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Tuesday, 8 March 2005
Page: 19

Senator MOORE (1:52 PM) —I was fortunate enough to be a member of the Senate Community Affairs Legislation Committee, which the National Health Amendment (Prostheses) Bill 2005 was referred to earlier this year. Until that time, ‘prostheses’ was but a term to me. I had heard about the legislation and had read up on it, but when I was given the opportunity to sit with this committee I became more aware of not only the number of people for whom this was an interesting point but also the number of members of the Community Affairs Legislation Committee who had prostheses themselves. They self-identified before the committee started, and I found that particularly interesting. I myself do not have any devices currently, so I can speak with openness on this topic.

In terms of the information we have had, my colleagues in the Senate have talked about the technical aspects of this bill. I want to concentrate on a few points which I think we need to consider when we are looking at passing this legislation. As Senator McLucas mentioned, I have referred to the committee as the ‘committee of hope’ because, whilst we had 12 submissions and a number of people gave evidence before the committee, the one common theme that we heard was that everybody really ‘hoped’ that this legislation would work. Everybody really hoped that there would be some containment of, some acknowledgment of and some improvement in the way this issue was being handled in our community. Reflecting that hope, there was also genuine agreement that what was happening currently was not good. We heard, for instance, from the Australian Private Hospitals Association, which said:

Reform of these existing arrangements is therefore not optional, it is essential.

We heard that it was absolutely critical that we as participants in this government looked effectively at the way legislation would be introduced so that there would be some real understanding of the way the budget would operate and so that the medical profession, the hospitals and all those people who had an interest in this area would be able to cooperate to ensure that we had the best possible system. In the submission from the Department of Health and Ageing—and this was also reflected in the explanatory memorandum to this bill—we heard about the issue of cost. Of course, that is important. The Department of Health and Ageing said:

Prostheses have been identified as one of the major cost drivers of health insurance premiums. Current rates of growth in prostheses costs are estimated to contribute around 2 per cent a year to total premium growth. There was an annual average 29 per cent increase in prostheses benefits paid in 2003-04 compared to 2000-01. Benefits paid in 2003-04 totalled over $647 million.

That is in payment to people who made genuine claims for surgical processes which included devices—and I hope to use that word for the rest of this speech. I only caught that one during the committee hearings. I think I would have used that word much more commonly if I had known that earlier. The expectation is that the new arrangements the changes that are before us are expected to make a significant contribution to reducing the pressure on health insurance premiums by limiting the rapid growth in benefits being paid. The anticipated savings are significant. I believe that they are almost essential in terms of where we are going as a community. But what worries me deeply is that the introduction of the legislation is based on hope. The actual details are not yet clear. In fact, Catholic Health Australia made that comment in their submission, which they followed up with evidence as witnesses to the committee. They said:

Not all of the detail has yet been worked out and we are yet to see what the outcome of the new arrangements will mean in terms of the extent of gap payments that consumers may face.

They went on to say:

Nevertheless we believe that the goodwill displayed by all parties to date and the consultative processes in place should provide comfort to Senate that the Bill should be supported.

I truly hope that the Senate can be comforted by those processes, but it always concerns me as a member of this place when we are asked to agree to legislation when the details are not clear and when we rely on the goodwill of all participants to achieve it. Certainly something that all the people who appeared before our committee shared was goodwill, because there was hope that these processes would operate. Nonetheless, it seems to be a precarious way to move through the process.

Up until now, people in the community having these surgical procedures could have confidence that their costs would be paid for any devices apropriately used in surgical procedures. The change is that there will now be gap payments in some cases. Gap payments are not new to the Australian community. As was submitted to our committee, gap payments are standard in so many parts of our medical system. The real issue here, though, is that up to now there has not been a gap payment for this procedure. Now there will be. We do not know how large the gap will be. That provides a great deal of concern for all those who are part of the industry and all those who feel that they will probably need a device in the future—and it probably concerns the minister. No-one wishes to make significant changes to legislation, including cost factors, without knowing exactly what the gap payments will be. I think that is something that should be more a reality than a hope.

Debate interrupted.