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Wednesday, 4 March 1970

The more important decisions I have announced represent the outcome of the Government's detailed consideration of the Nimmo Committee's report. At the same time they represent the culmination of the most carefully planned and comprehensive programme of reform of the health benefits system that has ever been carried out in Australia. This programme has been undertaken in pursuance of the Government's conviction that a plan based on voluntary insurance is far more likely to satisfy the needs of the Australian people than any alternative plan based on compulsory levies. Experience in other countries has demonstrated that a substantial degree of patient participation is necessary in a soundly based, economically operated plan. Patients must be personally identified with the plan and carry a degree of personal responsibility if the plan is to have any effective inbuilt cost controls - controls which are absolutely essential if we are to be protected against over-utilisation and over-servicing which has been common to so-called free health schemes in countries where such schemes exist.

Although patient participation is essential in order to provide some brake on costs, it must be arranged in such a way that noone in the community finds the costs of medical insurance or the costs of actual medical treatment unduly burdensome. Under our plan, each individual in the community who is able to do so shares the . cost at two points. He can insure himself and his family against the costs of medical and hospital treatment by contributing to a registered fund and, when he needs a medical service, will meet a small portion of the cost of the doctor's charge. At the same time our plan, although recognising these essential ingredients, includes them in such a way that the less fortunate amongst us are relieved of all or portion of the cost of the insurance contributions and no person, irrespective of his financial position, will have to meet more than a relatively small proportion of the doctor's common fee.

The Government believes that any arrangements whereby contributions by- the community are payable solely through taxation or by any method related to taxation result in the individual ceasing to recognise his contribution as a personal share of the cost of a particular service. In time he tends to regard it merely as part of his overall payment of Government revenue by way of direct taxation. A situation can also arise in which medical resources are at times misdirected and in which the correct priorities of medical treatment are not achieved. We are convinced that a scheme financed in that way would in the long run inevitably be more costly and less satisfactory than a scheme where the mem-, bers of the community assume personal responsibility for the payment of their contributions to- a non-government body operating under incentives for- efficient and economic service.

The Government believes that participation in a welfare measure of this kind, however valuable and desirable that welfare measure is to the individual, should be on the basis that the individual makes a personal and voluntary decision as to whether he wishes to take up that welfare assistance or not. For this reason, the new medical benefit scheme will continue to be based on the voluntary concept. In addition, of course, the Government is insistent that the patient be free to seek treatment by the doctor of his choice.

Any medical benefit arrangement depends on the co-operation of the medical profession and without such co-operation no medical benefit arrangement would work. My Government confidently looks forward to the general co-operation of medical practitioners in this country. There have been some difficulties and others will arise, but these difficulties are not basic to the overall architecture of the new arrangements and are capable of solution within the general framework of our health benefits plan. Notwithstanding what I have said, the Government fully realises that the profession must remain aware that it has a tremendous obligation under any medical benefits arrangements. The report of the Nimmo Committee made this point very strongly.

The Government has based its new medical benefits structure on the concept that doctors' charges can be the subject of a reasonable degree of uniformity and stability on a voluntary basis. The recognition of such a concept - that is, uniformity and stability - is believed to be the only way in which a medical benefits scheme can be made work, but of equal or possibly of greater importance is the need for the profession itself to recognise the concept and, by so doing, enable the people of Australia to be adequately protected against costs of medical treatment. These, then, are the fundamental concepts on which our health benefits plan has been developed. But sound principles and concepts do not in themselves constitute a plan and the Government has in these past two years accorded a very high priority to the task of translating the principles in which it believes into a practical, modern, health benefits plan tailored to to-day's needs in the Australian community.

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