Australia and NHI: Lessons - but no wizardry - from Oz

Australia and NHI:Lessons - but no wizardry - from Oz Gavin Mooney Universities of Sydney, Cape Town, Southern Denmark, New South Wales and Aarhus

G’Day!

Overview • Federal system • Funding by both Federal (Commonwealth) Government and the States but C’wealth more. • Provision by both Commonwealth and States but States more. • Overall poor logic on who pays, who runs and who has responsibility

Total Spend Getting on for 10.0% of GDP - and been rising

Breakdown of Total Spend • 70.7 % Government (44.2% C’wealth; States 26.5%) • 7.6% Private insurance • 16.8% Out of pocket (private individuals) • 4.9% Other

Who Provides What? • Federal government funds universal medical services and pharmaceuticals; financial assistance to public hospitals, residential care facilities and elderly home and community care. • State governments provide most acute and psychiatric hospital services; community and public health services such as school health and dental health • Local government mainly environmental health

Public Financing • Primarily (82%) from general taxation • But (18%) from ‘Medicare levy’, with level of contributions based on income

Private Sector • Exists more or less happily alongside public system • Provides about 1/3 of all hospital beds • Private insurance 7.6% of total health expenditure in 2008-9. • June 2011 44.3% of population had private health insurance

PHI Premiums • Community rated i.e. ‘non-discriminatory’ • Lifetime health coverage • Most often not full coverage – hence “gap”

Private Health Insurance Rebate • Tax rebates paid on PHI premiums • Levels of rebates: 30% general population; 35% 65-69 years old; 40% over 70 years • Rebate costs taxpayer $4.5 billion per annum

History of Medicare (NHI) • Originally “Medibank” introduced 1st July 1975 as a result of unhappiness with existing voluntary health insurance scheme. • To provide ‘the most equitable and efficient means of providing health insurance coverage for all Australians’. • Political shuffling to 1 February 1984; then Medicare

Dr Neale Blewett on Medicare • ‘A major social reform’ • ‘A health insurance system that is simple, fair and affordable’ • Provides ‘universality of cover’ which is ‘desirable from an equity point of view’ and ‘in terms of efficiency and administrative costs’.

1984 to 2011 • Some fiddling on benefits side • Some fiddling on costs side • But now accepted by all major political parties • Part of the social fabric of Australia

Medicare: Great but Could Be a Lot Better! • Careful in drawing messages for RSA • Health and health care systems are or should be cultural phenomena • So yes learn but do it the South African way

Some Thoughts from Australia System makes it very difficult • To set priorities • To achieve equity • To get debate on principles

What Do We Get? Many of the problems of not having a single funder • Lack of priority setting and hence inefficiency • Lack of concern with equity and hence inequities exist, especially geographically • Silly debate on who should pay, cost shifting and blame shifting

Who Sets Priorities in Australia? • Not clear that they are set - at least not explicitly • Largely done by some form of osmosis behind closed doors, with shroud waving and loud shouting, usually by blokes in white coats • Emphasis very much on hospitals with continuing neglect of equity, community care, prevention and mental health

Priorities of Informed Citizens • Equity • Community care and prevention • Mental health • (To pay for these extras? Close hospital beds!)

Primary Health Care I Dominated by GPs Dominated by FFS for GPs Hence • not into health • not into population health • not into prevention • not into equity • not into multi-disciplinary care

Primary Health Care II • Patient payments are for many unaffordable • Undermines Medicare’s claim to provide equal access for all

Aboriginal Health I • Medicare has failed Aboriginal people • Gap in life expectancy 11+ years • Policy based on horizontal but not vertical equity (i.e. only limited +ve discrimination) • Institutional racism • Lack of cultural security • Too little spending and major gaps in services • SDH crucial but largely ignored

Aboriginal Health II Basic problem • White fellahs have been telling black fellahs what’s good for them for over 200 years. • And we are still doing it!

Private Health Insurance Rebate • Costs $4.5 billion per annum • Does very little for health care or health • Largely transfer of monies from general taxation to the well off - hence seriously regressive • Money better spent in public hospitals

Hospital Cost Control • DRG or “case mix” funding ‘to drive efficiency’ • Assumption behind this is that what hospitals are trying to maxmise is cost weighted cases. • (Much better to use clinical budgeting for priority setting and try to maximise health)

Other Points • Watch demand led services • Keep patient payments to a minimum • Multiple funders lead to multiple problems • Get the critically informed citizens involved

The Buts of Oz Medicare • Much to defend and admire in Medicare • Difficult to contemplate Australia without it • Does deliver according to key principles of NHI • BUT....

Principles • Universal but... • Equitable but ... • Efficient but ... • Costly? no but ...

BUT Medicare Matters to Australians • There are problems and eccentricities of the Australian system. • BUT Medicare is now part of the Australian social fabric. • A major social institution • It aint perfect but ...

Thanks for listening! g.mooney@westnet.com.au

Australia and NHI: Lessons - but no wizardry - from Oz