New CIS book: crucial to fix Medicare

Jeremy Sammut

30 July 2018 | MEDIA RELEASE
Medicare is not ‘fit for purpose’ — and will fail to meet the changing health needs of Australians in the 21st Century unless the system is modernised,a new book from The Centre for Independent Studies (CIS) outlines.

The Future of Medicare? Health Innovation in 21st Century Australia calls on the federal government to commit to a comprehensive independent Productivity Commission review of the Australian health system to catalyse healthcare reform and innovation.
“The current Medicare system was suitable when the only health care most Australians needed was one-off GP or hospital visits to recover from short-term illness,” says Contributing Editor and Director of the CIS’s Health Innovations Program, Dr Jeremy Sammut.
“But Medicare cannot cope with the rising burden of long-term chronic disease in an ageing Australia – which is the major health challenge we face today.”
“Many chronic patients with complex conditions find the fragmented Medicare system hard to navigate; and many also miss out on accessing all necessary and beneficial care because of the ‘gaps’ in the system.
“Lack of access to services not covered by Medicare – such as community nursing and allied health services ­- means chronic patients miss out on the kind of care that could keep them well and prevent high cost hospital admissions.”
Dr Sammut says the problems identified in The Future of Medicare are conservatively estimated to cost around 11% of health spending a year.
“Health spending is higher than it should be because the right care isn’t received at the right time and place, and as result around 10% of all admissions are potentially avoidable,” he says.
“But this even more significant when the around 5-10% of patients that are the heaviest users of health services are responsible for generating 50% of health costs.”
“Innovation in health is crucial to deliver better quality chronic care that achieves the best and most cost-effective health outcomes — starting with capitated payments for chronic disease that would allocate a set amount of money on a per person basis to a healthcare provider.”
However, Dr Sammut says updating an outdated system considered the jewel in Australia’s social policy crown so it can meet the major health needs of Australians in a patient-centred and outcomes-focused way will be difficult due to the politics of health.
“The AMA and other entrenched vested interests in the health sector run ‘Mediscare’ campaigns to keep Medicare as is and funding the same old services in the same old way,” he says.
“But we can move the health debate forward and overcome the political obstacles by applying the lessons of recent reforms in aged care and disability services sectors.”
“Politicians have responded to the dissatisfaction of consumers, their families, and advocacy groups, and implemented important changes to old systems that were failing to meet the needs of older and disabled Australians.”
“A Productivity Commission inquiry would reveal the same latent dissatisfaction with Medicare of chronic disease sufferers and patient groups — and highlight the need for policymakers and the public to support modernising Medicare.”

Dr Jeremy Sammut is a Senior Research Fellow at the CIS.  The Future of Medicare? Health Innovation in 21st Century Australia will be published on July 31.
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