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Medicare: our nation’s greatest gift

By Kim Fischer - 8 July 2016 20

medicare

There is probably no policy that better defines modern Australia than Medicare. First legislated by the Whitlam government in 1974 as Medibank, Medicare guarantees free hospital services for public patients in public hospitals, and provides benefits for out-of-hospital medical services and most notably consultations with GPs or specialists.

Medicare was and is a positive transformational force in Australia, and is unquestionably the primary reason why I am a member of the ALP today.

Medicare has also been the most pronounced and consistent area of policy difference between the ALP and the Liberal party for more than four decades. Ideologically, the ALP believe in the importance of socialised healthcare, while the Liberals do not.

The challenge for the conservative movement has been working out how to reverse the effects of Medicare while claiming to support it, since it enjoys widespread support in the Australian population.

Following the close election result from last Saturday, the Coalition have been crying foul over Labor’s claims that the Liberals planned to privatise Medicare. Yet if we follow the principle that it is more important to judge people by what they do instead of what they say, it’s hard to avoid the conclusion that the Federal Labor campaign was 100 per cent correct. We just have to look at how successive Coalition governments have acted.

In 1975, Medibank commenced under Gough Whitlam. In 1976, Malcolm Fraser systematically dismantled Medibank. First, the government allowed people to opt out of paying the Medicare levy by holding private health insurance. Next, Medibank Private was set up, hospital agreements with states and territories were declared invalid, and bulk billing was restricted to pension card holders.

Finally in 1981, free health care was once again restricted to a small subset of the Australian population holding health care cards or meeting other strict criteria.

The Hawke government reversed almost all of these destructive changes in 1984, reverting to the original model under the new name of Medicare and retaining it with some minor funding changes for the next decade. Yet less than 12 months after Howard was elected, the Medicare Levy Surcharge and the Private Health Insurance Rebate were introduced to encourage people to return to the private health sector. By 2003, columnists in The Age were pointing out that the unrealistically low Scheduled Fees for GPs and incentives to only bulk-bill pensioners were once again undermining the universality of Medicare by stealth.

Post-Howard, it seemed that a strained consensus had been reached that both Medicare and the private health insurance system could co-exist. As one example, Kevin Rudd’s proposed Commonwealth takeover of the hospital system was focused on improving the public health system rather than undercutting the private health sector.

For the 2013 election, the Liberals put out policies that largely matched Labor’s platform, only to spring a completely unforeshadowed $7 GP co-payment on the Australian public the following year. Even after the switch to Malcolm Turnbull, the Coalition has continued to undermine Medicare, cutting bulk billing for pathology tests in the most recent budget.

Given all this, the ALP’s campaign to ‘save Medicare’ from the Liberals not only seems warranted but pretty restrained. I’m genuinely proud to be part of a party that believes in the importance of a strong public health-care system. The ideology of conservatives means that they simply can’t be trusted.

In the UK, David Cameron repeatedly and explicitly ruled out privatising the NHS (the UK’s Medicare equivalent), only to go on to significantly undercut the universality of their system through funding cuts and rationing of hospital and GP services to the public, leading to demonstrably worse care. As another example, the US private health system famously pays twice as much on its largely privatised health care system while having the lowest life expectancy of wealthy countries.

Medicare is not a guaranteed right for Australians. It has been revoked once and it could happen again if we don’t exercise our voting rights wisely.

The legendary writer and historian Harry Leslie Smith described life before public health care at a UK Labour conference in 2014. His speech continues to remind me why the fight for universal health care is still necessary today.

Kim Fischer is an ACT Labor candidate for the seat of Ginninderra in the 2016 ACT Legislative Assembly election.

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20 Responses to
Medicare: our nation’s greatest gift
JC 6:59 am 15 Jul 16

Leon Arundell said :

Now that the election is run & won and we all understand that Medicare is not under threat from the Government, can we please please please review the appalling state of the Medicare payment system? The IT systems that support Medicare are anchored in 1980’s technology that simply isn’t up to task. For that matter can we initiate an IT capability review across the whole of the Federal sector. Since the Public Service chose to in-source IT services late last decade, the only consistency has been the ever decreasing levels of service. If I have to hear another public servant claim, “yeah I like work in IT with all the computers and stuff”, I’ll spontaneously combust. Let’s take this as an opportunity to seriously review, plan and remediate our Federal IT systems and start taking service delivery, such that supports Medicare, seriously rather than playing political pong with the issues. The taxpayers are at least owed that.

What’s wrong with the payment system? I see doctor today, pay my $85 then get my ‘refund’ in my bank the next day.

Went to new clinic the other day paid my money then put my card back in and refund was instantaneous.

Seems to work to me. Working in IT myself sometimes the old clunky systems are the ones that work the best and more reliably. They break once you start messing with them.

wildturkeycanoe 6:32 am 15 Jul 16

Leon Arundell said :

Now that the election is run & won and we all understand that Medicare is not under threat from the Government, can we please please please review the appalling state of the Medicare payment system? The IT systems that support Medicare are anchored in 1980’s technology that simply isn’t up to task. For that matter can we initiate an IT capability review across the whole of the Federal sector. Since the Public Service chose to in-source IT services late last decade, the only consistency has been the ever decreasing levels of service. If I have to hear another public servant claim, “yeah I like work in IT with all the computers and stuff”, I’ll spontaneously combust. Let’s take this as an opportunity to seriously review, plan and remediate our Federal IT systems and start taking service delivery, such that supports Medicare, seriously rather than playing political pong with the issues. The taxpayers are at least owed that.

The Liberal’s response to this would be to offshore our Medicare system, sack thousands of Australian Medicare staff and place our personal health details in the hands of Indian and Philippine call centers.
“I’m sorry to hear you’re going to die in six months, but it is really important to Medicare that you wait on the line to complete a satisfaction survey of your call to us today. Can I also interest you in a funeral insurance quote?”

CyberJam 5:16 pm 14 Jul 16

Now that the election is run & won and we all understand that Medicare is not under threat from the Government, can we please please please review the appalling state of the Medicare payment system? The IT systems that support Medicare are anchored in 1980’s technology that simply isn’t up to task. For that matter can we initiate an IT capability review across the whole of the Federal sector. Since the Public Service chose to in-source IT services late last decade, the only consistency has been the ever decreasing levels of service. If I have to hear another public servant claim, “yeah I like work in IT with all the computers and stuff”, I’ll spontaneously combust. Let’s take this as an opportunity to seriously review, plan and remediate our Federal IT systems and start taking service delivery, such that supports Medicare, seriously rather than playing political pong with the issues. The taxpayers are at least owed that.

Dacquiri 5:04 pm 14 Jul 16

Nice sentiments, Kim, but the reality is that many people are still priced out of the public system in Canberra due to the lack of bulk-billing GP practices. A family member (male — and it’s hard enough to get them to go to the doctor anyway) has not sought much-needed medical attention for ongoing & painful conditions, nor has he attended for important preventive and diagnostic screenings — because he doesn’t have the money for the out-of-pocket fees for the GP, specialists, diagnostic imaging, and the rest. Most people prefer to have a regular GP, and the big bulk-billing GP centres are a complete lottery in terms of quality.

speak2us 10:57 am 10 Jul 16

Nice work Kim. I wonder how many people know the history of Medicare and that it was a policy introduced and instigated by the Labor Party. We should also send your article to the journalists who prefer to write stories from LNP media releases than research the background of Medicare.

Fancy accepting Abbott and, today, Sinodinos saying that the LNP is the “best friend Medicare ever had”
How insulting is that from the LNP that has been attempting to dismantle Medicare from its inception.

JC 6:28 pm 09 Jul 16

JC said :

Both major parties have failed to address this properly. Labor seems to think that ever increasing amounts of (unsustainable) government spending will solve everything, while the Coalition proposed a bunch of measures that were unacceptable to the public, but when they were rejected in the senate, and the polls, they put their heads in the sand rather than make the choices that would be acceptable to voters.

Agreed for the most part, the inergeneration report clearly shows the issue.

Though the Liebrals, their policy is to save by cutting. Doesn’t always work. Both sides need to realise we need additional income, ead tax to continue living the life style we as a NATION, and not self centred individuals should have in a country like ours.

chewy14 7:36 am 09 Jul 16

dungfungus said :

With the bulk purchasing power of Medicare, you would expect them to use it to drive down prices.
“Medicare will endorse your practice / clinic / laboratory if you charge no more than the scheduled cost of services.” If you charge more, you’ll be classed as a private non-Medicare provider and you’ll need to only service private patients who will not be able to claim from Medicare. That should drive prices down quick smart.

Medical services especially in Canberra are way too expensive because Medicare automatically pays part, and then they charge based on what they think the well-heeled people of Canberra will afford to top up.

The current system is not cost-effective and unsustainable in the long run. The Medicare levy and levy surcharge cannot continue to cover the cost of “free healthcare”. Doesn’t it seem selfish to you that we are are happy to leave the bill to our children so that our generation can get “free hospital services”?

Exactly, Medicare isn’t the best friend Australians have ever had, it’s the best friend Doctors and their massive and ever growing incomes have had.

It’s also extremely interesting to see the large amount of well off baby boomers suggesting income tax increases (Medicare levy) or other direct government funding, safe in the knowledge that they won’t have to pay for it.

Asking them to partially fund some of the services they use directly through a co payment or other mechanism? Outrageous.

Garfield 12:48 am 09 Jul 16

wildturkeycanoe said :

It’s nice to see a change in pace on a website heavily dominated by people who do serious mental gymnastics to convince themselves that the Liberals support the universal health care, and that they don’t want to see it dismantled. Medicare simply needs an increase amount of temporary funding to support the baby boomer generation, and costs are predicated to go down (due to lowered demand) once they starting passing away. This was always going to be a problem due to that generational population gap.

Personally I think we should consider abolishing the private health insurance rebate and the medicare levy surcharge to get the additional funding. The MLS has already been proven many times to be useless, and since Howard introduced the scheme it has simply distorted the insurance market and acted as unnecessary corporate welfare. I recall seeing some statistics which showed that most people who had private health insurance don’t even use it when they’re in hospital – and that’s probably because people purchase plans off junk providers like HCF/NIB which exist for tax minimisation purposes.

Medicare doesn’t simply need a temporary increase until the baby boomers start passing away. Australia’s demographics show the largest age groups of the population are those currently aged around 25 – 55 while the boomers are about 45-70. As the number of older people grow and they live longer, government health costs are going to keep increasing exponentially for probably the next 50+ years while the number of working people paying taxes is going to decrease. It’s one of the reasons government needs to do something to fix the structural budget deficit rather than sitting on its hands waiting for bracket creep to bring it back into surplus. Both major parties have failed to address this properly. Labor seems to think that ever increasing amounts of (unsustainable) government spending will solve everything, while the Coalition proposed a bunch of measures that were unacceptable to the public, but when they were rejected in the senate, and the polls, they put their heads in the sand rather than make the choices that would be acceptable to voters.

HiddenDragon 6:19 pm 08 Jul 16

Interesting information here about the Medicare co-payment legislated by the Hawke Government in 1991 –

http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/FlagPost/2014/April/GP_co-payment_lessons_from_past

With the Medicare Levy now raising about half of the costs of the services provided under Medicare, the best option may be another increase in the Levy – as proposed by at least one State Government (Queensland, from recollection) when there was talk earlier this year of increasing the GST and/or expanding its base.

Mysteryman 3:51 pm 08 Jul 16

creative_canberran said :

And if we look at what the Labor Party did the last time it was in office, it froze the Medicare rebate in 2013 due to the state of the budget. Its a good chance that if Labor managed to form government after this election, they might restore Medicare funding initially, only to cut it again later due to the larger deficits they are planning compared to the Coalition. The Unions and Getup made a lot of noise about protecting Medicare during this campaign, but they were completely silent on it in 2013, showing their true colours as left wing advocates and not independent organisations that can be trusted to be impartial.

That’s the MO of the unions and GetUp. They complain bitterly about any changes proposed by Liberal governments, and keep deathly silent when Labor cuts things – like they did in 2011 and 2012 with the cuts to the public service.

farout 3:30 pm 08 Jul 16

With the bulk purchasing power of Medicare, you would expect them to use it to drive down prices.
“Medicare will endorse your practice / clinic / laboratory if you charge no more than the scheduled cost of services.” If you charge more, you’ll be classed as a private non-Medicare provider and you’ll need to only service private patients who will not be able to claim from Medicare. That should drive prices down quick smart.

Medical services especially in Canberra are way too expensive because Medicare automatically pays part, and then they charge based on what they think the well-heeled people of Canberra will afford to top up.

The current system is not cost-effective and unsustainable in the long run. The Medicare levy and levy surcharge cannot continue to cover the cost of “free healthcare”. Doesn’t it seem selfish to you that we are are happy to leave the bill to our children so that our generation can get “free hospital services”?

I am a Rabbit™ 2:42 pm 08 Jul 16

It’s nice to see a change in pace on a website heavily dominated by people who do serious mental gymnastics to convince themselves that the Liberals support the universal health care, and that they don’t want to see it dismantled. Medicare simply needs an increase amount of temporary funding to support the baby boomer generation, and costs are predicated to go down (due to lowered demand) once they starting passing away. This was always going to be a problem due to that generational population gap.

Personally I think we should consider abolishing the private health insurance rebate and the medicare levy surcharge to get the additional funding. The MLS has already been proven many times to be useless, and since Howard introduced the scheme it has simply distorted the insurance market and acted as unnecessary corporate welfare. I recall seeing some statistics which showed that most people who had private health insurance don’t even use it when they’re in hospital – and that’s probably because people purchase plans off junk providers like HCF/NIB which exist for tax minimisation purposes.

creative_canberran said :

And if we look at what the Labor Party did the last time it was in office, it froze the Medicare rebate in 2013 due to the state of the budget.

I agree it was a poor move, and Labor was heavily criticised on that by their own supporters. It was supposed to be a temporary move until funds could be found to support the increased demand, which is being driven by the rapidly increasing aged population as baby boomers start to retire. I don’t think anyone can say for sure if Labor would have ever found the funds to unfreeze the rebates… Labor has released costings and promised that they will roll back the freeze should they win the election, but I think it’s impossible for them to form government with their seat numbers.

ungruntled 1:03 pm 08 Jul 16

Thank you Mrs Fischer for this accurate historical run-dwn of the processes.

It is so easy to loose track, & lots of younger people don’t know their own history. (Oh did that come out of my mouth? – I must be an oldie!! When did that happen?). But I digress.

Maybe, if part of being in the government was that you HAD to use the Public Health system, it would make a difference to the decision making.

Come to think of it, if all pollies also had to use Public Transport to get to & from work & had to send their children to Public Schools?

Either all the Public Services would improve or the quality of our Politicians would improve, methinks.

rommeldog56 11:24 am 08 Jul 16

The ALP/Greens/Union scare campaign in the election about “privatising” or selling Medicare, was deceitful at best, if not a down right lie.

What needs to happen is that funding for Medicare/public health must increase if it is to survive and not be white anted by things such as freezes on the Medicare rebate and reduction in the taxation concession for private health insurance.

How would that be done ? There are few options. (a) Make Medicare/public health more efficient (b) increase taxes (like the Medicare levy) (c) reorganise budget priorities and channel more $ to prop up Medicare (eg. Do we really need 12 new subs @ a cost of b$50 +. Maybe 6 would do.). There are probably more too, rather than just freezing the Medicare rebate or increasing the co-contribution.

Also, from the OP :

: “Given all this, the ALP’s campaign to ‘save Medicare’ from the Liberals not only seems warranted but pretty restrained. I’m genuinely proud to be part of a party that believes in the importance of a strong public health-care system. The ideology of conservatives means that they simply can’t be trusted.”

So, ALP candidate for the upcoming ACT Election, just what does your party propose to meet the ballooning cost of Medicare/public health ? There is no substantive mention of that in your OP. Just more unhelpful, non constructive, scare tactics.

Garfield 9:56 am 08 Jul 16

And if we look at what the Labor Party did the last time it was in office, it froze the Medicare rebate in 2013 due to the state of the budget. Its a good chance that if Labor managed to form government after this election, they might restore Medicare funding initially, only to cut it again later due to the larger deficits they are planning compared to the Coalition. The Unions and Getup made a lot of noise about protecting Medicare during this campaign, but they were completely silent on it in 2013, showing their true colours as left wing advocates and not independent organisations that can be trusted to be impartial.

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