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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

the electoral politics of health « Previous | |Next »
October 2, 2007

The politics of health continue. Health Minister Tony Abbott has foreshadowed a solution to a dogs breakfast health "system". The next five-year commonwealth-state health agreement would require each hospital to have a chief executive accountable to a local board. The measures would follow the model established by the Federal Government when it intervened to prop up the Mersey hospital in northern Tasmania, which will be funded by the Commonwealth but managed locally.


The justification? Apparently the ALP is engaged in a federal takeover of hospitals so the Coalition is going local. The ALP is actually talking about a single funding for hospitals, not actually running state public hospitals from Canberra.

This shift to placing power in the hands of local communities by the Coalition effectively cuts out the states, and it is at odds with the plans of some States (eg., SA) to do away with local hospital boards as they modernize their health system so that work in terms of a co-ordinated clusters of hospitals, primary care clinics and aged care facilities in a particular region.

It is also ignores the workforce shortages and the lack of resources at the heart of the health systems that necessitates the shift to clusters and co-ordinated and the transformation of some regional hospitals to aged care and rehabilitation facilities.

Update: I October
The crisis in the hospital "system" surfaces most dramatically in the adverse events in cash-strapped public hospitals and with patient complaints. The Age has an editorial on the topic. It says:

Both parties in this hospital war — or is it just a phoney war, a blame game being waged by political adversaries with no definite, clearly articulated policies to fix the system? — need to focus on issues that get to the heart of the problems in health-care delivery, not tactical manoeuvres that just meddle at the fringes without committing themselves to a real and necessary increase in resources that would go a long way to tackling the system's failures. The Australian public has little interest in the minutiae of hospital funding but knows that more is needed, given that the Government's private health initiatives, and a concomitant decline in realistically indexed federal funding over the past 10 years, have clearly done little to ease pressure on public hospitals. Also, it is more than aware that with growing pressure on hospital beds, the imperative for an early, and sometimes premature, discharge has increased.

The Age's editorial says that rather than pointing the finger at the states and threatening federal takeovers, the Government, or should it win office the Labor Party, needs to deal with the implications of an ageing population — for example, by boosting the number of nursing home places, which will free hospital beds for those who are ill, not just old. More beds means more doctors and nurses to attend them, and the next Government must ensure there are enough university places available to train them.

| Posted by Gary Sauer-Thompson at 5:33 PM | | Comments (31)


And so we have the hospital wars.

Tony Abbott argued that the difficulties in the public hospital system stemmed from poor management rather than sparse funding. Large area health services were inefficient, with the majority of decisions getting stuck in state government bureaucrats' offices.

Isn't giving clinicians and community representatives a say in how a budget is spent a good idea? Eg the subsidarity principle. As you have previously pointed out the states have a poor record of governing public hospitals. Something has to shift.

Dr Tony Joseph, chairman of the NSW branch of the Australasian College for Emergency Medicine, welcomed Abbott's proposal:

I think it is a step in the right direction but I think that the whole public hospital system is grossly underfunded from the point of view of not enough inpatient beds, which are the result of overcrowded emergency departments and not enough trained frontline staff.

The Australian Medical Association (AMA) also backed the plan to create local boards, saying it would put back a sense of responsibility and pride in public hospitals. morale in the public sector was low, and many clinicians had moved to private practice because they felt their ability to care for patients was being compromised.

She said the plan would encourage doctors to return to the public sector; but also said that the plan did not remove the need to boost funding.


I don't understand how shifting responsibility from the states to a local board is going to fix the major problems caused by shortages. Shortages of everything from bandaids to beds.

It makes sense for regions to decide what they need, but reallocating the decisions won't fix staff and equipment shortages. Surely if you leave the states out of the equation, then the federal level has to be accountable for funding both health and the educational support needed to supply the health system?

yes you are right --subsidarity is a characteristic of good federalism. But the local hospitals and aged care boards also need to be co-ordinated into a regional plan so that the various health institutions do different things (different levels of hospitals, aged care, rehabilitation, primary care) rather than all doing the same thing--a general hospital.

That was the problem with the Howard/Abbott intervention in Tasmania --it overrode, and spurned, the state health plan for the region that had been based on two exhaustive inquiries.

shifting responsibility from the states to a local board isn't going to fix the major problems caused by shortages. You are still going to have a shortage of health workers, especially in the regions.

It was the point made by Dr Tim Woodruff, President of the Doctors Reform Society.

Abbott continually covers up the health workforce shortage issue--or rather he's practising deception when he says that the boards can get staff in regional areas. Abbott also covers up that local boardfs running the show would result in them competing against one another rather than working co-operatively within a state regional plan.

Aren't hospitals run by a group of people already?

Wont calling them a board be just calling them a different name?

Abbott's plan to create 750 hospital boards raises an issue of who controls the funds and who makes the decisions to spend the funds on which health issues. Abbott is saying it should be the local board, which includes community representatives---presumably they outline the health needs of the community---and the clinicians. Some clinicians complain that the state bureaucracy stifles decision making in hospitals, which in turn affects the quality of health services delivered.

The Government's weapon to impose this is the forthcoming five-year hospital funding agreement, which is due to be signed by the middle of next year, but which is in abeyance because of the looming election.

What both parties should aim to build a properly funded public health-care system that would not countenance a woman giving birth in a hospital lavatory.

The SMH reports that the NSW Govt is starting to listen to the argument that the health system is at breaking point, and that there are a host of problems plaguing emergency departments.

The problems in the NSW state public health system include a chronic lack of senior staff, failure of NSW Health bureaucrats to listen to clinicians, a severe bed shortage, and emergency units riddled with chronic management problems that are jeopardising patient care.


Would it be correct to say that this extends the notion that competition produces results to the public health system? I mean, that competition for scarce resources will make them operate more efficiently?

Not really. The health system is treated as something more than an industry in the economy.

I recently heard Tony Abbot saay at a Pharmacy Guild dinner in Canberra that health was not a commodity like soap powder, and so it could not be governed soley in economic terms. He never used the word 'public good' though.

Secondly, politics cuts in. The AMA rules health and so the economics works to enrich the AMA members. You never hear Govt ministers raging against the medical unions or their bully boys.

The upshot is that market competition is resisted in health care--especially by the ALP, which reduces health to public health and is deeply opposed to fee for service.

You are right.Changing the governance structure also won’t overcome other key problems for hospitals – the growing numbers of patients, increasing levels of chronic disease, the shortage of doctors and nurses.

The significance of Abbott going on the front foot is that it shows the government is willing to embrace some reform, in contrast to the incremental steps of its previous stategy, described by Abbott as the "first, do no harm" approach.

The Coalition's decision to introduce the reform through the next Commonwealth-State healthcare agreements is a turnaround. It was only three months ago that Abbott
"didn't see any point" in negotiating the contracts when there was a question over who would be in government.

Gary is alo right in that to take the Coalition's reform seriously, it will need to have policies that go beyond hospitals if it wants to make a real difference in health. Some of the problems in our public hospitals arise from a lack of connection to other areas of the health system, such as GPs and aged care.

Public servant,

I'd forgotten about the AMA. I'm more familiar with the similar labyrinthine setup in education. Obviously the AMA is more wealthy and powerful than the teachers unions.


I'm just beginning my education on the health system, so if the relationships between other areas like GPs, aged care, education and the resources to make them all work together is so obvious to me, they must also be to plenty of other people.

Isn't the significance of Abbott's willingness to embrace some reform countered by his unwillingness to substantially increase resources? I also read somewhere, Blogocracy I think, that part of the plan is to reduce the federal contribution from the original 50 percent to 40.

I am sick of hearing about how much health cost the Australian community. I believe the aging of the community is a furthy used by the Government. The facts as I see them are that whether we die at 70 or 90, we spend about the same length of time sick. We are much healthy aged population than we have ever been. We are healthier because of the advances in health.

What I would like to see is what it would cost the Australian community if we did use the advances in health care, whether expensive or not.
Some of the most expensive, such as joint replacement and organ replacement actually cost the community less in the end.

These procedures return the patient back to the workforce, where they are very productive. The alternative of not performing expensive procedures, would lead these people needing very expensive ongoing treatment to keep them alive. It would be very unlikely they would return to the workforce.

Modern health procedures not only keep us healthy, they allow us to continue to be a productive member of society.

The cost of the health to the community is important. The cost of not providing the best health care is one we cannot afford.

My personal opinion is that this Government over the last 11 or so years have weakened and glutted Medicare. Their final aim is to get rid of Medicare. They are more than halfway through the process.

So in an election year Tony Abbott wants to go local and, blames public hospital service delivery problems on poor management.
This from the man that happily admits that the Commonwealth only supplies 40 per cent of public hospital funding, even though it has constitutional responsibility for health services.
Know who I think is a cynical opportunist.

yes you are right -- a key problem in health care is the funding.

Health-care costs are rising faster than inflation, partly because of the higher expectations consumers now have, but also because of the increasingly high-tech nature of modern medicine. Governments are struggling to maintain current levels of hospital funding, and there is evidence the contributions made by the Commonwealth and the states for the operation of public hospitals has fallen in recent years.

Under the last five-year Australian Health Care Agreement signed in 2003, the states and territories received almost $1 billion less than expected, and the Commonwealth's share of the costs of operating public hospitals fell to about 40 per cent of the total.

Well, it is true that a political cynic would judge that the Federal Government's plan for new governance arrangements in public hospitals is more about antagonising the states than an attempt to fix the serious problems that beset Australia's public health-care sector.

However, the Coalition has done little during the drawn-out phoney election campaign to suggest it is committed to working cooperatively with the states to deliver better health care outcomes in our hospitals. Quite the opposite.

The leaked information from Textor/Crosby showed that the Government had been given a five-point strategy for electoral recovery by its own pollster, Textor/Crosby, including advice to pick fights with the states to highlight their ineffectiveness.

And it was around that time that Prime Minister John Howard unexpectedly announced the Commonwealth would take over the funding and management of a hospital in northern Tasmania (which happened to be in a marginal Coalition seat), undermining, if not destroying, the Lennon state Government's plans to consolidate services in a nearby hospital and to co-rddiante health care in the region.

I guess we must be political cynics.


As a former chair of a regional area health board I had contact with the remnants of a group of local boards and with the trials and tribulations which led to the winding up of the boards in NSW. I wonder if some of the authors of the above posts have read Abbott's proposal and his answers to a series of hypothetical questions. Do they,including Abbott, actually know how the present systems work and what they replaced?
Over the last ten years NSW has really had a clean-out with many admin. tasks simplified, combined, shared and computerised. Are we going back to 750 different purchasing systems, computing systems, clinical quality controls, reporting, risk management policies? If the local board decides what coverage the hospital has, who would decide where the money was coming from or if the hospital had the clinical competence? Each state will still only have finite amount of money to disperse by the State Minister. Or is the Fed minister going to do that on the basis of marginal electorates as has been demonstrated in the recent past?
At present each Area Service in NSW has a Health Council with, if necessary, cluster Adivsory Groups and an Advisory Group for each hospital but it does not stop a river of comments going direct to the Minister. Under an Abbott plan can we envisage these going to the Chair or perhaps directly to Mr Abbott?
The two critical issues facing public health are shortage of trained people in almost every category and shortage of resources. People in a community and the staff of a hospital want to see every patient who presents, treated appropriately. The trouble is the resources are simply not available to do that. GP services and pharmacuetical services are not capped. Can finances be uncapped to meet need in a public health system? Public health is not just about hospitals. Its also about mental health, community health, aged care, and more. How do these fit into Abbott"s plan?
A different issue is the politics. In NSW, hospital boards were a fetish of the
National Party which stopped the Libs from abolishing them when they formed sector boards. In the end the local boards were left sitting there with nothing to do. Is this just about getting votes in rural electorates? It was never a great issue in the city communities.
Abbott talks a paying $10.000pa per member and having doctors as members. Doctors expect to be paid at doctor rates during consultation hours and won't attend in their own time, especially if they are "on call" rostered! Will there b e differential rates for non-doctors? How many members? 10 say. You do the math. And then add the apparatus to support them, and the bureaurocracy to interpret and carry out their biddings. Then there is the conflict between the elements of the board and the Ministers and Departments. Will the Boards be gender balanced, indigenous balanced, ethnic balanced and who will appoint them - the State Local Member, the Federal Local Member, a Senator, the State Health Minister or Federal Health Minister.
When reviewers, no matter who, impliment the results of their endeouvours without checking very carefully the reasons why their proposals failed on previous occasions they are setting us up for another expensive failure.

Lyn, you won't lean much about healthcare from the political debate.
Health Minister Tony Abbott issued the Government's plan for public hospitals to be administered by local boards. This is worth considering, compared with federal Labor's policy/threat to take over the running of hospitals from the states if certain benchmarks aren't met. The states, all Labor, then criticised the Government's plan. Abbott's response was to assert that the states wouldn't want local boards to run the hospitals because that would decrease the power of health sector unions.

This is pretty poor.

The Australian Institute of Health and Welfare report into government spending showed that the commonwealth's contribution to public hospital funding had dropped from 45per cent to 41 per cent in the past decade.

I read that Health Minister Tony Abbott said yesterday the commonwealth would increase its funding of hospitals under the next five-year commonwealth-state agreement, to be negotiated next year. It is part of the election pitch, the commonwealth might increase its proportion of funding in an attempt to put pressure on the states to lift their contributions.

You are right. The doctors (AMA) may like the idea because it gives them increased clout in running hospitals but most others in the health sector, including independent experts, think it is a disaster. The states are beginning to move away from individual hospital boards in favour of broader management that better allocates resources according to need. Rightly so, since hospital boards have been a substantial barrier to reform in South Australia----they were successful lobby groups pushed by doctors for the particular interests of their hospital, regardless of the system as a whole.

As you point out the Coalition's proposal to reform public hospitals by creating boards of management for each of the 750 institutions is a nightmare scenario and is at odds with the attempts by the states to introduce some form of rational planning into the health "system" so that it starts to function like a health system.

This is about politics not health care reform. Abbott was a centralist before this election started. Now he is saying "If you don't like what's happening in public hospitals now, don't vote Labor because state Labor has created this problem and I think federal Labor would just make the problem worse. That sure is great contribution to public debate to healh reform.

All the attention by both political parties has been on who should run hospitals. Their policies have focused on hospital management and governance. Changing which tier of government controls hospitals--commonwealth, state, regional local, won't add an extra doctor, nurse or bed to the system or bring in allied care professionals.

Francis Sullivan, the Catholic Health Australia's chief executive says it well:

"In our own Catholic system, to have single incorporated entities around the place doesn't work because you end up with fiefdoms. You need a governance structure that is less emotionally attached to the hospitals so that they can make harder decisions about how best to fund health care, otherwise every hospital will want an intensive care unit and the latest medical technology, and it just escalates costs. You need to be able to shift resources and you can't do that with local boards. Questions about getting more doctors and nurses, reducing waiting times or determining which hospital is best suited to the highest specialities are not solved by local boards. Local boards are about managing an allocated budget.

Will local hospital borads running things without a state plan means that very hospital will want an intensive care unit and the latest medical technology, and that then just escalates costs.

Carol Nader, the health editor of the Age, has an article where she points out that the core problem our public hospitals face:

Hospital staff have long reported an urgent need for more beds to relieve "access block" — where patients are stuck in emergency departments for much longer than they should be because doctors cannot find beds for them. Even staff in Victorian hospitals say they are demoralised, burned out and exasperated with the bureaucracy, despite the fact that the state regularly ranks best in terms of emergency departments.

Extra funding is needed as all the efficiency gains demanded by the neo-liberals in the 1980s have been squeezed out. The state Treasury departments don't like putting increased money into health since they see it as a leaky bucket. So they use the tools of rationing.

The politicians fall into line as they succumbed to the demand of economic orthodoxy to run budget surpluses. That showed the money markets that they had the guts and the balls to take the tough decisions and so improve their credit ratings.

you have argued that Abbott's idea to require all 750 public hospitals to have local boards is unlikely to make life any easier for the staff working in packed emergency departments. Simply bringing in boards without arming them with additional resources won't ease the hospital pressure points.

But as Public Servant points out Abbott has flagged the prospect of more hospital funding. Isn't Abbott on the right track? Do we really want out hosptials to be run by Canberra?

extra funding is required given the example below of the consequences of the neo-liberal approach to health care----cash strapped public hospitals. The middle management is dictating to doctors how they are to treat their patients and it's all driven by cutting costs, whilst the State Government refuses to accept the health system is in disarray or crisis.

Last week Dr Valerie Malka, head of trauma at Westmead Hospital, condemned the health system - calling it a shambles and demanding the Government take immediate action. Malka said the situation was so critical that lives were at risk:

My philosophy is that patients should get the care I would want my mum and dad and family to get, and there is no way that would happen, certainly not at Westmead. You cannot get anything done for patient care at Westmead because everything you try to do is an obstacle."

She added that:
some toilets in the wards at Westmead were so filthy that patients refused to use them. Misdiagnosis was common because junior and inexperienced doctors were left alone after hours and at weekends.Patients are at the mercy of the system and its failures.

Dr. Malka said she was at the "end of her tether" and ready to quit.

Sally McCarthy, head of emergency at Prince of Wales Hospital, and Tony Joseph, head of trauma at Royal North Shore Hospital, also warned of systemic problems across NSW. "They just don't listen to anyone at the clinical coalface," Dr McCarthy said.

Yesterday Dr Kate Porgeos, a member of the Australasian College for Emergency Medicine and acting director of Gosford and Wyong hospitals, added her name to the list. She is quoted by Kate Sikora, the health reporter, in the Daily Telegraph saying:

Everywhere across Sydney we are seeing severe access block, you can't see patients in appropriate places, we are very dependent on junior medicos and often overseas trained doctors or locums - we feel like we are losing registrars because they say it is a sweat shop and go elsewhere. It is a very stressful workload and you constantly feel like you are cutting corners and it is unsafe.

The hospital wars are seeing the staff at the public hospitals fight the NSW Health Minster and senior bureaucrats in the NSW Health Department.

Little comment has been made about industrial relations and health. The Federal Government has insisted on Work Choice being applied to Universities. All those who provide labour to the health system,including doctors and specialists, have good reason to see AWAs in future dealings with public hospitals. Local Govt. Councils as well as hospitals will have pressure applied to put all employees on AWAs. We have seen Government tactics demonstrated in its past dealing with the MCG when a very handsome grant was offered but conditional on all workers being placed on AWAs. The Victorian Premier refused the condition, on that occasion, and had to provide the full amount out of State funds.
The Nurse's Association is well aware of the health service's vulnerability to financial pressure and the Coalition Government has demonstrated that it is prepared to reduce funding and then blame the States for adverse avents.

I see Abbott (SMH 10/10) continues to falsely accuse Labor of wanting to move hospital affairs to Canberra. I note correspondent Han also makes that error. If people would only read the Policy documents Labor has on the web rather then rely on media interpretation and Coalition spin they would see that after giving the States an injection of cash and a breathing space to improve, they would in the event of continued perceived difficulty, give Australians an opportunity to vote in a referendum about health. This would be preceeded by a broadly based Commission giving advice on how best to proceed. Such a commission in Canada produced a good result for that country. We have lots of professional groups and community organisations that know what the problems are and have a variety of solutions to collectively debate. The health of Australians is too importantant an issue to leave to politicians and the media.
The Coalition has no overall health policy that it is prepared to expose to public scrutiny. Mr Howard and Mr Abbott keep throwing vague uncordinated thought bubbles in front of voters in marginal electorates that if carried out would cut across professional State planning.

re your comment "Little comment has been made about industrial relations and health."

Haven't the national nurses federation (ANF) had something to say about the issue of AWA's and hospitals?

As a result the Prime Minister said he had "no intention" of making billions of dollars in funding for public hospitals conditional on nurses being offered Australian workplace agreements (AWAs). Thsat was back in March.

yes you're dead right.I should have been more careful. Rudd and Roxon stand for co-operative federalism---working with the states to improve the perforwmnce of our hospitals, not a federal takeover.

re your comment:

after giving the States an injection of cash and a breathing space to improve, they would in the event of continued perceived difficulty, give Australians an opportunity to vote in a referendum about health. This would be preceeded by a broadly based Commission giving advice on how best to proceed. Such a commission in Canada produced a good result for that country.

That's a fair account of the ALP. If the states don't shape up then the feds step in.

What do you think of the Australian Health Care Reform Alliance's ideas in its 2007 Communique for a:

1. national health policy – without which the development of coherent national health policies that plan for future needs cannot occur.

2. for a national independent health commission to monitor policy and standards and outcomes for all aspects of health services, including workforce, and regularly report its findings publicly. This commission must be at arms length management from government to wrest control from vested interests. This national independent body would provide clarification of the current confusing systems in health and outline clearer responsibilities for all levels of government. The commission should allow for workforce innovation as recommended by the Productivity Commission.

3. for the commission to provide for a common national language, benchmarks, reporting of expenditure, and health outcomes, as well as outlining cost effectiveness by performing and regularly reporting a cost benefit analysis of all health services at both the provider and institutional level.

No. Not quite right. If the states don't shape up we have a referendum about health in Australia. Whatever proposal or proposals are developed and put to the people the referendum will determine the out come. That is not an automatic take over by Canberra. There are already a number of models that have been put foreward including the ideas put forward by the Allience which has merit. Re your comment on IR and nurses. Howard cannot be trusted on this subect. We can only go on previous behaviour. He is prepared to withhold school funding unless history is taught to his specification. AWAs are important to him and he will use the funding weapon to enforce his ideology. Why wouldn't he? He invented the none-core promise.

yeah your'e right again. I don't think that it will ever come to a referendum. It will more likely be done though funding and accountablity though public standards---a bit like competition policy