Roxon and Wong: Building a sustainable health system

The community must get better at having discussions around healthcare issues, was the resounding message at a CEDA conference in Melbourne.

Both Minister for Health and Ageing, the Hon. Nicola Roxon and Senator the Hon. Penny Wong, Minister for Finance and Deregulation spoke of difficult choices that need to be made today in the health system to ensure it can deliver a sustainable health system into the future.

Ms Wong highlighted our ageing population; an important factor "that will shape healthcare funding and health policy for the decades to come".

"By 2049-50, Australian Government health expenses are projected to account for approximately 29per cent of the Commonwealth Budget compared to the current 15.2 per cent.  At the same time this is occurring, the pool of taxpayers to support this increase is diminishing," she said.

In 1996 $19 billion was spent on health by the Australian Government, this year spending will have increased to $60 billion, and in 15 years health expenditure is expected to reach approximately $140 billion.

"The choice for Governments is whether they act now so their health system can cope with increased demand and challenges, or to sit back and let health systems and budgets gradually be overwhelmed," she said.

"We need to reform now, so that future generations can enjoy standards of service at least comparable to our own."

In regards to the health budget, Ms Wong said: "We have a responsibility to ensure that we make the best use of scarce resources" which for health "means making sure our investment gets the best possible results in terms of health outcomes".

On private health insurance Ms Wong said the current program "is clearly not equitable," suggesting that "over the short-term means testing would save the Budget $2.8 billion".

"These are the trade-offs and decisions we face as leaders. Responsible leaders will make the hard choices," she said.

"By making the right choices now, we can ensure that future governments continue to provide the level of health care Australians deserve.

"It is not just about funding today and tomorrow, it is about making sure we can continue to fund the policies we put in place into the future."

Ms Roxon spoke of the health system inherited from the past government, changes and investments made by the current government as well as reform in areas, all to ensure "we keep our health system as good as it is and improve it and at the same time make sure that it's going to be sustainable".

"The system we inherited was under serious strain" as evidenced in emergency departments, elective surgery waiting lists, and workforce shortages, Ms Roxon said. The approach by the previous government, were it allowed to continue, "would have broken the system, as well as the bank," she said.

As such the current government is making "unprecedented investments in infrastructure" and are now rolling our more than 700 projects in public hospitals," she continued. Additionally the gaps for services in rural areas has been addressed with "24 regional cancer centres being built" as well as ensuring "rural incentives for GPs are carefully designed so that the greatest incentive is paid for doctors to go to the most remote areas - and gradually we are seeing an impact," she said.

"We also took a long term view, embarking on the most comprehensive reform process the health system has seen for decades.

"Less remarked upon, but just as critical for our health reform agenda, are the negotiated outcomes we have been able to achieve with other parts of the health sector - to the benefit of taxpayers, consumers, and health businesses."

She said negotiated outcomes with other parts of the health sector include:

• Memorandum of Understanding, signed with Medicines Australia that would generate $1.9 billion in savings over five years.
• Fifth Community Pharmacy Agreement, negotiated with the Pharmacy Guild which will yield savings of $1 billion for the taxpayer while providing better pharmacy services to the consumers and a stronger role for the pharmacist in primary healthcare.
• Pathology sector agreement which will generate $550 million in savings...providing this sector with business certainty.

"All of these delivered precious health dollars...there are other areas where we have been carefully running our ruler over existing expenditure," she said.

"No areas of the health budget can or should be immune from this kind of rigorous evaluation and scrutiny."

Roxon discussed that, unlike other areas of Commonwealth health expenditure, the Medicare Benefits Scheme, which is costing $17 billion per year, "has not been subject to any large scale change or negotiation".

"To keep it working well for patients into the future, maybe doctors, and the community at large, will need to consider how they can play a role in keeping the MBS up-to-date and sustainable," she said.

"We have also committed to providing very significant additional funding for hospitals now and into the future... In exchange for this additional funding we are demanding important reforms to the way the hospitals are funded, to ensure greater efficient and transparency."

Roxon concluded by saying that: "the Australian health system was in urgent need of both reform and investment. The Gillard Labor Government has delivered reform and that investment...of course, in health there is always more to do."

During the question and answer session both Ministers responded to questions about value measurement, quality, research and development, means testing, individual healthcare responsibility, impact of technology, role of NGO's, and ethical health challenges.

On measurement and quality, Ms Roxon said that the government and community could be better at having discussions balancing the value of services and provisions. She also agreed that quality should be an indicator of value and best practice should be the same across the state, but it is not currently. Roxon urged for the Quality and Safety Commission to be made permanent but, said it was voted against by the opposition.

On the agenda of Research and Development, Ms Roxon said it was certainly valued and they had invested more than any previous government in this area within health.

"We are incredibly well placed in Australia, we should be able to attract non-government dollars, as well as government dollars," she said.

On the issue of means testing legislation in parliament, Ms Roxon was not confident that it would be passed before parliament finished this year, while it still remains in the House of Representatives, due to a backlog in the senate.

Asked if there was the opportunity to shift responsibility towards individuals for looking after their own healthcare, Ms Roxon said that it would be difficult in the Australian system, given the universality of Medicare.

On the impact of technology and the NBN, Ms Roxon said that there was enormous potential within the healthcare sector but where the funding would come from, Medicare or other, was in question.

Lastly Ms Roxon was asked about the ethical issues surrounding required service provision, and the degree of intervention to keep someone alive. Again the message was the community must be more involved and have difficult debates around these issues.

For event audio click here