Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

I rise to speak on Health Insurance Amendment (Extended Medicare Safety Net) Bill 2012. The Extended Medicare Safety Net, established by the previous coalition government, assists thousands of Australians with high out-of-hospital medical expenses. For those who have eligible expenses above the relevant thresholds—and I can remind the Senate that that is $598 for concession card holders or $1,198 for all non-concession card holders—the safety net provides 80 per cent of any additional out-of-pocket costs for the remainder of the calendar year.

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

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.

I think we all know what is coming. In the 2009 budget Labor proposed cuts of $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 changes, of course, as is typical with the Labor government both under Mr Rudd and Ms Gillard, were proposed without consultation. When have we seen that happen: the social workers, the occupational therapists, the mental health nurses recently—the incentive program? We have seen it with a whole range of things. It is so typical of those opposite. We have seen it in quite a number of programs in mental health. We have recently seen it with aged care. They go out, they do not consult, they make the decisions.

Then there is a kerfuffle and we work out that patients are at risk and then all of a sudden we see quarter backflips, some other backflips and no backflips and an absolute debacle with patients most especially left in the lurch.

Taking you back to 2009 and the proposed cuts of $610 million, the changes were proposed, as I said, without consultation and were a clear breach of the promise given at the previous election—surprise, surprise! Why should this not surprise Australians? Because this is a government whose hallmark of its time in government has been broken promise after broken promise, whether it is the carbon tax and 'there shall be no carbon tax under a government I lead' or something like this in the health or mental health or ageing or any other portfolio.

At that time the coalition secured some important concessions. The government was forced into negotiations with key patient groups and the profession. The coalition's actions resulted in increases in Medicare rebates, increases in the proposed caps and the addition of new items, particularly in relation to IVF. The coalition was also successful in preventing the capping of the item numbers for injections into an eye, which would have been detrimental for patients requiring treatments for macular degeneration.

Given Labor had already broken its promise on the Extended Medicare Safety Net, 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 approved by a resolution of both houses of parliament. Ultimately, the review of the capping arrangements did show that out-of-pocket expenses had increased for patients for those items that had been capped.

This bill makes further amendments as a result of the caps that the government has put in place. It seems clear that this is an issue which should have been addressed when the caps were enacted. This bill will allow caps on benefits under the Extended Medicare Safety Net to apply where more than one Medicare service is performed on the same patient on the same occasion and it is deemed to constitute one professional service. The bill limits the Medicare benefit payable under the Extended Medicare Safety Net for a deemed professional service to what would apply to the constituent items of service; that is, the Extended Medicare Safety Net cap that will apply in such circumstances will not exceed some of the Extended Medicare Safety Net caps that would apply to the individual Medicare items. The bill appears to address an anomaly rather than making policy changes. It also removes the requirements that families confirm in writing the composition of their family for the purposes of the Extended Medicare Safety Net.

I will now take the Senate to some comments that were made by the health minister on 16 August during the debate of this bill the other place. They are so typical of those opposite, most especially Minister Roxon, the previous health minister. And now Tanya Plibersek, the current health minister, has taken up the usual rhetoric that they normally throw into every health debate, which is this absolute fabrication—the assertion that when the Leader of the Opposition was health minister apparently a sum of money was taken out.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

He cut $1 billion.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

That is wrong. That is an absolute lie and you know it, Minister Ludwig.

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Order! Through the chair, Senator Fierravanti-Wells!

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

Minister, you know that it is wrong. Let me tell you this.

Senator Ludwig interjecting—

I withdraw 'lie' and replace it with fabrication. Let me tell you why it is a fabrication. It is misleading, it is wrong and it is something that those opposite continue to parrot. The assertion that funding for public hospitals decreased by $1 billion under the coalition government is false.

Australian government funding for health, including public hospitals, increased significantly under the coalition government. According to the Australian Institute of Health and Welfare, Australian government expenditure on public hospitals increased every year from approximately $5.2 billion in 1995-96 to over $12 billion in 2007-08. Annual spending on health and aged care by the Australian government more than doubled from $19.5 billion in 1995-96 to $51.8 billion in 2007-08. Australian government funding to the states under the Australian healthcare agreements was $42 billion between 2003 to 2008, compared to $31.7 billion between 1998 to 2003 and $23.4 billion between 1993 to 1998. The 2003 to 2008 Australian healthcare agreements provided a 17 per cent increase in funding compared to the previous agreement.

The government's claims are untrue. They are wrong, they are misleading. Minister Ludwig, they are a fabrication because in 2003 the coalition government provided an extra $10 billion for public hospitals in the Australian healthcare agreements. Funding for public hospitals from 2003 was 83 per cent higher than under the previous Keating Labor government. A change in the growth rate of the Australian healthcare agreements due to higher private health insurance coverage and other demographic changes was reflected in the forward estimates of 2003. Some public hospital expenditure continued to increase by 17 per cent in real terms in the 2003 to 2008 Australian healthcare agreements, contrary to the false accusations that those opposite continue to peddle. Let me repeat that: from 1993 to 1998, it was $23.4 billion; from 1998 to 2003, it was $31.7 billion, and from 2003 to 2008 it was $42 billion. It is important that those opposite stop peddling this fabrication for some political gain. It is absolutely, totally untrue.

There are some important examples of where the government has broken its promises in health. We have just seen one example through the Extended Medicare Safety Net. But I would like to focus on a couple of areas in my own portfolio which have recently demonstrated yet again this government's incompetence and its mismanagement. It was with great fanfare that we saw mental health in last year's budget. Mental health has been done. We had Get Up! out there with the candles; we had the Prime Minister out there with various people, including Professor McGorry, making comments about mental health and spending. I say to the Australian people that it was an absolute illusion. Where has the money been spent? Do not just take my word for it. Why are we starting to see eminent people like Professor McGorry and Professor Hickie in the press making these comments? I want to raise in particular in article that appeared in March 2012 in Hospital and Aged Care. Here we have Professor Hickie being very critical of the government.

I want to quote from this article. In one part of it Professor Hickie is very critical of the progress that this government has not made in terms of meeting its mental health promises, and he makes this comment:

As a result of the mess left at the end of the Rudd era, key structural issues in mental health services remain unresolved. There is no commonly agreed service model, particularly for out of hospital and ongoing community care. Due to the unholy horse-trading between the Commonwealth and the states, the first good idea that was discarded was a Commonwealth takeover of the funding of state-based community health.

In this article, in which he makes a series of very critical comments against the government, he also makes this comment:

A whole range of other essential services also awaits clarification as to who has the responsibility to fund or deliver. Much has simply been left for later dialogue or worse, potentially, to be delivered via Medicare Locals at some future (unspecified) date.

I could go on, Mr Deputy President, but what is this telling you? This is telling you that this government, in whatever area it is in, is all about spin and no substance. We are dealing with one in five Australians with mental health issues, and here we have leading people like Professor Hickie, Professor McGorry and Professor Mendoza, who resigned so spectacularly from the government's own national health advisory council, criticising the government for its lack of action in even the most basic of ways in relation to mental health. It is a very, very sad indictment of those opposite.

Indeed, we even have the chair of the National Mental Health Commission, Professor Allan Fels, for whom I have great respect, writing an article in the Australian on 1 October under the headline: 'This commission will help mentally ill or I'll quit'. It is very clear that the framework that Professor Fels has had imposed on him in relation to the Mental Health Commission will, in my view, in no way allow him to do what really needs to be done in mental health in this country. Here we have Professor Fels hoping, I think, that the Mental Health Commission will make a difference; but, as he said in his article:

… if it doesn't, I'll be the first to call for it to be closed.

I want turn to some recent events in my Ageing portfolio which demonstrate this government's total lack of transparency and bad faith in its dealings with providers in this country.

Again, we had the fanfare—and Minister Butler is very good at lots of fanfare—with the release on 20 April of the so-called aged care 'reform' package. Certainly, when that package came out, the coalition was, I think, justified in being cautious in its response. We said the devil would be in the detail; and, indeed, the devil has been in the detail. Of course, we did have the peak bodies immediately endorsing the package, but I think they are somewhat regretting that now because they have seen that the devil has been in the detail and they have been short-changed to the tune of $1.6 billion. It is very clear that these changes were done administratively and, therefore, not done with the opportunity of their having public scrutiny. At this stage, we do not know how much of that so-called reform package will require legislation—and, when it does, we will certainly give it proper scrutiny.

I want to take the Senate to the issue of the changes that were announced on 1 July. Again with little or no consultation with the sector, suddenly the sector finds $1.6 billion has been taken out of the aged care funding instrument that was released. I take the Senate to some comments that were made and a report that was commissioned by Leading Age Services Australia. It is revealed that there will be a $750 million shortfall over the next 2½ years in this analysis, which the Centre for International Economics undertook for Leading Age Services Australia. It predicts that 89 per cent of aged care facilities will face unrecoverable losses of revenue under the revised funding model, which came into effect on 1 July. The head of Leading Age Services Australia, in a media release on 10 August 2012, states:

This ultimately means an average reduction of between $20,000 and $23,000 in care funding for each affected resident every year …

…   …   …

The average loss per aged care facility is more than $125,000 each year, with some facing revenue shortfalls of up to $560,000.

I agree with Mr Mansour, who says:

Smaller and rural facilities are potentially the most affected.

He states:

As running costs continue to rise, aged care providers—unlike most businesses—cannot increase care fees—

because they are pre-set.

Recently we have seen comments made by Grant Thornton that $3.5 billion worth of development has been taken and will be affected in the aged care sector. I conclude by saying that the coalition does not oppose the changes in this bill. (Time expired)

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I thank senators for their contributions to the debate on this bill. I also thank Senator Fierravanti-Wells for her contribution. Although I am not sure it stayed relevantly close to the bill, we do have wide-ranging second reading debate speeches on this topic.

More than ever before, we are making the most of every precious health dollar. We are guided by the evidence and have invested wisely. We are finding efficiencies and returning the benefits to patients. Where the evidence said things were not working, the Gillard government have done things differently. The bill before this Senate is part of this. We have looked at the evidence on how the extended Medicare safety net works, and it says we need to close the loophole to protect the integrity of the system.

The EMSN provides individuals and families with an additional rebate for their out-of-hospital Medicare services once an annual threshold of out-of-pocket costs is reached. Once the relevant annual threshold has been met, Medicare will pay for 80 per cent of any future out-of-pocket costs for out-of-hospital services for the remainder of the calendar year, except for a number of services where an upper limit of the EMSN benefit cap applies. The government introduced benefit caps for certain services following an independent review that found some providers have used the EMSN to increase their fees to excessive levels. The EMSN was designed to help patients with out-of-pocket costs, not to subsidise excessive charging by some doctors.

Under the current legislation, in certain circumstances where more than one Medicare item is claimed by the same patient on the same occasion and the items are deemed to constitute one professional service, EMSN benefit caps are unable to apply as originally intended. An example of this is where patients have more than one operation performed at the same time. Some doctors are performing multiple operations to avoid the EMSN benefit caps. The bill amends the Health Insurance Act 1973 and allows the EMSN benefit cap to apply even when multiple services are performed. This means that the Medicare benefit goes towards helping patients with out-of-pocket costs, not on subsidising excessive charging by doctors. Importantly, it helps to protect the integrity and sustainability of the EMSN, and for those reasons this bill is supported.

I note the opposition are also supporting the bill. In reply to some of the issues raised in the second reading debate speeches raised by the coalition, one of the areas where there is really a stark contrast between the views taken by those opposite and this government is if you look at one area in GP bulk-billing rates.

We think bulk-billing rates do provide an indication of the difference between this government and those opposite. In 2003, under the coalition, bulk-billing plunged to a low of around 67 per cent. This government has spent a record $17.64 billion in Medicare benefits, excluding dental benefits. That is an average of about $784 in Medicare benefits for every Australian. So GP bulk-billing rates are now at a record 81.2 per cent. The coalition could never claim to have improved bulk-billing rates. This government has set out to improve the bulk-billing rate and has improved it significantly. Why? Because we have an unprecedented investment in health and hospitals across Australia, unlike those opposite, who took a billion dollars out of the health system.

If you look at bulk-billing rates since 2008, you will see that we have invested a record $2 billion to drive them up, with incentives for general practice, pathology, diagnostic imaging and telehealth services. If you look at the record of the coalition, you can see that it has only ever stood for cuts to health, which means cuts to bulk-billing and higher fees for Australians when they go to the doctor. The opposition have characterised this debate as a health debate. Our record stands for itself, while the coalition failed to deliver during their 10 years in government. But we are not talking about that; we are talking about a health legislation insurance amendment to ensure that it continues to deliver for Australians. So, with those short words, I commend the bill to the Senate.

Question agreed to.

Bill read a second time.