Features Australia

Our health debate is terminal

25 June 2016

3:00 AM

25 June 2016

3:00 AM

Many politicians in recent history have found it more rewarding to dupe the public with half-truths and hyperbole rather than hash out their differences in a full-throated battle of ideas.

Yet even by today’s deprived standards, Labor’s fear campaign on the so-called privatisation of Medicare has seen the tenor of Federal political debate dragged to dispiriting new lows. Indeed, at least for discerning voters, this election is less a referendum on Medicare than it is a test of whether facts have even fleeting currency in modern politics.

In the vain hope that facts do actually matter, it’s worth ironing out a few hard truths about our public health system and how they relate to the election platforms of both major parties.

Put simply, the policy position of the Coalition is not to defund Medicare so much as to tinker with small, incremental ways to curb it’s inexorable spending growth without any compromise to front end services. The imperative here comes not from ideology but the inconvenient reality that health spending now sits on a permanently upward trajectory, easily outpacing both revenue growth and inflation. As more of the population ages out of the taxpaying workforce into the older demographics that consume the bulk of our health expenditure this problem will worsen, and substantially, at that.

The Coalition has sought to tackle this herculean task by investigating ways to create efficiencies and streamline the bureaucratic quagmire that makes up our state and federal health system. Part of this strategy has been looking into ways to outsource non-frontline services, such as the payment system. The logic is that if a private provider can better handle the complex web of payments and transfers that make up our health system, it makes sense to outsource it. In other words, the possibility of even major outsourcing in no way implies anyone will be made to pay for anything they already get for free.

If our commitment is to a first rate public health system with more dollars being funnelled back to much-needed front services, this idea has intrinsic merit – regardless of where one sits on the political spectrum.

The same can be said of reviews into the byzantine web of subsidies known as the ‘Medical Benefits Schedule’ and the ‘Pharmaceautical Benefits Scheme’. Savings and efficiencies free up scarce public funds which can then be allocated to other, more vital ends.


By contrast, Labor has declared itself unwilling to even countenance the possibility of seeking any savings in the federal health budget. It’s clear intention is to press on, peddling the politically expedient myth that we can continue to fund a health system that gives everything to everyone for the meagre price of the 1.5 per cent levy paid in income tax.

The irony is that when you measure either party’s commitment to public health based on substance and not sophistry, the ideological differences are threadbare at most. Both are committed to government controlling the vast bulk of the health system, with all the subsidies, rebates and total lack of means testing it currently entails. The real contrast between the Coalition and Labor is their varying appetite to confront the reality that at some point, the cost of sustaining the ever-growing pool of public funds we plan to lavish on our health system will have to be reconciled with Treasury’s stagnant revenue base.

That Labor has fought so hard to portray the choice as one between an ‘Americanised’ health system and a social democratic utopia speaks volumes about the intellectual bankruptcy of Bill Shorten’s leadership.

Milton Friedman’s famous aphorism ‘there’s no since thing as a free lunch’ has become a well-worn cliché, but it has never been more salient when it comes to how we talk about health. Whether healthcare is paid for by a leaky bucket of taxpayer funds sent to Canberra and siphoned off to various departments or out of the patient’s pockets at the point of transaction, someone always pays.

Nor is the cost always strictly financial. Lengthy surgery, ambulance and emergency waiting times are a perennial problem for state governments. This is not surprising. Rationing is the inevitable outcome of any system which offers unrestricted access to services backed by necessarily limited resources.

This was brought home rather unceremoniously to a friend of mine after splitting his head open during a night of post-exam revelry. Upon arriving at the emergency ward, he was informed that he could expect to wait between six and eight hours. The private hospital down the road was able to treat him immediately, but demanded an upfront fee of $250.

My friend faced an ill-fated choice: he could either pay through time and pain, or with his bank account.

In this sense, perhaps the most honest and constructive way to approach debating health would be to acknowledge that Medicare can’t carry on as a one-stop palliative for every ill that ails the public.

Once we accept this, it may be possible to debate health in a way that is about spending money in the way that best maximises health outcomes for those who need it rather than treating every dollar of subsidies as an inherent public good.As a starting point, we’d be wise to heed Joe Hockey’s tale of visiting the emergency room after his son Xavier broke his arm. Notwithstanding both Hockey’s and his wife’s exceptionally high salaries, his son received full treatment at a world-class facility at a price of only $40 – the cost of setting his cast. The remainder was pawned back onto the public dime.

If we genuinely want a health system that reconciles the aspiration of providing quality healthcare for all Australians with the constraints of public spending, Bill Shorten’s Medicare scare campaign does our politics a rank disservice.

With state and federal budgets facing the long-term squeeze of an aging population, the days we can afford to treat the Commonwealth as a Pied Piper for our every medical beck and call are strictly numbered.

This is a debate Australia can’t afford to shirk. Sadly, everything we’ve seen this election campaign is just spitting in the wind.

The post Our health debate is terminal appeared first on The Spectator.

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