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

finally, some movement on health reform « Previous | |Next »
March 3, 2010

I see that Rudd has agreed with the common criticism of his government:--that the government has not progressed enough on delivering on its promises and Labor has not managed its issues - in particular the emissions trading scheme - effectively. Acknowledgment and acceptance of criticism is the first step.

Is it a tactical move---a circuit-breaker? Maybe. Maybe not. Stephen Leeder gives Rudd credit.


At least the criticism has resulted in steps taken towards health reform--- to get back to shaping the political agenda again shift. The reforms aim to shift away from Australia's heavy dependency on hospitals; to establish a new "independent umpire" at arm's lengths from government; to set "efficient national prices" of health services to be paid for by federal and state governments; the federal government taking over full funding responsibility for primary health care outside the hospital system; and new "Local Hospital Networks" paying for services, replacing the traditional model of Commonwealth grants to the states and territories.

An optimistic interpretation is that the Rudd Government is seeking to reduce not increase use of public hospitals, thus easing the strain, by putting in place a more efficient, integrated arrangement which, it is hoped, will spur people to be treated by less expensive primary health, (ie outside hospital) services.

However, what has been tabled in the reform agenda is two systems of government talking to one another with the commonwealth saying its gonna be xyz. Will the states concur? Will they reject it? No doubt more bribes (extra money as bait says Michelle Grattan) will be required to get them to accept national performance standards and the historic shift of power to Canberra on health care.

I've re-read Rudd's Better health, better hospitals speech more closely. The core emphasis is that this fundamental reform is about improving hospitals. Rudd says this is:

Reform that for the first time enables eight state-run systems to become part of a single national network, using consistent national standards to drive and deliver better hospital services. Funded nationally. Run locally.The National Health and Hospitals Network contains seven major reforms. For the first time, the Australian Government will take on the dominant funding responsibility for all Australia's public hospitals from the states because the states simply cannot afford to fund the future growth of the system.

The Australian Government's funding share will almost double, from 35 per cent today to 60 per cent into the future - equating to an additional $11 billion per year from next year.The Australian Government will take clear financial leadership in the hospital system, permanently funding 60 per cent of the efficient price of every public hospital service provided to public patients.We will fund 60 per cent of recurrent expenditure on research and training functions undertaken in public hospitals.We will fund 60 per cent of capital expenditure - both operating and planned new capital investment - to maintain and improve public hospital infrastructure.

No previous Australian Government has accepted any responsibility for the funding of hospital infrastructure - let alone 60 per cent.Over time, we will also pay up to 100 per cent of the efficient price of 'primary care equivalent' outpatient services provided to public hospital patients.These reforms will permanently reverse the decline in the Australian Government funding contribution for public hospital services over the last decade.They will put an end to the tiresome cycle of the blame game between the Australian Government and the states over hospital funding.

There really wasn't that much on primary care and nothing about health inequalities. During questions after the speech Rudd suggested that it’s hard for governments to invest in prevention because the benefits won’t be seen for 10 years or more. Therein lies the limits of this fundamental reform.

| Posted by Gary Sauer-Thompson at 5:51 PM | | Comments (17)


Initial leaks had me worried in that it looked like the new scheme would only involve hospitals, but what he announced today, as you note, is much more, and much better, than that. Taking control of primary health care is, I think, the key to controlling what happens in hospitals. It is also closer to what the states have been arguing for too, so I think this will meet with less resistance than people are presuming.

Anyway, haven't had a really close look yet, but this is looking promising.

I agree with your comments about the leaks, what was announced and the reaction of the states. I would only add that a lot of the critical detail will lie in the implementation.

However I note that there are "Local Hospital Networks" paying for services, replacing the traditional model of Commonwealth grants to the states and territories.

So where are the local primary care networks? Primary care is a dogs breakfast, especially the "linkages" between GPs and allied health professionals; allied health and specialist services.

Basically you need e-records the accompany the patient's journey. There was no mention of that.

We have a long way to go. Is this just the first step?

I'm still sour on Rudd + Co's inaction They are using health reform to take the wind out of Abbott's sails. It is an election remember. What's happened to aged care?

Yes, but is is really going to happen.

My understanding is that this is only the first of a series of health reform proposals, and that the primary care hinterlands supporting hospitals are yet to come.

As Tim said, it is looking promising, as long as the rest of the total package complements this first part.

The states are one major concern and as plenty of commentators have pointed out, it could bring about a shift in federal/state relations with consequences we can't really imagine yet.

Bernard Keane expects that, as with the ETS, lobby groups will mangle the thing to the point where it's useless. The AMA seems to be onside though, which is a big deal from a practical and a political point of view.

Someone on the 7.30 Report last night wanted to know how it will mesh with the private system, which is another good question. Although, if the AMA is onside, you'd imagine that people in the private system are happy.

Am I right in thinking that a lack of good, affordable aged care is the biggest problem for hospitals? If so, that must be a high, but terribly expensive, priority.

aged care should have little to do with hospitals except in emergency situations or acute care. That we have the equation aged care = hospitals shows how much health is reduced to hospitals in Australia.

Older Australians want to live in their own homes for as long as they possibly can, then in village style residential accommodation.

The more I re-read Rudd's speech the less optimistic I am about health reform shifting the focus of the health system to primary care. They remain stuck on improving the delivery of hospital services. Understandable, given that the politics of health is that our public hospitals are in crisis.

Rudd says about primary/preventative care that:

it's longer term. So I simply say in response to an entirely valid question, we've got more to say on preventative health care, and that's why I indicated it together with mental health and a couple of other areas, we'd have something further to say in the period ahead.

As for today, what we have been on about is getting the fundamental reform of the structure, the funding, long-term for our Australian health and hospital system right. That is what we're on about.

So the health debate remains firmly stuck on hospitals rather than tobacco, alcohol and energy-dense, nutrient-poor food. Though Rudd advocates for primary health care, he is still talking about measuring outcomes in terms more suited to hospitals and specialists.

The Rudd Government say they are going to find 100% of primary care. Does that include chiropractors, psychologists, nutritionists, therapeutic masseurs, or the gym? I very much doubt it.

GP health services is not the same as primary care. since the absence of disease does not equate to wellness. Access to allied health services via Medicare is currently rationed either through GP care plans in the case of private allied health services funded under Medicare, or through waiting times in the case of state community health services.

Of course, you can access allied health services though the market plus private health insurance.

Will primary care services o be funded through local primary health care organizations?


The politics of healthcare revolves around hospitals, and this government already stands accused of making everything too complicated (CPRS).

It's understandable that hospital funding and management would be the centrepiece

yeah its about hospitals not health given the lack of integration between hospitals and primary care services at the local level. Currently, there is a governance structure that's centred on the hospital, and a a tendency to put resources into maintaining hospital services when that may not be the most important thing.

NSW is on board The West Australian government has ruled out handing over its GST receipts to fund the new system, whilst the Victorian government said Rudd's plan would be meaningless without extra money for hospitals.

How will a patient be able to access faster treatment at another hospital in the same local network when hospitals nationwide are now routinely choked?

Kevin's statement that the states should "just get out of the way" will be ringing in his ears now.
Gillard has come through this first term relatively unscathed. This health revamp will only go badly for Rudd because its an issue that you never win. It will be interesting to see if speculation starts now in the media whether Gillard would make a good leader. I smell blood.

Automated forex is an interesting new market I've recently discovered, it's possible to use 'expert advisor' systems to trade currencies for a profit.

It's not like other markets, it's open 24/7 and has low deposit minimums. The trick is to find a good strategy. I've been using a portfolio I found at

the current consensus amongst health reformers is that good health reform means that hospital care is integrated with primary care. In Australia we are over hospitalised. A key policy objective should be to keep people out of hospital with alternative arrangements in the community.

Perhaps we could have community operations nights then. Gladys over the back fence can hold the book while Tom the plumber does a quick hernia op.