Comments on Kevin Rudd’s Hospitals Statement

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The government’s announcements on hospital reform are
bold and deserve widespread support. They are in the right direction. I am
agreeably surprised, given the history of previous health reform attempts.

I hope the states and the
coalition are not churlish and miss a great opportunity for themselves and the
Australian people.

In the months ahead there will be
hard negotiations and I assume further policy announcements to flesh out yesterday’s

The announcement has a clear
hospital focus, a continuation of an obsession we all have with iconic
hospitals. The best health systems in the world are grounded in primary care.
In Australia
we are over hospitalised. A policy objective should be to keep people out of
hospital with alternative arrangements in the community. Hospitals are like the
family refrigerator; regardless of size it will always be full.

So I will be looking for future
policy statements about how hospital care is integrated with primary care. This
issue is only a footnote in the statement yesterday.

A key part of integration of all
health care will be governance at both national and local level.

The government is challenging,
quite correctly, the special interests of state governments and their health
bureaucracies. Stronger special interests are amongst providers – the AMA, the
Australian Pharmacy Guild, pharmacy companies and the private health insurance
funds. They have legions of lobbyists who dominate the public debate at the
expense of a community that is effectively excluded and disenfranchised.

That is why I have suggested that
at the national level the Commonwealth Government should establish a permanent,
independent, professional and community-based statutory authority, an
Australian health commission, similar to the Reserve Bank in the monetary
field. The Reserve Bank’s governance structure has made it almost impervious to
lobbying and generally, it has been independent. Such an independent health commission
with strong economic capabilities is necessary to facilitate informed public
discussion, counter the power of special interests and determine programs and
distribute Commonwealth health funds across the country. Last year, the
Business Council of Australia called for a single ‘independent body that can
lead and be accountable by the Australian community’ for health
services. The traditional ministerial/ departmental model is proving just too
susceptible to special interests in health.

The Commonwealth Government should not opt out of policy responsibility, but
issue principles, as it does to the Reserve Bank, to provide policy and
implementation guidelines for the health commission. The principles could

  • universality,
  • equity,
  • efficiency (both technical and
  • single-payer (to best manage
  • choice of provider (with
    government funding for private hospitals),
  • subsidiarity (delivering
    healthcare at the most feasible local level),
  • accountability (With all providers
    obliged to meet key benchmarks. What about a ‘my hospital’ website? With fee
    for service, providers are compensated for the number and length of
    transactions rather than health outcomes.),
  • social solidarity and
    risk-sharing, and
  • personal responsibility (For
    personal health outcomes and use of health services).

In addition to the need for integration of all health
care and independent and professional governance, there is a range of other
health reforms that are essential.

First, the Health Insurance Commission (Medicare)
should be what its name implies, a proactive public insurer anticipating risks
and controlling costs. With a default option policy for everyone, it should
also provide a range of policies for members, eg higher excess for GP visits in
return for increased hospital benefits.

Secondly, we need a major reform of the restrictive
work practices and demarcations that bedevil our health workforce structure. In
the name of safety, these archaic work practices are designed principally to
protect the turf of doctors. This is at the expense of hundreds of thousands of
other health professionals and the community.

Thirdly, quality and safety must be urgently
addressed. There was a media frenzy over four Australians who died installing
insulation batts. There was a Royal Commission in Victoria over 172 bushfire deaths. Yet 200
Australians die each week in our health sector as a result of avoidable
mistakes. The silence is deafening.

Fourthly, we need to include dental care within
Medicare. The $4 b p.a. subsidy to the wealthy with private health insurance
should be transferred to a universal dental scheme. (I assume that the
government has buried the outlandish proposals by NHHRC on Denticare and
Medicare Select.)

There is a lot to be done, but the first step by the
government is to be applauded and encouraged.

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