Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Hansard source

I rise to speak on the Health Insurance Amendment (Extended Medicare Safety Net) Bill 2012. The Extended Medicare Safety Net established by the previous coalition government assists Australians with high out-of-hospital medical expenses. For those who have eligible expenses above the relevant thresholds—$598 for concession card holders and $1,198 for all others—the safety net provides 80 per cent of any additional out-of-pocket costs for the remainder of the calendar year. This is of enormous assistance, especially for families already burdened by rising cost-of-living pressures under this government. The EMSN was one of a suite of measures introduced by the coalition to improve the affordability of health care. The coalition's Strengthening Medicare initiatives increased GP Medicare rebates to 100 per cent of the scheduled fee, provided bulk-billing incentives, increased rebates for GP after-hours attendances and rebates for practice nurse services.

The private health insurance rebates dramatically improved the affordability of health care for millions of Australians through 30, 35 and 40 per cent rebates for respective age groups. Accordingly, we saw a 75 per cent increase in private health insurance coverage. Importantly, there was also a significant Commonwealth investment in public hospitals during this period. According to the Australian Institute of Health and Welfare, Commonwealth government expenditure on public hospitals increased by more than 110 per cent between 1995-96 and 2006-07. So the EMSN was important and was a very important component of a broader strategy to improve the affordability and accessibility of health care for all Australians.

In the lead-up to the 2007 election, Labor claimed it would honour the safety net and the support it provided to families. The then opposition leader Kevin Rudd and shadow health minister Nicola Roxon stated, on 22 September that year:

With about one million people each year receiving some cost relief from the safety net, federal Labor will not put more pressure on family budgets by taking that assistance away.

It only took until the budget of 2009 for Labor to renege on those promises. In that budget, Labor proposed to cut around $610 million from the extended Medicare safety net by capping item numbers for a range of services, including obstetrics, assisted reproductive technology, treatment of varicose veins, the injection of a therapeutic substance into the eye and cataract surgery. The government attempted this cash grab without consultation. The then president of the AMA summed up the concerns of many in this debate about the then minister's 'tendency to use the politics of envy and some vilification'. Instead of a mature and reasoned argument and genuine engagement with affected parties, the minister resorted to just blaming, in her words, 'greedy doctors'. Fortunately, given the composition of the Senate at that time, the coalition was able to achieve some very important concessions for patients.

The government was forced into negotiations with key patient groups and the profession. The coalition's action resulted in an increase in Medicare rebates, increases in the proposed caps and the addition of new items, particularly in relation to IVF. The government's targeting of macular degeneration patients in its original proposals was particularly alarming and ill-conceived. This would have resulted from the capping of item numbers for injections into the eye and was an attempt to shift the cost of treatment from government to vulnerable patients, many on fixed incomes. Macular degeneration is the leading cause of blindness in our country, causing 48 per cent of severe vision loss. It affects one in seven Australians over the age of 50, with the incidence increasing with age. At the time of this proposal, treatment of macular degeneration with Lucentis was only available in a limited number of public hospitals. It was not available at all in New South Wales public hospitals and the patients who could not afford the increased costs may have stopped treatment and risked blindness. Importantly, the coalition was successful in preventing the capping of the item number and providing a reprieve for these vulnerable Australians.

Given Labor had already broken its promise on the EMSN, the coalition also successfully moved an amendment to provide greater scrutiny of any future changes to the caps. It requires that any ministerial determination to change the caps must be provided by resolution of both houses of parliament. Ultimately, the review of the capping arrangements did show that out-of-pocket expenses have increased for patients for those items that have been capped—that is, there has not been a consistent commensurate decrease in doctor's fees. It is important to note that average patient contributions per service have increased by more than 20 per cent since 2006-07. The review specifically found that, for assisted reproductive technology, out-of-pocket costs rose substantially for those women who accessed stimulated cycles. The median out-of-pocket cost for stimulated A cycles increased from $950 in 2009 to $2,000 in 2010. Women who accessed frozen or donated embryo cycles saw out-of-pocket costs increase from $330 to $950 over the same period. Similarly, for obstetrics it was found that out-of-pocket costs increased markedly. For both normal and complex pregnancies the median out-of-pocket costs increased by $1,000 or 50 per cent, whilst the 90th percentile out-of-pocket costs doubled. This vindicates the coalition's position of forcing the government into negotiations to mitigate the impact on patients of some of their original proposals. However, it is only one of many cases where Labor has attempted to raid patients' pockets to bankroll their own fiscal incompetence. This is the practical and direct impact of a government which wastes money. It drives policy in health which is not about better health outcomes but about trying to patch up black holes. We saw the completely arbitrary 50 per cent cut in the Medicare rebate for cataract surgery. Again, this would potentially have left older Australians—mostly on fixed incomes—hundreds of dollars out of pocket for this incredibly important procedure. Through multiple disallowances the coalition was able to force Labor to the negotiating table with patient groups and the profession. Ultimately a compromise position was reached. The whole complicated and unnecessary process, which dragged on for months and caused enormous stress to thousands of patients, could have been avoided entirely through initial consultation and mature, competent administration. We have seen it again with cuts to the private health insurance rebates and the incredible decision to defer listing medicines on the Pharmaceutical Benefits Scheme for fiscal reasons, not for better health outcomes. We still have no certainty that medicines will not again be deferred in the future.

At the same time, it is worth noting, that Labor has committed billions of dollars to the establishment of around a dozen new bureaucracies. The coalition has consistently argued that, in this regard, the government's priorities are entirely wrong. Funding should be targeted to patient services and ensuring the affordability of health care, not to creating new bureaucracies. The bill before us today makes further amendments as a result of the caps that the government has put in place. In her second reading speech the minister stated that there was a need to 'close a loophole' in how the EMSN operates. It seems that this is an issue that should have been addressed when the caps were enacted but, given the legislative chaos caused by the government's handling of the changes at the time, it is certainly not surprising that some mopping up is now required. The bill will allow caps on benefits under the EMSN to apply when more than one Medicare service is performed on the same patient on the same occasion, and they are deemed to constitute one professional service. Examples of a deemed service that have been provided include a patient who is having varicose veins treatment in both legs and medical expenses for administering anaesthetic for multiple operations on one occasion. These situations currently fall under section 15(1) and section 16(4) respectively of the Health Insurance Act. Section 15 provides that in calculating the Medicare benefit payable for two or more operations covered by an item and performed on the one occasion on the one person amounts other than the greatest shall be reduced by half and the other amounts reduced by three-quarters. As the minister indicated in her speech, this is in recognition of the efficiencies of providing multiple services at one time.

The bill limits the Medicare benefit payable under the EMSN for a deemed professional service to what would apply to the constituent items of service—that is, the EMSN cap that will apply in such circumstances will not exceed the sum of the caps that would apply to the individual Medicare items. Whilst we will continue to monitor the consequences for patients of the changes the government has made, the bill before us does address an anomaly rather than create additional changes to policy. The bill also removes the requirement that families confirm in writing the composition of their family for the purposes of the EMSN. Clause 3 states that, instead, notification is to be provided 'in a manner approved by the chief executive of Medicare'. It is argued in the explanatory memorandum that this will allow a more streamlined process and ensure faster payment of safety net benefits to patients.

The coalition does not oppose the changes in the bill. We will, however, continue to apply appropriate scrutiny, especially to the administration of policies affecting patient services. The Labor government has undermined confidence in key pillars of our health system not just by the process in which they have made changes to policy affecting the EMSN but through its changes around Medicare rebates, the PBS and private health insurance, to list but a few. The coalition will continue to work closely with those affected by the government's actions in the portfolio to ensure there is accountability and to offer a stable, competent alternative.

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