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Issue #1628      February 26, 2014

Why bulk billing is important

Dr Con Costa is a Sydney GP and national president of the Doctors’ Reform Society (DRS). The DRS was formed in 1973 to support a proposal for a publicly-funded universal health insurance system. Medibank (now Medicare) was successfully created despite opposition from the Australian Medical Association (AMA). The DRS is strongly opposed to the introduction of a Medicare co-payment as are other medical organisations including the AMA, College of GPs and health unions. Dr Costa was one of the speakers at the “Stop Abbott, Save Medicare” rally in Sydney on February 15. The following is his speech:

Dr Costa speaking at the “Stop Abbott, Save Medicare” rally in Sydney.

Before I talk about the effect that a $6 co-payment will have on our health care system I want to take you back to the days before Medicare.

Some of you may be too young to remember what our public health system looked like before Medicare, so let me paint a picture for you.

Before Medicare

Before Medicare (and Medibank) it was not unusual for people to be locked up and put in jail because they were unable to pay for the medical bills. In fact, at one time, in South Australia it was the most common reason for being jailed. Many Australians, at that time, lived under the threat of punishment for failing to pay for the costs associated with their family’s medical care and treatment.

Before Medicare, there were few doctors outside of the lower North Shore or the eastern suburbs. People living in the western suburbs or much of rural Australia couldn’t afford to see a GP so the GPs didn’t venture out west. Many of the people living in these areas were forced to resort to the emergency department of their closest hospitals for basic treatment and care. They would wait for hours in outpatients departments to see a doctor.

Before Medicare, the only women who could access women’s health checks were wealthy women. Women who could not afford pap smears, mammograms and other essential check-ups simply went without. As the primary care-givers, this also meant that these women couldn’t access medical care and check-ups for their kids and families.

Before Medicare, immunisation rates were dependent on community health or public immunisation programs and schools. That was the only way that children could access this type of preventative health care. Today, many of these programs no longer exist, so children from families who can’t afford to see their local GP will resort to going to their local hospital and waiting in the emergency room to be immunised. We could potentially see a rise in epidemics of disease and illnesses we have already fought so hard to hold back.

This is what our health care system was like before Medicare. I want you to keep all this in mind before I start talking about the $6 co-payment that the government may introduce.

Since Medicare

Since Medicare and bulk-billing were introduced: doctors have gone out west to areas where they are needed, we have a better economic provision of health care for all Australians, bulk-billing has kept access to GP viable for all Australians by keeping a lid on GP-related costs. It is important to note that Medicare-related costs have not increased in over a decade. This means that since Medicare was introduced the health care system has already been more affordable and sustainable for patients and for government.

The importance of the affordability of seeing a family doctor or local GP is priceless to our public health system. If most people can see a GP it means they can access routine health checks and screening, and all-in-all they can receive preventative care that provides early and effective treatment at a much lower cost for the community and the country, compared to high hospital costs.

Just imagine how much worse off and costly it would be if a third of all Australians had no access to a GP.

Remember: There are no longer the public immunisation programs, community health services, check-ups, dental programs etc that there were in pre-Medicare days.

So, in essence the state of our health care system would be worse than pre-Medicare days when people were jailed for health bills!

Rural areas and poorer country towns, women, Indigenous Australians and those living in outer urban areas of major cities would be amongst the biggest losers. These groups have most to lose from LNP proposed cutbacks.

The government has spoken a lot about the disadvantages of bulk-billing. But, in fact, bulk-billing has kept medical costs very low and sustainable without any increase over the last decade. Bulk-billing means that whilst there are enough doctors using the billing rebate of $36 (per-consult), Medicare can control the market in health care and associated costs – including blood pathology tests and X-rays, mammograms, MRI scans etc.

Bulk-billing at risk

If the Abbott government proposed $6 co-payment is introduced it won’t just be $6 that Australians will have to fork out from their pockets. Many more doctors will stop bulk-billing. Currently non bulk-billing doctors charge on average $65 per standard consultation. The AMA recommended rate is $72 per standard consultation. So if we do stop bulk-billing there will be a significant cost per person, per visit overnight.

The implications of a $6 co-payment need to be considered also.

Allegedly, the Abbott government says it will save $180 million per annum. That is a saving of $180 million from a $140 billion system. This is a piddling amount of money when you compare what we are set to lose.

Higher costs

The Doctors’ Reform Society disputes Mr Hockey’s budgeting outlook on this issue. We argue that in the long term the government won’t save any money if a $6 co-payment is introduced. If bulk-billing is scrapped in place of a co-payment, most pathology, X-ray and MRI centres would follow suit. Currently just a routine check-up of 10 battery tests or a standard MRI costs $500. Those who are in need of regular monthly or even weekly check-ups to keep on top of their health to avoid being sent to hospital will be unable to afford such costs.

So what will they do?

Many Australians who can’t afford these high costs will simply have no choice but to flood back into emergency departments to have their blood pressure, glucose, cholesterol levels checked and their scans and X-rays done. Such a response will only seek to place increased pressure and stress on our hospitals.

A recent report from the AMA about Australia’s poor public hospital performance shows we already cannot afford to let Medicare and our current bulk-billing health system go. Our hospitals simply cannot be put in such a position without disastrous consequences for those who need emergency responsive treatment and intensive care.

So as you can see the Abbott government proposed $6 co-payment will cost Australians a lot more than $6. It will destroy the Medicare and bulk-billing system that has been put in place to provide affordable and sustainable health care in this country and replace it with expensive private health insurance. It will mean an Americanisation and privatisation of our health care system.


Just to provide you with a snapshot of an American-style system of health. I had a patient who recently returned from a family holiday to Hawaii. Her four-year-old son came down with an ear infection and she was forced to take him to a local doctor who charged her $500 for a consultation plus the additional costs associated with the medication and scripts she was given to treat to her child. That is what we can expect from such a pay-as-you-use system.

The proposed pay-as-you-go $6 co-payment will not save money or make the health system more sustainable, it will simply drive up costs to the individual and families. It will create a two-tier health system where the rich are slugged a ridiculous amount for health care, driving up Private Health Insurance costs and premiums through the roof, while at the same time excluding those who cannot afford to pay from our health care system altogether.

Mr Hockey’s message to Australians is quite clear: if you don’t pay you go without; in health terms, if you don’t pay you die.

This is not about saving money; this is an ideological attack on bulk-billing! Medicare outlays by the federal government have been flat-lining for over 10 years. The real increase in the health dollar is in the hospitals and the Pharmaceutical Benefits Scheme (PBS).

Where we have seen the big increase in health costs are the high costs of hospital care and government over generous deals with the big pharmaceutical companies. The same cholesterol drug that cost $40 in Australia, $20 wholesale at your local chemist, costs only $2 in New Zealand and $3 in the UK. Our government is simply not getting a good deal for Australians.

I might not be an expert economist or a politician; I’m just a GP with over 30 years’ experience in public health. But if I wanted to save money and make our health system sustainable for an ageing population, I would definitely NOT destroy primary health care and bulk-billing by introducing a co-payment to reduce GP care.

A sustainable approach

Instead, I would:

Expand primary care into the community, including access to a GP so that people have the right to good healthcare in the home and community at cheaper costs.

What we need to do is expand Medicare into nursing homes, rural communities and palliative care. That proper servicing in the community would save a lot of money by taking pressure off the growth in expensive hospital care.

When new contracts are up for signing with Big Pharma this year, Mr Hockey could save the health system billions of dollars by negotiating a fairer price on pharmaceuticals for all Australians. That’s a lot more than they would supposedly save by destroying affordable GP care.

We should include dental care under Medicare – so that Australians can again access treatment for their teeth. That means seriously considering the idea of universal dental care in an Australian system of universal health care.

I would review private specialist fees. It is unacceptable that a specialist can charge $5,000 for a cataract operation, make $40,000 in one morning alone and cost the health care system $4 or $5 million a year, when most Australians can’t access or afford to see a specialist.

That’s what we could do to ensure the affordability and long-term sustainability of a public health care system for all Australians and save the health dollar.

On a separate personal note, I feel that if we don’t all stick together and fight to save Medicare for all Australians, both the haves and have-nots, many of us will become refugees in our own health system. And I fear the $6 co-payment is only the beginning.

Next article – Culture & Life – “They don’t want to work”

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