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Wednesday, 14 September 1983
Page: 743


Dr KLUGMAN(12.5) —I suppose it is not a great secret that I have some reservations about the Medicare proposals. My reservations are exactly the opposite from the predictions of the shadow Minister for Health, the honourable member for Mackellar (Mr Carlton). I think exactly the opposite to what he predicts will happen. He predicts that there will be socialisation or nationalisation of the health care industry, doctors, et cetera. I think exactly the opposite will happen. In fact, my main reservation about the proposal is that it enshrines private fee for service medicine which, I hope to illustrate a little later, is not good not only for ideological reasons but also mainly for medical reasons. The shadow Minister's remarks contained massive contraditions which were repeated again and again.

The first point I would like to take up with him, because it is the main point that has been pushed in the Press, is the alleged loss of 5,000 jobs in the private health sector and the implication that those jobs will disappear altogether and 5,000 more people will be unemployed. To me it is a sort of Alice in Wonderland situation that the honourable member for Mackellar, who was trained by McKinsey and Co. Inc. to be a good manager in a capitalist society, attacks us for introducing greater efficiency causing job loss. I am afraid that I do not share his belief that government enterprise is necessarily more efficient than private enterprise. The total number of jobs in the health industry will probably be similar or even greater after the introduction of Medicare.

On two occasions during the shadow Minister's speech the honourable member for McPherson (Mr White) by interjection attacked what he sees as a conversion of doctors to Public Service status. It was interesting to hear the honourable member, who as I understand it comes straight from the Services, attack the Public Service status of doctors or of anybody else. It reminds me of President Eisenhower, who had a similar career, although possible on a more exalted level, in both the Services and politics, but the honourable member for McPherson is younger. When President Eisenhower had put to him propositions similar to the ones being put in this legislation he took a similar line in favour of private medicine. Yet President Eisenhower and his wife had always been treated by Army or veterans' affairs doctors. His father was a full time officer. He lived with his father and received treatment from Army doctors. From there he went to the West Point Academy and he went on to receive medical attention continuously from Army and veterans' affairs doctors. When he was President and made that statement he had a full time doctor attached to his staff. He had never paid a cent for health services. His statement was utter hypocrisy.

On the subject of public funding, I can give honourable members a similar example of hypocrisy which arose during the last few weeks. The current President of the United States of America, President Reagan, took $31m of public funds for his election campaign and then came out strongly in opposition to public funding. When he had to hand in his tax return he showed in television that he had crossed off the option of having $1 of his tax go towards public funding, but he was perfectly happy to accept $31m towards his election to the position of President. As I said earlier, my main reservation about the introduction of Medicare is that it enshrines fee for service medicine which, to my mind, is bad not only for ideological reasons but also, more importantly, for medical reasons. It brings about excessive surgery and excessive treatment. We get all kinds of excesses. With due respect to my colleague the honourable member for Capricornia (Dr Everingham), we get orthomolecular medicine and like developments in which doctors will send patients for a complete review which will cost $600 or $700. It does not cost the patient anything and the doctor collects his money from the Government. There has to be some restraint on the part of the patients. There has to be a patient moiety which I may mention in a minute.

In passing, I refer to the long waiting time, allegedly, in the United Kingdom for surgery. This is, of course, for elective surgery, surgery for such things as tonsillectomies. When I was in the United Kingdom having a look at its system I found that what was happening-I am not necessarily defending its system, as will become clear later-was that when a child had enlarged tonsils he was automatically put on a waiting list at some hospital. There would be a waiting list of some 600,000 kids for tonsillectomies. What is important is that, because they were non-urgent cases, by the time they reached the point when they could be admitted for a tonsillectomy it was no longer necessary. The important point with much of the elective surgery is that it is not necessary. The situation is similar to that pertaining when the shadow Minister for Health was a Minister. In many cases he did not answer letters straight away. If he waited a couple of weeks or even six weeks there was often no need to get involved in a brawl because the problem had solved itself. It is exactly the same in medicine.

My rather cynical view on surgery is best expressed by one of my favourite cartoons in which a doctor says to a patient: 'I am afraid the trouble is your appendix'. The patient says to the doctor: 'I would like a second opinion'. The doctor replies: 'It could be your gall bladder'.


Mr Hunt —But we will take it out anyway.


Dr KLUGMAN —Exactly, one after the other. The only advantage of asking for a second opinion is that only one of the organs will be removed immediately. We can look at some examples of unnecessary surgery. I have the most recent example from the Sydney Morning Herald of 10 January 1983, which gives figures which compare rates of elective surgery in different areas in New South Wales. One gets fantastic variations. We know already that for the whole of Australia surgery rates are much greater than they are for most comparable countries. I come back to the gall bladder operation, the cholecystectomy. Generally medical students are told that the most common candidate for cholecystectomy is a woman who is fat, fair, fecund and forty. Apparently those kinds of people predominate in the Wollongong area of New South Wales. There is a huge difference between cholecystectomy rates in Wollongong and in other areas. In the Wollongong area it is four times the rate of some other areas in New South Wales. It would be interesting to see whether the congregation of people needing such surgery is so much greater in the Wollongong area.

Let us look at the figures for the United States of America and compare the situation of people who have private insurance, Blue Cross insurance, where a doctor is paid on a fee for service basis, with that of patients who are insured with a health maintenance organisation, where a doctor does not get paid on that basis. If one compares similar patients of similar ages, similar backgrounds, similar occupations and similar medical histories one gets a factor of 3 and 3.4 for such operations as hysterectomies and back operations. One gets huge differences which can only be explained by the doctor's attempt, conscious or otherwise, to get more money by performing certain operations where he is paid on a fee for service basis.

We have had debates on this matter before. I think the honourable member for Gwydir (Mr Hunt) and the honourable member for Warringah, also is at the table-I am sure this would have included the shadow Minister for Health had he stayed long enough as Minister for Health-accepted many of my propositions which they probably did not accept when they first took on the job of Minister for Health. I see they are nodding. The medical profession is no different from other professions in trying to increase its income. That applies also to lawyers. I am sure the people who are performing before or as royal commissions on a daily fee basis are not particularly keen to finish off the job terribly quickly. I have not heard from Mr Costigan that he wants to stop his inquiry. I do not think that we will hear that for some considerable time, judging from the rate at which he is being paid.

Let me deal with the Australian Medical Association, especially its New South Wales branch, which is a particularly reactionary body. I do not wish to give the Federal Branch the death kiss but its Secretary, Assistant Secretary and President seem to me to be reasonable people. They are rational people who take a reasonable approach. They support our proposal. The reason they support it, of course, is that it is in the interests of the medical profession and they see it that way. However, people in the New South Wales Branch of the AMA are what in other groups in society one would consider to be rednecks. Last week I received a letter from it in my capacity as a member of the profession, although I am not a member of the AMA. It sent a common letter dated 22 August to the medical profession in New South Wales. Apart from the fact that whoever drafted the letter cannot spell--


Mr Hunt —It would not be George Repin?


Dr KLUGMAN —No, it would not; it is the New South Wales Branch. The letter is from somebody called Dr Godfrey Douglas. He spells health with a double 'l' and publicly 'publically'.


Mr MacKellar —He must have been talking to Doug Everingham.


Dr KLUGMAN —I do not think that the honourable member for Capricornia uses that form of spelling. Dr Godfrey Douglas puts 'greater' when it should be 'lesser' and 'to' when it should be 'too'. I come to the piece de resistance in the letter, which I think got some publicity yesterday in the newspapers. It reads:

In view of the nature and objects of the fund--

This is a fund to fight Medicare-

and the restriction on the use of monies received, we have been advised by the Deputy Commission of Taxation, that 'in the case of taxpayers deriving assessable income from engagement in the Medical Profession, the nexus between the contributions and the income-producing activities would be sufficient to establish entitlement to deductions in terms of Section 51 of the Income Tax Assessment Act'.

Mr Godfrey has obviously had advice from Mr Mike Evans of the National Party in Queensland, who is Secretary of the Bjelke-Petersen Foundation. He told us that we could donate any amount of money to the Bjelke-Petersen Foundation and it would be called advertising. A letter from Sir somebody Sparkes, President of the Queensland National Party, informed potential donors that the Australian Taxation Office would not challenge anybody on whether he was getting value for money for his advertisements, that one could pay $10,000 for a single paragraph advertisement in the National Outlook, the Queensland National Party newspaper.

There is an utter hypocrisy on the part of the New South Wales branch of the AMA and on the part of the Opposition, I am afraid to say, at this stage on gap insurance. They argue, and I accept the argument to some extent, that there has to be some payment by the patient so as to restrict unscrupulous patients and unscrupulous doctors from overusing medical services. The only way one can restrict that is by having some sort of patient moiety. In other words, the patient pays a very small amount, but nonetheless an amount, towards the cost so that at least he has an account rendered to him, which he has to pay. I know that many people on my side of the House disagree with that, but I think it would be a restraining influence. It is quite depressing to me that people on the other side of the House argue for gap insurance. The AMA, which has argued for a moiety all the time, is now putting up notices in waiting rooms attacking the Government for not allowing gap insurance. If one has gap insurance one has no patient moiety. The patient never knows how much it costs to deliver medical services.


Mr Ian Robinson —Do you include pensioners in this?


Dr KLUGMAN —No.


Mr Ian Robinson —Why?


Dr KLUGMAN —Because I just think there are certain people--


Mr Ian Robinson —They are the best watchdogs. Put them in too. Put everybody in.


Mr DEPUTY SPEAKER (Hon. Les Johnson) —Order! I draw the attention of the honourable member for Cowper to the fact that there is only one debate and the honourable member for Prospect has the floor.


Dr KLUGMAN —I wish to make a couple of final points. I have taken longer than I intended to, and I apologise for it. My view is that the subsidy for private beds is excessive. The cost of a private bed-I am now talking about a doctor of choice bed in a public hospital-is of the order of $220 or more a day. Yet we are subsidising the cost of that bed so that the patient has to insure himself for only $80 a day. We are subsidising that patient by some $140 to $160 a day. Therefore we are encouraging fee for service medicine in hospitals because we are making it easier for people to take out private health insurance. My view is that people should not take out any private health insurance at all on top of their entitlement under Medicare.

Finally, I wish to support strongly the separate identification of the health levy on the tax statement. I think this should be done not only in relation to health but also in relation to social security. It should be done for all kinds of benefits. There is a quite ridiculous attitude in the Australian community, which does not relate tax expenditure to benefits obtained. The only way that can be done is if a significant proportion of the tax that one pays is clearly labelled and related to some benefit.

I obviously have no time left to give honourable members my alternative, but I have given it on many, many occasions. I think I do to some extent agree with the proposition that people are motivated by money, and that includes the medical profession. It is just the same as any other group. To be efficient we must have something like the health maintenance organisation in the United States whereby, instead of it being in the doctor's interest to have unnecessary hospitalisation and unnecessary services, the doctor in fact is paying for the unnecessary services and surgery. That is the only way the problem can be overcome. As long as it is in the doctor's interest to do unnecessaary things, as long as it is not in the doctor's interest to have healthy patients, all the concentration on the part of the medical profession will be on treatment and on performing all kinds of services which are particularly well paid. Very little emphasis will be placed by the medical profession on preventive medicine. The only way one can really encourage doctors to go in for preventive medicine is by showing them that it is in their own financial interest to do so.