Outlining his government’s “positive and ambitious agenda” at the National Press Club last week, Anthony Albanese reiterated a series of health policy commitments made during the election campaign: pledges to improve Medicare bulk-billing rates, limit pharmaceutical co-payments, build more urgent-care clinics, and launch a 24/7 health advice line and an after-hours GP telehealth service. Left off the list, this time at least, were election commitments on mental health and women’s health.
The scale of the funding is historic, but these are bandaid-style fixes. Many Australians will benefit almost immediately, but the extra spending will do nothing to fix entrenched problems, including fragmented healthcare and prohibitive charges for specialist care. The government knows how to deal with these problems — the necessary reforms have been proposed in government-commissioned reports over the past decade — but it has so far lacked the will to act.
How health minister Mark Butler and his department tackle these recommendations during Labor’s second term will give some indication of the willingness of the government and the bureaucracy to think long-term, view healthcare spending as an investment in productivity and the economy rather than a budget impost, listen to patients, carers and the public, and override the “sharp elbows and loud voices” of the medical colleges, the pharmaceutical industry and pharmacy groups, private health insurance funds and private hospitals.
First issue off the rank is the need to renegotiate the National Health Reform Agreement that determines public hospital funding. A new agreement with the states and territories is overdue: this year’s budget merely funded it for an extra year, with a one-off top-up thrown in as an acknowledgement that more funds are needed. A new agreement with states and territories has been delayed by difficulties in reaching agreements over foundational supports for the National Disability Insurance Scheme.
The current national agreement reinforces a siloed approach to healthcare and provides no incentives or resources to encourage better coordination between community-based care and hospital care. True, national cabinet has agreed to “long-term, system-wide structural health reforms” that will “focus on the entire health system and move towards a more integrated, equitable, efficient and sustainable system.” But these are empty goals without new mechanisms for cooperation, collaboration and adequate resourcing across the jurisdictional divide. Priorities must include better access to out-patient specialist services, step-down and rehabilitative care and hospital-in-the home, and quicker access to aged care services.
There is no shortage of expert advice to guide this work, including the Grattan Institute’s recent Putting the “Reform” in the National Health Reform Agreement report and the midterm review of the current agreement, commissioned to determine if it was fit for purpose. The continuing validity of most of the recommendations of the seminal 2009 report of the National Health and Hospitals Reform Commission highlights how long the needed reforms have been dodged.
The struggles of both public and private hospitals to deliver needed services in the years since the height of the Covid pandemic highlight the need for a payment system that rewards services appropriately and boosts workforce capacity. More than that, it underlines the imperative, ignored until now, to sort out the best cooperative arrangements between the public and private hospital sectors.
The elephant in the room is the $8 billion-plus the federal government provides to the insurance industry via the private health insurance rebate. Mark Butler’s approach to the current feud between the private health insurance funds and private hospitals shows that active intervention is not on his agenda. But given the impact of the threatened collapse of private maternity and mental health services, it’s increasingly important for him to seek a resolution, and the rebate might be a cudgel he needs. Underlying these problems is a simple question: is this the best way to spend $8 billion or more in taxpayer dollars?
Central to the government’s wider challenge in healthcare is the need for a well-located workforce with the right clinical and cultural skills. Again, much of the thinking has already been done, but longstanding turf fights, union battles and Medicare arrangements are hampering implementation of the National Medical Workforce Strategy 2021–2031, the Working Better for Medicare review, the 2024 Unleashing the Potential of our Health Workforce scope-of-practice review, and the seven-point plan proposed by a unified group of peak nursing and midwifery bodies.
On top of this, graduating medical students are increasingly avoiding primary care roles, especially in underserved areas, and limited accredited speciality training places mean shortages in critical areas like psychiatry, paediatric surgery and orthopaedic surgery.
Increased investment in primary care is widely agreed to be the key to a robust healthcare system. Medicare “must rise to meet the new challenges in health and primary care,” says Anthony Albanese, but he and Mark Butler routinely fail to recognise that most of what Medicare funds is the general practice part of primary care. Primary care, more broadly, includes health promotion and prevention and better access to a wide range of healthcare and social welfare professionals (as outlined on the health department’s own website).
In his first term Butler commissioned a welter of expert reviews of general practice and Medicare, all of which highlighted the need for a more multidisciplinary model, with funding based on patients’ needs and the time taken to deal with them — in other words, a move away from fee-for-service to bundled payments that reward continued care and outcomes over activity.
Yet, as the Grattan Institute points out, the election commitment to spend $8 billion on bulk-billing incentives pushes in the opposite direction by boosting existing fee-for-service payments. Nor does this substantial package relieve the pressures on busy GPs by expanding affordable access to allied health, mental health and substance abuse services, and specialist care.
A startling omission from the government’s commitment list are the “missing middle,” those people whose needs are not well met by current health services. Often they are too unwell for primary care but not unwell enough for hospital care. While the term is most often used in mental healthcare, it also applies to the growing number of Australians who are frail and/or have multiple chronic conditions. This is a growing segment of the ageing population.
These people struggle to find affordable specialist services, have substantial out-of-pocket costs, experience fragmented care, and need help with daily life. If they’re over sixty-five they don’t qualify for NDIS services. Home-care packages are limited, and most would benefit from a healthcare coordinator. A failure to meet their needs in the right place at the right time inevitably means they end up, often inappropriately, in hospital emergency departments.
The other missing piece of the government’s healthcare policy is affordable dental care. This perennial election issue is routinely at the top of people’s healthcare needs list, and Labor backbenchers and the Greens have long pushed for more government resourcing. Butler has dismissed these calls, saying that it was not one of his priorities and declaring he was “very clearly and unapologetically” focused on general practice. At the same time, he described oral care as a “fundamental” aspect of healthcare.
The other big gap is prevention. Almost everything funded through the health portfolio is about illness and very little is directly related to good health and wellbeing. Much lip service is paid to prevention but very few resources are devoted to keeping people fit and healthy. Preventing chronic disease was not included in the mandate of the new Australian Centre for Disease Control, despite this option being considered during the consultation on its role.
The organisational chart of the Department of Health and Aged Care shows that the Preventive Health and Food Policy section sits two levels down within Primary and Community Care. Chronic disease is a big challenge to the system and the impact of climate change on health increasingly looms as a threat, but prevention always loses out to the exigencies of clinical care.
Australia has one of the lowest rates of preventive health spending as a proportion of all health spending among OECD nations. The National Preventive Health Strategy 2021–2030 recommended that at least 5 per cent of total health spending be dedicated to preventive health by 2030, but the figure continues to hovered around 2 per cent.
Focusing more resources on prevention — to tackle problems like obesity and alcohol misuse that lead to long-term chronic disease and increased pressures on the healthcare system — and the social determinants of health — to tackle poverty, insecure and substandard housing, and a lack of health literacy — is sound economic management. It reduces healthcare costs and pressures and means a more productive and engaged society. But it does require long-term commitments; the returns on such investments are substantial but they are not seen within the three years of an electoral cycle.
There’s a lot of work to be done to deal with current health inequalities, not least to Close the Gap on Indigenous disadvantage. This requires much more than improved bulk-billing rates, more affordable prescriptions and new hospital buildings. Rather than simply parking more ambulances at the bottom of the cliff, we also need stronger fences at the top.
The groundwork for this shift in emphasis is there in the national wellbeing framework and the Measuring What Matters report, which recognise that prevention and early interventions are priorities and that changes in budget rules are needed to better justify these measures. International and Australian research has identified what’s needed, including a whole-of-government approach and a long-term focus that includes consideration of future generations
The federal government needs to ensure that the wellbeing framework is embedded into its decision-making, including budget decisions. Mark Butler must assume the role of point man on this and use the Measuring What Matters data to drive needed reforms in his portfolio. •
