She's Right - It Is Stuffed, (But We Must Know Why, And How To Fix It)

She’s Right – It Is Stuffed, (But We Must Know Why, And How To Fix It) – 14 April 2005

The Australian Doctors’ Fund today welcomed frank admissions by the SA Minister for Health, Ms Lea Stevens that hospital Medicare “is stuffed” and “a disaster waiting to happen”.

For many years state health ministers of all political persuasions have been apologising and telling official lies (spin) for a hospital system that simply can’t deliver what Australians have been promised, namely “unlimited high quality medical care on demand to everyone all paid for by the taxpayer,” Executive Director of the Australian Doctors’ Fund, Mr Stephen Milgate said in Sydney today.

Furthermore, there is ample evidence to show that as taxpayer funding increases productivity declines by a mechanism known as Gammon’s Law, i.e. “in a bureaucratic system, as funding increases productivity declines”.

Australian taxpayers are contributing around $18 billion p.a. to our public hospital system. By any standards, this is an incredible amount of money and represents almost $1,000 p.a. per Australian or almost $2,000 p.a. for everyone without private health insurance. But it isn’t delivering; it never seems to be enough.

Instead of looking at failed models (or their derivatives and hybrids) such as US-styled managed care, budget holding, fund holding, purchaser/provider split, and the appalling British National Health System, we should examine where we’ve come from.

Australia once had a very proud public hospital system. Can we get back there? The answer is, yes.

Public hospital insurance targetted at the chronically ill and those not able to be covered by private health insurance would see all patients directly funded for in-hospital patient care on a case by case basis.

Tax deductible Medical Savings Accounts backed up by insurance would reform the private health care financing system. What are we waiting for?