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Productivity Commision & health care reform « Previous | |Next »
April 13, 2005

Health care reform in Australia often centres around our public hospitals. The story that is told is one of patients waiting longer for elective surgery, despite ever more money being poured into public hospitals by the federal and state governments.

In some states patients are waiting months longer for many common surgical procedures in 2004 than they did in 2002. Our public hospitals are under unprecedented pressure to meet budgets by cutting bed numbers and limiting access to operating theatres. In market terms the demand for medical treatment exceeds the number of doctors, nurses and hospital beds available.

One obvious solution is to shift the hospital-centric focus on the care of people who are ill and in hospital, and spend more on public health schemes that are designed to prevent illnesses. Receiving earlier primary care treatment by a GP or an allied health professional would keep many patients out of hospital.

Australia has a high level of hospitalisation because our level of primary care is fragmented, inadequate and too doctor-centric.

Into this debate steps the Productivity Commission's Economic Impacts of an Aging Australia. that had been commissioned by the Federal Treasurer. Addressing the issues before the baby boomers become old and sick provides us with an opportunity to think ouside the tight health, hospital, doctor nexus. The Report's economics of ageing paints a picture of rising health costs over the next 20 years that would have to be covered either by massive increases in taxes or containing spending and expanding the economy.

The Productivity Commission argues that keeping people over 65 in the workforce, reducing government spending on pensions, and removing remaining incentives for early retirement in the superannuation system could help governments meet the financial burden of an ageing population.

A lot of the response has been on expanding the economy by saying that the key is participation in work for the over-55 jobless. It's more work less play. Treasury, as you would expect, is talking about cost-effective health care provision meaning containing spending through Australians shouldering a bigger share of their own health care costs.

The federal Treasurer is talking about welfare-to work reforms that will form the centre of the May Budget.He means to shift thousands of people from welfare to work. His justification is that Australia will need to lift workforce participation rates to avoid a massive budget blow-out and tax burden.

The Australian Financial Review says the key is increased productivity, meaning getting more out of the diminishing workforce and making it more flexible. Then it goes on about reforming federal state relations to avoid duplication, rural producers paying market price for water, containing Telstra's vast monopoly etc etc; little of which has anything to do with health. It uses the issue to push its own reform barrow.

Hardly anybody is talking about reducing future health costs through preventive medicine that would keep an ageing population healthy, and so out of our public hospitals and aged care facilities.

Interesting silence that, don't you think. All the chatter is about short term politics. It commands attention for a while then dies down. The long term policy concerns are not addressed. Treasury's representation of the health care crisis is just accepted.

| Posted by Gary Sauer-Thompson at 1:09 PM | | Comments (3)


Gary: One of the tenents of Health Psychology is the prevention of illness. It is galling from a personal and professional position to realise that psychological services are often devalued within our society. However there is ample evidence to suggest that these treatment measures have positive benefits for individuals, and as a consequence the community as a whole.

I concur.

The sad reality is that a state like such as SA is very mean with its treatment of those suffering from mental illness.

Treasury rules health in SA and Treasury says that cutting health budgets is good economics The health budget has to be capped because it will blow out. Therefore mental health services have to be provided out of the current budget and not extra funding.

Of course, that means the mentally ill end up in our prisons and that blows out the prison budget. But that is good because we need much more law and order to deal with all the urban crime.

what you think about social security number reform from Bush administration