COMMITTEES;Community Affairs References Committee;Report – 28 Aug 2014

I would like to take a few moments to talk about the Community Affairs References Committee’s report into Out-of-pocket costs in Australian healthcare. I think it is important that I spend a few moments to outline this report, because the committee heard important evidence which heavily criticised the coalition’s attack on the universal health-care system that has held this country in good stead for 40 years. It highlighted just how out of touch this government is with the lives of everyday Australians. The committee made a number of recommendations, but the key recommendation was that ‘the Government should not proceed with further co-payments.’ The evidence was overwhelming in this regard.

Evidence to the inquiry emphasised that, rather than discouraging ‘overservicing’ and reducing the number of ‘unnecessary visits’, the introduction of co-payments would have a negative impact on consumers’ ability to access necessary primary health care services. The Royal Australian College of General Practitioners provided the following evidence:

The federal government’s proposed co-payment model is intended to reduce unnecessary general practice health service use. However, international studies demonstrate that, with the exception of the most vulnerable patients, there is limited evidence that co-payments actually reduce health service use. The economic rationale for implementing co-payments is further confounded by evidence suggesting that healthcare costs increase due to preventable conditions not being treated and poorer control of chronic disease and greater hospitalisations.

Submitters and witnesses expressed concern that an increase in out-of-pocket costs in the form of a co-payment for GP services would result in people delaying seeking medical treatment. In its review of health care in Australia, the COAG Reform Council found that nationally, in 2012-13, 5.8 per cent of people delayed or did not see a GP for financial reasons.

Adding an additional co-payment will exacerbate the situation and impact disproportionately on individuals with the greatest healthcare need, including Aboriginal and Torres Strait Islanders, elderly people, women, people on low- or fixed-incomes and people with chronic illnesses. A $7 GP tax would also affect the viability of GPs in rural and regional areas and could lead to their closure. Mr Gordon Gregory, the Executive Director of the National Rural Health Alliance, told the committee:

… we anticipate that a $7 co-payment will present a dilemma, especially for lone GPs in small rural and remote towns, and that the viability of these medical practices may be reduced, with consequences for access to health services in those towns. Further consideration of the impact of proposed new co-payments should therefore include their differential impact on people in rural and remote areas.

Evidence provided to the inquiry indicated that people living in rural and remote areas are less able to pay out-of-pocket costs, resulting in a greater proportion of people in rural and remote areas postponing or not making visits to a health professional due to the costs. As a member of the committee, I was concerned about the evidence given about the effect that the $7 GP tax and other proposed government measures would have on my home state of Tasmania. I would particularly like to highlight the evidence given by the President of the AMA, Associate Professor Owler, who said:

Tasmania has a higher burden of chronic disease and higher smoking rates, and we need to do more to encourage preventive health care and chronic disease management. That is why I think the co-payment is probably going to affect Tasmanians more than it affects people in other jurisdictions.

The Department of Health clearly articulated what was wrong with the ideology behind the coalition’s policy of a GP co-payment, saying:

Basic economics suggests that, other things being equal, increased prices lead to decreased demand … However in real world situations, particularly in health, other factors are not equal, and the relationship can be quite complex. In particular, demand is also influenced by income, and for superior goods like health, demand can be very elastic and grow faster than incomes. Moreover, not all health interventions have the same value and changes in aggregate demand may not impact on health outcomes if they reflect a ‘swapping out’ of less effective interventions for more effective interventions.

It is disappointing that the coalition senators chose to write a minority report that coincided with the government’s own ideological position rather than the evidence given at the inquiry, because this inquiry clearly showed their thinking is flawed and they need to stop developing policies based on self-serving ideology.

Cost is currently preventing Australians from seeking the treatment that they need. Adding a GP tax will further increase the number of Australians delaying treatment—particularly the most vulnerable Australians. This will cause an exacerbation of their symptoms and they will present to hospital with more severe conditions at significant additional costs to the health system. I seek leave to continue my remarks.

Leave granted; debate adjourned.