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