InSight | November 2008 edition

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In this edition:

Bringing Health Care back to Local Communities

The health status of many Australians is among the best in the world, however there is ample evidence of gross inequity and inefficiency in our health system, as well as very limited citizen and consumer input into how our health system works.

Substantial inequities in health status exist across different population groups ⎯ most powerfully illustrated by the 17 year life expectancy gap between Indigenous and non Indigenous Australians ⎯ but are also quite apparent on geographical and socio-economic measures. These gaps are due to inequitable access to health services and also to the effects of the social determinants of health - such as poverty, homelessness, violence and illiteracy - often summed up as lack of control over one's life.

Access to health care services too often reflects what is known as the inverse care law: "those who need the most health services receive the least, and those who need the least receive the most." [1]

This can be demonstrated by the fact that the combined Medicare and Pharmaceutical Benefits Scheme funding for individuals in large capital cities is 23 per cent more than for those in rural or remote locations.[2] This is despite the evidence that mortality rates for all causes are consistently higher in rural and remote locations. Mortality rates also increase as socio-economic status decreases, but despite this our health system has multiple financial barriers limiting access to services for those of lower socio-economic status.

Our health system is plagued by innefficiency, particularly in regard to the state/federal divide, but also due to the siloed nature of health professionals' practice and the current funding mechanisms which channel funds through individual providers or specific programs. This leads to duplication and a lack of integration of services, with estimates of the cost of these inefficiencies ranging from $2 to $8 billion yearly.[3] In addition to spending the most money on the least needy, the emphasis on hospital care, rather than primary and preventive care, is increasingly recognised as inefficient.

To redress these inequities access to services will need to be improved, as will the quality and effectiveness of care. Improved clinical co-ordination is needed so people can access the most appropriate service provider for their needs. Integrated planning is necessary so that health service sectors can operate in coordinated and complementary ways that reflect local needs. The accountability of health care providers to local communities must be improved, as must the efficiency of health resource allocation and use. All this must take into account and address the social determinants of health.

The authors propose shifting the focus of the health system to a regional level, where locally determined health data and the input of local communities are used to drive change. It is a proposal for significant structural change which also allows for gradual introduction to allow capacity building, and the retention of the many excellent elements of the current health system. It uses the equitable and evidence based distribution of funds to locally governed entities to address both inequity and inefficiency.

We propose that state and federal health care funds be pooled to address structural and funding barriers to equity, efficiency, and improved health status in the Australian health system, particularly in relation to primary health care.

Our proposal centres on several specific ideas. All Commonwealth, state, and local government health care spending should be allocated to regions of about 200,000-400,000 people on the basis of measured need. The determination of need would require an ongoing independent audit of health status and health spending in regions. A Regional Healthcare Organisation (RHO) would be developed within each region. National benchmarks for general health status, the health status of specific groups, access to health care, standards of social determinants e.g. housing and education, would be established. Within each region a detailed continuous independent audit of health status would be collected and be publicly available to be used as the driver of change within each region.

Across Australia, this would mean the establishment of 50 to 100 RHOs, depending on population distribution. They would be incorporated bodies with a board of management with representation from government appointees, local primary health care agencies and citizens/consumers. Thus, representatives of local government, local GP divisions, area health services or equivalent and community health centres should all be considered. Importantly, there should be sufficient citizen/consumer input to prevent domination of the board by specific interests, and there should be representatives from Aboriginal Controlled Community Health Services (ACCHS).

The RHOs would work with government and an independent auditing organisation to identify regional and intra-regional health needs, service utilisation patterns, and health spending. This information would require constant reassessment to maintain its relevance and would form the basis for the development of proposals for change. It would be publicly available for the purposes of advocacy. The independent body would assess the success of the proposals measured against national benchmarks to encourage optimal performance. The setting of national benchmarks would be either a Federal or combined Federal/State responsibility, and must specifically address the needs of marginalised groups and prioritise health care targets. The Australian Institute of Health and Welfare could fulfil the role of the auditor.

With comprehensive information available regarding the health needs and health status of the local community, the RHO could then develop and implement proposals to address identified inequities and inefficiencies. Incentives to develop and implement proposals would include the following: proposals would attract funding; public disclosure of health needs data and RHO performance would promote accountability; and accurate knowledge of health needs would enable the development of locally relevant proposals. The incremental development of RHO proposals would gradually lead to increased experience and capacity to implement proposals in a manner which suited the region's needs.

Over time, there would be a progressive increase in the proportion of government funding through RHOs. This would provide poorer RHOs with additional resources to address health needs by purchasing/commissioning the services required. Whilst this strategy would not initially have any impact on the current inequitable distribution of Medicare and PBS funds, the poorer RHOs would have substantial resources available to attract health professionals. This does not preclude an RHO considering patient enrolment, pooling of Medicare/PBS funds, capitation, or other reform ideas.

Direct federal funding would be required to set up and run the RHOs. The amount of funding available would depend on funding already present in the region, compared to its measured health need. RHOs that were already well funded would receive a nominated percentage increase to allow for innovation. Funding available to all other RHOs would be up to the level of the best funded RHO for equal health need but with a loading for lower health status. Any savings from the implementation of proposals would be returned to the administering central authority ie Federal or State or Federal/ State body, and thus be available for further proposals.

This proposal could be implemented on a state by state basis, wherever the State and Federal Governments can work together. Initially, the role of State Governments as a provider of services would change little, but as the RHOs developed, the role of both State and Federal Governments with respect to planning and co-ordination of care would be reduced. However, State Governments would still be a significant service provider, especially of hospital services. In this model, all current providers would continue to deliver services provided they meet the accountability and service requirements of the RHO.

The possibilities for improvement can be seen through the following examples: Regions which currently struggle with a shortage of doctors (and consequent poorer health) would be eligible for extra funding for both underfunding and greater health need. It would use this funding in a manner which suits its needs and the availability of suitable health professionals.

In another region with a lack of aged care beds, the RHO could use its resources to provide the services needed, eliminating the need for elderly people to move. If there is no spare funding but it is also identified that there is unprecedented spending on dental care through the Private Health Insurance rebate, the proposal might be to look firstly at how to improve the spending on aged care, but also on more appropriate spending on dental health for the privately insured, freeing up more money for aged care.

If inadequate housing was seen as an issue, the RHO's responsibility could be to submit proposals for funding improvements as well as advocating for change, perhaps in combination with other RHOs.

This is a proposal which addresses the widespread problems of our health system at a regional and sub-regional level, using data and regional funding to empower communities to drive change. Over time, this arrangement will lead to more equitable, coordinated, accountable and effective health care system, responsive to all the factors which influence health status.

This proposal is outlined in further detail in a recent submission to the National Health and Hospitals Reform Commission and will be further developed in a paper for the Centre for Policy Development in 2009.

Notes
[1] Hart, J. T. The Inverse Care Law, The Lancet, 27 February 1971.
[2] Department of Health and Ageing, Annual Report, 2002-03.
[3] Drummond M, 2003, Costing Constitutional Change: Estimates of Savings in Health, Presentation to Australian Health Care Summit, August, Canberra; Menadue J., Obstacles to Health Reform (2007).

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A Rather Too Conservative First Year

Prime Minister Kevin Rudd has apologised to the Stolen Generation, signed Kyoto and fixed some of the worst conditions for asylum seekers. These actions seemed to suggest a serious change in political directions, but other signs show he is leading a government designed to avoid scaring off the Howard voters.

This is worrying, as the social agenda of the government could be defined as a more modern form of social conservativism, with some residual neo-liberal tendencies. It lacks the fire and imagination that would challenge some of the retrograde social assumptions that drove most of the last government’s policies.

In this article I will look at their record in four areas of social policy: Indigenous issues, income support, child care and parental leave. While a year is not long in power, especially with the big problems of climate change and macro economic crashes, the social framework is important. Without increased levels of generalised trustworthiness - good social capital - dealing with major problems becomes much harder. Egalitarian social connections are a core part of this so I am concerned that in each of the areas nominated above, there are indications of continued support for the somewhat paternalistic policy directions of the past and only limited indications of change.

Indigenous Issues

Starting with Indigenous policy, the current government inherited a decade of bad relationships, the abolition of structures of consultation and an extraordinarily authoritarian intervention in over 70 Northern Territory Aboriginal communities. The last government’s basic assumptions were that the problems in these communities were intrinsic: addictions and lack of self discipline, individual aspirations, and order. More central control was thus warranted. Therefore Rudd’s apology, linked with promises to Close the Gap, was welcomed, setting up expectations of changed policy approaches.

Disappointingly, the intervention has continued and has now been further extended, with very few changes. While it has some Indigenous supporters, there is no evidence that it is protecting children or improving other indicators. Minister Jenny Macklin’s promise that an evidence based evaluation would be done and acted on, has proved hollow. The Task Force report was generally ignored, with no counter evidence produced. The result is that Indigenous communities are deeply divided and there remains no formal processes of consultation. Many Indigenous people feel angry that they are treated like irresponsible children, that they are no longer covered by the Racial Discrimination Act and that they have lost other rights. Closing the Gap may also fail because the necessary workforce planning and training of local workers in health and human services is non-existent. Former Indigenous Affairs Minister Mal Brough would not be displeased with the effects.

Income Support

There is an Inquiry underway on income support with Jeff Harmer to report in the new year. However, there are already indications that some of the moralism of the last government is still alive and flourishing in terms of who is and isn't seen as a legitimate recipient of support. A campaign by aged pensioners, rightly concerned about the plight of single pensioners who can’t live on $281 per week, has been effective and there is already a promise of more money in next year’s budget and a bonus of $1,400 before Christmas as a fiscal stimulus. (Incidentally, the $1400 bonus will also go to part pensioners, including those singles whose private income is up to $770 per week of probably untaxed super.) But what about the unemployed on Newstart? They are paid $224 per week, so they have even less to live on than pensioners. No rise is in view for them and they didn’t get the bonus - the implication being that they should be able to get a job. In a time of shrinking employment, this is just populist claptrap, not social justice.

And there are other losers. Income quaranting is now to be imposed on other families apart from NT Indigenous people. Those subject to this new scheme must be identifiably poor parents (as opposed to the NT scheme which made no such distinction) but this policy is another cause for concern. There is no evidence that income control improves parenting, but it does fit with a very paternalistic view on welfare that assumes that a lack of money turns the unemployed into workers and better parents. The continued 'get a job' pressures on the unemployed, sole parents and those with lesser but still significant disabilities continues under Welfare to Work with minor amendments, but with no recognition, for instance, of parenting needs.

Child Care

Residual neo-liberalism is writ large in the problems of ABC Child Care. The Rudd Government had a chance to make changes to the system but preferred to support it further by raising the child care tax rebate to 50 per cent. This extra cash reinforced the problems inherent in the Howard Goverment model of encouraging private sector provision of child care. By funding parents, not services, the last government gave up previous controls on the location and costs of services. Generous subsidies for fees attracted many players and new services multiplied. These were not, unfortunately, responding to market needs but tended to be located where cheap land limited capital costs, with the result that too many services opened in many areas and too few in others.

A cowboy capitalist blew the system by setting up new services to compete with others, and buying out non profitable as well as profitable competition. The last government even hired Eddy Groves to run their defence services' child care centres and encouraged the expansion of his company. The incoming Labor government should have reviewed the whole system and used its extra funding to impose some planning order and controls on the sector. So far it has chosen to support the current strategy, but funding only some centres in areas of need. Rather than mutterings about monopolies there needs to be discussion of how to move from child care from a laundromat model back to an essential community service.

Paid Parental Leave

As one of only two OECD countries that have no form of universal paid parental leave, it would seem to be a no-brainer to introduce it. The Government set up an inquiry with the Productivity Commission to assess it from a hard edged economic viewpoint, and we were all hopeful that this perennial problem would be solved. It is after all now mainly the lower income, lower status workers that have no access to such leave, as about 40 per cent of workers have negotiated some leave from employers. So there is a strong social justice argument as well the economic ones.

The interim report emerged and it is pretty good, recommending 18 weeks plus two weeks for fathers/partners funded publicly at the minimum wage. The report makes it quite clear that the payment of parental leave to mothers is not just about money but also about workplace connections and the recognition of the contribution women make in the paid workforce. It would also firmly connect the roles of paid workers and parenting carers in ways that open up further debates about care-friendly workplaces and conditions. The first Government reaction was good with Rudd stating it was time to ‘bite the bullet’.

The Opposition, not surprisingly, leapt in to condemn the report as disrespectful of mothers who were not in paid work, ignoring their baby bonus, which was introduced to counter a proposal on maternity leave in 2002 and is still in place. Although the overall financial entitlements were fairly similar, at least one Government representative immediately claimed there would be no differentiation between paid workers and the rest.

Why is the Government worried in 2008 about recognising that women in paid work may have some entitlements not available to those who are not employed? This is a picket fence, Howard-era viewpoint. The final report from the Productivity Commission is still to come and hopefully these remarks will not be followed up, but another threat has appeared on the horizon, as Finance Minister Lindsay Tanner has suggested that this payment may not be affordable in the current economic crisis. As the costs of 13 of the proposed 18 weeks leave would come from redirecting current spending, this seems an inadequate excuse.

Conclusions

There are other indicators of a conservative bent - the overreaction to the Henson pictures, the focus on the sins of binge drinking and over-eating and definitions of social inclusion that are primarily aimed at getting the excluded into paid work. I am worried about the faint hint of 19th century “poor laws” moralism underpinning these initiatives, which is somewhat surprising in a Labor government. However, rising unemployment may raise awareness of the social, as opposed to individual, causes of the difficulties many Australians face, and this may in turn create the space for broader discussions of ways to remedy inequalities.

The Best and Worst in Health

The Rudd Government's first year has brought a mixed record in health policy - a grab-bag of small, uncoordinated initiatives have been announced, but major election commitments to reform remain unfulfilled, awaiting reports from a raft of advisory groups.

The Best
The best health policy initiative from the Rudd Government this year was its commitment to spend $90.3 million over the next five years on Indigenous child and maternal health services. This will contribute to closing the gaps on mortality, morbidity and literacy and, if done well, could provide valuable learning back into white Australian society about the importance and contribution of the extended family in establishing a healthy and rich cultural life of children.

However, this endorsement comes with caveats: the policy proposal will only work if it is sustainably funded; if staff with appropriate health and cultural training are supported in their efforts; if welfare, health and development problems uncovered are addressed; and if the Commonwealth can work in effective partnerships with the states and territories and Indigenous communities.

This new commitment, which will incorporate a program based on the Nurse Family Partnership, pioneered in the US by Professor David Olds, must be integrated with current commitments such as Health @ Home Plus, Healthy for Life, Family Centred Primary Health Care, and state and territory programs. The risk? We could too easily end up with a series of different programs all trying to do the same thing, diluting the investment of scarce resources, effort and goodwill.

The Worst
The most deeply disappointing policy decision (or more correctly non-decision) was that which led to no change in the advertising of food on children's television. We were used to Mr Abbott's view that, if there was a problem with what was on children's TV, parents should simply switch it off. Strength of character and parental presence was all that was needed.

After considerable prevarication, Health Minister Roxon has ended up adopting the same position. The immense political power of the food manufacturing giants cannot have had any impact on the decision, can it, although their analysis of the research data unsurprisingly supported the conclusion of no impact from advertising? The food industry's investment in such advertising is thus incomprehensible - unless, of course, the wrong research data were entered into the debate.

Indeed that is the case. Sales data, never made public, probably hold the appropriate evidence. Many forms of evidence influence policy, of which health research metrics is but one, occasionally applied.

The proposition "no we won't restrict advertising because there is no conclusive proof that it affects consumption" bears an eerie, almost plagiarised, similarity to the arguments made last century against controlling tobacco advertising. Nevertheless we got rid of tobacco advertising. Now the evidence is visible for all to see - tobacco consumption rates in Australia are among the lowest (17 per cent) in the world, with falling lung cancer, heart disease, and emphysema death rates.

Inevitably the public - sick of being fat, concerned about childhood obesity and diabetes - will drive food companies to change their behaviour and drive our politicians to change their position as well. In the meantime, this is a disappointing policy cop-out with substantial health consequences.

One Year On: The Good, the Bad and the Ugly

Most of us would rather not know how two things in life are made: sausages and government policy. (Increasingly, there is a third thing - how Qantas undertakes maintenance on its planes, but that is beyond the scope of this article.) As a vegetarian, I am not really interested in sausages, but you cannot escape government policy.

It is with this thought in mind that I am trying to figure out what the Rudd Government was thinking when it decided to announce a $1.5 billion injection into First Home Owners Grant (FHOG). This seems like sausage factory policy to me, no matter what is happening in the broader local or global economy. Before presenting my thinking on this, I want to emphasise that I am not against government injecting funds into the economy - but only when the policy implications are well thought out. The Government seems to have got it right with well-targeted payments to pensioners, low-income households and carers.

So why do I think that the FHOG policy was hacked together in a sausage factory? To begin with, it is targeted at the wrong people. The policy is not means tested and only serves to assist those who can already buy a home: that is, towards higher income earners. Throwing money at higher income earners does nothing to assist housing affordability and is (upper) middle class welfare.

The second reason this is really bad policy is that it will actually push up already inflated housing prices. The Real Estate Institute has recently estimated that the price of houses will increase by around about the same amount as the grant as a result of this policy. Hardly rocket science: if you give everyone that can afford a house extra money, all they will do is bid up the price by that amount. In other words, it further distorts an already inflated market. So the policy not only targets the wrong people, it has the potential to have a negative impact on the rest of us.

The third reason for concern is the opportunity cost of throwing money into this area. A better policy would be to use the money to increase our dwindling public housing stocks. We are seeing increasingly long waiting lists for public and community housing. We are also seeing jumps in rent across the board that are, in large part, driven by the problems of low housing affordability - the FHOG could potentially inflame this situation.

Much has happened in the twelve months since the Rudd Government took office. On the positive side, the apology to the Stolen Generation as well as the decision to sign Kyoto are important symbolic steps in two policy areas in which the Howard government was negligent. On the ugly side is the continued crackdown on social security recipients for technical breaches. On the bad side, the decision to not only continue but add to a scheme which artificially inflates asset prices is a policy not fit for public consumption.

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Motivating Residential Energy Conservation

During a long winter of conservative government, policy pressure inevitably builds up within the forces of progressive politics. Denied for so long, there is a understandable desire to see things change quickly and mightily, setting the stage for disappointment. The Labor Party was out of power for over a decade before the Rudd Government took office, and it could have taken the nation's new minders a year simply to "find the keys" ⎯ thus the proliferation of commissions and reviews. On the subject of residential energy conservation, I won't so much mark the Government's scorecard as give a progress report - and a word of caution.

Under the recommendations of the Garnaut Climate Change Review, residential electricity prices are projected to rise by 21 to 31 per cent by 2020. The review recommends mitigation strategies for low-income households, but there is little discussion of helping Australians change their energy use behaviour to reduce consumption. If Australians can be assisted and motivated to reduce their household energy consumption, they may be able to mitigate the projected increase in their electricity bill, while contributing to the overall reduction of greenhouse gas emissions.

In the Rudd Government, the Environment and Climate Change portfolios were divided between Peter Garrett and Penny Wong, respectively, and residential energy conservation fell within Garrett's arena. That may provide this less glamorous policy area with more attention than it would have received in Wong's office, which is understandably focused on business and industry and the overall implementation and market impacts of the Emissions Trading Scheme (ETS).

Additionally, the target of residential energy conservation requires a particular approach. We cannot expect individuals to react to changing environmental regulation, incentives, and costs as rationally or responsively as corporations, who have the knowledge and resources to conform to changing policy frameworks. Both the Garnaut Climate Change Review and the Government's Carbon Pollution Reduction Scheme (CPRS) Green Paper have noted information barriers, bounded rationality and split incentives as obstacles to the uptake of energy conservation by Australian households. Some of the initiatives announced by the Government so far are designed to combat these market failures:

A 4-year scheme to improve the energy efficiency of appliances, including a new 10 star rating system, a greenhouse minimum standard, more products covered, and reducing standby power.
Green Loans scheme, providing a household sustainability assessment, a green renovations kit, and low interest Green Loans of up to $10,000.
Low-Emission Plan for Renters, providing a rebate of up to $500 for landlords to install energy-efficient insulation.
Your Home Renovators Guide, with information on making homes more environmentally friendly.
One Stop Green Shop, a single, government web portal designed to link schools, businesses and families to household efficiency programs provided by all levels of government.

This is a good beginning. However, international research has demonstrated other barriers to changing energy consumption behaviour, relating to the subtleties of human motivation. For example, research has shown that while people say they are motivated by concern for the environment and saving money, the greatest motivator for the take up of energy conservation is social diffusion (i.e., installing a solar hot water heater because your brother-in-law or your neighbour did).[1] This suggests that informational websites, living greener guides and public information campaigns (such as the Howard Government's much maligned "Be Climate Clever" campaign, addressed by me here) do not sufficiently motivate changed behaviour. Residential energy conservation requires a more robust democratic approach, by selling programs in community and neighbourhood settings as much as possible.[2]

Lack of feedback is another important barrier to change. Australians generally receive quarterly energy bills or a monthly bill averaged out across the year. This provides little to no direct feedback to people on how they are using energy and what it is costing them. Research from other countries has shown that providing an energy meter in the home (or for a particular appliance) that shows energy use and/or cost on a continuous basis causes most households to significantly reduce their energy use.[3] Demonstrating to people that they are consuming more energy than their neighbours also leads to a reduction in energy consumption (this is social diffusion at work again).[4]

It is not yet possible, or fair, to give the Rudd Government or the Minister for the Environment a mark for residential energy conservation. Many of their initiatives are in development or in the process of being implemented and the time this is taking is not unreasonable. Looking to their proposals, it is best to say that they have many bright ideas, but that many similar ideas have failed in implementation. It is crucial for the Rudd Government to consider the many failures, and few successes, in residential energy conservation as they work through the specifics of the policy design; most importantly, that they take account of the complexities and subtleties of human motivation.

Notes

[1] Nolan, J.M., Schultz, P.W., Cialdini, R.B., Goldstein, N.J. & Griskevicius, V. 2008, ‘Normative social influence is underdetected’, Personality and Social Psychology Bulletin, vol. 34, no. 7, pp. 913-923.
[2] Coltrane, S., Archer, D. & Aronson, E. 1986, ‘The social-psychological foundations of successful energy conservation programmes’, Energy Policy, vol. 14, no. 2, pp. 133-148.
[3] Wood, G. & Newborough, M. 2003, ‘Dynamic energy-consumption indicators for domestic appliances: environment, behaviour and design’, Energy and Buildings, vol. 35, no. 8, pp. 821-841; Wood, G. & Newborough, M. 2006, ‘Energy-use information transfer for intelligent homes: enabling energy conservation with central and local displays’, Energy and Buildings, vol. 39, no. 4, pp. 821-841.
[4] Schultz, P.W., Nolan, J.N., Cialdini, R.B., Goldstein, N.J. & Griskevicius, V. 2007, ‘The constructive, destructive, and reconstructive power of social norms’, Psychological Science, vol. 18, no. 5, pp. 429-434.

Making Health Policy with Kevin Rudd

It is a truth universally acknowledged that a new government in possession of a reform agenda must be in want of a Taskforce (or a Commission...or a review...or a policy committee). The Rudd Government is no exception to this rule having established, in its first year of office, taskforces, policy reviews, commissions and consultation processes in almost every area of the health system. These include the following:

A National Primary Care Policy Reference Group
The National Health and Hospitals Reform Commission
A Preventative Health Care Taskforce
Consultation processes for the development of both a Women's and Men's Health Strategy
The National eHealth and Information Principal Committee

Looking at the list above, it is not surprising that health interest groups feel like they have done little else during 2008 than prepare submissions and appear in front of committees.

So, what does this tell us about the Rudd Government? On the plus side, its focus on involving stakeholders in these review and developmental processes is evidence that, compared with previous governments, the new regime is actively seeking input into policy from a broad spectrum of experts, providers and consumers.

Another positive is that the Government has committed to addressing important areas of policy neglect, such as ehealth and primary care, in an effort to develop a framework around key areas of health care which have been developing in a policy vacuum.

Prime Minister Kevin Rudd and Health Minister Nicola Roxon have also acknowledged the need for structural reform within the health sector and flagged support for major changes to workforce roles and responsibilities, and they have committed to an increased focus on performance and outcomes. These are long overdue issues which previous governments have neglected or put in the "too hard" basket.

However, unfortunately for the long-term success of the Rudd Government's reform agenda, these efforts alone, even if backed up by additional health spending, will not be enough to improve the overall health of the community.

As the history of health policy in Australia demonstrates, even the most dedicated taskforce or the most comprehensive and inclusive review will not improve health outcomes unless it results in real changes in the way in which health care is delivered. This will only occur if the Rudd Government is prepared to undertake two challenges that previous governments have considered to be too politically risky to confront.

The first of these is to resist the traditional role of the medical profession and medical lobby groups in orienting the health system around the needs of doctors rather than consumers. While the Government has made an obvious commitment to listening to stakeholders other than doctors when developing its health policies, it has not yet demonstrated the extent to which it is willing to take on medical interest groups if they oppose recommended reforms.

The second of these is to explicitly address the role of rationing within the health system. Currently, health resource allocation decisions are made in a variety of ways, often not transparent to consumers or reflective of community priorities. Involving the community in making decisions about rationing of health care resources is vital to ensure they reflect community (rather than provider or government) priorities. However, involving consumers more directly in setting priorities for resource allocation will also mean confronting the politically challenging reality that not everyone can have all the health care they believe they need.

These are both politically sensitive and challenging issues. However, unless the Rudd Government is prepared to tackle them directly, they have the potential to undermine the successful implementation of its reform agenda and the long-term potential for this Government to achieve lasting positive changes to our health care system.