Communist Party of Australia  


The Guardian

Current Issue

PDF Archive

Web Archive

Pete's Corner


Press Fund


About Us

Why you should ...

CPA introduction

Contact Us

facebook, twitter

Major Issues





Climate Change



What's On






Books, T-shirts, CDs/DVDs, Badges, Misc


Issue #1669      January 21, 2015

Abbott still determined to destroy Medicare

The removal of the $20 co-payment on short (up to 10 minute) GP consultations last Thursday (January 15) is great news. It was introduced by the Abbott government through regulatory means towards the end of December with little publicity and was to have come into force on Monday January 21. But it is too soon to celebrate; Medicare remains under attack and new Health Minister Sussan Ley is as determined as PM Tony Abbott to destroy bulk billing and Americanise Australia’s health system.

On Wednesday last week Prime Minister Tony Abbott was adamant that the $20 co-payment on short GP consultations of less than 10 minutes would remain. Come Thursday facing massive opposition on all fronts, including within government ranks, it was removed.

In February last year, Prime Minister Tony Abbott declared the Coalition government would be “the best friend Medicare has ever had”. As the saying goes, “With friends like these, who needs enemies?” And before that there was the “no cuts to health” pre-election promise. The government’s first budget in May 2014 contained measures for $350 billion in cuts to Medicare.

Treasurer Joe Hockey tried to justify the cuts in terms of “unsustainable health-care spending … if no changes are made.” Abbott keeps on telling us that the Medicare “blowout is unsustainable.” Overall government spending on health (including subsidies to private hospitals) might have increased, but spending on Medicare has been flat for a number of years. And there is plenty of spare fat to be found in the military budget and non-payment of taxes by corporations.

First the $7 co-payment

The centre-piece of the budget cuts was a $7 co-payment by patients for GP consultations and out-of-hospital pathology and X-rays. ($2 to be kept by doctor, and a $5 reduction in the government rebate to doctors.) The co-payment was to commence on July 1, 2015.

Doctors and other service providers were not obliged to charge the co-payment, but there was an incentive – the $5 cut in the rebate paid to the doctor. This would apply for the first 10 services a year for concession card-holders, children under 16 and a few other groups. Thereafter they could be bulk billed without the service provider losing $5.

The co-payment would have been unaffordable for many patients and unsustainable for bulk billing doctors, some of whom were already struggling after years of frozen or below CPI increases in government rebates. A four-year freeze on rebates as contained in the budget would have compounded the situation.

Once fees replaced bulk billing, that would be the death of Medicare, which of course is Abbott’s aim.

Not surprisingly, doctors, nurses, midwives, other health groups, trade unions, various political groups and the general public strongly opposed the co-payment. There were national rallies. Pressure mounted and it was clear the Senate would block the $7 co-payment with Labor, Greens and a number of cross-benchers committed to defeating it.

Then the $5 copayment

Under immense pressure, on December 9 Abbott announced a new “optional co-payment” as if the $7 scheme had not been optional. Medicare rebates would be reduced by $5, the same as under the first package. GPs would not be penalised for bulk billing concessional patients and children. GPs would miss out on the $2 in the original scheme.

Doctors could continue to bulk bill but would be $5 worse off than before. They could charge the co-payment to replace the $5 reduction in their rebate. The government still speaks as though this is bulk billing. It is not – as said above, it is the death of bulk billing.

Or they could charge a higher fee as many “private” practices do. The Australian Medical Association’s (AMA) recommended rate for a standard consultation is $73. The patient pays the GP’s fee and then makes a claim through Medicare. The present refund (rebate) is $37. It would be reduced by $5 to $32.

Doctors are free to charge what they like. Without the competition from Medicare their fees would be much higher.

Hence universal access to Medicare is critical.

Nobody was fooled by the $5 scheme, no matter how hard Abbott tried to put a new spin on it. The new $5 co-payment was met with just as much opposition and had no hope of getting through the Senate.

Add on the $20.05 co-payment

Then, without any fanfare, in late December, the government introduced a new regulation, to start on January 19. This would cut the government rebate for short consultations (up to 10 minutes) by $20.05! GPs would have to charge at least the $20 co-payment to stay in business. In effect it would be a $20 co-payment.

The present Medicare rebate for a short consultation is $37. The rebate if the $20 cut came in, would be $17. But that’s not all. Come July 1, if the $5 co-payment is passed, that rebate would be reduced to $12! That is unsustainable.

This meant that a doctor who bulk billed or a patient who paid a fee receives $16.95 from the government instead of $37. The $20 rebate is what doctors and patients were paid in 1994. It is unsustainable.

Short consultations play an extremely important role in primary and preventative medicine, such as monitoring patients with specific conditions, follow-ups on tests, immunisations, etc. Any sharks rorting the system can be dealt with by other means.

As with the previous three proposed packages of cuts, there was no consultation.

The reaction to the $20 co-payment which was in addition to the $5 co-payment package was even stronger. Rallies were being organised, pressure was placed on MPs and GPs were organising to use their rooms as campaign offices.

The AMA wrote a strong letter to the PM regarding the short consultation regulation; “The level of anger and disbelief within the general practitioner community that your government has so little regard for the value of their services at the front line of Australian healthcare is unprecedented.

“In health policy terms the measure is short-sighted. As the backbone of Australian health care, general practice is proven to be cost-effective in preventing, managing and delaying the development of health conditions and the associated downstream health costs,” the AMA letter said.

The $20 co-payment was facing certain disallowance in the Senate and the government was up against strong opposition within its own ranks. Added to that the Queensland Premier was furious and desperate to get rid of the co-payment with difficult state elections at the end of this month.

So, just four days out from the commencement of the $20 co-payment the PM pulls the plug on it. But the government is still pursuing the $5 co-payment and a freeze on rebates. The Minister has said she will consult with doctors and other on a co-payment or some type of “price signal”, in other words a fee. The AMA is prepared to accept fees for those on higher incomes which suggests some sort of means testing of access to bulk billing – something Labor might support.

The result of any co-payment would put GP consultations out of reach for many Australians with all the negative consequences that would follow. Overstretched hospital emergency departments would be flooded, costs would rise. Ambulances cost over $700, Emergency Departments around $300 compared with $37 for the GP.


Economically, it makes no sense to introduce a co-payment. But that is not what it is about. The main objectives of the government are to abolish bulk billing; privatise Medicare; and allow private health insurance (PHI) funds to provide cover for co-payments and administer Medicare rebates.

BUPA and Medicare Private, the largest funds, are driving the government’s agenda.

The government’s objectives are ideological. For the corporate sector that stands to a make a killing they are first and foremost economic – another source of rich profits.

The spin about blowouts and unsustainability is an attempt to sell the government’s neo-liberal privatisation agenda to the public and cover up the pro-big business ideology behind the budget measures.

Abbott is hell bent on taking Australia down the disastrous, high cost American path of managed health care. The result will be that people who cannot afford private health insurance will be denied quality primary and preventative care from a general practice. And it won’t be cheap!

Act now!

It is critical that as many forces as possible are mobilised to ensure the complete $5 co-payment package or any replacement is defeated. At present, Labor, the Greens, the Palmer United Party’s Glenn Lazarus, Nick Xenophon, Ricky Muir and Jacqui Lambie have indicated they will oppose the co-payment.

The Greens have also indicated that they will oppose the freeze on rebates. The Labor Party disturbingly remains silent on this question. The freeze is also a means of making bulk billing unsustainable for medical, pathology and imaging services.

There are huge cracks within Liberal ranks. These have to be widened, especially in marginal electorates. The federal elections are due next year. Labor needs to be convinced of the need to block the freeze on rebates and any form of fee.

Time to lobby using social media outlets, talkback radio, letters to the editor, etc. Phone your local MP and Senators. The $20 co-payment has gone for now. It is possible to defeat the $5 co-payment and freeze.

NB: Figures for rebates and fees have been rounded off.

A co-payment goes right to the fundamental underpinnings of Medicare – attacking universal access to quality care and bulk billing. Bulk billing means the patient does not pay a cent when seeing a medical practitioner, having pathology or other tests or treatment. People pay through their taxes including the Medicare levy according to income. Medicare pays the provider directly out of central revenue raised through the taxation system.

Next article – Editorial – There are no absolute freedoms

Back to index page

Go to What's On Go to Shop at CPA Go to Australian Marxist Review Go to Join the CPA Go to Subscribe to the Guardian Go to the CPA Maritime Branch website Go to the Resources section of our web site Go to the PDF of the Hot Earth booklet go to the World Federation of Trade Unions web site go to the Solidnet  web site Go to Find out more about the CPA