Medicare Safety Net Must Be Preserved
REPORTER: A $1billion jump in Medicare spending last year has forced the government to review the safety net, which allows families to claim back 80% of out-of-pocket medical expenses greater than $300. It's costing more than twice as much as planned, raising the threshold at which it cuts in to be part of discussions for next month's budget.
In March last year the government estimated the safety net policy would cost about $107 million in 2004. However by August the government revealed the number of people had more than doubled from 450,000 to 1 million. If it continues to rise at the current rate, the safety net could be costing taxpayers more than a billion dollars in three years' time.
The government originally wanted families to spend $500 on out-of-pocket medical expenses before qualifying, while those who didn't get the family tax benefit were to spend $1,000 before coming under the safety net. The Democrats forced the lowering of the threshold to $300 for families receiving the family tax benefit and $700 for others, in return for supporting the package in the Senate.
The government takes control of the Upper House from July and will no longer need Democrat support if it wants to increase the safety net threshold. Roy Jamison, Sky News.
COMPERE: And joining us on the line now is AMA President, Dr Bill Glasson. Dr Glasson, thanks for your time. Firstly, is calling for changes at this stage a reactionary measure?
DR BILL GLASSON: Look, we feel so. We feel this is premature. And we asked the government to let this system run, the safety net run for at least another 12 months. And they'll find that the initial spike I suppose that we're seeing now will plateau out because what's happening is that $2 billion in out-of-pocket expenses that you and I as patients have been paying for the last couple of years have come on to the books.
But the reality is that there is no, I suppose, inflationary pressure on medical expenses at this stage. And we asked the government not to destroy the integrity of the safety net because it's very important from the electorate's point of view - and it's very important from the point of view of providing affordability and security for patients out there, particularly young families and those with chronic disease.
COMPERE: Yes, it was a fairly key part of the government re-election strategy, wasn't it?
DR GLASSON: Well, very much so, and I think that's the other issue - that the government got elected on a number of issues but one was the health policy, particularly about safety net policy. And I think that the electorate would be very cynical if they felt that there was a major downscaling, I suppose, of that policy so soon after the election.
COMPERE: Now, concerns though, and what the government is arguing is that taxpayers will be burdened with, well, with a massive burden in years to come if they don't make these changes.
DR GLASSON: Look, I think that's a nonsense. If you look, in the sense of the overall health outlays, the bit that actually contributes to the safety net is quite small. So I think this is just political rhetoric. It's typical of bean-counters in Treasury trying to claw back after their successful election, and I think everyone out there listening deserves to have concerns about the cynicism about this.
So I asked the Prime Minister and also asked the Health Minister to lobby hard to ensure that there's not a claw back at this stage and the integrity of the safety net is preserved into the future.
COMPERE: So you're suggesting, Dr Glasson, that at this stage nothing should be done, that it is a temporary spike, that it will level out.
DR GLASSON: Absolutely. I ask the politicians just to hold off, let it run for another 12 months and they'll see that the initial spike in fact plateaus out.
COMPERE: Okay, Dr Bill Glasson, we appreciate your time this morning. Thank you.
DR GLASSON: Very good morning to you.