Contrary to what we often hear, access to public healthcare in Australia isn’t free. It costs the taxpayer almost $100 billion each year. That’s about $4000 per resident or 6.5% of GDP. Our total spend on healthcare — both public and private — is 9.4% of GDP.
That money comes at the expense of other potential areas of public spending. Every dollar spent on healthcare is a dollar that cannot be spent on education, infrastructure or defence, or simply left in taxpayers’ pockets.
Local outbreaks of SARS-CoV-2 have put pressure on public hospitals. Treating COVID-19 patients uses resources that can be spent on other health problems or in other public policy domains altogether. The financial cost of ventilating a patient in a public hospital for four days approaches $100,000. If ICUs are at capacity, the additional cost is someone else missing out on care.
Given that, one, we now have strong evidence that vaccination significantly lowers the risk of not only transmitting the virus but of hospitalisation and death, and two, vaccines are now readily available in Australia, debating how to deal with vaccine refusers seems quite legitimate.
Denying treatment to those who are eligible but refuse, as touted by the Victorian AMA, is quite distasteful. A public system must treat all comers based on need and capacity to benefit. End of story.
The principal lever to address vaccine hesitancy and minimise refusal must be public education. Mandates play a role. But there may be a palatable way to incentivise vaccination and recoup some of the costs of additional treatment.
All taxpayers are charged an annual Medicare levy of 2%. Medicare is the federal scheme that funds general practice and specialist care, with individual patients paying the “gap” between the Medicare fee and what their practitioner charges.
In addition, individuals that do not have private hospital cover face a Medicare Levy surcharge (MLS) of 1%, 1.25% or 1.5% depending on their taxable income. In the absence of an equivalent levy for public hospitals, a similar scheme could be introduced for those who refuse vaccination without a valid exemption. The MLS kicks in at a taxable income of $90,000 per annum (the highest rate of 1.5% is applied at $140,000 and above).
Such a scheme would ensure continued access to care while applying a small financial incentive to get the jab and recouping some of the financial burden created by refusing to participate in a mainstream, evidence-based public health intervention.
It would be relatively easy to coordinate, given that vaccination status is easily recorded and difficult to falsify — the logistics would be far easier than (accurate) verification of vaccination status at venues or shops. Its binary nature sets it apart from behavioural risk factors that increase healthcare use like smoking or poor diet, which are not only difficult to quantify objectively but also linked to socio-economic status and potentially difficult for individuals to change.
It would not be regressive. If there is a social gradient for vaccine hesitancy, like there is for obesity and smoking, it is taken care of by a progressive design. Just like the MLS, a marginal rate could be applied, and low-income earners could be exempted. Wealthy refusers would thus be charged disproportionately more than the poor. A potentially elegant solution.
There’s the coercion argument. Yes, it is a financial incentive to get the vaccine. But then we tolerate the MLS — a financial inducement to buy private health cover, a policy explicitly designed to “encourage people to take out private patient hospital cover … [and] reduce demand on the public system”.
There’s a range of other similar policies: punitive tobacco taxes, traffic infringement penalties, compulsory schooling or indeed the ‘no jab no play’ mandates for childcare. A junk food tax — proposed by many public health experts — would, in fact, be more regressive than a vaccine levy.
Should we bother given Australia is on track to be one of the most vaccinated populations on earth anyway? The answer is probably yes, both epidemiologically and politically.
COVID-19 is becoming an epidemic of the unvaccinated and it is far from over. Getting as close as possible to 100% will help Australians maintain personal freedoms especially once winter comes around. It will also suppress the chance of vaccine resistant variants, although this obviously needs to be a global effort. This is a stated reasons why, despite having reached 85%, Singapore will soon be charging COVID-19 patients who have refused to be vaccinated without a valid exemption for their medical costs.
Politically it’s a signal that there exist a small number of democratic obligations that, if adhered to by everyone, generate the many freedoms we enjoy. Vaccination is a modern embodiment of these.
All policy interventions entail some risk of unintended consequences. A surcharge may give vaccine refusers self-ordained licence to refuse other limitations. “I’ve paid my way so it’s unreasonable to deny me entry into this [insert place where vulnerable people could be at risk]” would be a regrettable outcome.
Nevertheless, we should consider policies that discourage people from placing the health of fellow citizens in in danger without a reason that aligns with secular, democratic values.
Note: this piece has been amended since publication.
Before we start denying anyone medical care lets address a couple of other issues.
1. Wealthy people who dont pay tax.
2. Governments who throw millions at millionaires and billionaires for no apparent reason.
3. Clawback incorrectly awarded jobkeeper.
4. Stop billionaires going to outside consultancies for advice that the public service should be giving.
5. Prosecuting politicians who rort grants processes.
When we have done all that we can think of denying govt services to tax paying citizens.
Michael, no (reasonable) person would argue with you that the issues you raise here are worthy, and very much need to be addressed, but with respect, they are not the subject of Luke’s article. To raise these issues is a ‘red-herring’ of the first order. I do not know if you are deliberately attempting to distract readers from the central issue which is, as the headline reads, whether or not:
“Vaccine refuseniks need to pay for the pressure their actions put on public hospitals”.
Excellent wattaboutery.
Luckily, you can rest assured. The writer of this article is not considering denying govt services to tax paying citizens.
Whatabouttery Michael – crackpot argument in this case.
Bollocks. Well meaning health analysis let down by macroeconomic bollocks.
These two sentences are just not true. The federal government is not a household, and is not subject to the same financial constraints as a household. Dollars are the one and only thing that the federal government has an infinite supply of. What is finite are the resources available in the economy that can be purchased with those dollars. That is the constraint on all spending.
If we as a nation can resource it, we can do it. If resources are constrained, we have to prioritise accordingly.
If the multiple billions doled (sic!) out to corporations as JobKeeper don’t convince the electorate of that then nothing will.
Agree, the LNP government like the Tories and GOP come up with a variety of reasons, without stating clearly, while they ‘wedge’ parties and the electorate into expecting or demanding lower taxes, smaller budgets and fewer government outlays for investment in society.
What they are really proposing is ‘radical right libertarian’ ideology informed by James Buchanan’s Orwellian termed ‘public choice theory’, when it’s actually about ‘choice’ for the top 1% inc. corporates for lower taxes, no regulation and small government; promoted as our ‘freedom & liberty’; radical right libertarian trap based on rhetoric….
Hi Richard
You’re quite right about the household thing but that applies to borrowing and putting money into the economy (that’s the macro part). even with all the money in the world resources will always will be scarce. For example. We can put tertiary hospitals with ICUs in every suburb, but they’d be empty because where would we find the staff? So you’re quite right about the need to prioritise ie. minimise opportunity cost (that’s microeconomics).
but I’m NOT saying we shouldn’t treat COVID patients who refused vaccination. My argument is ok, fine, but let’s add a mild financial incentive to get jabbed on those who can afford it, and recoup the marginal cost of treating the unvaccinated (staff overtime, additional equipment, medications etc.) cheers
A convincing case. The advantages of such a scheme easily outweigh the disadvantages.
No, just no.
While I think anti-vaxxers who don’t get vaccinated for conspiratorial reasons are a problem, they should not be denied or have to pay more for health care. What’s next? Athletes paying more? Kids who do community sports or injure themselves when playing? Obese people? Musicians with hearing problems?
How about we actually start tackling the real causes of this (outside the always existing fringe on everything) – political opportunists, corrupted media and an (not unjustified) increasing loss of trust in governments . As you say, Australia is one of the best vaccinated countries in the world with other vaccinations, the cause of this is not those people, it’s the ones that are riling them up. Putting these measures in place just exacerbates the actual cause.
Did you read the article? It states as explicitly as possible that nobody should be denied healthcare, regardless of their vaccination status or anything else.
But the article also made the point that anti-vaxxers should pay, because it’s easy to get them to pay. In other words discrimination because it’s easy to do so.
BTW, I’m double AZ vaccinated.
It makes the point that the unvaccinated impose a cost on society, so it proposes a way to place a charge on those unvaccinated that can afford it, in proportion to their ability to bear that cost, to compensate for that cost. It’s not perfect of course, but it’s pretty good.
I’d just reinforce that it would only apply to those without a valid exemption
Faulty logic and a blatant misrepresentation of the article – which did not justify dIscrimination on the grounds that it would be easy.
Well said, browser. The article explains why the levy would be a fairly marginal addition to the existing medicare levy arrangements and simple to administer fairly and accurately. That is a genuine advantage of the proposal. It is not a justification, it was not presented as one and Zeke is traducing the author by suggesting it was.
Did you know that if you are privately insured and make entry to a public system, before you are really conscience there will be a client facilitator getting you to sign to say that they can bill you private fund for a public bed in a public hospital.
I wonder at what point the entire Australian health system collapses?
The advantage of charging insured people who are willing to be charged for public hospital treatment is that the public funds that would have been spent treating them can be spent treating an uninsured patient. I’m insured and I have used my insurance in a public hospital. It makes no difference to the treatment but it lightens the financial burden on the hospital.
Who really cares if you are double vaxxed with Boris brew or not.
It doesn’t prevent you from getting Covid, it reduces your chance of landing in the ICU by 85 out of 100 times, it supposedly slows your sharing the damn virus.
Anti-vaxxers are willing to pay lots of money to charlatans for stuff to pour down their throats or up their anus’ which doesn’t really work except for the placebo effect and I think this economists is trying to work out how to harness this waste of money for the real health system.
Levying ANY financial penalty will have the effect of deterring the recipients on low incomes from going to hospital. Sliding scale is irrelevant. Even if its $5 or $10. It will be a deterrent. The last thing we want is covid positive people avoiding hospitals due to these penalties and continuing to circulate in the community. Recipe for disaster.
It’s not a financial penalty. It’s a medicare levy. Going to hospital or not has no effect whatsoever on it. Those on low incomes don’t pay it anyway.
We do have to pay for education , why not the athletes?
We do pay for athletes. It’s very annoying.
The Australian Government’s Federal Budget delivered more than $158 million of new investment to Sport Australia and the AIS.
That’s extra, new funding on top of the decades of feather bedding and big bucks.
So? How much does the average “He has done his ACL? ankle/ shoulder cost over a season or two?
Cost whom – obscenely wealthy clubs?
The more the better
Certainly the taxpayer should not pay a ha’penny.
Maybe a special levy on ticket sales except that far more consume the heroics via TV so factor the AIS into the mass media contracts.
Very Soviet like agitprop production and using sport as a national PR project while ‘amusing ourselves to death’ i.e. participating through watching sport on tv…..
The all pervasive “Big Pharma” conspiracy theory, just needs a little push and it is almost a perpetual motion machine.
I am a,passionate pro vaxxer. The punitive side of me Iwould love to see determined anti vaxxers further penalised for their stance. But this idea which has been embraced by Singapore and ex NSW Premier Bob Carr locally – is too dangerous. Conservative governments have been trying to dismantle Medicare for decades. I say any policy that plays into their agenda endangers the entire structure of Medicare. If we start introducing penalties for a group the majority of us pro vaxxers clearly disagree with – I ask – who will be next on the hit list? Because in the hands of the anti Medicare brigade, this will be the thin edge of the wedge. Sequentially they can target unpopular health consumers and via various means, separate them put from the herd. And all they need to do is keep selecting easy targets, pick them off and over time, the loyalty and support for the entire public health system is eroded. It is classic back-door incremental technique to dismantle a public asset by stealth. We start with anti vaxxers. Then what about drug addicts and alcoholics. Surely their lifestyle choices are leeching Medicare of resources too. The overweight? Ditto. Lifestyle choices covers all sorts of biases. Hosputal ER’s burst at the seams on weekends and public holidays when sports injuries peak. Are sports injuries self induced and therefore a choice they should pay for because they are sucking medical resources away from babies? I have no doubt AIDS/HIV was and remains classified by many as a ‘lifestyle choice’ – so we know what these sort of exclusionary or punitive policies would have meant in the 80’s. And nowhere mentioned is the health costs to society of imposing even sliding scale means tested financial penalties on covid. What will happen is the most marginalised will avoid going to hospital to avoid incurring a financial penalty- which means with covid – they remain circulating in the community while covid positive, shedding covid widely until they drop and are varied off to hosputal. These homeless and marginalised groups were the prime source of covid outbreaks in my community. They simply do not plug into health programs in the same way. They will work to avoid financial penalties the rest ofvus would consider mild. That is what happens when you live on social security, have insecure housing, and /or live on the streets or in refuges. A $10 penalty can be enough to deter going to hospital if they know their social security can be garnisheed. The rest if us would spend more than that on a coffee and biscuit without hesitation. Sometimes daily! These ideas are a fundamental attack on Medicare itself. The solution is not to penalise financially who ever the damned group du jour happen to be. The solution is to fund Medicare and our public hospitals better. This government is throwing and wasting billions on French ( now US) submarines. Without a backwards glance. Let’s increase the public health funding by rerouting resources from there for example. Whole lot more money doing that compared to levying financial penalties on stubborn less than 5% of our population who are committed anti vaxxers.
We’ll said.
The idea is paying extra tax, for anyone unvaccinated, not a charge when you front up to hospital!
And by far the worst incentive to dismantle Medicare is the levy for those on higher income who do not have private insurance. Direct your spleen there.
Well put I agree 100% But we obviously have many anti-vaxxers in all groups in society including this one . Impossible to debate or discuss some of the most ridiculous theories re vaccines. Their self-caused conditions should they occur should be treated as we treat the mentally ill, the smokers, the obese, and many other victims of their own lifestyle choices.Recent history has examples of tyrants who have used other means to rid their society of “problem health “costs.
Sad to see the anti-vaxxers are still unable to debate this difficult and important matter .Two streams to a debate one the financing of medical responses the second being.the responsibilities and entitlements of those who chose not to vaccinate.
This country has outperformed most others in protecting its citizens .There has been little difference in individual states’ performances. The pre-vaccine modeling if we can remember that far back predicted loss of lives similar to those still being suffered in the least vaccinated countries.
That we still have a low death rate reflects the importance of a high rate of vaccination and a population willing to follow medical advice .
Anti vaxxers can hold any opinion they like but the facts are they are beyond doubt the COVID patients in hospitals with a ratio of 9 to 1 of vaccinated and .Until this matter can be addressed by informed debate the unvaccinated will suffer short term and long term.