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Medicare co-payment on the table

Health minister’s first policy speech calls for debate on controversial measure.

Minister for health Peter Dutton has fuelled talks of the introduction of a GP co-payment, during a major speech on the Coalition’s healthcare agenda.

In the first of several presentations on health policy, he highlighted the extreme pressure Medicare is under, reiterating the government’s intention to “modernise and strengthen” the 30-year-old system. Dutton said this cannot be achieved without Australians who can afford to contribute to their own medical costs doing so.

“The universal health system means there will always be value in leveraging people into supporting their own health needs in the sector,” he said on February 19 whilst addressing the Committee for Economic Development of Australia conference.

Later that evening, Dutton called for debate on the co-payment issue, saying it has points for and against it.

Stakeholders were quick to react.

Speaking to Sky News the next day, Australian Medical Association president Dr Steve Hambleton agreed it’s the right time to have a conversation about the rising costs of healthcare, adding we need to think about what the drivers of healthcare costs are. However, he went on to suggest caution when using a “blunt instrument like payments”.

“We’ve got to be very careful … in particular in primary healthcare, that we don’t get perverse outcomes,” Hambleton said.

The Opposition suggested the Abbott Government “plans to destroy universal healthcare in Australia”.

“What Mr Dutton is really talking about is dismantling our fair and sustainable system in favour of a private health system like that which exists in the United States,” Catherine King, shadow health minister said.

She noted that Australians who can afford to pay more already do so at tax time, through a greater contribution to the Medicare levy.

Meanwhile, ANMF federal secretary Lee Thomas offered an alternative solution to raising funds for the nation’s stretched health budget – a financial transaction tax (FTT).

“Minister Dutton is understandably concerned about the need for a sustainable healthcare system, but a co-payment for people to visit the GP isn’t a solution,” she said.

Thomas believes the proceeds derived from an FTT – which is a small tax on financial institutions – could be used to strengthen Medicare.


Claims the Coalition would introduce a $5 to $6 Medicare co-payment for GP visits and effectively end ‘free’ healthcare in Australia gained momentum over the summer break.

They stemmed from a Commission of Audit proposal authored last year by Terry Barnes, a senior policy adviser to Tony Abbott, whilst the current prime minister was health minister in the Howard government.

The report, produced by the Australian Centre for Health Research – a think tank – calls co-payments a “simple yet powerful reminder that we have a responsibility to look after our own health and not simply pass on all the costs of and responsibility for caring for ourselves to fellow taxpayers”.

Barnes has told the ABC the proposal was designed to change the way people think about accessing GP services: “People don’t always need to see a doctor for things they see a GP for, particularly minor things like coughs and colds and particularly flu in the winter.”

The original paper proposed exemptions for pensioners and concession card holders.

In the health department’s only official statement prior to Dutton’s recent speech, acting health minister Kevin Andrews dismissed speculation on introduction of a GP fee as a “scare campaign”, and said it was a “blatant attempt [by Labor] to distract from their woeful record in government and Kevin Rudd’s betrayal of the people of Griffith”.

The reference to Griffith, the locus of the hotly contested February by-election that political observers talked up as a proxy referendum on the federal government’s first few months in office, and a seat that Labor ultimately retained with a small swing against it, hints at the political damage that tampering with universal healthcare can do. Observers are divided on who the real victor was in Griffith – the swing against Labor was the first swing towards a government in a by-election since 1996. But Labor’s strong anti-copayment campaign clearly had the Coalition worried.

At the start of January, Bill Glasson, the Coalition candidate for the Queensland seat, told the ABC he supported an “affordable price signal”, such as a co-payment, as long as it “wouldn’t [affect] the most vulnerable in our society”.

But by late January, Glasson, who is a former Queensland state and federal president of the Australian Medical Association, and who achieved a 5.5 per cent swing against Labor at the 2013 election, refused to recommit to the proposal.

The timing of the story had been a further challenge, emerging on the eve of the 30-year anniversary of the introduction of Medicare. The Opposition framed the policy as a “GP tax”.

The government was criticised at the time for refusing to explicitly rule out changes to the Medicare system, but a litany of ministers did distance themselves from the co-payment proposal, remembering perhaps that Bob Hawke lost the Labor leadership in 1991 largely due to his announcement of a similar plan.

Abbott told reporters in early February that nothing had been considered, proposed or planned. Foreign minister Julie Bishop said the proposal was not before the Cabinet.

It was not hard to see why at the time. “Did Tony Abbott mention this before the election?” asked Penny Wong in December, “Did he tell Australians that he was planning on introducing a new tax on doctor visits for sick children and ill families?”

Catherine King joined the chorus then as well: “The Coalition want to sneak in a new tax that will hit families every time they take their sick child to the doctor.”

The NSW Nurses and Midwives’ Association, which controversially claimed in a federal election ad campaign last year that the Coalition sought to privatise Australia’s health system, said the introduction of Medicare co-payments would be the “beginning of the end for free, universal healthcare in Australia”.

The union said emergency department staff would “bear the burden of this government decision on a daily basis”, and that it would shift the cost burden to the public health system by driving people to visit hospital emergency departments to get checked for routine and minor ailments, “rather than paying rising upfront fees to see the local doctor”.

Meanwhile, Liberal MP for Gilmore, Ann Sudmalis, appeared to support the proposal in January when she told WIN News: “I think some people will say, well that’s too hard … but basically pretty much that’s a cup of coffee if you go out these days, a little bit more. That’s not a lot of money to make sure you’re covered off with health.”

Flynn Murphy contributed to this article.

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