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Thursday, 21 June 2018
Page: 3674


Senator LEYONHJELM (New South Wales) (18:31): I rise to take note of the interim report of the Senate Select Committee on Red Tape on the effect of red tape on health services. The Select Committee on Red Tape was established in October 2016 to inquire into and report on the effects of restrictions and prohibitions—that is, red tape—on the economy and community. It's presented interim reports on the sale, supply and taxation of alcohol, tobacco retailing, environmental assessment and approvals, and pharmacy rules. I presented the interim report on health services in late March and now speak to the report.

Regulation has an important role in promoting the quality and safety of health services. While many risks surrounding health services can be reasonably foreseen by an average consumer, some cannot. However, submitters and witnesses described how health regulation is sometimes costly, excessive, ineffective and outdated. They argued that this red tape is impeding competition, growth, viability and efficiency. Submitters and witnesses argued that this red tape is adversely affecting health service consumers, with the consumers most affected being the disadvantaged, and they argued that this red tape is adversely affecting health service providers. In fact, in some instances people could be dissuaded from undertaking a career as a health practitioner due to the regulatory burden. Ultimately this is not in the public interest.

Let me mention some specifics. Roche Products submitted that red tape surrounding clinical research means that Australia is missing out on research to our neighbours in the Asia-Pacific region. Day Hospitals Australia submitted that private standalone day hospitals are a growing part of the health system, but there are significant challenges to running a day hospital in the current legislative, regulatory and accreditation environment. Some of the conditions imposed on the day hospital sector severely hinder financial viability and thus the provision of services to patients. The Royal Australian College of General Practitioners and the Medical Oncology Group argued that general practitioners and oncologists unnecessarily spend a large amount of time on management and administration. Both indicated that this expenditure burdens doctors and could be better spent on the delivery of health services.

The Australian Dental Association claimed that dental practices are subject to a much higher level of regulatory oversight than medical GPs. Its submission conservatively estimated compliance costs at $397 million in 2016, or $84,400 per practice. The Australian Dental Industry Association agreed. Both groups argued that this burden of compliance makes dentists less likely to be innovative and entrepreneurial, not to mention that they would be less able to treat more patients. Similarly, the time and resources required to navigate and comply with red tape will lead to higher costs of care for patients.

The Pharmaceutical Society of Australia outlines several red tape issues associated with the PBS Safety Net, the PBS authority system and the lack of an electronic prescribing and electronic prescriptions system. But it wasn't all bad news. Medicines Australia acknowledged steps undertaken by the Commonwealth government to streamline assessment processes and expedite access to some priority medicines. Its submission also expressed support for the new provisional approval pathway process that will facilitate the registration of new prescription medicines. However, Roche argued that the process for PBS listing is still unnecessarily complex and lengthy. It particularly argued that there were opportunities to reduce the number of submissions and resubmissions to the Pharmaceutical Benefits Advisory Committee for reimbursement of new medicines.

The committee also looked at red tape surrounding private health insurance. Private Healthcare Australia indicated that one of the most frustrating red tape issues is the prohibition against health funds funding out-of-hospital care, arguing that this prohibition is no longer practical or appropriate. The example was given of someone who has surgery for cancer—in hospital, for which cover can be provided. But the remainder of their care, including chemo, pathology and imaging, occurs out of hospital. Health insurance is prohibited from covering the co-payment for this. This leads to people facing huge out-of-pocket costs. The same applies to pregnancies. Insurance cover is permitted for the birth in hospital but not for any out-of-hospital care. This is leading to people going to hospital unnecessarily in order for the costs to be covered by health insurance. One of the committee's recommendations is that the Department of Health investigate allowing private health funds to fund out-of-hospital care.

On prostheses, the committee heard how unnecessary regulation is adding significantly to costs. Although steps are being undertaken to improve this, the committee is not convinced that either consumers or industry players benefit from government intervention in the prostheses market. Provided that there remains general oversight of product safety and efficacy, leaving the rest to a free market would seem likely to result in reduced costs and better patient outcomes. The committee recommends that the government considers ceasing regulation of the prostheses market, apart from maintaining standard consumer protection.

As is regularly mentioned in examinations of red tape, duplication of regulation is a significant area of concern. The committee heard how dentists are subject to regulatory inconsistencies and compliance challenges. For example, on teeth whitening products, the ACCC, the TGA and state health departments each try to tell them what they can sell. On infection control, they are subject to duplication involving the Dental Board of Australia as well as state governments, with inconsistencies and duplication having no benefit to anyone. Some submitters and witnesses contended that red tape and the provision of health services could be significantly reduced with up-to-date digital technologies. They pointed to multiple opportunities for this, beginning with electronic prescriptions. Even when processes are digital, this results in the 'bizarre' situation where doctors and other professionals are issued with multiple identifier numbers for practice purposes. The committee cannot perceive any logical reason why healthcare practitioners should require multiple identifiers. As part of digital reform, the government should streamline these to reduce the red tape burdens that they create.

On clinical trials, the committee heard that there was substantial scope for increasing consistency for obtaining ethics approvals, particularly for trials across multiple sites and institutions. The committee considers that by standardising and harmonising the ethics approval process governments could reduce the red tape associated with clinical trials.

On diagnostic imaging, the committee heard there was excessive red tape at the state and territory level, which results in a compliance burden for suppliers and health-care professionals. For example, in most jurisdictions in Australia dentists are required to purchase two sets of licences with respect to radiation machines: one to own and possess the machine and the other to use it. The same duplication applies for class 4 laser equipment—one to possess and one to use. The committee recommends the government place licensing requirements for the supply, ownership and operation of diagnostic equipment on the agenda for consideration by COAG.

The Australian government's 2013 deregulation agenda aimed to reduce excessive, unnecessary and complex regulation to lift productivity and boost growth. The committee supports this objective but has found that excessive red tape continues to affect health services. It is telling that the government has not published red-tape savings in the health portfolio for a couple of years. So perhaps the most important recommendation of the Red Tape Committee is for the red-tape reduction reports for 2016 and 2017 in the health portfolio to be published without delay. I seek leave to continue my remarks later.

Leave granted; debate adjourned.