BY DAVID SCRIMGEOUR
Whereas, in years gone past, our prime minister was called "Honest John" Howard by the media, it is now clear to us all what an inveterate liar he is. He lied to us about the GST, he lied to us about the "children overboard" affair, and he lied to us about the reasons for going to war in Iraq. He also lied to us when, before his election in 1996, he promised to "retain Medicare lock, stock and barrel".
The public should have been more skeptical. Here are some of the terms he had previously used to describe Medicare: "scandalous"; "absolute rort"; "miserable cruel fraud"; "total and complete failure"; "quagmire"; "total disaster"; "financial monster" and "human nightmare".
Now he has presented us with a package for reforming Medicare which, in another example of Orwellian doublespeak, is called "A Fairer Medicare — Better Access, More Affordable". The proposals in the package will not lead to a fairer Medicare, and will not make health care more accessible or affordable, especially for those on lower incomes. They are likely to lead to the death of Medicare.
There are problems with our health system, but they are not all due to Medicare.
There are problems with Medicare, but overall it is amongst the fairest systems of health care in the world. It is certainly fairer than what the government is proposing.
Medicare is a universal health insurance system, based on the principle that health care should be accessible and affordable to all. By being funded through progressive taxation, those who can afford to pay more, pay more. To most people, that seems fair.
Medicare has become an Australian icon, and opinion polls repeatedly show that Australian people are happy with the principles of Medicare. This can also be demonstrated by looking at the history of Medicare and its precursor Medibank, and how they fared in various elections.
Back in the 1960s, the poor often did not have adequate access to health care, or were dependent on the charity of doctors. The most common reason for imprisonment for debt in South Australia in the 1960s was failure to pay medical bills.
In the late 1960s, the ALP developed a policy of universal health insurance. This was part of the platform which led to the election of the Gough Whitlam-led federal government in 1972. There was still much opposition to the idea from the medical profession, and from the Liberal Party, but after a number of setbacks, Medibank was enacted in July 1975.
Soon after this, Whitlam was dismissed. Conservative Prime Minister Malcolm Fraser, who replaced Whitlam, realised Medibank's popularity (despite previously opposing it). He was elected after a campaign in which he promised to retain Medibank. However, once in power he introduced changes that led, in effect, to the abandonment of universal health insurance.
The ALP did not campaign on this until it became a major part of Bob Hawke's platform in 1982. Hawke was elected as PM, and Medicare was introduced in 1984.
In the three subsequent federal elections, the Liberals' platform proposed major changes to Medicare, and they were defeated. Finally, "Honest John" Howard went to the elections in 1996, promising to retain Medicare; and the rest, unfortunately, is history.
Political parties tamper with Medicare at their peril. It is a sign of how electorally confident Howard is, that he is prepared to propose these changes, even dressed up as a "fairer" Medicare.
Why is he prepared to do this?
At least three reasons come to mind: Medicare is abhorrent to Howard's ideology of small government and supporting the private sector over the public sector. Howard needs to reduce government expenditure to pay for military adventures in support of US imperialism. Worldwide, there is a tendency for government policy to be determined more by the interests of corporations and global capital than the interests of the people. This is a tendency which we must resist.
What is in this government package called a "fairer Medicare"?
Incentives to GPs to bulk-bill concession-card holders. However this will have little effect on overall bulk-billing rates. Most GPs will earn more from consulting non-concession-card holders, which means that concession-card holders will be considered second-class patients and often receive second-class treatment. It will not address the current disparity of GPs between the cities and rural areas and between wealthier and poorer suburbs; it will, in fact, encourage GPs to work in wealthier areas.
The package encourages co-payments for non-concession-card holders, allowing doctors who charge a co-payment to bill Medicare direct and collect the gap alone from patients. There is no increase in the Medicare rebate paid to doctors. This is likely to lead to a further decline in bulk-billing.
Those who favour the idea of co-payments say that the need to pay a fee will reduce unnecessary use of health care. However, international research shows that co-payments lead to increased utilisation of health care from the rich; and reduced utilisation from people on low incomes and with chronic illness.
Howard says he is not dismantling Medicare, and tries to get away with this by redefining Medicare. He claims that Medicare was never meant to be a universal health insurance system, and that it was always meant to be just a safety net for the poor. This is another one of his whoppers. Medicare was designed to be a universal health insurance system. The concept of a safety net for the poor leads to a two-tier system and disadvantages many, especially the working poor, who do not qualify for the safety net.
The ALP has responded to the government package with a package of its own which is a little better, but does not go far enough. Labor says it will increase the Medicare rebate paid to doctors, and provide financial incentives to GPs to bulk-bill. This at least is likely to lead to an increased level of bulk-billing and better access to GP services.
However, the ALP has not said that it will remove the 30% tax rebate for private health insurance, which benefits the rich (who are more likely to have private health insurance) more than the poor, and constitutes a subsidy of more than $2.5 billion per year to the private health insurance industry. The private health insurance industry now receives more budgetary assistance than that provided to the mining, manufacturing and agricultural industries combined.
Under Howard there has been a steady decline in funding for the public health sector, with an increase in funding to the private health sector. This does not make our health service more efficient. The exact opposite is the case. Overall health spending has increased since Howard took power, from 8.4% of GDP to over 9% of GDP.
In the US, with the most privatised health care system among developed countries, health expenditure is 15% of GDP, compared with less than 10% in other developed counties. But health care is not only less efficient, it is also less effective (in terms of health outcomes) and much less equitable in the US. And this is the direction in which Howard wants to take us.
It is a point of dogma for free-market ideologues that the private sector is more efficient than the public sector. At least in health care, the evidence reveals the opposite. Administration costs in the private health insurance industry are consistently three to four times higher than in the Health Insurance Commission, which administers Medicare.
If all government subsidies to the private health insurance industry were redirected to public hospitals, an additional 1.5 million cases could be treated in public hospitals every year.
Most health economists agree that the 30% rebate should be scrapped. In fact, it is questionable that we need private health insurance at all. Private health insurance, despite the massive subsidies it gets from the federal government, contributes less than 10% of total Australian health expenditure.
It has been estimated that an increase in the Medicare levy of a mere 0.75% would entirely fund the additional dollars that private health insurance provides to the system.
We do not need more privatised health care. We do not need private health insurance at all. We need a universal, publicly funded, health insurance system, funded through progressive taxation. That is what Medicare is about, and we should not allow it to be dismantled.
[David Scrimgeour is a member of the Socialist Alliance, not aligned to any grouping within the alliance. This is abridged from a talk given a Socialist Alliance public meeting at the Semaphore Works Club in South Australia.]
From Green Left Weekly, September 3, 2003.
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