheme ultimately going to become a casualty of rising costs and community expectations?

While the measure has been described by the government as introducing additional convenience for patients, it is more correctly classified as a financial incentive for doctors to bulk-bill concession card holders by making it easier to charge non-concession patients more. As Ross Gittins said in the Sydney Morning Herald on 7 May:

So over time this package will be a big move in the direction of higher GPs incomes and this would cause the nation's total spending on health care to grow a lot faster than otherwise. At the same time, however, it would reduce the proportion of the total bill being picked up by the federal budget and increase the proportion paid directly by the individuals.

There you have an independent commentator clearly spelling out what the end result of the government's package will be—and it will be, of course, that a higher proportion of health costs will be paid directly by the individuals. This so-called A Fairer Medicare package will make it easier for the doctors who currently bulk-bill Australian families to start charging a copayment for the first time and make it much easier for doctors who are already charging patients directly rather than bulk-billing them to increase their fees from, say, $20 to $25 than to increase them from $45 to $50. Whichever way you look at it, the unregulated fee structure under the government's package will result in the Australian public paying increased medical charges. Indeed, an article in the Sydney Morning Herald a couple of days ago reported that the minister recognises there is a serious problem with rising costs to the patient out of this package but at the same time is not clear on how the problem will be resolved. For these reasons, the Labor opposition will be opposing this bill.

This legislation goes very much to the core of the Prime Minister's credibility. I do not think there is any issue like this one, where over a period of time the Prime Minister has been making contradictory statements about whether or not the government would retain bulk-billing and Medicare. He has flip-flopped on this issue a number of times. It is notable that at one stage the Prime Minister was even being fairly conciliatory in suggesting that really there was very little difference between what the Labor Party and the government were trying to do. That was stretching the imagination a little bit, but somehow or other I think he recognised the difficulties with his package and was trying to soften the impact by suggesting that there was not too much difference between the two parties on this issue. That, of course, is a completely inaccurate statement. There could not be more of a difference on this issue. This is one of the fundamental issues on which there is a big difference between the two parties, and it shows that the Prime Minister is trying to cover up his repeated flip-flop. All you have to do is look at some of the statements he has made over the years on Medicare.

In conclusion, I will refer to what the now Prime Minister said when he was the Leader of the Opposition. In 1980 he said that Medicare was a `miserable, cruel fraud', a `scandal', a `total and complete failure', a `quagmire', a `total disaster', a `financial monster' and a `human nightmare'. He subsequently threatened to `pull Medicare right apart' and to `get rid of bulk-billing'. In 1995 on radio station 3AW, he said:

We're not going to contemplate altering the universality of Medicare. I mean, that is fundamental, and we're also going to keep bulk billing.

You could have fooled me. Maybe he has changed his mind over the period since then. His then shadow health minister, Dr Michael Wooldridge, said in answer to a question:

Yes, that's something we have grappled with for over a decade and the Party, now, is really unanimous on that. Medicare stays. Universal bulk billing stays. These are the things the Australian public demands and we accept that.

Certainly the last sentence is something that we would all agree with; these are the things that the Australian public demand and we accept that.

I can take this further. On the Sunday program on 4 June 1995, in answer to a question from Laurie Oakes, Mr Howard, the then Leader of the Opposition, said:

We absolutely guarantee the retention of Medicare. We guarantee the retention of bulk billing ...

Can you blame the public for being confused? In answer to another question, the then Leader of the Opposition said:

... yes, well you're questioning John Howard and nobody else, and I'm giving a guarantee that it is not going to be changed. I'm giving a guarantee about bulk billing.

What a lot of twaddle! Again, on 8 November 1995 he told the Age:

We're keeping Medicare full stop. There's no doubt about that. Let's have that absolutely crystal clear, we are going to keep Medicare lock, stock and barrel.

I would suggest there has been a very confused message, but I think most Australians now know that this government intends to destroy Medicare.