Let’s be clear about the magnitude of the reform achieved by Kevin Rudd yesterday: it’s not very much. But it’s something.
The Rudd health plan was never really about health (well, okay, it was mainly about politics, but put that aside for the moment). It is a useful micro-economic reform in the health sector, courtesy of the shift to activity-based funding and much greater, and more consistent, performance information. Those two reforms alone will drive significant efficiency gains in the health sector, which is useful because we’re going to be spending more on health in years to come, no matter how much reform puritans like me rant about the need for more user-pays.
The failure to shift to a single-funder model is unfortunate, partly because the unification of funding sources would have ended cost and blame-shifting, and partly because bypassing the states would have taken us a small step closer to getting rid of them entirely.
Even so, we’ve still got the two important reforms locked in.
This is more of the “5%” reforms that this Government specialises in — unglamorous, low-level removals of inefficiencies and impediments that by themselves are small and have survived successive waves of bigger reforms, but which together yield substantial long-term benefits. The fact that it’s in the ever-growing health sector is beneficial, too.
As a health reform, as opposed to an economic reform, it won’t do a lot, but then we’ve already got a high-quality health system for people in urban and suburban areas. At least there’ll be some additional funding for mental health services, and the increase in doctor training might increase the overall supply of doctors and, therefore, make more available to regional and rural communities.
This modest amount of reform has been purchased, in true COAG style, with a lot of money — $5.365 billion over four years, much of it going to gold-plated and already-effective metropolitan hospital system. A lot of dynamic efficiencies will be needed to cover that, but they’ll mount up, in time. Fortunately it’s not as much money as that demanded by John Brumby, whose “last bastion” act didn’t last long after his press conference shoulder-to-shoulder with Colin Barnett yesterday.
Brumby didn’t exactly backflip, he merely repeated his act from previous COAG episodes of talking tough and claiming he’d hold out until enough cash came his way to enable him to claim he’d secured a good deal. Why change a winning formula?
All this has created a sort of reform inflation. Every COAG meeting, the price of buying off the states seems to go up, partly because Kevin Rudd is so willing to pay. Even with the threat of a referendum, and a starting point of 60-odd% support for his plan, he didn’t baulk at spending money. The cost of the next round of reform, major or minor, has just gone up.
Dr Harvey M Tarvydas
Again on the money BK.
Reform wise its less than first imagined but I feel more profoundly important than you’re crediting. The medical reforms need a medical profession to contribute, PM Rudd is being the accountant. The medical profession knows what that is when it come to not paying tax but refuses to understand the meaning here.
The accounting comes with an emotional jacket, the sort that confuses the noble (but corrupt) medical profession. the logic …………………..
PM Rudd believes about 30% of State GST funds at least is needs to be spent by States for their contribution to health provision.
The States agree by saying they will put 30% of their GST into a pool. (‘pool’ because they are too scared to trust the Feds)
Failed state health provision, where it is so, is because States spend less than 30% of their GST here enjoying spending it elsewhere.
Federal health expenditure areas are much less criticised for failure.
Feds (one body) expect States to steal health money for other purposes so are insisting on controlling that 30% which they guarantee to health.
If that 30% is given to the States on a promise that they will give it to health there are 7 bodies to chase down to get it to happen instead of 1 body (Feds) to chase down.
There is more reason for the Feds not to trust the States than visa versa on performance alone.
This Federal Govt is asking for trust as the first Federal Govt to get serious about health and proving it by giving more money for health then ever before beyond the 30% and now.
The rest of the debacle of the last few weeks is intellectually worse than kindergarten including experts (rather noble ones at that) who are all missing the seriousness of what heavy duty reform means.
There’s a whole lot of essential reform needed in medicine administration and action separately to finance administration which is what the PM is on about here. The PM expects Drs to do that and to get out of the way with their gripes which are rather ancient. Look to the new the PM is saying.
Reinvent your gripes if you must or especially if you still need to in the new system.
The medical experts are too inept to make that happen; they haven’t till now, and are confusing the whole thing into a mess that the media has been unable to see through.
BK gives the game away when he says: “It is a useful micro-economic reform in the health sector, courtesy of the shift to activity-based funding and much greater, and more consistent, performance information. Those two reforms alone will drive significant efficiency gains in the health sector, which is useful because we’re going to be spending more on health in years to come, no matter how much reform puritans like me rant about the need for more user-pays.”
Of course this is utter tosh, straight out of the neoliberal songbook that equates marketisation of public services with efficiency gains. The failure of such models to contain costs when installed in other countries lies in the increase in bureaucracies whose sole purpose it is to monitor and cajole “efficiencies” (see the marketisation and part-privatisation of the NHS, where costs have gone up considerably but the systemic problems have continued to fester). The real target of those “efficiencies” will be frontline workers in public health. You know, those fat cats whose unions will be trying to protect their bloated salaries.
Worse, BK has accepted the idea that public hospital cost savings can be made with no reference to the private sector’s bloated inefficiencies. The subsidisation of private health by the government (most outrageously through the PHI rebate) has been a key driver of growing costs and will now be enhanced by terrific ideas like throwing even more money at private organisations when public hospitals can’t keep up with Mr Rudd’s targets.
And the erosion of serious efforts to contain pharmaceutical costs, in part subsidised by ordinary punters through rising co-payments (that lovely “user-pays” doing its job again), impact heavily on public providers also.
It’s a weird model of efficiency, this, and one that will not stop the systemic under-resourcing. But in BK’s world as long as there is a market it must work. Or someone else will be to blame. Probably those health workers who the bureaucrats will be whipping to work harder and faster for less.
The only good thing that came out of this smoke-and-mirrors “reform” was extra funding. But will it be used to do good or evil?