Katy Gallagher (ACT, Australian Labor Party) Share this | Hansard source

I welcome the opportunity to speak to the Social Security Amendment (Diabetes Support) Bill 2016 this morning. This bill will amend the Social Security Act 1991 to automatically issue a healthcare card to all Australians with type 1 diabetes and people with dependent children who have type 1 diabetes.

It would entitle those cardholders to diabetes services, including medical and allied health consultations and goods—for example, to administer insulin—regardless of their income. It would entitle those cardholders to other healthcare card benefits below certain income thresholds—$88,000 for singles and $176,000 for couples—and make other technical changes related to residency compliance penalties and indexation. This bill itself does not provide the funding for the increased expenditure associated with these additional benefits.

The issue in this bill raised by Senator Muir is a valid one. There is no doubt that people with ongoing health conditions have additional cost burdens placed on them to manage those chronic and ongoing health conditions. When we look at the statistics across the country, more broadly, around chronic disease, of which diabetes is one, the Australian Institute of Health and Welfare estimates that one in five Australians is affected by multiple chronic diseases. The leading one of course is cardiovascular disease: one in five. In cancer, it is one in two men over 85 or one in three women over 85. One in 10 Australians have chronic kidney disease. One in 19 Australians have diabetes. One in five are affected by mental health. One in four Australians have musculoskeletal conditions. In oral health, for example—something that not many people focus on in the area of chronic disease but it is a very important one—three in 10 adults suffer from teeth decay. Then there are the very large numbers of people who have asthma—one in 10—or other respiratory contributions, for example, COPD: one in 42 Australians.

There is no doubt for anyone who is interested in health care or understands the healthcare system that managing the ongoing human and economic costs of those chronic diseases is one of, if not, the biggest challenges facing the health system in the future. It is right up there.

The cost to the community is not only large in terms of expenditure from budgets and revenue raised through tax; it is also the economic cost of people not being able to work or having long periods of time where the management of their health condition is unstable. If you approach this bill from that point of view, the arguments that Senator Muir put forward are well understood and have merit.

I also think in relation to type 1 diabetes, particularly, its onset is often between the ages of 10 and 14. The human cost of managing a child who suddenly has a lifelong condition and the additional expenditure that comes with it are very difficult things for families to manage.

The information that the ABS and the AIHW collects shows us that the rate of type 1 diabetes in Australia is remaining stable but it is still not an insignificant number of people: in 2013, there were 2,300 with 23 new cases of type 1 diabetes in Australia, which equals 11 cases per 100,000 population. The incidence rate for type 1 diabetes is higher in males than females. It peaked at age 10 to 14, where 33 per 100,000 population were diagnosed with type 1 diabetes. More than half of all new cases of type 1 diabetes were in young people under the age of 18.

When you look over the long term, from 2000 to 2013 there were 31,895 cases of type 1 diabetes diagnosed. This was around 2,300 new cases of type 1 diabetes each year, or six new cases a day. That incidence rate has remained stable over the last 13 years. That puts us in contrast with other countries that are seeing increases in the incident rate of type 1 diabetes. That is not being seen in Australia. One other interesting issue is the low rate of type 1 diabetes in Aboriginal and Torres Strait Islander people, which is in stark contrast obviously to the rate of type 2 diabetes for those population groups.

There is no doubt that type 1 diabetes is an enormous burden on both individuals and the community. Those who have the condition require lifelong health management. It has associated health problems—in some cases disability and in other cases it certainly affects quality of life and can lead to premature death, particularly if it is not managed well in the primary healthcare system. The Incidence of type 1 diabetes in Australia says that the financial burden of type 1 diabetes is estimated to be $517 million annually. The incidence rate of type 1 diabetes amongst children and young people in Australia is relatively high when compared to other countries. Australia is in the top 10 countries in the world even though, as I have previously commented, this rate has remained stable over the last 10 to 15 years.

More broadly—and again the health economists can easily pull numbers together on what the direct and indirect health costs are—back in 2008-09 direct health costs to manage chronic disease in Australia were estimated to be about 36 per cent of all health expenditure. I would expect that, as that data is quite old, that percentage rate would have increased slightly with the huge growth we are seeing in the number of Australians experiencing and living with chronic disease. Of course, then there are the indirect costs associated with those conditions.

There is no doubt that the health costs associated with chronic disease management more broadly in Australia are a massive challenge for governments and parliaments when considering legislation that seeks to extend or increase the amount of support that is provided. Certainly in the states and territories the expenditure on health, mainly through the hospital system, is eating up increasingly large areas of their revenue base. Anywhere from 30 to 35 per cent—heading to 40 per cent pretty quickly—is being spent on health care. Whilst we have seen some reductions in the growth rate that the Commonwealth is prepared to fund, there is still a large amount of expenditure going into health from the Commonwealth as well. We would argue that the decisions around cutting back on the growth rate to hospitals in particular, the cuts that have been made, are making it increasingly difficult for people with chronic illness to manage their condition, as are the cuts that have been flagged and imposed in the primary healthcare system.

From a health point of view one of the great things about Australia is Medicare. Labor designed the Medicare system, and we will protect it as a priority. Medicare makes sure that health services are available to all people. Wherever you are in Australia you are able to access top-quality health care if you need to. That is a fundamental principle that underpins Medicare and it is why Labor will fight so hard to ensure that Medicare is protected. The minute you start tinkering with that we start walking away from that principle.

We also believe that people, particularly those on low incomes, must be able to afford the costs associated with accessing health care. That goes to some of the entitlements that are received through access to a healthcare card. That is targeted to income and access to that healthcare card does not specifically give additional entitlements for particular health conditions. The main focus must be that any decision government makes to provide financial support for people with ongoing health conditions must be targeted to those who need it and to all who need it. That is why the cuts to bulk-billing, the freezing of the indexation rates for GPs, the pathology changes and the pathology cuts are so critical in this space. They will mean that people, particularly those with chronic health conditions like diabetes, will end up having to pay a lot more money.

It is not just about meeting the costs or improving on the costs that they are currently experiencing; it is the fact that some of the changes being proposed, whether it be through the MYEFO or for decisions already taken, will mean that people with diabetes, for example, could be hundreds of dollars every year out of pocket for the cost of actually staying well—that is, going in for monitoring, for blood tests, for urine tests or for checking on the function of their kidneys. All of those tests that people who have diabetes must have to manage and keep their diabetes stable will potentially now cost a lot more money. Labor has been resisting and arguing against precisely that because: first, it will mean people who have already got additional health costs will have to pay more; and, second, it will potentially reduce the availability of those services to people who need it. There are enough service providers in the pathology industry saying that that will be the result.

Also, if those tests are not done and if people do not keep on top of the management of their diabetes in the community then they will end up in hospital. When they end up in hospital, the costs associated with that care are much greater. We would argue that this is a very short sighted save the government is proposing because it will provide a disincentive for people to actually proactively manage their disease well so that they do not end up in hospital. Once they enter hospital, there is a whole range of human costs and financial costs associated with that.

Listening to the debate this morning, the other issue that comes up from time to time is whether some particular diseases and illnesses should be treated preferentially to others—it is not an easy discussion—because some diseases and illnesses are the result of lifestyle factors and others cannot be helped at all; therefore because an individual did not, in a sense, bring it upon themselves, the entitlement to access financial supports may be greater. I think that is a very difficult argument to resolve because when you look at the expenditure in health care, an amount of it no doubt is expended because of choices individuals make about their lifestyles. There is obviously a whole range where that is not relevant but I think one of the fundamental strengths of a universal healthcare system is that there is not judgement attached to the particular illness that may require you to access health services. It is a pretty slippery slope that will act as a disincentive for people to seek treatment, to seek support. For the greater good of the community, we need to have those options available to people.

Whilst I completely understand and sympathise with families who are having to manage some of these costs, I think it is worthy of review. It is worthy of further examination across the board as to whether the current arrangements are adequate. Some would argue that the MBS review will allow that broader examination. I know that there are various health groups that have provided input into the adequacy of the current arrangements but I think that is probably a broader debate than we can pursue in relation to this bill.

I think the main focus for us as politicians who are interested in the future of the Australian healthcare system should be to ensure that we protect the fundamental principles of the healthcare system, which is Medicare for a start. It is appropriate to fund the primary healthcare system, the hospital system, the exit points from the healthcare system and to make sure that those who are unable to afford care still have access to top-rate, first-class, international quality health care. If you accept that those are the criteria for which you plan and fund your healthcare system then the flow down from that will benefit people who have ongoing chronic and lasting health conditions. There is no doubt if we can better manage people in the primary care system, if we are able to put the focus on preventative health care—and that will not affect people with type I diabetes; I accept that—and if we can lessen the burden of disease in other lifelong and chronic health conditions then resources will be freed up to plug into other areas of demand within the healthcare system.

The healthcare system is going under such huge transformative change at the moment that the opportunities to reallocate should be real. The government has not helped here with the cuts to the Preventative Health Agency or with the cuts to the National Partnership on Preventative Health, which go precisely to that point. Early investment in this area will actually deliver long-term benefits if we are able to stop the amount of escalating cardiovascular disease, respiratory illnesses and mental health conditions. If the investment goes in early, the benefits are there for all of the community including for those who have ongoing health conditions that cannot be addressed by a change of lifestyle.