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Into the 21st Century: The Rudd Reforms

When regimes change, health systems tend to change – or, at least, attempts are made at system change. For the AMA, this has been one of its most frustrating occupational hazards. Over its 50 years, the AMA and its members have had to face this problem six times. So, late in 2007, when the Howard Government gave way to that of Kevin Rudd, the AMA prepared to knuckle down once more.

A major concern at the time of this regime change was the consequences for the hospital system of the failures and inconsistencies over the years of the funding arrangements between the Commonwealth and the states. The Rudd health policies for the election campaign dwelt to a large extent on this problem. They included a formula that would swing the bulk of the responsibility for funding public hospitals on to the Commonwealth (subject, among other things, to the states accepting some serious ifs and buts involving taxation arrangements) that, if it worked, could begin to tackle a serious and growing shortage of hospital beds. But the Rudd proposals also included other ideas that, if they too worked, contained the potential to cause difficulties for the operations and prospects of AMA members, especially GPs. This was at a time when, though there was strong growth in the number of specialists and trainee specialists, the supply of full-time practising GPs was in decline, according to Medical Labour Force, a contemporary report by the Australian Institute of Health and Welfare.

One such proposal was for 36 GP Super Clinics around the country, which the new Government considered would improve access to, and coverage of, community healthcare by providing under the one roof a multidisciplinary team comprising GPs, nurses and other allied health professionals. The AMA was pessimistic, advocating in a submission to the Government that GPs should not be displaced by the clinics, that the clinics should be located where they were genuinely needed, that they should operate strictly according to clinical need and that the multidisciplinary teams should be led and coordinated by GPs. Meeting these conditions seems not to have been easy, which may well have contributed to the fact that, between the onset of the scheme and when the AMA celebrated its 50th anniversary four years later, barely three quarters of the clinics planned were operating or being established.

Nevertheless, at the onset of Rudd rule, some signs, as the AMA saw them, were fairly positive. The AMA was encouraged early in 2008 when the new Government set up (among a large number of other policy reviews) a National Health and Hospitals Reform Commission to “develop a long-term health reform plan for a modern Australia”. It was especially pleased that former Federal President Dr Mukesh Haikerwal was a Commission member, which (the then Federal President Rosanna Capolingua said) was an acknowledgment of the AMA’s “unique ability to provide advice across all aspects of health”. The Commission was asked to bring down an interim report by the end of 2008 and a final plan in mid-2009, which would provide a blueprint for tackling challenges to the system, “including the rapidly increasing burden of chronic disease, the ageing of the population, rising health costs and inefficiencies exacerbated by cost-shifting and the blame game”. This looked more promising, and the AMA welcomed it, pledging to support the Commission “in its efforts to build a modern, responsive, affordable and equitable health system to meet the needs of all Australians, no matter their means and no matter where they live”. The AMA’s sixth health system change was on its way. Before the Commission could produce its long-term reform plan, though, the Government had to get on with dealing with its immediate problems in healthcare delivery, and the first sign of what it had in mind would come in the first Rudd Budget.

The AMA’s immediate reaction to this Budget was relief that it had not imposed major expenditure cuts on health and that many of the issues on which it had campaigned had been supported: Indigenous health, preventive measures for diseases such as cancer and investment in the public hospital system. A few days later, after closer analysis, the AMA’s response was not so benign. The detail of the Budget showed that it had taken the razor to a number of programs that supported GPs so that it could find about $170 million to pay for the GP Super Clinic scheme, Dr Capolingua said. The AMA said that the Budget had provided barely more than half the number of GP training places that the Australian Medical Workforce Advisory Committee had recommended. It had failed to increase the indexation of the Medicare patient rebate so that it could keep pace with the cost of care. Its proposal to increase the Medicare levy surcharge would precipitate an exodus of young healthy people from the funds, which would then result in 5 per cent increases in premiums. This decision would start “a vicious cycle of unaffordable private health insurance”.

About a month later, in June 2008, the Government released Towards a National Primary Healthcare Strategy, a discussion paper on “a wide range of issues associated with . . . current planning, delivery, governance and financing” of primary care. It set up an External Reference Group of health experts who would develop the strategy and present it to the Government by the middle of 2009. The paper echoed the proposal made in a Productivity Commission report on the health workforce two years earlier that doctors should move over and let some of their role be carried out by other health professionals. The discussion paper emphasised that allied health professionals such as nurse practitioners and pharmacists were increasingly important in multi-disciplinary primary care teams, and that some health professionals might already be providing some aspects of care that “could be delivered equally effectively by another health professional”. The AMA could see where this was heading and reacted badly. This was a backward step, it said. Nurses and other health providers were skilled and respected in their role of assisting patient care “but, in terms of comprehensive primary care, they are most effective for patients while under medical supervision”. And the AMA questioned how the Government intended to maintain high-quality patient care “while diverting patients from seeing doctors”. The attack continued a week later, when the AMA organised a statement signed by the Presidents of the AMA, the Royal College of General Practitioners, the Rural Doctors Association of Australia and the Australian College of Rural and Remote Medicine that was critical of the view expressed by the discussion paper. “Medical competency, diagnosis and management and effective team-based care were the foundation of best practice and safe primary care,” the statement said, and this care was best delivered “under medical supervision with assistance from other trained health service providers”.

At about the same time, the AMA issued more formal statements that dissented from the Government’s “restrictive policy framework”. One renewed the AMA’s attitude towards GP Super Clinics, calling for the Government to dump the idea and work with the AMA instead on other “broad measures” that would improve access by patients to GPs. Another urged the Government “to address the policy inertia that continues to restrict medical services for the sick and frail residents of aged care homes”. By now it was clear that the early neutrality between the AMA and the new Government had disappeared. There might be elements in the Government’s health reform policy about which the AMA was not too unhappy and it might be prepared to coexist with the policy, if not embrace it, but it had come to the view that the reform package as a whole at best did not benefit eeither patients or its members.

Over the next few years, as more of the package unfolded, this view hardened. Many AMA members would see the Rudd proposals as arguably the most difficult – and most foolhardy – of the six reform challenges that the AMA has faced. Indeed, by the time that she reported to members in the 2008 Annual Report, Dr Capolingua had dropped the niceties, referring to a reform agenda that contained “a grab bag of proven failures as the principal policy options”, including models from the National Health Service “that have failed generations of patients in the UK and other options that have seen the provision of healthcare in the United States increasingly become the domain of big business instead of care givers. “The bureaucratisation of health in Australia is building a faceless future,” she said, “where patients are numbers and the family GP – the person generations of families have turned to in good times and bad – becomes a thing of the past.” The AMA was no longer making nice with the Rudd Government. It is hard to imagine a worse moment than this for a long-dormant proposal for a national registration scheme for all health professionals to re-emerge.