A Wounded Government Doubles Down On Its War With Doctors

The idea of “rebooting” a computer is simple enough: turn it off and on again, in the hope that it will come back to life.

This seems to be the logic behind the Abbott government’s policy efforts in recent weeks, in education, paid parental leave, and now in health.

In education, Christopher Pyne’s university reforms were defeated in the Senate. Undeterred, he immediately reintroduced them in the House. There were some minor amendments, but the core of the policy remains: taking money off universities, and encouraging them to charge students more.

In health policy, the same tactic is being tried. Unlike Pyne’s university deregulation, Dutton’s policy never even made it into a bill. But it was hugely unpopular nonetheless, and the cause of endless heartache for a struggling government.

Voters don’t like the GP co-payment. It’s hardly surprising: it would levy a new charge on everything from getting a scan or a blood test to visiting the doctor. That’s not a policy calculated to win the hearts of middle Australia.

Yesterday we saw the Prime Minister and the Health Minister announce a new version of the GP co-payment. Like the education reforms, some of the details were tweaked. More patients will be protected: pensioners, under 16s and those on concession cards.

But the core of the policy remains: taking money off doctors, and encouraging them to charge patients more. The way it works is uncannily similar to the university reforms. Government subsidies for GP consultations will be cut by $5 per consultation (plus an indexation freeze). GPs can then charge patients more to make up the difference.

But the rebooting of health policy demonstrates the pitfalls of such superficial revamps.

One of the biggest issues for the government remains the hostility of the health sector. Unlike higher education policy, where Pyne was able to win partial support for his reforms from university bosses and lobby groups, the opposition to the co-payment in the health sector has been almost universal.

The Australian Medical Association, a far more muscular lobby than Universities Australia, has taken a dim view of the changes from the beginning. Under its current boss Brian Owler, the doctor’s lobby has tried to present a nuanced position, arguing against the unfairness of co-payment even while representing the understandable anger of its members over the significant cuts to their government subsidies.

Yesterday, Associate Professor Owler was again tip-toing through the minefield, praising the protection of vulnerable patients but criticizing the cuts to the Medicare subsidies.

“We are pleased that concession card holders, children under 16, and residents of aged care facilities will not be subject to reduced Medicare rebates for general practitioner services,” Owler said.

“However, we remain disappointed that rebates for GP services for everyone else will be cut by $5. This comes on top of a freeze on Medicare patient rebates until July 2018. This means that, by 2018, Medicare rebates for many services will have been frozen for almost six years, while inflation continues to rise.”

Out in the medical community, there’s far more hostility. Many took to Twitter to vent their frustration at what amounts to a pay cut. Former AMA boss Kerryn Phelps tweeted that the $5 reduction in the standard consultation subsidy amounted to a 13.5 per cent pay cut.

Medicare fee standard GP consult=$37.05 Drop in rebate=$5 Reduced practice income=13.5% reduction Most GPs will have to charge #copayment

— Prof Kerryn Phelps (@drkerrynphelps) December 9, 2014

The AMA’s Victorian branch was even blunter.

No one will bulk bill. Co-payment gone, but $5 cut to MBS rebate = cost of seeing a GP will increase http://t.co/yoAfNN4cOg @theprojecttv

— AMA Victoria (@amavictoria) December 9, 2014

Patient groups and policy exports aren’t impressed either. Non-bulk billed patients will lose out, after all: they’ll get $5 less back on their Medicare rebate. 

The Consumers Health Forum’s Adam Stankevicius said bluntly that “the Government is turning GPs into its bagmen for the death of universal health care.”

The Public Health Association of Australia’s Heather Yeatman told The Converstion’s Michelle Grattan that “our GPs are being forced to do the dirty work of the government. Either they lose $3 billion from their own pockets over the next three and a half years or drag it from the wallets of the bulk of their patients.”

No-one believes these funding cuts are about better primary care. Policy experts point out that government slashed hundreds of millions from primary health in the May budget – $121 million from Indigenous health, $367 million from preventative health, and $635 million from dental care. The Abbott government is also in the process of abolishing the Medicare Locals that Labor set up, in a chaotic transition to so-called Primary Health Networks.

There’s considerable concern that this proposal, should it survive the Senate, will lead to a general rise in medical costs for GPs. GPs earn a good living, of course, but their wages are considerably less than their highly-paid colleagues in the specialties. Given the freeze on rebates and the squeeze on costs that was already flowing through from the Labor years, the likelihood is that more clinics will stop bulk billing altogether.

Perhaps the most puzzling aspect of the health policy reboot is that the Abbott government thinks it will mollify critics. Many of the same flaws that originally bedevilled it are still there: the $3.5 billion the government says it will save won’t be returned to the budget bottom line, or even to Medicare to make it more “sustainable.” Instead the money but will be sequestered in the government’s increasingly illusory Medical Research Fund – effectively asking patients to pay for medical research.

The government has never made a good case as to why general practice and health consumers should pay for medical research. Perhaps it simply can’t. Peter Dutton has never been the most scintillating of political performers. His efforts on the ABC’s 7.30 last night reinforced the widespread view that Dutton is unable to explain complex policy reform. 

The government’s repeated use of the phrase “price signals” is a case in point. For doctrinaire neoliberals, the idea of price signals makes perfect sense: raise the price, and fewer people will go to the doctor. But for ordinary citizens, the phrase “price signals”, if it means anything at all, is a red flag that means “prices going up.”

Coalition backbenchers may have some questions of their own. Why on earth would a wounded government wish to double down on its war with doctors? And if the government is “resetting”, why not retreat on the co-payment altogether?

GPs are one of the most trusted groups in the entire community – a group of professionals who interact with millions of ordinary Australians on a daily basis. A marginal seat campaign led by suburban doctors is pretty much every Liberal MP’s worst nightmare.

And yet yesterday the Prime Minister was attacking their professional conduct with backhanders about “six minute medicine” – as though a pay cut to doctors will somehow drive better primary care. At a stroke, the Abbott government has created a powerful enemy, but is no closer to achieving its policy goal.

After all, all these tweaks can be undone in the Senate in the new year. Given the hostility to the reboot shown by Nick Xenophon and the Palmer United senators yesterday, Labor and the Greens should have no trouble passing a Senate motion to strike down the co-payment.

That’s the problem with policy reboots. As many a frustrated office worker can tell you, when your operating system is corrupted, rebooting the computer doesn’t necessarily work.