Liberal frontbencher Peter Dutton.
Liberal frontbencher Peter Dutton. AAP

Opinion: Peter Dutton defends Medicare co-payment

IT IS often been said that a society is judged by how it treats its weakest members.

It may have been with a similar notion in mind that our world-class health system first became a reality.

It was therefore with a sense of great duty that we began to consider how we could reform Medicare so that it could go on serving this purpose; so it could survive in the face of a changing world, where the rising incidence of chronic disease and the growing cost of cutting edge medicines were threatening Australians' ability to afford it.

We set out with a clear goal in mind: to work out a way to modernise, strengthen and improve Medicare so it didn't collapse under its own weight.

The 2014-15 Budget was prepared in the shadow of some concerning facts: $123 billion in Labor deficits and gross debt heading towards $667 billion.

There was a regrettable yet unmistakable symmetry with the nation's health expenditure.

Ten years ago, we were spending $8 billion on Medicare.

Today we are spending around $20 billion. In that time, spending on the Pharmaceutical Benefits Scheme has jumped from $5 billion to $9 billion.

Former AMA president Dr Steve Hambleton acknowledged the challenge, when he said: "It is true that if we don't make a change, the trajectory is really unsustainable." (Source: The Canberra Times: 23 May 2014).

On the path that Labor had charted, our universal health care system was in grave danger, potentially undermining the access to subsidised medicines and treatments that Australians take for granted.

Along the way, the core precepts of Medicare also appeared to have become somewhat lost, if not perverted into blatant contradiction.

A scheme that was designed to protect those who were unable to support themselves had become, in some cases, a tool with which GPs could gain market share, and poach patients from the surgery or clinic down the road.

The Government had no choice but to act; to have done nothing would have been to jeopardise unacceptably our ability to deliver quality health care to Australians most in need.

But let us make one thing clear. Contrary to what you might have heard from our political opponents, we have not cut funding.

One look at the budget papers will show you that the Health Budget is growing by around $14 billion over the next four years, from $64 billion in 2013-14, to $78 billion by 2017-18.

Furthermore, we are boosting funding to the States and Territories to run public hospitals by 36%, or around $5 billion over the next four years.

Funding to the PBS will grow by around $1 billion over that time, while funding to the MBS will have swollen by $3 billion a year.

To support the Government's considerable effort to ensure the long term sustainability of our health system, we've asked that all Australians make a small contribution to the cost of their own health care.

From July 1 next year, patients are asked to contribute $7 for previously bulk billed visits to the GP and for out of hospital pathology and diagnostic imaging services; $5 of which goes towards our visionary new $20 billion Medical Research Future Fund and $2 goes to the doctor.

It is important to note that we are retaining bulk-billing, meaning that doctors remain free to charge patients as much or as little as they see fit.

Children under 16 as well as concessional patients, of whom there are 8.6 million in Australia, will have the number of times they are charged a co-payment capped at ten.

After that they revert to current bulk-billing arrangements.

And we are protecting those with high health needs by simplifying the Medicare Safety Net and lowering thresholds.

It is important to point out that our approach is by no means the result of an ideological agenda - far from it. In fact Bob Hawke - who led the Labor Party before it lost its way - introduced a co-payment in 1991, following advice from current Labor front bencher Jenny Macklin.

At the time Hawke said, "It's very difficult to suggest that a co-payment of $3.50 [around $6.40 in today's dollars]...is going to create great hardship." (Source: Bob Hawke, Quoted in: Hawke Surprised By Budget Reaction, Michael Gordon, Sunday Age, 25 August 1991).

More recently, Andrew Leigh, the most academically qualified economist in Labor's ranks (and now Shadow Assistant Treasurer), said, "…the ideal model involves a small co-payment - not enough to put a dent in your weekly budget, but enough to make you think twice before you call the doc. And the idea is hardly radical." (Source: Andrew Leigh (co-written piece), SMH, 14 April 2003).

It is rare to see such consensus across the political divide; however, not unexpectedly, the current crop of Labor leaders is opposing this necessary reform, for the purpose of opposition itself.

Unfortunately, many other important health initiatives have been lost in the noise too, such as the significant jump in the number of Commonwealth funded GP training places, the $52.5 million in grants to regional and rural GP practices, and the expansion of the national bowel cancer screening program.

And there is the Medical Research Future Fund I mentioned earlier; the net earnings from which will serve as a permanent revenue stream for world-leading Australian medical research.

Once the Fund reaches maturity, the earnings will provide an extra $1 billion to medical research every year.

It is an initiative our country should be immensely proud of.

We are going to be leading the world in working towards cures to our worst and most debilitating diseases - and it is only possible because of the structural reform we are making to our health system now.

Generations of Australian families to come will need access to the quality health care that we enjoy today. However, if Australia is to have an effective health system in the decades to come, we need to rebalance our spending immediately.

The biggest change to the original intention of Medicare since its inception is not the introduction of a co-pay, as Labor would have you believe. Rather it is the steady growth in bulk-billed or "free" services (which are of course, not free at all, but funded by the taxpayer), which is undermining the sustainability and therefore the universality of the system.

Turning a blind eye is simply not an option.

I urge Australians to turn their attention to the finer details of our proposal and to make up their own minds.

This is a Budget that puts health in Australia back on a sustainable footing and sets Medicare on a sure path for the future, so that it can continue to serve all Australians and, perhaps most importantly, the most vulnerable among us.


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