Speeches and Transcripts

AMA Speech - AMA President Dr Steve Hambleton, AHHA Medicare Anniversary Roundtable







***Check Against Delivery

Making Medicare Relevant in the 21st Century

I would like to acknowledge the traditional owners of the land on which we meet and pay my respects to their elders past and present.

Good afternoon ladies and gentlemen, and a very happy anniversary to Medicare.

Thank you to Anne-Marie Boxall, the Deeble Institute, and the Australian Healthcare and Hospitals Association for inviting me to join today’s Roundtable discussion.

I commend you on gathering an impressive list of speakers at short notice, especially at a time when a lot of people are still at the beach or doing things other than pondering the past and future of Medicare.  Well done.

I note the presence and participation of Shadow Health Minister, Catherine King.

Catherine spoke about the history of Medicare and Labor’s Medicare legacy.

I am sure Catherine and the AMA will have many meetings ahead to discuss and help shape the future of Medicare to continue that legacy.

The future of Medicare

I want to speculate about Medicare’s future today – and the key role of doctors, particularly GPs, in that future.

I will make some suggestions about how Medicare can improve its relevance in a changing environment, and how it can best serve the Australian people by continuing to deliver quality, affordable and accessible health services.

As you know, I am not the only person into Medicare speculation recently.

December and January are traditionally the silly season in the Australian media.

The news is full of sport and celebrations … and stories that are recycled, and stories that normally would not see the light of day.

For health, it has been a very silly season.

We have recently seen many opinions about the health system and health financing

People are speculating about the changes to be made to ensure we have a sustainable health care system.

These opinions became stories that inevitably focused on Medicare – because for most Australians Medicare is the Australian health system.

The most notable proposal was the oft-recycled patient co-payment. 

The AMA does not support this concept and we have made our view very well known.

There are better ways.

It is interesting that this speculation has come at a time when a new Lancet Commission, when considering global health up to 2035, has recommend that countries should lower the barriers to early use of health services and increase access to disease prevention and minimise the impact of medical expenses.

While I acknowledge the growth in Medicare expenditure, it is important that any changes do not throw the baby out with the bath water.

Any changes must be in the context of the long term goal to improve population health, which will deliver real cost savings.

In terms of spending on medical services, via the Medicare Benefits Schedule, doctors have done their bit over the past decade on containing costs.

As I have said in other fora, medical services costs are not the problem.

Let’s once again set the record straight.

Here are the facts …

Health expenditure

The proportion of health expenditure on medical services was 18.8 per cent in 2001-02 compared to 18.1 per cent in 2011-12.

The average annual growth in total health expenditure on medical services in the decade to 2011-12 was four per cent, compared to growth in PBS expenditure of 6 per cent and 9.3 per cent for products at the pharmacy.

The growth in average health expenditure by individuals on medical services in the decade to 2011-12 was four per cent, compared to 5.3 per cent for PBS medicines and 7.5 per cent for products at the pharmacy.

The average growth in Medicare benefits paid per service in the decade to 2012-13 was 4.7 per cent, less than the real growth in total health spending of 5.4 per cent in the decade to 2011-12.

It is clear that the MBS - combined with the private health insurers’ schedules - is an effective price dampener for medical services.  At least that is what my members keep telling me!

In terms of access to care – despite the low growth in the Medicare Rebate, today, 81 per cent of GP consultations are bulk billed.

And 89 per cent of privately insured in-hospital medical services are charged according to the patient’s private health insurer’s schedule of medical benefits.

This means that patients had no out-of-pocket cost for their doctor’s fee for 93.5 million GP consultations in 2012-13, and over 26 million privately insured in-hospital services.

When Governments get nervous about spending in health, they have three options: reduce the price they pay; spend more wisely; or collect more revenue.

I think that the recent focus on price, in terms of the Medicare Benefits Schedule, is a bit misdirected.

The focus should be on spending that money wisely.  Today, Minister Dutton is quoted as saying that we need to invest in the areas of greatest benefit.

The medical profession stands ready to do its bit in this regard, too.

Australia must change the way it provides health care, where it provides care, and when it is provided for the major driver of health care costs - non-communicable diseases.

Medicare needs to facilitate this.

With the rapid increase in medical knowledge and the rate of change of best practice care, evaluation and change must be part of the medical practitioner DNA.

In terms of our clinical practice, we are going to have to translate what we know into what we do - and we need the tools to do it.

We will need to do this in a structured way so that we stop doing the things we do that don’t provide real outcomes for the patient.

Our clinical practice must be about doing the right things at the right time in the right part of the health system.

Once people get to hospital, their care becomes very expensive.

Keeping people out of hospital is cheaper and it frees up resources, but it might need an increased investment from Medicare, not a decrease.

That investment must be sufficient to improve the coordination of primary care services.

Population Health in the Community – Medicare Locals

The AMA understands the need for community-based health care organisations to improve the coordination of health care outside of the hospital environment.

Such organisations can help to break down the silos in the non-hospital space, build better links between the hospital sector and community based care, support improved population health, and address gaps in the delivery of primary care services.

The former Government set up 61 Medicare Locals to undertake this role.

Despite now having been in operation for a number of years, few Australians understand what Medicare Locals do.

Many GPs feel disenfranchised by them – and so do almost all community-based medical specialists.

We have welcomed the incoming Government's review and have made a strong submission, based on frontline medical practitioner input.

We believe the former Government pursued the wrong governance model.

They substituted or downplayed the role of GP leaders in Medicare Locals and in their decision-making structures.

They made the same mistakes that the New Zealand Government made in 2001 when it decided to implement ‘skills based boards’ that excluded GPs.

These boards were initially made up of people who, while experienced in governance, did not understand the complexity of health care delivery.

Clinical leadership was absent in many areas in New Zealand and the models failed to deliver.

The leadership role of GPs has now been restored.

The PHOs in New Zealand are now playing a more meaningful role in support of improved health outcomes for local communities.

In New Zealand, the PHOs are now:

  • supporting GPs to focus on population health;
  • supporting improved quality in general practice by facilitating information sharing among GPs;
  • supporting pro-active management of chronic disease;
  • supporting e-health initiatives;
  • funding specific initiatives to keep people out of hospital; and
  • helping support more sustainable general practice by building improved IT and delivering business support.

These are initiatives that are being built from the ground up and led by GPs, not imposed from the top down.

We are calling on the Abbott Government to overhaul the Medicare Locals model to make them responsive to local health needs and to be fully engaged with GPs, who are the engine room of non-hospital based care.

But enough about Medicare Locals, which have got nothing to do with Medicare.

That is why we have suggested a name change.

Complex and chronic disease

The challenges for primary care are growing with our ageing population.

Complex and chronic disease represents a huge burden to the health system.

It accounts for about 70 per cent of the allocated health expenditure on disease and is estimated to increase significantly in the immediate future.

This is both a threat and an opportunity for the Medicare of tomorrow.

Current Medicare-funded chronic disease management arrangements are limited, can be difficult for patients to access, and involve considerable red tape and bureaucracy.

We need less red tape and more streamlined arrangements allowing GPs to refer patients to appropriate Medicare-funded allied health services.

We need a more structured, pro-active approach to managing patients with complex and chronic disease.

The Department of Veterans Affairs is doing some great work in this area with its Coordinated Veterans Care (CVC) Program.

DVA is supporting GPs to provide comprehensive planned and coordinated care to eligible veterans with the support of a practice nurse or community nurse contracted by the Department.

The CVC program is a proactive interactive approach to the management of high acuity chronic and complex diseases.

It supports GPs to spend more time on these patients on a longitudinal basis.  This is something that Medicare currently works against.

The CVC program recognises the non-face-to-face work required, including regular follow-up to see how patients are going without relying on the patient returning to the surgery.

We need to look at how we can roll out this type of pro-active approach more broadly.

It would allow us to invest in a healthier future with better disease management, and prevention of avoidable costly hospital admissions.

The overall message is that if we as a nation do not wish to spend more on health – and that is the clear message coming from the new Government – than we must spend smarter.

We must invest in the things that work.

We must share the knowledge that our various organisations gather from the coalface of health service delivery.

Above all, we must be spending more time building on the things we agree on – and there are a lot of things that we agree on.

Doctors are ready to be a major part of the solution.

GPs are the foundation of primary care – and they save the health system money.

The GP role in population wellness and, ultimately, cost control must be enhanced by Medicare – not eroded or substituted.

The AMA strongly believes that 2014 and beyond must be the years of the GP who can deliver the right care at the right time to the right person.

Medicare must rise to the challenge.


30 January 2014


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