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Monday, 10 April 2000
Page: 15602


Ms GAMBARO (6:10 PM) —I rise tonight to speak on the Health Legislation Amendment (Gap Cover Schemes) Bill 2000. I am very happy to be speaking on yet another forward initiative of this government in the area of private health insurance.

I seem to follow the member for Latham quite a lot. I do not disagree with a lot of what he says: there is cost shifting, there are problems in the system, there are areas that are duplicated at a federal and state level and it is a health system that perhaps does not match its resources in the best possible way. These are problems that have existed for many, many years, and many governments have grappled with them on many occasions, including the member for Latham's government.

There are crazy situations that arise in health—for example, in Queensland, where major hospitals are opened and there are no patients. It is like something out of a Yes, Minister serial. A major teaching hospital in my electorate, the Prince Charles Hospital, is the leading cardiac hospital in the Southern Hemisphere but it does not have an MRI machine. Currently, the administration of that hospital is talking to the state Minister for Health, Wendy Edmond, about that situation, and I will continue to lobby for an MRI machine in that hospital.

The situation is that we do have the best health system for the most affordable price. I know the member for Latham is a well-known economist and he quoted the work of Scotton, who has dealt extensively in this area, but the system is supply driven. There is nothing that we can do that can stop the supply. People still go to their GP for a variety of ailments. I thought I understood health until I became involved with someone in the medical profession a few years ago. There are people out there in the community who will go to a GP just to get a bandaid for a cut on a finger, so to not look at supply and demand is clearly a mistake when we encounter this debate.

The bill tonight looks at a number of consumer and health industry issues, and I will touch on those in a moment. I would like to point out that this government has done much and achieved more for average Australians in terms of accessibility of private health insurance than has been achieved in the history of the health insurance industry in this country. The bill complements a lot of other good measures undertaken by this government in the area of private health insurance, and the 30 per cent rebate and the move to Lifetime Health Cover are examples of this government's commitment to better value health insurance for consumers and a strong and viable private health insurance system.

The bill is particularly significant in that it vastly increases the choices and options available to private health consumers. This is the first time that legislation has been introduced to formally enable a non-contractual agreement between doctors and health funds on pricing and payment strategies for dealing with the gap. The most common health issue that my constituents come to see me about is the gap. The fact is that they go in to have a major operation and do not know how much gap is involved, and then they get a multitude of bills from the hospital and receive a huge shock after they have had their operation. I think this bill goes a long way to deal with a lot of those uncertainties and a lot of those fears that people face at the end of an operation.

Indeed, valuable contributions towards addressing the gap cover issue have come from a number of private health insurers, hospitals and the AMA. It is a great example of what really can be achieved when industries get together and work with the government to facilitate and improve delivery of services to the consumer.

The bill also provides for an extensive range of health funds to develop their own gap cover schemes as well as to tailor gap cover schemes to suit individuals—a measure which vastly increases the choice to each private health cover consumer. The gap schemes are voluntary and ensure no inflationary impact—that is, they do not provide for open-ended reimbursement of medical fees, nor do they increase the total cost for consumers. Most importantly, the interests and the welfare of consumers are completely safeguarded. In fact, all gap cover schemes will need to be approved by the Minister for Health and Aged Care before they can be implemented, and that ensures that they will remain fair and genuine in their benefits to consumers. Other ways in which the aims and intentions of the gap cover bill are safeguarded are in the balance and the fairness to the consumer, the industry and the medical profession. They will generally deliver no gaps or, if chosen, known gaps to consumers, and that is very important.

The member who spoke previously spoke about the role of the GP in this. I think the GP has a very valuable role to play in ensuring that patients know what costs are incurred when they are admitted to hospital and that they have full financial consent and full financial information relating to those costs. It is not uncommon to hear in my electorate about someone with the top level of cover in private health insurance going in for heart surgery and having to pay a bill of $30,000. In fact, I was speaking to the Mayor of Redcliffe some months back when he told me how much his heart surgery cost him. Those situations will no longer occur under this legislation. People will have financial consent. They will be able to make a decision to go to those particular doctors who have no-gap products, and they will have greater choice available to them.

The provisions contained within this scheme will ensure that, in the event that the scheme is revoked by the minister, the consumers are in no way disadvantaged. Also, the scheme requires medical practitioners to inform private health insurance consumers of any amount that they will be liable to pay for a professional procedure. That is a very important part of the doctor-patient relationship and should never be compromised as well. Patients should be informed of how much their operation or procedure is going to cost them. Doctors currently do that. They currently advise patients of specialists who do charge the prescribed amount and no more. It already exists, but I think this bill will provide greater scope for that to occur.

The scheme also provides for simple billing arrangements and streamlining of an individual's claim procedure by providing one bill for all-in-one hospital cost. It is not unusual for people to go into hospital and be presented with 50 bills. It is pretty horrifying. Even when you go into hospital for a minor operation, you can have something like 10 or 15 bills by the time pathology, X-rays, pharmaceuticals, et cetera are sent to you. It can be daunting. Just when you think you are over one hurdle—paying one amount to the radiologist—another bill will come in and set you on that sort of horror train of more financial imposts. Perhaps most importantly the schemes will be reviewed at regular intervals to absolutely ensure that the above criteria are adhered to, and the minister has the power to revoke any scheme that is not delivering a better method and better outcomes to patients.

The bill will also provide the best deal for average Australians who have, or would like to take out, private health insurance, and the bill is good for medical practitioners as well. The issue of gap cover has been, to date, a problematic one, and it has been a problematic one for a number of sectors, including the medical profession. However, this bill ensures that all gap cover schemes maintain and guarantee the professional freedom of medical practitioners, and that freedom should never be compromised. Indeed, since we made amendments back in 1997 whereby doctors could come to contractual arrangements on hospital based gap cover, the number of patients being covered by gap products and the number of hospital admissions being covered by gap products has increased by approximately 25 per cent in the December quarter of 1999 alone. This bill is a further improvement on these existing arrangements.

The gap has long proved to be a thorn in the side of the private health insurance industry and is the single most important factor in the public perception of private health insurance as not value for money. Quite often, members of parliament deal with constituents who question that value for money, and I think that this legislation goes a long way to addressing some of those particular problems. Consumers essentially want no gap, or at least they want a known gap, in return for their insurance premiums. The continued existence of the gap is the major cause of complaint about private health insurance, and it has been the major cause of complaint of my constituents over the last four years. It particularly occurs when there is a requirement to pay and it is not realised by the patient prior to the receipt of the bill for services. This difficulty has obviously impacted on the participation by the general population in private health insurance. National private health insurance coverage has fallen from 61.5 per cent of the Australian population in 1983 to just over 30 per cent in December 1999. That was an alarming drop and it needed to be addressed because the increasing number of people who drop off from private health insurance places a greater demand and a greater stress and strain on the public system. We need to address those issues.

Each year, private health insurance contributes around $3 billion in hospital benefits, and the private sector cares for about one-third of all hospital patients annually. It is clear that private health insurance plays a crucial role in funding the hospital system in this country. It is not an area that we can allow to fall behind, and the Labor Party let it fall behind with disastrous results. Any fall in the proportion of people covered in the private health system—a fall such as we experienced under Labor—has far-reaching implications for the Australian health system as a whole. The Howard government has sought to turn this tide around with significant results; the participation rate has begun to rise again, and that is a good thing. With the introduction of the initiatives of the 30 per cent rebate and Lifetime Health Cover, the government has put private health cover back on track. The bill seeks to enhance and improve upon that record. It is also designed to make private health insurance good value for money again. It makes it transparent, streamlined and up front, and it represents the government's hard work and absolute commitment to a robust, fair and efficient health insurance industry.

There are problems in the health system; there are problems of resources and there have been from time immemorial. There are problems with federal and state governments. There are problems of cost shifting, as we spoke about earlier, and they need to be addressed in time. There are a number of programs that are duplicated. But there are times when federal and state governments can and do work together well. I had an opportunity recently to launch a domestic violence initiative that came under this particular portfolio area where the federal government provided the funding and the state government was able to implement the program, which dealt particularly with young children and the effects of domestic violence on them.

The health system is the best health system when one compares it to those in many other countries in the world and their difficulties and lack of resources. One of the things that people do not realise or perhaps are not informed about is the cost of pharmaceuticals. They feel it is a free health care system and that pharmaceuticals, for example, are free as well. A number of my constituents are quite amazed when I speak to them about the cost of pharmaceuticals, the fact that the government picks up the tab for pharmaceuticals and that they are not solely costed at $2.60—for example, some heart and high blood pressure tablets can cost up to $100 and the government picks up the tab for that under the best pharmaceutical benefits scheme in the world. Our drugs are 30 per cent to 40 per cent cheaper than anywhere else in the world.

One should not lose sight of the great health system that we do have. We have an affordable health care system. Anyone today can go to a GP and take advantage of the bulk-billing system. Sure, it is abused. There are cases where people do doctor shop. They do abuse medications. I know that before the prescribed minimum amount of pharmaceuticals was brought in there were members of the community—and this occurred largely in the aged population—who would go to the chemist for their free pharmaceuticals and stockpile them. The pharmaceuticals would run past their use-by date and there was a tremendous waste of resources in stockpiling pharmaceuticals that were never ever used. It was a problem.

We have a good health care system. We have a health care system that is available for all people—the Medicare system and bulk-billing. We have a great pharmaceutical system and integrity of GPs. I must also commend the minister for the training initiatives, particularly in the GP area. The profession asked for those particular initiatives and we delivered them, and the quality of training of our GPs is one of the highest in the world and we are recognised as leaders in the medical profession universally.

This bill represents the government's hard work and absolute commitment to having that robust, fair and efficient private health insurance industry. It will mean that the private health industry and people who have private health insurance do get value for money. It will make sure that they have a known-gap product, that they know what they are going to pay when they go into hospital. The GP also has a valuable role in this in providing informed consent and providing assistance in letting patients know just what that gap or what those medical expenses will be, and that will mean that there will be greater peace of mind. I know that this private health insurance bill that I speak to tonight will provide a fair and more efficient system. I commend the bill to the House.

Sitting suspended from 6.26 p.m. to 8.00 p.m.