Dr Rosanna Capolingua on Radio National - Medicare levy and 2008 Budget

STEVE CANNANE: Let's stay with our pre-Budget coverage and turn to the Government's proposed changes to the Medicare levy and surcharge.

To discuss this, and tomorrow's Budget, we're joined by Rosanna Capolingua, President of the Australian Medical Association. Good morning, Rosanna.

DR CAPOLINGUA: Good morning.

STEVE CANNANE: What's your understanding of how both the levy and the surcharge will change?

DR CAPOLINGUA: The Medicare levy, of course, is something that we all pay as a percentage of income. It doesn't truly reflect what the cost to government of delivering health care across the country is, so the Medicare levy itself is a bit of a furphy, but it's been in existence for a long time. It's meant to be some sort of message to the population about the cost of health.

The Medicare levy surcharge, of course, is what people - individuals or families - were levied if they didn't take out private health insurance, and there was a threshold income for that for singles of $50,000 and $100,000 for families, so that below those limits, if you didn't take out private health insurance, you didn't get charged the surcharge on top of the levy.

STEVE CANNANE: So what's the AMA's view on the raising of the point at which the levy and the surcharge kick in?

DR CAPOLINGUA: Well, let me put it this way, at the moment we know that the public health system across Australia is really on its knees. Even with the injections of money that have been committed to by the Government. We were so far behind in the public health system in our ability to care for patients in a clinically appropriate time across Australia that we're paying catch-up and we've got a catch-up which has a long way to go.

Anything in this Budget, or anything at any time that gives a signal to Australians that they can and should drop their private health insurance, or should not take up private health insurance, means that they'll automatically fall into the public sector if they need health care.

STEVE CANNANE: Do you think that will happen, because the Finance Minister, Lindsay Tanner, just told us that this will not lead to an exodus to the public health system.

DR CAPOLINGUA: If, indeed, there is any exodus out of private health insurance - if you give up your private health insurance, then you're exposed. If you're in need of surgical treatment or medical care in a hospital, then you either have to find money to pay for it yourself, out of pocket expenses in the private sector, and many families can't afford to do that, even in that income age bracket, or you will fall automatically onto the public sector and increase the burden there. And the public sector cannot afford that burden.

And what it will do is, the public sector is designed to look after those patients and those people who genuinely cannot afford. Those people who are in low-income brackets and the ones described in the increase in the Medicare levy surcharge.

Those patients - those people who genuinely cannot afford, they will actually be pushed further down elective surgery waiting lists. They'll wait longer for the radiation oncology if they've got a cancer. They will, indeed, be penalised. And they don't have any option. They can't buy themselves out of there.

So I'm very wary of this. I'd be very surprised if it's coming through. It sounds like it's going to and the impact will be significant.

And for those who continue to purchase private health insurance, their premiums will go up by the nature of the number of people in private health insurance and by the nature of the distribution of those people purchasing.

STEVE CANNANE: Rosanna, the Government's keeping the private health insurance rebate. That's a big subsidy to the private health industry. But they - the Government's saying that they simply are not going to force lower income people to face the choice of either higher tax or health insurance premiums. Is that fair?

DR CAPOLINGUA: We're hearing today the Government's commitment to keeping the rebate, and I hope we continue to hear it ad nauseam and ad infinitum, otherwise we really will be in even more trouble than we are now.

As far as the income brackets, we're talking $100,000 for a single, and I think we need to consider very carefully whether that's the right bracket to be making this particular decision and to be sending that particular message. As they've done the modelling, I would very much like to see that.

STEVE CANNANE: We're talking to Rosanna Capolingua, president of the Australian Medical Association.

It's seven minutes to eight on Radio National Breakfast.

Rosanna, you've put forward an AMA submission of what you'd like to see in the Budget. What are the big ticket items that you'd like to see?

DR CAPOLINGUA: Well, the first thing is that, you know, we very much hope that this is a Budget that invests in health and doesn't, indeed, make cutbacks in health when we know that we've been suffering from a long lag of under-funding in the health sector overall.

The AMA continues to call for that focus in Aboriginal and Torres Strait Islander health. The 17-year gap in life expectancy between Indigenous Australians and non-Indigenous Australians is something that is unacceptable, and the statistics that we could, you know, call out from neonatal to childhood deaths, to deaths in various age groups and the incidence of disease in the Indigenous population in Australia is just unacceptable and we need focused, clear goal-oriented funding to change that, to turn that around.

STEVE CANNANE: What about preventative health? That was a big issue that was raised at the 2020 Summit. What would you like to see done there?

DR CAPOLINGUA: Preventative health is a combination of things. Prevention starts with education, and people understanding how to make healthy choices for themselves.

So if you look at the big things that are damaging our health, of course, obesity is one of those. The public health campaigns and initiatives around getting Australians - supporting them and enabling them to make healthy choices as far as their diet and exercise goes is a very, very important preventative health initiative. So those campaigns involve, you know, the traffic light food labelling, education campaigns generally, looking at junk food advertising, even considering how supermarkets can assist us in encouraging people to make healthy choices in food. So that's an example.

Alcohol's another one. Ongoing attack on smoking is very important. Smoking in Indigenous communities is enormously important.

STEVE CANNANE: And Rosanna, just briefly, the issue of funding to public hospitals, we know that the - that figure from the federal perspective had dropped over the last five years. What would you like to see done about that?

DR CAPOLINGUA: Move the balance in funding between the states and the Commonwealth back to 50-50 per cent share. In some states it's dropped quite low, below 40 per cent down to - into the 30s. That is important. And, of course, the AMA has continued to call for more beds.