David Gillespie (Lyne, National Party) Share this | Hansard source

I am very pleased to be here talking about the Health Insurance Amendment (Safety Net) Bill 2015 because it goes to the heart of a very important part of the delivery of health services, and that is the Medicare safety net. I would just like to clarify a few things before the member for Throsby leaves. I am the member for Lyne, L-Y-N-E. The previous speaker from the government side is the member for Lyons, which is in Tasmania. I reside on the North Coast and the member for Lyons resides in Tasmania. There was a lot of argument put in there where Lyne, L-Y-N-E, my wonderful electorate, was pronounced 'Lin' and confused with Lyons. Just for the record, I have not spoken yet. I am now rising to speak for the first time.

This bill replaces all the existing Medicare safety net arrangements. As we know, there have been several iterations of the original Medicare safety net and the Extended Medicare Safety Net. This will roll them all into one Medicare safety net. There are changes; I will put on the record that there are changes. Whenever anything changes there are always people who are used to the current regulations and the current system, and if they are not in a public health institution it changes a lot of the economics of it. I understand that. The people who it will change the economics for as well are, obviously, the patients. But as we can see from some of the things I will bring to the table, there will be an increase in the coverage rather than a decrease in the coverage.

The main change is in the way that the Medicare safety net threshold is reached. It is changed by a new calculation, which both the member for Ballarat and the member for Throsby have outlined. There is a reason for why that has been changed, and that is what I would like to bring to the House's attention first of all.

The original Medicare safety net and the Extended Medicare Safety Net were designed as a safety net for the patients. They were not meant to be an open-ended lack of ceiling for medical and provider charges. There have been observations from previous changes that tried to address this, that the system had the phenomenon of a higher upfront provider fee reaching the threshold and then ongoing fees being picked up by the government purse.

Because of this very generous system, which was honest in its intent, some of the private providers—individual medical and surgical providers, or commercial providers—did not have that market feedback, because the purchaser was not going to bear the consequences of a higher fee. That is what the government observed in the reproductive technology space, before it changed the guidelines some years ago for the way it worked. So we do have to put a ceiling on what the government can pay—that is the existential problem that we find ourselves in. The government has a fiscal problem, and so we have to do this in a way that benefits most people. In that particular instance, we want the services to continue but we want people not to have high fees and to have a safety net.

Rather than having no incentive to control fees, which is what was observed—where we had the high up-front fees and the Medicare safety net picked up most of the subsequent gaps in fees—we are changing the way this is calculated to have 150 per cent of the Medicare fee, minus the rebate, going to the contribution to reach the Medicare safety net. That is significantly different, but the thresholds have been lowered. For people without concession cards, that threshold is being dropped from $2,000 to $700 for singles and $1,000 for families. And for concession card holders it is being dropped from $638.40 currently, down to $400.

Contrary to what the member for Throsby was alluding to, the department has worked out that it is expected that more than 53,000 additional people will receive a safety net benefit under these new arrangements. For concession cardholders in particular, 80,000 more people would receive benefits under that system than under the current arrangements. The number of non-concessional card holders receiving benefits will actually reduce. It is changing the mix of who would be attracting the benefit.

There are some other observations that have been collected, because the government is the ultimate payer for all of this and they have to look at costs. In my electorate of Lyne, we have a wonderful radiation oncology provision. We have the North Coast Cancer Institute, which has a couple of linear accelerators and specialist radiation oncologists as well as very large numbers of specialists both in the centre of Port Macquarie in my electorate and in the electorate north of me at Coffs Harbour in Cowper. The average per capita fee charged through the Medicare safety net now for an individual is $4.68, whereas in the metropolitan centre south of me in the Eastern Suburbs in Sydney the average is about $57 and on the North Shore area it is $59. So there is a difference in charging practices, and I might make some personal observations about why this is. It is not all about the phenomenon I mentioned at the start of this speech about medical fees chasing the safety net dollar. In a lot of metropolitan areas, many years ago, there were publicly provided radiotherapy centres and a lot of the complex stuff happened just in public hospitals, but with the expansion of the capability of the private sector a lot of the public sector providers have not expanded and the private sector has grown.

The economics of running private provision of health services, whether it is a private hospital, radiation oncology or complex IVF, are different to where the same technology is delivered in a public hospital, because in a public hospital or a public facility the state government is contributing to a lot of the capital works and to a lot of employment of the technical staff, and the superannuation payments and leave payments are all on the state government tab; whereas, if you are a private provider, you have to build your own facility, buy your own equipment, employ your own people and run it all out of the HPG grant for the equipment and the item number for the professional services. That is all bundled into staffing as well as the medical or surgical fee as well as running the facility. There are going to be greater fees; it is just a question of arithmetic and economics. What we do not want is what I was alluding to before, which was observed many years ago: where, because it was virtually open-ended—not totally but virtually—there was not that feedback between a medical fee and the patient bearing the cost of it, because there was this very generous open-ended Medicare safety net.

We have to be wise with our taxpayer dollars because there is a limited amount of them, and, when you make changes, some people will be very upset. It is a very difficult situation. But, on the balance of things, 53,000 more people accessing the Medicare safety net is a very powerful figure. It should make it more available and not less available. I will put on record now that I understand that for some people in some situations, depending on where you are going, through these changes there will be more out-of-pocket costs. But if that is the cost of keeping our whole system sustainable, it is an unfortunate consequence. It is really important that people have access to health care, and that is what the private providers are providing. In the public system, like we have in the North Coast, there is a significant wait. But to go to Newcastle, before there was the North Coast Cancer Institute, you could be waiting for many, many, many months for your radiotherapy and you would just be on a queue. Newcastle was overwhelmed with people coming from the Hunter and from the north-west of the state. So the North Coast Cancer Institute has filled that. But as I pointed out, a lot of the capital works was from government grants; the state government is contributing to it. But the fees that are charged on the Medicare Benefits Schedule and the other payments for the equipment and the building are supplementary to what they get from the state and federal governments out of other pockets of money. That is part of the reason the per capita draw on the Medicare safety net on the North Coast is vastly cheaper than what it is in the metropolitan centre where a lot of those other factors are at play.

Overall, it is a very significant change. We do want to get access to health care, particularly these very highly technical things. I do not want to second guess what every different situation is going to be, but when you look at it in total I think most people will have a more sustainable system, and more people will be able to access the Medicare safety net. I commend this bill to the House.

The DEPUTY SPEAKER (10:01): It being 10 o'clock, the chair will be resumed at the ringing of the bells.

Sitting suspended from 10:01 to 11 : 50

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