Wednesday, April 30, 2014

Pre - Budget Review Of The Health Sector - 1st May 2014.

As we head towards the Budget in Early to Mid-May 2014 I thought It would be useful to keep a closer eye than usual on what was being said regarding what we might see coming out of the Budget.
According to the Australian Parliament web site Budget Night will be on Tuesday 13th May, 2014.
Here are some of the more interesting articles I have spotted this week.


Audit commission prescribes some harsh medicine

CHANNELLING John F. Kennedy, Joe Hockey asked Australians this week not to judge the impending budget on “what they get or lose today but the quality of life for the years ahead”, as he laid down ambitious fiscal markers that will make or break his reputation as Treasurer.
“There is a strong economic and moral imperative to change course and to put the budget back on to a secure and sustainable footing,” the Treasurer said, as he revealed sombre analysis from the Commission of Audit showing the government faced a decade of deficits unless it dramatically cut projected spending or allowed three million workers to drift into higher tax brackets.
The political imperative, however, will be to dither and delay. The commission’s report, due to be released next Thursday, will contain 86 painful recommendations to trim and restructure social security, cut corporate welfare, and boost fees for government services that will prompt shrill outrage from Labor and practically every lobby group and rent-seeker in the country.

Hockey to cut $300 billion to reach target

Date April 25, 2014 - 8:11AM

Mark Kenny

Chief political correspondent

Joe Hockey grilled by British presenter

Treasurer Joe Hockey receives a tough interrogation from BBC journalist Andrew Neil on the government's fiscal policy and the relative strength of Australia's economy. Nine News.
The Abbott government would have to take $300 billion out of Commonwealth spending over the next 10 years to achieve its target surplus of 1 per cent of GDP in 2023-24, analysis of figures released by Treasurer Joe Hockey shows.
The statistical information, combined with the Treasurer's warnings about the unsustainability of the age pension and other welfare programs and services, suggests the scale of the fiscal consolidation being considered is virtually unprecedented requiring long-term reductions in support programs assisting older Australians in particular.

Competition in pharmacy on the agenda: Quilty

24 April, 2014 Christie Moffat
Community pharmacy remains one of the “least broken” parts of the health system and should not be tampered with, according to a senior figure within the Pharmacy Guild of Australia.
In the latest edition of Forefront, executive director David Quilty said that the political risk level for community pharmacies in the upcoming Federal budget was higher than ever, in the wake of price disclosure and unfavourable anti-pharmacy media coverage.

Is the 'retail pharmacy gravy train' at an end?

24 April, 2014 Chris Brooker
Community pharmacy is facing renewed attacks in mainstream media sources, with an article in the Australian Financial Review saying the sector faces pain in the upcoming Federal budget and referring to a pharmacy ‘protection racket’.
Last week, pharmacy was under attack from News Limited publications, with columnist Janet Albrechtsen claiming pharmacy owners were a “cartel dodging reform”.
Now, AFR column ‘Chanticleer’ says the “retail pharmacy gravy train” is facing tough times as government seeks to wind down health costs.
In the past, the Pharmacy Guild of Australia had “managed to convince politicians of the importance to the country of the contribution made by 5000 small businesses... Whenever there were moves to bust the protection racket,” the article stated.

Pain sets in for pharmacies

Tony Boyd
There was a time when joining Australia’s $12 billion retail pharmacy industry was a passport to guaranteed wealth creation thanks to a stack of business-friendly factors. Territorial oligopolies were clearly marked, limits were placed on the number of pharmacies one entity could control and above all, there was a handsome profit arbitrage between government pricing of drugs and the discounted price from drug manufacturers.
The government-friendly regulations were guided and shaped by the Pharmacy Guild, which was one of the most powerful lobby groups in Canberra.
The industry was considered virtually gold plated and this manifested itself in the willingness of wholesalers of drugs to guarantee the bank loans of pharmacists.

Doctor plan to cut health costs

Andrew Tillett Canberra The West Australian April 25, 2014, 2:45 am
Health funds would pay incentive payments to doctors who kept patients out of hospital under a plan insurers say could save the health system billions of dollars.
Private Healthcare Australia, which represents funds, will present its blueprint for reform to Health Minister Peter Dutton within weeks as the Abbott Government grapples with reining in spending.
The industry lobby group has already put to the Government's Commission of Audit a proposal to cut the price of prostheses.
It argues Australian funds - and indirectly the Government, which covers 30 per cent of the cost through the insurance rebate - are being charged by private hospitals up to five times more for the same brand and type of prostheses compared with other countries.

An added sting in Hockey's cuts

Treasurer Joe Hockey wants to share the budget pain but cuts to essential services, and the absence of tax reform, will place the greatest burden on those least able to bear it. A fixation with meeting the government’s election promise to achieve a budget surplus could potentially result in a range of unnecessary and ill-conceived cuts at the May budget.
In a speech in Sydney yesterday, Hockey provided the clearest indication yet of what to expect in the May budget. Tough times are coming for Australians and everyone is going to feel the burden of spending cuts whether they deserve to or not.
The speech comes a week before the Commission of Audit is set to release its four-volume assessment of government spending. The report will feature 86 recommendations for the federal government, but a vast majority are unlikely to be given serious consideration. Hockey acknowledged as much yesterday.

'Nothing is free': Joe Hockey warns of budget pain, with pensions in the firing line

Date April 24, 2014 - 8:47AM

Mark Kenny

Chief political correspondent

Australians from all walks of life should brace for a serious tightening of federal government expenditure, Joe Hockey has warned, but it appears older Australians will be asked to do some of the heaviest lifting in a budget repair task being pitched as a moral and economic necessity.
In a key note speech just weeks ahead of his first budget, Mr Hockey has railed against the unsustainability of the age pension, the growing cost of aged care services, and the drain on the budget from the Pharmaceutical Benefits Scheme, which he noted was weighed down with 80 per cent of its costs coming from concessional usage.

Health system research the right tonic for patient care

Elizabeth Foley
It’s not sexy, but research into the way our health system treats patients could be just the tonic the sector needs.
A year ago this month, the McKeon Review into Health and Medical Research outlined how we can get better bang for the bucks – up to $4.8 billion – Australian governments spend on health research each year. We don’t have to spend more to get more value, at least not in the short to medium term. What we do have to do is better direct and leverage investments already underway.
The McKeon Review calls for embedding research into the health system. This makes sense. Health is a massive industry that already accounts for 9.5 per cent of GDP. It should have an R&D arm to help plot future direction.

Selling cuts hard without a full-blown crisis

Alan Mitchell
As the budget leaks become more threatening, the role of the National Commission of Audit becomes more crucial.
The challenge facing the Abbott government is to sell the first seriously tough budget in almost 20 years without the help of a full-blown fiscal crisis to make the case for painful spending cuts and tax increases compelling.
Australia does need to get off the slippery fiscal slope, but even on the more conservative assumptions of the mid-year economic and fiscal outlook statement, the federal government’s net debt will be only about 15 per cent of gross domestic product in 2023. To most of our friends among the advanced economies that’s petty cash.
The sense of crisis will be further reduced by the Abbott government’s decision to boost infrastructure investment so that it can cut recurrent spending without undermining the economic recovery.

AMA gives cautious support to disability support crackdown

Date April 20, 2014 - 5:35PM

David Wroe

National security correspondent

An Abbott government proposal to have disability support pensioners independently reviewed has won the cautious backing of the Australian Medical Association, which says it can be hard for doctors to reject patients' claims they cannot work.
Dr Brian Morton, the AMA's spokesman on general practice, said on Sunday doctors were often in an "invidious position" in having effectively to decide whether someone was fit to work.
"For GPs to be the arbiter of whether someone complies or not can be very difficult, because you often have a relationship with the patient," he said.

GP Co-payments.

Vic govt warns against $6 GP charge

12:16pm April 24, 2014
Charging $6 for GP visits will send more people to busy hospital emergency wards, Victoria's health minister warns.
David Davis said if, as speculated, the federal government introduces a $6 co-payment for a GP appointment, it would make it tougher for people to go to a doctor.
"It's hard to see how putting additional charges on improves access," Mr Davis told reporters on Thursday.
"We will certainly advocate to the commonwealth very strongly against making primary care difficult to access."

$6 hit for bulk-bill GP visits in budget

  • The Australian
  • April 22, 2014 12:00AM
What we know so far. Source: The Australian
A CO-PAYMENT of $6 for bulk-billed visits to GPs will be included in the Abbott government’s first budget with the aim of saving $750 million over the next four years.
The expenditure review committee has decided to go ahead with the co-payment, including a proposal to cap it at 12 visits, meaning a maximum extra cost of $72 a year for patients.
Health Minister Peter Dutton has refused to confirm the co-payment plan would be adopted but has encouraged “a conversation” to be held about proposals to reduce the long-term growth rate in health costs.

Peter Dutton says wealthy shouldn't expect free doctor visits

Date April 23, 2014 - 3:57PM

Dan Harrison

Health and Indigenous Affairs Correspondent

Federal Health Minister Peter Dutton has fanned speculation that the Abbott government will introduce a fee to visit the doctor by arguing that well-off Australians should make a greater contribution to the cost of their care.
Speaking to reporters in Canberra on Wednesday, Mr Dutton refused to confirm the change would be in next month’s federal budget, but said the nation needed "an honest conversation about how we build and strengthen our system".
"We will take care of those that can't take care of themselves," he said.

What's Likely In The Federal Budget For Health Care?

FNArena News - April 23 2014
 -GP co-payment likely positive for Primary
-Pharma co-payment likely negative for Sigma
-Changes unlikely on medical insurance
-Lifting retirement age?
By Eva Brocklehurst
There's speculation the Australian government will go ahead with a $6 co-payment for visits to the GP, to be announced in the May budget. According to media reports this co-payment would be capped at 12 visits per year, making a total out-of-pocket cost of $72 per person.
UBS believes the devil will be in the detail. Savings for the government are envisaged to be around $750m over four years and the broker assumes the preferred implementation measure is allowing GPs to retain the co-payment while the government freezes indexation of the medical benefits schedule payments. The impact of the mooted changes would be most significant for stocks such as Primary Health Care (PRY) and Sonic Healthcare ((SHL)). Primary bulk bills 100% and the co-payment would provide a material pulling forward of revenue that would have otherwise taken over three years, in UBS view. Sonic already has a significant level of co-payments, which would continue, but is expected to implement the co-payment where it was bulk billing.

States may oppose $6 payment for GP visits

Joanna Heath
Liberal state governments are concerned a mandatory co-payment for GP visits will add to budgetary pressures as patients transfer to public hospitals.
According to reports on Tuesday, the government’s expenditure review committee has decided to adopt a $6 co-payment proposal originally put forward by a former adviser to Tony Abbott, and it will be announced in the May budget.
A spokesman for Victorian Health Minister David Davis said the government was aware of the proposals and would be “concerned about any ­proposal that reduced access to key ­primary care services including GPs or increased the flow of patients to public hospitals”.
Joanna Heath

GP payments won’t heal health budget

Joanna Heath
The apparent confirmation that the May budget will include a mandatory $6 co-payment for GP visits should surprise very few people.
What will be more interesting come budget day is to see whether the government will take the more controversial step of encouraging the states to match the move in public hospitals.
Health economists, and indeed the original author of the proposal, Terry Barnes, say the move on GP payments will save nothing overall if even a small proportion of avoided GP visits end up in the hospital system.
The federal government may be happy for that to take place, given the budgetary burden would be transferred to state governments and would no longer bother Canberra. It goes without saying that state governments, particularly those with tight budgets, would not be happy about this.

‘Sick will put cash before care’, say emergency doctors

EMERGENCY Department doctors at public hospitals in disadvantaged regions across the country are worried about the impact of a co-payment plan on residents already struggling to make ends meet.
Salaried Medical Officers ­Association president David Pope said the policy was counterproductive.
“It makes people go to places based on finances rather than their actual medical needs, which ... distorts the whole system,” he said.
“Certainly co-payments that could increase those presenting to hospitals would be vehemently opposed by medical staff.”
23 April 2014, 6.07am AEST

Save now, spend later: why co-payments for GP visits are a bad idea

Stephen Duckett
Director, Health Program at Grattan Institute
Like a movie zombie, a policy idea that should have died has arisen from the dead and is likely to feature as a cost-savings measure in next month’s budget. The idea is simple: most GP patients should make a A$5 or A$6 co-payment to keep Medicare “sustainable”.
The idea was proposed in October by Terry Barnes, a policy adviser to Tony Abbott when he was health minister. Under the plan, bulk billing (without a co-payment) would be reserved for “pensioners, concession card holders and children under 16”. Barnes calculates this would save around A$750 million over four years.
It all sounds very reasonable; the amount concerned passes a “milk bar test” of what is seen to be affordable to ordinary consumers, and the “deserving poor” are protected. But once you look behind it, big risks emerge.

GP fee proponent Terry Barnes welcomes reports the Abbott government is set to introduce $6 charge for GP visits

Date April 22, 2014 - 10:58AM

Dan Harrison

Health and Indigenous Affairs Correspondent

The former adviser to Tony Abbott who proposed a $6 fee to visit the doctor has welcomed reports that the Coalition government has adopted his idea, but has called for it to go further and impose a means test on Medicare bulk-billing.
Terry Barnes, who worked for Mr Abbott when he was health minister in the Howard government, proposed the $6 fee in a submission to the National Commission of Audit on behalf of the Australian Centre for Health Research, calculating it would save $750 million over four years by reducing unnecessary GP visits.
News Corp reported on Tuesday that the Abbott government's expenditure review committee had decided to include the change in its first budget. Patients would not have to pay the fee after their 12th visit in each year, meaning the extra burden on an individual patient would be capped at $72 a year, News Corp reported.

Labor suggests alternatives to GP co-payment

Naomi Woodley reported this story on Tuesday, April 22, 2014 12:10:00
ASHLEY HALL: The Federal Opposition says the Government should be looking at Medicare rebates to doctors if it needs to find efficiencies in the health budget.
The Government has signalled that people who can afford it to should make a contribution to the cost of their own healthcare.
But it won't confirm or deny reports that the budget will include a $6 co-payment for bulk-billed GP visits.

How exactly will the $6 GP fee work?

Date April 22, 2014 - 4:52PM

Dan Harrison

Health and Indigenous Affairs Correspondent

Under the proposal, patients would pay a $6 fee to visit the doctor.
Who will pay the fee?
Under the proposal by the former advisor to Tony Abbott, Terry Barnes, patients who are bulk-billed would pay the $6 fee. How patients who already pay a gap fee will be affected will depend upon the approach of their doctor. The doctor could raise their fees, leave them unchanged, or use the revenue from the $6 fee to reduce out-of-pocket costs for other patients.

Co-payment in, MLs out: budget speculation

22nd Apr 2014
THE federal opposition has seized on reported budget leaks as proof the Abbott government is determined to unwind universal healthcare in Australia.
Opposition health spokeswoman Catherine King said on Tuesday reported leaks foreshadowing a co-payment on bulk-billed consultations and an overhaul of Medicare Locals made a farce of Prime Minister Tony Abbott’s pre-election promise to be a government of “no surprises”.
“Make no mistake – with the GP tax, the Abbott government is dismantling universal healthcare as we know it,” she said. 

Medicare Locals.

Medicare Locals gripped by closure rumours

22 April, 2014 Paul Smith
Medicare Locals will be scrapped and replaced by 20 new primary care organisations according to the latest Federal Budget rumours swamping the network.
The rumours come from one senior Medicare Local source who has told the network he has inside information on the government's budget plans.
If true, it would mean that the network of 61 Medicare Locals would begin going through a 'transition' phase this year before being replaced in the middle of 2015 by a statutory-based network of 20 organisations.

Medicare Locals to be target, hints Dutton

23 April, 2014 AAP
Federal Health Minister Peter Dutton has given a clear indication Medicare Locals could be cut in the May budget.
The previous Labor government set up the 61 Medicare Locals, which co-ordinate primary health services such as after-hours GP clinics and mental health support.
But the coalition has long opposed Medicare Locals as an unnecessary layer of bureaucracy, and after the federal election launched a review of the $1.8 billion scheme.

Cathy McGowan says give us health facts


April 26, 2014, midnight
FEDERAL member for Indi Cathy McGowan is calling on the government to release its review of Medicare Local.
The independent MP said members of the public should be able to examine the report themselves, and see any decision on the health initiative’s future is “made on the best grounds and not on party lines”.
Her comments come after reports surfaced this week the federal government was considering axing the Medicare Local scheme — introduced by the previous Labor government about two years ago — in next month’s budget.

Medicare Local has one-year guarantee

April 24, 2014, 8 p.m.
AS Medicare Local lies on the federal government's budget chopping block, the North West's services have been given a one-year guarantee.
Central and North West Queensland Medicare Local chairman Phil Barwick said he was expecting policy changes from the Abbott government in the coming budget but could confirm the CNWQML was assured of all funding in the coming financial year.
``We have worked hard to keep administrative costs low and to act as an efficient channel for Commonwealth funding into health programs in our region,'' he said.

Medicare Locals in budget firing line

23rd Apr 2014
FEDERAL Health Minister Peter Dutton has fanned speculation that Medicare Locals are in the firing line for budget cuts, reiterating his intent to slash bureaucracy at the community-based healthcare organisations set up under Labor.
"We think there are some good Medicare Locals doing some good work," Mr Dutton told reporters in Canberra on Wednesday. 
"What I'm determined to do is to make sure that we can get money back to doctors and nurses and away from health bureaucrats."
Various media have reported rumours of Coalition government plans to scrap funding or redraw boundaries for some of Australia’s 61 Medicare Locals to reduce them to 20 or so groups.

Fears of Medicare Local axing

By Jodie Stephens

April 23, 2014, midnight
TASMANIA Medicare Local chairwoman Judith Watson says staff are "extremely concerned" by speculation the Medicare Local system will be axed in next month's federal budget.
The ABC reported yesterday that several Medicare Local chief executives were told the federal government planned to shut down the 61 community health organisations spread across the country.
This comes after the government ordered a review of the $1.8 billion initiative, which was established by the Rudd government.

Medicare locals to be "phased out": ALP

1:42pm April 22, 2014
The opposition says the Abbott government is preparing to break its election promise to keep Medicare Local centres open.
Labor health spokesperson Catherine King said CEOs of the centres, which plug important gaps in after-hours care and mental health, have been told they would be phased out.
"We have heard speculation today that Tony Abbott is about to break another election promise, when he said no Medicare Locals would close," Ms King told reporters in Melbourne on Tuesday.

Medicare Locals likely to face the axe in May budget, health executives warn

By medical reporter Sophie Scott and Alison Branley
April 22, 2014
The ABC has learned a number of Medicare Local chief executives have been told the Federal Government plans to shut down the current system.
Speculation has been mounting that the local health bodies, which were set up under the Rudd government to organise community-specific health programs, will be scrapped in next month's budget.
Late last week chief executives of the 61 community-based health organisations held a series of a conference calls to discuss the Government's plans for the scheme.
The drumbeat suggesting a tough budget continues to build. The final report of the Commission of Audit (COA) has been handed to Government and as I predicted we are starting to see some hints and leaks. A full release is promised this Thursday - May 1. (At 2pm I hear after a budget style lockup)
If what we read here is correct it is pension age up, a co-payment to see the GP is coming, Medicare Locals are in trouble, more disability pension exclusions and less funds overall are all virtually certain. That is enough to be going on with along with superannuation concessions and family tax benefit changes also on the agenda.
Interesting to see Community Pharmacy may also be in gun. No matter what the Government is running the mother of all 'scare campaigns'.
To remind people there is also a great deal of useful discussion here from The Conversation.
As usual - no real news on the PCEHR Review.
More next week.


Anonymous said...

Interesting too that NEHTA, a hotbed of dissension, has received no mention anywhere of late. Perhaps its closed its doors and no-one has noticed!

Anonymous said...

Any surprises here?

NEHTA was and always will be as Health Minister Abbott’s still-born ehealth baby!

Labor just committed an unconscionable act of necrophilia with NEHTA, abusing vast amounts of Taxpayers' monies in the process through their Government tenure.

Now that Abbott is back and in a much higher elevated office, nothing untoward or publically damning will happen to the now infamous NEHTA on this PM’s watch…

NEHTA's future will follow the well-trodden path of Health Connect!

Anyone still talking or reading about "Health Connect"??

Anonymous said...

NEHTA was formed in late 2004 by Health Minister Tony Abbott.

In 2005, Mr Abbott said he hoped the e-health dream would become a reality under NEHTA in three years.

"We believe upwards of 3000 people a year die prematurely because of inadequate information and record-keeping," Mr Abbott said then.

"We're never going to be able to entirely eliminate that, but we think we can avoid quite a few of these unnecessary deaths if we have an integrated records system. We also have very heavy expenses with the duplication of diagnostic tests.

"That certainly can come down if we have readily available health records so that blood tests, X-rays and MRIs don't need to be repeated by every lot of treating doctors.

"Now we've got a high-level, well-funded body exclusively dedicated to ensuring that our dream becomes a reality, hopefully within the next three years,'' Mr Abbott said in February 2005.

What does Mr Abbott think now?

Anonymous said...

If one was to be unkind, one might say that, if the system had been available at the end of 2009 as Mr Abbott hoped and expected, that would have meant about 12,000 lives could have been saved.

On the other hand, maybe it's only unkind to those people who died.

Of course, in reality, the expectation was stupid.

The real (unstated and internal) justification for the PCEHR is to collect big data and reduce costs.

Terry Hannan said...

David, I thought these extracts from the following document have relevance to the upcoming budget and how the Federal government might approach costs factors in health.
In 1999 Charles Safran provided the editorial review of 25 plus years of “effective clinical computing” in the Int J Med Inform. 1999;54:155-6. The whole issue documented systems from North America and Europe.
Therefor it was interesting to read the ongoing evaluation of thee HELP system in Utah, through the consolidated organisation, Intermountain Health Care. I am including what I feel are relevant extracts from the publication that indicate much has been learned and achieved with “effective clinical computing’. Terry
How Intermountain Trimmed Health Care Costs Through Robust Quality Improvement Efforts By Brent C. James and Lucy A. Savitz. HEALTH AFFAIRS 30, NO. 6 (2011): – ©2011 Project HOPE— The People-to-People Health Foundation, Inc.
1. Intermountain has very extensive administrative data systems that evolved over time to manage budgets, facilities, and clinical measures imposed by external regulators. On both previous occasions, those undertaking the efforts had assumed that they could use Intermountain’s existing administrative data systems to achieve clinical management.
That was a fatal mistake.
“we conclude that any organization basing its clinical measurements on inadequate internal administrative data and external regulatory requirements—rather than on intermediate and final clinical, cost, and service outcomes built around specific clinical care processes—will fail in its attempts to manage care delivery.”
2. ACTIVITY-BASED COST ACCOUNTING: Hospital admissions for specific treatments has similar characteristics e.g. 80% CABG similar severity/ complexity/ outcomes
Debunks “my patients are sicker” syndrome.
Best patient care did not reside in any one physician
Massive variation in physicians’ practices ~ x 2
Focus not on individual physicians but on the “processes of care”
2. Elective inductions of labour
If the patient met the criteria, the induction proceeded; if not, the nurses informed the attending obstetrician that they could not proceed without approval from the chair of the obstetrics department or from a perinatalogist—a specialist in high-risk pregnancies.
Elective inductions that did not meet strong indications for clinical appropriateness fell from 28 percent to less than 2 percent of all inductions. The length of time women collectively spent in labor fell by roughly thirty-one days per year. As a result, Intermountain is now able to deliver about 1,500 additional newborns each year without any additional beds or nurses.
Cesarean Sections 21% vs. National AV. 34%
Reduced health costs in IHC !$50 million/yr. Nationally $3.5Billion/yr
3. Alan Morris LDS: evidence-based clinical practice guideline for managing the settings on mechanical ventilators used to treat a serious pulmonary illness called acute respiratory distress syndrome. No reliance on written guidelines.
Acute respiratory distress syndrome: Reduced the rate of guideline variances from 59 percent to 6 percent within four months. Patient survival increased from 9.5 to 44 percent;
Physicians’ time commitments fell by about half;
Total cost of care decreased by 25 percent

Bernard Robertson-Dunn said...


Re the National Commission of Audit Report

Not a word about the PCEHR.

Could that be because of the PCEHR review? Rather handy that, as effectively, DOHA gets to review its own performance.

As Joe Hockey is telling everyone who will listen: This not a budget.