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12 Jun 2014

Transcript: AMA President, A/Prof Brian Owler, Parliament House Doorstop, 12 June 2014

Subject: COAG Reform Council, co-payment

BRIAN OWLER: Well, thanks for coming out everyone. I'm here to talk about the COAG Reform Council Report that was released today. There are a number of issues I think that are very important; not only in terms of the health of Australians, but also in the context of the budget that was announced last month. First of all, there is some good news; life expectancy has obviously increased for both men and women, but there are still significant gaps in terms of the life expectancy between Indigenous Australians and non-Indigenous Australians, and that's a real concern.

It does also highlight the fact that smoking rates are decreasing; although, we still have a relatively high smoking rate of 16 per cent across the nation. We've seen the number of heart attacks also falling, down by about 20 per cent, and that's due to the sort of care that our doctors and nurses are providing in our hospitals.

But what is concerning is the number of people that are obese or overweight - almost 63 per cent - and that's a number that's been increasing. We also see the issues to do with non-insulin dependent diabetes, or type 2 diabetes. About four per cent of the population have this condition, and very concerning is the fact that about a quarter of the people that have it, have not been diagnosed. We also see that some people are not taking adequate steps to address their diabetes in terms of losing weight and changing their lifestyle.

There are other issues in this report in terms of the number of preventable hospitalisations and preventable deaths. We still see that two out of three deaths that occur under the age of 75 years do so because of potentially avoidable or preventable causes such as lung cancer, which is obviously due to smoking in most cases; things like stroke and heart attack and even suicide. So it's a lot of work to do that. Child death rates have also decreased, but still we see that it's twice the rate for Indigenous children and that's something that we certainly need to address as a nation.

In terms of the financial aspects of this report, we do see that even in the context of an 80 per cent bulk billing rate by GPs, we still see that about five and a half per cent of patients don't access GP services or defer accessing a GP because of costs. We also see that people don't fill prescriptions or access dental services for the same reason, i.e. because of cost. Now, if a co-payment is introduced, then it's going to put increased pressure on people's finances; particularly those most disadvantaged in our society. It's going to mean that there are less people accessing GP services to address the issues like obesity, address the issues such as diabetes, and that's something that as a society I think we can't afford. GPs are the answers to the sustainability of the healthcare system; they're not the problem. 

QUESTION: What do you make of the high number of people who are being hospitalised and it was found that it was preventable; they could have had a flu shot?

BRIAN OWLER: That's right. So there was about 560,000 preventable hospitalisations and that's - that really goes to the core of the problem and that is delivering a sustainable healthcare system is about prevention. It's about promotion of things like vaccinations for influenza. It's about managing things like gastroenteritis and keeping people out of expensive hospital care. And so there has to be a lot more work put into prevention, and we need to encourage people to go and see their GPs rather than putting up financial barriers in the form of a co-payment.

QUESTION: What's behind the obesity increase?

BRIAN OWLER: Well, the obesity increase, I think, is a lifestyle problem associated with not only over-nutrition, but poor nutrition. So people are eating more fatty - high fat and sugary foods and drinks, but also inactivity. So we need to see people out there doing the exercise that promotes good health. The image of Australians we have in our mind is one of people that engage in sport and activity, and unfortunately this report paints quite a different picture.

QUESTION: Dr Owler, can you forgive the Australian public for being confused about the AMA's position on the $7 co-payment? Over Christmas, the AMA opposed the co-payment. Now you say you support it for some people and today you're whinging that if it's introduced, people won't go to the doctor. Do you want that or don't you want it?

BRIAN OWLER: So let me make it absolutely clear. The position on co-payments with the AMA is based on policy that's been formulated for years. Many of our doctors already charge co-payments. The AMA is not against co-payments per se, but what we don't support is the current budget proposal where we see the most vulnerable in our society subjected to at least 10 co-payments, and that's going to have impacts on preventative healthcare, chronic disease management, and those in our society that can least afford it. So until we saw the budget, like everyone else, we didn't see how many people would be affected by the co-payment and the fact that so many are, as the most vulnerable in our society, would be affected.

The report - the COAG Reform Council Report demonstrates the fact that financial costs deter those most vulnerable in our society from seeing a GP. So if you look at those most disadvantaged in the society, about 12 per cent of patients defer seeing a GP or don't access a GP already under the current bulk bulling system that we have. Now, if the co-payment is introduced, that's only going to increase, and that's the same for Indigenous Australians as well. Over 12 per cent of Indigenous Australians don't access GP services because of concern about cost.

And so this co-payment model, which does not exclude any of those things - I mean, the Treasurer, you know, is not across the detail of the policy when he said that if you've got a chronic disease, you're going to be covered. You're not going to have to pay the co-payment. Well, you are. Chronic disease management item numbers are covered, but that's only a planning number. And so, our concern is about those most vulnerable in our society, about managing chronic disease, about preventative healthcare.

QUESTION: Well, should we means test the co-payment or should we exempt people who have got certain diseases? How should it be managed?

BRIAN OWLER: Well, clearly those people that can afford to contribute to their healthcare should do so, but we need to make sure that we promote the health of Australians that can't afford to contribute and we don't punish them. We don't want to see an increasing divergence between those that are healthy and those with chronic diseases or those that can't afford to pay.

QUESTION: So are you supporting a means test?

BRIAN OWLER: So what I'm saying is that the AMA is doing the work with our general practitioners, but also the pathologists and radiologists to work up a proposal that protects those most vulnerable in our society. Now, this takes time and certainly not something that's done on the back of an envelope or in a couple of weeks. And it's the sort of work that really should have been done before the budget proposal was announced. I mean, the proposal went through without consultation with the AMA and for that matter any other health group. We need to make sure that when we have these sorts of radical shifts in terms of our health system, particularly in primary care, that it's done so in the context - not of finance or economics alone - but in the context of a health policy framework. So that's what we're working up at the moment.

QUESTION: So just to clarify, when Treasurer Joe Hockey says that the AMA has given, in principle, support to these particular payments increasing over about a five year period. If we see the further $50 billion taken out of state hospitals, do you think we'll see that further widened and waiting times get longer?

BRIAN OWLER: Again, this report highlights the fact that our public hospital systems do struggle in terms of meeting not only elective surgery targets, but in terms of achieving emergency department targets as well. Now, there have been improvements in terms of emergency departments through, again, hard work of doctors and nurses in our emergency departments and the reform process on which we embarked. And the AMA has participated in that process.

But the struggle with achieving those targets is not getting the patient in and out of the emergency department within the recommended timeframes; the struggle has always been to get the patient admitted into hospital. And that's why elective surgery targets have always been a problem as well for most jurisdictions. It comes down to the capacity of the public hospital system. You can't provide the number of services that we need to provide as doctors in the hospitals, because the capacity is not there.

Now, I have very significant concerns about the budget and the way that it's going to deal with public hospital funding to the states. We had a process that we went through. We highlighted the issues of the blame game between the state and the federal governments about who was responsible for funding healthcare. At the end of the day, we're just concerned about the outcome for the patient and so should be both state and federal governments.

My biggest concern is the fact that not only have they reduced funding such as the reward funding to address some of these targets, but they are going to fund our public hospital system on the basis of CPI and population growth from 2017. Now, that's going to be a long way short of the sort of funding that we need to fund public hospitals and provide the sort of capacity that we're going to need to look after a growing and aging population into the future.

The states, particularly the smaller states, just do not have the economies. They do not have the revenue to be able to cover state health budgets to meet the demands on our public hospital system. Now, we've talked a lot about the co-payments, but we've talked little about public hospital funding going forward. The other aspect was that the public hospital funding under the National Health Reform Agreement was about activity-based funding (ABF).

And that activity-based funding was not necessarily just about funding more activity; it was about a system that reduced things like unwanted clinical variation that made people look at the efficiencies of the services that they provided in their public hospital system to try and drive a sustainable healthcare system. What we saw in the federal budget was a move away from that ABF model to the traditional funding of just funding the states on CPI and population growth. And I think that's going to be a long way short of what they're going to need to meet the future demand.

QUESTION: Do we need an increase in the GST then to properly fund public hospitals?

BRIAN OWLER: Look, it's going to be up to the governments to decide how they raise the revenue and how it's distributed. Now, clearly, we need to have a discussion about healthcare funding going into the future and how we meet those needs. I think the narrative that's been built up around the sustainability of the federal budget when it comes to healthcare is an issue as well.

We've seen back in 06/07, the proportion of the federal budget spent on healthcare was about 18.1 per cent. This year, it's down to 16.1 per cent. So federal government expenditure on health is not unsustainable - in fact, it's actually been falling. And so the narrative that's being built up about an unaffordable healthcare system that, you know, GPs are the ones that are driving this problem with sustainability is a narrative that does not - is not based in the reality of the figures that the government themselves are publishing.

QUESTION: Are they lying?

BRIAN OWLER: Well, you've just got to look at the particulars, you know. I don't agree with their interpretation about the fact that the system is unsustainable in terms of federal government spending.

QUESTION: Are you concerned that the abolition of the COAG Reform Council means we won't get reports like this in the future that compare like with like?

BRIAN OWLER: Well, there are a number of agencies, of course, that were abolished under the latest budget and I have very significant concerns about the things like COAG Reform Council's abolition. You can see the use of the information that's provided here. The way that that should be informing healthcare policy and strategies to address these issues in the future, which does address Australia's healthcare needs.

That's the sort of information that we actually need to drive health policy in the future, not the sort of ideas that get floated as thought bubbles and then come out as a federal government budget proposal. We need to make sure that we have a national strategy around things like obesity. The National Preventative Healthcare Agency has also been abolished. What is going to fill the void that's going to be left when these agencies are abolished? Because we need the information to drive policy, but we also need these agencies and these groups and these experts to be providing these strategies on a national basis. Good. Thanks.

12 June 2014

CONTACT:         John Flannery                       02 6270 5477 / 0419 494 761

                         Odette Visser                       02 6270 5464 / 0427 209 753



Published: 12 Jun 2014