Judith Adams (WA, Liberal Party) Share this | Hansard source

I certainly agree with my colleagues’ comments and I rise to add further to those. Industry comments during our Senate Community Affairs Legislation Committee’s inquiries relating to this bill were ones of concern relating to consultation with industry and about possible conflicts of interest. There was also concern about the mechanism being used to set the levy rate. As you have already heard from my colleague Senator Boyce, many of the submissions and the witnesses at the inquiries commented on the lack of consultation between themselves and the Department of Health and Ageing. During the Senate inquiry, I asked the department how and when industry had been consulted and they admitted that there had been no consultation prior to the budget announcement. Therefore, until a month ago, the industry was not aware of this levying process. The lack of consultation results in no feedback from industry regarding the implementation of this legislation. One witness even commented that the first time they had become aware of the levy was when reading the inquiry advertisements.

I would like to quote from Device Technologies Australia, who questioned the logic of the timing of the bill, given that the review of health technology assessment, HTA, is currently underway. In light of the lack of consultation with industry, Device Technologies stated:

It is disappointing to note that despite the consultative progress being made through the current HTA Review and previous Productivity Commission reports, industry has not been consulted and appears not to be considered as an integral stake holder in the passage of the Bill, despite the proposed tax being directed specifically and exclusively towards sponsors of orthopaedic prostheses. Industry would have a conflict of interest in self funding a registry of orthopaedic devices supplied by it to the Australian healthcare system.

Another area of concern at the recent inquiry was the lack of industry representation on the registry management board, as the two seats for industry body representatives had been removed. When I asked the department for the reasons behind their removal, the response was that it was purely advisory. I am assuming, then, that if advice is given but not acknowledged or even used by the board, industry representation is not required. I will just read from our report. Medtronic Australasia raised similar concerns:

At present, with regard to the NJRR, industry does not hold any positions on the NJRR Management Committee. A position is held on the subordinate Advisory Committee. Should industry seek data from the NJRR, then it is only available on a payment basis. We are unclear as to what representation and access to data industry may have if the proposed legislation is enacted.

That is certainly another area of concern. Regarding the conflict of interest, currently the data on the registry is managed by the Australian Orthopaedic Association, and although none of the witnesses felt that there was any particular conflict of interest I would like to state that one organisation having complete control of the registry should be noted as something of concern. If the Orthopaedic Association has control of data input as well as releasing information to other organisations, this must be seen as a conflict of interest and should be reassessed, and therefore more consultation must be done with industry to assess the best process regarding access to registry data.

The committee also heard from a number of witnesses, as well as receiving submissions, that stressed the concerns relating to the levy rate setting mechanism. The department’s proposal relates to the prosthesis list, when instead the department should have consulted with industry and perhaps looked at the option of utilisation. For example, some prostheses can cost as much as $67,000. However, these may only be used once or twice a year, compared to other items which are constantly used. Most submissions highlighted this, noting that an item such as the $67,000 prosthesis would more than likely be used in paediatric orthopaedic operations and are therefore very rarely used compared to a knee or hip replacement prosthesis.

It is clear that in countries where there is a levy rate for joint replacements—for example, the United Kingdom—it has worked well and is considered successful. However, the United Kingdom’s levy is different in that it looks at utilisation, while the department’s levy does not relate to utilisation and therefore would not have the same success rate. I support the bill to introduce a national joint registry levy. However, it is clear that more industry consultation needs to be done and it is important that there be a review that would this time involve industry feedback. Therefore, I hope that the government will consider the coalition’s recommendation that the levy system and the funding of the registry be reviewed in 12 months time.