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2003-2004

Medicare - for all Australians Senator the Hon Kay Patterson Federal Minister for Health and Ageing

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Medicare - for all Australians Senator the Hon Kay Patterson Federal Minister for Health and Ageing

• From the Minister
• Introduction
• Now and Into the Future
• Affordable Care
• Better for Patients and Doctors
• A Fairer Medicare – Questions and Answers

From the Minister

The 2003-2004 Budget confirms the Government’s commitment to a stronger, fairer Medicare.

The Budget measures will help Australians stay healthy with access to appropriate and affordable medical services when needed.

Medicare provides universal health care for Australians. That will not change. However,
the system needs strengthening to make vital services more accessible and affordable.

"The Government remains strongly committed to the principles of Medicare. We also remain strongly committed to the private health structures of this country, and we believe that together, they give this country the best health system in the world."

Prime Minister, John Howard, 28 April 2003, Parliament House, Canberra.

This Government has invested heavily in the pillars of Medicare: access to primary care providers such as GPs; public hospitals; and the Pharmaceutical Benefits Scheme.

We currently spend more than $8 billion every year to make sure people have access to doctors.
The $917 million Fairer Medicare package adds to and consolidates that commitment.

In addition, the Government has put 28 per cent real growth into public hospital funding through the current five year agreement with the states and territories. Next year, the Federal Government will give the states and territories up to $7.5 billion for public hospitals.

Our recent changes to private health insurance, such as the 30% Rebate and Lifetime Health Cover, have provided a real choice in hospital care for people. Clearly they are exercising that choice. Latest evidence shows us that an extra 245,000 patients, an increase of 12 per cent, are using private hospitals, easing the pressure on our public hospitals. Public hospital admissions have fallen for the first time since the introduction of Medicare.

Our world class Pharmaceutical Benefits Scheme, for which all Australians are eligible, subsidises more than 155,000,000 prescriptions per year, at a cost to the Government of $5 billion. This ensures that the community can afford needed medicines.

The 2003-2004 Federal Budget is a health blueprint for the future. All Australians will remain eligible for bulk billing and the availability and affordability of GP services will be improved. More doctors, nurses and other health professionals will be provided, particularly in areas of need such as urban fringes and rural and remote communities.

The Budget also establishes, through the Australian Health Care Agreements, record funding of $42 billion, for the next five years. This amounts to an extra $10 billion to help the states and territories run public hospitals - an increase of 17 per cent in real terms.

Prevention will become a fundamental pillar of Medicare, so that the health system becomes more focused on health rather than illness. The first step is an investment in innovative strategies to ensure early diagnosis, intervention and better care for people with, or at risk of, chronic and complex conditions, and to involve people more in their own health-related lifestyle choices.

This booklet outlines the Government’s Medicare commitments and achievements, as well as proposed changes under A Fairer Medicare and how they will affect you. I trust you will find the information
helpful. If you would like more details, please visit my Department’s website. The address is www.health.gov.au/fairermedicare.

Senator Kay Patterson


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Introduction

A world class health system

A world class health system is one that helps all of us stay healthy, provides support and treatment when we need it and is financially sustainable.
The Commonwealth Government is committed to ensuring that Australia has such a system, now and into the future.
Many challenges to the health system will continue to emerge, from ageing of the population to unforeseen threats such as the emergence of Severe Acute Respiratory Syndrome (SARS) and the tragic events in Bali. The Government will ensure that Australia’s health system continues to adapt to meet all such challenges.

Public Hospitals

The Commonwealth has invested record funding to meet patient needs, the rising costs of health technology, an ageing population increasingly reliant on medical services and advances in medical science.
Funding has been significant in the areas of safety and quality in our hospitals and ensuring they are equipped with the latest medical technology. The overall funding commitment will continue and will focus on better ways to support people both in hospital and on their pathway home.
The current five year Australian Health Care Agreements, which delivered a record $32 billion to the states and territories, are drawing to a close. The Commonwealth has now offered the states and territories $42 billion, an extra $10 billion, to support the provision of free public hospital services over a new five year agreement. This is a 17 per cent increase in real terms.

Choice through private health insurance

In 1996 when the Howard Government came to office, the private health insurance industry was struggling, and costs had been increasing at an average 11.3 per cent per year. It was non-competitive and membership was declining rapidly. People turned, naturally, to the public system, putting extra demands on public hospitals.
The introduction of the 30% Rebate, rewarding long term membership through Lifetime Health Cover and moves to modernise the industry, turned that tide. Coverage has increased by around 50 per cent to sustainable levels which have taken a load off the public hospital system.
People who take out private health insurance extras cover, backed by the Government’s 30% Rebate, can also be helped with the costs of important services such as dentistry, optometry and physiotherapy. In 2002 such services accounted for around three-quarters of all benefits paid under extras cover.


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Pharma-ceutical Benefits Scheme

Medicines are central to good health care. In Australia we have a world class scheme based on rigorous analysis of the benefits and effectiveness of individual medicines. Through the scheme, we spend around $5 billion each year to provide subsidised access to medicines for all Australians (this equates to roughly $250 for each person), including higher subsidies for concession card holders. For example, the dispensed price for Lipitor, a cholesterol lowering medication, is $83.39. The subsidy reduces the cost to just $3.70 for concession card holders and $23.10 for others.

A medical workforce to meet community needs

A major priority has been to ensure that there are enough doctors and they are located where they are needed.
It’s everyone’s right to have access to local medical services such as GPs, but for many Australians, particularly those living in rural and remote communities, this wasn’t always the reality. Innovative approaches were needed. Since 1996, the Government has spent more than $2 billion on targeted rural health initiatives, including More Doctors, Better Services, which provided $562 million for new health services and strategies to get more doctors and health workers out to areas of need and keep them there. The success of this program is clear from the 11.4 per cent increase in doctors in rural areas over the last five years, including a 4.7 per cent rise in the most recent year. Doctors are also being provided with new incentives to live and work in outer-metropolitan areas.

Supporting our doctors to support their patients

GPs play a central role in the health care of Australians and this role has been strongly supported and enhanced by the Government.
For example, the 2001-2002 Budget introduced funding incentives for improved care for patients with asthma and diabetes, increased cervical screening, improved outcomes in mental health and nurses to work in general practices.
These incentives reward general practices that provide comprehensive, high quality patient care. The average payment to GPs under this program is around $18,000 per year per doctor.

Better health and disease control

Our smoking rates are among the lowest in the western world. There is a growing focus on health promotion and lifestyle programs. Recently a National Obesity Task Force was set up to look at factors contributing to ill health among both adults and children.
Seven years ago, immunisation rates among our children were appallingly low, at 53 per cent. Now, at over 90 per cent, they are world class. The Government’s new program to protect our children against Meningococcal C is the single largest expenditure on an immunisation program in Australia, costing $291 million. Our rates of vaccine preventable childhood diseases are at a record low. We have also achieved excellent levels of screening for breast and cervical cancer.

Security and protection

Security through our hospitals and health care system is a top priority for this Government. Our efforts on readiness for bio-terrorism are amongst the best in the world, including preparation of vaccine stocks. Our compassion and responsiveness to the Bali tragedy was comprehensive, and our management of critical health incidents such as the international SARS outbreak means Australians can continue to feel secure as a result of our health system.


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Now and into the future

A focus on health

“The universality of Medicare will be maintained. All Australians will have access to the rebate. As is the case now, doctors will be free to bulk bill all their patients. There will be no co-payment and there will be no means test.”
Federal Minister for Health and Ageing, Senator Kay Patterson, 28 April 2003, Parliament House, Canberra.

As part of the 2003-2004 Federal Budget, the Government has proposed important changes to Medicare to make the system better for all of us.
Today, Medicare meets the health care needs of more than 19 million Australians through: –

• a universal Medicare rebate for medical services,
• a universal Pharmaceutical Benefits Scheme, and
• universal access to free public hospital care.

These essential components will remain at the heart of Medicare, but the Budget adds a new and fundamental pillar to Medicare through the Focus on Prevention package. In doing so, it establishes the Government’s commitment to building a genuine health system, and moving beyond what many have described as a sickness system.

A fairer, stronger Medicare

The changes proposed in A Fairer Medicare – Better Access, More Affordable will ensure that all Australians have access to affordable, quality health care, no matter where they live or how much they earn.
The $917 million package will strengthen the Government’s commitment to Medicare.
It will make it more affordable to visit a GP, by reducing the up-front costs of a visit where the doctor chooses not to bulk bill, and encouraging doctors to treat Commonwealth concession card holders at no cost to the patient. It will also increase the number of doctors, nurses and other health professionals.
The package must still be passed through both houses of Parliament and this process will begin in the coming months.

Commitment ot public hospitals

The Commonwealth Government has underlined its commitment to free treatment for all Australians in public hospitals through a $42 billion investment in Australian Health Care Agreements. This amounts to an additional $10 billion over the last Agreements.
The Commonwealth is asking the states and territories to match its commitment of 17 per cent real growth across Australia’s public hospital system. If the states and territories are prepared to make this additional effort, hospital services can be planned with greater confidence to help meet community expectations that people can access public hospital services when needed.


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Affordable care

Bulk billing

All Australians are eligible to be bulk-billed for services provided under Medicare. That will not change. Under A Fairer Medicare, people with a Commonwealth concession card will be guaranteed to see their GP at no cost if the practice has agreed to take part in the new Government funded General Practice Access Scheme.
Currently, people in cities are more likely to be bulk-billed than people in rural and regional areas. This is unfair and will be addressed through measures in the package that will encourage GPs in all parts of Australia, whether in the city, urban fringes or rural and remote areas, to bulk-bill all patients covered by concession cards.

A new safety net

The Government will legislate to cover 80 per cent of out-of-pocket expenses in excess of $500 in a calendar year for those concession card holders whose illness, frailty or level of need exposes them to high costs. This covers, for example, services by specialists, and pathology and diagnostic imaging services provided out of hospital. Up to 50,000 individuals and families will benefit from this extra safeguard.

New private health insurance coverage

Subject to passage of legislation, private health funds will be able to offer insurance to cover all out-of-pocket expenses for Medicare services in excess of $1,000 in a calendar year.
At present, some 30,000 Australians face out-of-pocket costs of more than $1,000 in a year for Medicare services. This package provides increased protection to those who wish to take out this insurance product for extra peace of mind. The new product will be available independently of hospital or extras insurance cover.
This will cover a wide range of important Medicare funded services, including X-rays, ultrasounds, biopsies and radiation oncology provided out of hospital, as well as visits to doctors. Expenses for surgery and other services provided in hospital will continue to be covered by existing private health insurance.
This will give people a new choice in private health insurance and, for an expected cost of around $1 a week, will mean that $1,000 a year would be the most that any individual or family would ever pay for out-of-hospital Medicare services.
The Federal Government’s 30% Rebate on private health insurance will apply to these new policies.

Caring for veterans

Australia’s 340,000 veterans who are entitled to Gold or White Health Cards can rest assured that their medical visits will remain free of charge from Local Medical Officers.
Doctors registered as Local Medical Officers will be paid an additional fee of $3 above the schedule fee for each eligible veteran or war widow.


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Better for patients and doctors

Leave the GP with no more to pay and no more to do

Doctors can still bulk-bill anyone they choose. Patients without a concession card who visit a general practice which has joined the General Practice Access Scheme but chooses not to bulk- bill them will benefit from the convenience of new electronic billing arrangements. Instead of paying the full doctor’s fee, then claiming back the Medicare rebate, patients can assign their rebate to the doctor and pay only the difference between the rebate and the doctor’s fee. The rebate is then paid directly to the doctor through the electronic HIC Online (a service provided by the Health Insurance Commission). This is more convenient for patients, and for doctors.

Support for doctors

Doctors who join the General Practice Access Scheme under A Fairer Medicare will be eligible for financial incentives. The precise amount paid to each general practice will depend on where the surgery is located and how many patients they see with a concession card. Since practices in rural and regional areas typically have lower bulk-billing rates than those in large cities, they will receive larger incentive payments.
The incentives have been designed to make the vast majority of GPs financially better off. General practices will also benefit from the added bonus of simpler billing arrangements and payment of the rebate within two days.
There is nothing in the package which justifies the introduction or increase of gap payments for any patient.

Nurses and allied health professionals

More nurses and allied health professionals will be made available by extending current initiatives to additional areas of workforce shortage, in particular outer metropolitan areas.
The Federal Government will provide assistance to employ a nurse for up to 800 general practices.
Eligible practices will also have the option of employing allied health professionals such as physiotherapists, podiatrists and Indigenous health workers where appropriate.
This will free up more of the doctor’s time to see patients.

Cutting red tape

Doctors will be encouraged to make greater use of HIC Online, the electronic way of doing business with the Health Insurance Commission (HIC). Claims can be lodged directly from medical practices to the HIC, using details already stored by the practice on its computer, thus eliminating the need to re-enter information or keep duplicate records.
Practices which opt in to the General Practice Access Scheme will also be eligible for help with the purchase of equipment and set up costs for the online service. While general practices will need to register for the Scheme, payments will be generated automatically by the Health Insurance Commission. There will be no red tape.
The Government has set up a high-level taskforce to look at additional ways to reduce the administrative burden on GPs, so that doctors can spend more time with patients.

Investing in the future health workforce

From 2004, 150 new training places each year will be added to the GP registrar training program. This will be an increase of one third on the current number of places and will mean more doctors on the ground working in practices while they train.
To combat the shortage in Australia’s medical workforce, an additional 234 publicly funded medical school places will be made available from January 2004 – an increase of 16 per cent in total places.
This increase is consistent with advice from the Australian Medical Workforce Advisory Committee and ensures that growth in the medical workforce will meet community needs.
Students who choose to take these new medical school places will work under a bond for six years in an area of workforce shortage in their chosen speciality.
Both of these initiatives will particularly benefit outer metropolitan and rural areas.

Making prevention a fundamental pillar of Medicare

In Australia, chronic diseases are estimated to be responsible for 80 per cent of the total burden of disease. What is sad is that most of this is preventable.
The Intergenerational Report, which the Treasurer released in the 2002-2003 Budget, highlighted the challenges we face as our population ages. A focus on prevention will help improve the health, lifestyle and productivity of our ageing workforce and ease cost pressures on the health system.
Key components of the Budget include funding for: collaborative work between health professionals to deliver better results for patients; helping patients manage lifestyle risk factors including obesity; and renewed funding for a range of education and prevention programs, for example in regard to breast cancer and hepatitis C.


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A Fairer Medicare – Questions and answers

Is Medicare here to stay?

Yes. This package reinforces the Government’s commitment to a universal health care system for all Australians under Medicare.
All Australians will continue to be eligible to receive Medicare rebates and will remain eligible to be bulk-billed. They will continue to benefit from free care in public hospitals and subsidised medicines through the Pharmaceutical Benefits Scheme.

How does A Fairer Medicare provide protection, choice and convenience?

A Fairer Medicare means that participating doctors will guarantee to provide GP services at no cost to people with Commonwealth concession cards.
This package helps people who are living with a chronic illness. People who have high medical expenses can receive greater protection under the new package than ever before.
Patients of participating doctors will no longer have to go to Medicare offices for a refund. Instead they will only need to pay any amount the doctor might charge above the rebate level.
For Commonwealth concession card holders, the Government will pay 80 cents in the dollar of out-of-pocket Medicare costs above $500 each year. Unlike the current Medicare safety net, which only applies to the difference between the schedule fee and the rebate, this new safety net will apply to all out-of-pocket costs incurred by patients with a concession card
Private health insurance funds will be able, for around $1 per week, to cover costs for Medicare services above the rebate, in excess of $1,000 in a calendar year. This new product will cover all out-of-hospital services that receive a Medicare rebate, such as radiology, pathology and doctors.

Does everyone remain eligible for bulk-billing?

Yes. All doctors will still have the choice to bulk-bill patients who don’t hold a concession card. The package does not require or justify any new or increased charges for any patient.

Why not just increase the Medicare rebate?

The Medicare rebate already increases through indexation. In the six years since 1996 the rebate for a standard GP consultation has increased by 20 per cent, and for longer consultations by 26 per cent.
Additional increases will not provide the answer. Every $1 increase in the rebate costs taxpayers $100 million per year. An across the board increase would give no guarantee of higher bulk billing rates. And it would not address unequal access to medical practitioners in rural and regional Australia.

Won't it make fees go up?

The package provides no basis for doctors to charge more. In fact, the incentive scheme will mean that most GPs who opt into the scheme will be financially better off. The package provides $470 million of additional funding for GPs, to encourage them to participate.

How will care be improved?

By improving access and affordability of care at the local doctor’s surgery, it will be easier for people to access preventive health services. Illnesses and chronic conditions can be diagnosed and treated earlier, reducing the need for future hospitalisation.
The workforce measures in the package will put more doctors and nurses into areas of medical service shortage, including many outer-metropolitan and rural areas. People living in these areas will find it easier to visit their doctor.

What about paperwork for doctors?

There is no red tape for doctors who wish to opt in to the new scheme. The package encourages all practices that participate in the new program to use HIC Online. This will give doctors a direct electronic link with the Health Insurance Commission and allow them to be paid within two days instead of the current eight days.
The Government recognises that GPs should spend their time with patients and not dealing with paperwork. A high-level task force has been set up to look at additional ways to reduce red tape.


For more information: www.health.gov.au/fairermedicare


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