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Wednesday, 25 March 1998
Page: 1580

Mr ZAMMIT (5:46 PM) —I am very pleased to enter this debate on the Health Legislation Amendment (Health Care Agreements) Bill 1998 . When Medicare was introduced in February 1984 it was heralded as the solution to Australia's national health care funding. Medicare would give universal access to free or subsidised medical care and free hospital treatment to all Australian residents. Financial assistance to the states and territories for public hospitals and other health services would be provided by the Commonwealth conditional on the state or territory entering into an agreement in force under section 24 of the Health Insurance Act 1973. Private medical cover would still be an option for those wishing for a wider choice of medical specialists, hospitals, et cetera. Initially, despite all the critics, this two-tiered system of medical care worked reasonably well when compared with health care systems throughout the industrialised world.

However, over the past decade or so a dramatic decline in the number of people contributing to private health insurance cover and the increasing number of Australians now turning to the public health system for their medical needs has placed an ever increasing burden on Medicare to the extent that the states and territories are now demanding a greater level of Commonwealth funding. The current Commonwealth, state and territory agreement on funding was negotiated in 1993 and ends on 30 June 1998. That is only a few months away so it is essential that a new agreement be reached as quickly as possible.

Up until now, state and territory health ministers have refused to accept the offer on the table. Can they be blamed? For a start, under the existing five-year agreement and also under the previous agreement the federal government has repeatedly failed to honour trigger points in relation to private health care insurance. The Commonwealth has not increased funding to the public hospitals despite an undertaking in the agreements to review funding each time private health insurance coverage fell by two percentage points. Private health insurance coverage is now at its lowest level ever, with less than one-third of Australians currently contributing to health care funds. Unless the Commonwealth government can come up with a more convincing incentive than the current tax concessions, the numbers will continue to decline. With the decline in health fund membership, two reviews of medical funding have been carried out but the Commonwealth has failed to make any additional funding available to the states.

New proposals put forward by the Commonwealth again offer automatic adjustments for any further decline in the coverage of private health insurance in any state or territory, taking the form of an extra payment of $83 million a year for every percentage drop in the numbers in private health coverage from June 1999. But can state and territory ministers trust the Commonwealth to keep to that arrangement this time? It has not done so in the past. However, at issue is not only what might happen in the future or whether the Commonwealth will honour its arrangements in the new agreement. What is vitally important and what must be addressed is that the states badly need additional funding now in order to met rising health costs and the unacceptably high public hospital waiting lists. At present under the new agreement offered by the Commonwealth, the states and territories are being offered a total of $30.17 billion over five years, an increase of $4.17 billion over the previous five-year agreement. The states and territories are united in claiming that that is not enough and have asked for $34.5 billion. The Commonwealth's refusal to consider any further increases on the $30.17 billion led, as we all know, to a walkout of the state and territory premiers at the recent Premiers Conference on 20 March. There is little doubt that the states and territories have some justification in holding out for increased funding. Since 1993, one million Australians have deserted private health care funds, costing the states and territories an estimated additional $622.5 million per year. That money has to come from somewhere.

The states and territories have presented a convincing case for extra funding and there is ample evidence that public health is suffering because of inadequate funding. One only has to turn on the radio or TV to learn that cuts have already been made to the provision of health care services and that many hospitals have had to close wards because there is simply not enough money to keep hospitals running at maximum capacity. I will be talking about that a little later with regard to one of my local hospitals.

Hospital administrators are having to continually reshuffle funds from one area to another in order to meet costs. This is just not good enough. If Australians are to have a level of public health care that is second to none then increased Commonwealth funding must be made available to meet changing circumstances, such as an increase in the number of people using the public health system, and to cover the rising costs of providing and operating these services.

As a consequence of these cuts and closures, many non-urgent or elective surgical cases have had to be postponed and public hospital waiting lists are growing at an alarming rate. Perhaps most affected by the lengthy waiting lists are the frail and elderly. This is the sector of the population which most often relies on the public health system and is the sector that can least afford to take out private coverage. I cite one example of an elderly couple living in my electorate who, incidentally, have been with MBF for over 35 years. In 1998 they are faced with an annual premium for their private health coverage of $2,261.40. How many pensioners can afford that? Yet they have told me that they will continue to do without life's little luxuries in the twilight of their lives to meet this premium because they are afraid that, when they fall ill, our public health system will be so underfunded that they may have to wait an inordinate amount of time on a hospital waiting list.

To relieve the burden on the public health system the Commonwealth government must come up with an incentive that induces large numbers of people, especially large numbers of young and healthy individuals, to again look favourably at private health care coverage. Tax incentives, when they are more or less completely negated by increases in health fund premiums, do little to encourage people to consider private health as a viable alternative to public health. Until this occurs, the pressures on the public health system in this country will be immense, and the states and territories face an uphill and constant battle to make ends meet. The Commonwealth government must increase the offer currently on the table to ensure that all Australians, not just the rich who can afford to pay for private health care, have access to an efficient and adequately funded public health system commensurate with their needs.

The major concern I have, however, is with the Commonwealth's attitude to the whole issue of health—an attitude that suggests it has firmly decided, as I make it out, against any major changes to a fast-declining health care system. There is no doubt the present system is crumbling. The only way forward is to look at new funding arrangements and to rule nothing in or out. Sticking to the present system is a recipe for disaster. I believe all Australians expect as a basic right subsidised, private medical services and free public hospital care.

I also believe that our fellow Australians are realistic enough to understand that these expectations come at an extremely high cost and, in fact, things may well be at the stage where the continued funding is becoming beyond budget affordability for several reasons, not the least of which are the following three. Australians are living much longer. High tech medicine is increasingly effective in dealing with the ailments of patients, but is also proving to be highly expensive. Thirdly, medical litigation is on a substantially increasing curve. The costs of medical immunity have grown exponentially. These costs are, quite understandably, passed on, resulting in huge increases in fees and charges.

The largest group by far that are deserting private health cover are, as I said earlier, the young men and women who see little need to be privately covered until they reach their early fifties. There is no incentive for them to take out private health cover at this stage in their lives. What incentive does the coalition government provide to keep them in or to encourage them to join private health funds? Not a great deal.

The less than 32 per cent of Australians who are privately covered are increasingly the sick and the elderly. We are heading for a brick wall at an increasingly fast rate and, unless remedial action is taken now, the crash will come and the poor suffering taxpayers will have to pick up the tab. But I fear that tab may well be beyond the reach of any government, and hence beyond the reach of taxpayers, resulting in an increasingly two-tiered health care system: one for the well-off and rich and the other for the average Australian battler. The clock is fast approaching midnight.

As I said earlier, I want to make a passing reference to one hospital in my electorate, Concord Hospital, formerly the Concord Repatriation and General Hospital. It is very close to the Olympic site and is increasingly being referred to as the `Olympics hospital'. The problems at that hospital are very substantial indeed, and I must pay tribute to its administrators for having succeeded in doing a very fine job for the local community under increasingly difficult conditions especially because of the cutback in funding to this hospital, which is one of the finest teaching hospitals anywhere in the state of New South Wales. Frankly, I fear for that hospital because it has proven to be a hospital greatly needed by the local community especially as a result of the closure of the old Western Suburbs hospital on the Croydon Park site.

Prior to the 1995 state election a commitment was made by the then state coalition government that a new hospital would be built on the Croydon Park site. On or about 2 February—from memory—just prior to that state election, work had begun on building on that site a new, high-tech hospital, which was absolutely vital and needed. I well recall the work that had commenced. I recall the bulldozers going in to remove the old hospital site buildings that had become virtually useless. The time had come for a new high-tech hospital to be built. The state coalition government at the time had signed an agreement and work had begun on the site. I believe, as I have been informed by the excavators, that one million tonnes of earth was removed from that site after work had begun. The concrete foundations had been laid for the underground car park, and I can still visualise the work that had begun, including the concrete walls that had gone up.

Immediately after the state election, the incoming Carr government had the choice of one of two things: either to proceed with the building of that hospital at the Croydon Park site or to update and make more efficient the buildings of the Canterbury Hospital. Because of political reasons—there is no doubt of that in my mind—the fact was that the Carr Labor government decided that they were going to build on the Canterbury Hospital site. There is equally no doubt in my mind that, had they had the money, had it not been a choice of one hospital or the other because of the lack of funding, they would have continued with the building of that high-tech hospital at the Croydon Park site. In fact, here we are now almost four years later and the old Western Suburbs hospital site is a barren block of land. It is fenced off and it is just lying there. That is a great tragedy, but that is the effect of what has occurred in regard to the problems we have in funding in health care.

I want to conclude by saying that the coalition government have tried. There is no doubt that they have offered incentives, they have tried, but the system that has been put in place is just not working in modern day Australia. We have to look at alternatives, we have to look at a new way of doing things. There are many proposals that have been put to the government, some of which I find can work, given a chance, provided that there is an open mind that is put to dealing with the problem that we are all going to face increasingly as time goes by.

I will not vote in favour of the amendments proposed by the opposition because I want to see what the government is going to do when the budget comes down. I also want to see what new policies are going to be proposed by the coalition government in trying to resolve what is admittedly a very difficult issue but an issue that needs to be grappled with, and grappled with sooner rather than later.