Health Care Reform

Health care reform for the 21st century and the willingness of doctors and other health care professionals to work extended hours has diminished as the health workforce ages, as the proportion of women in the health workforce increases, and as individuals seek to balance work and family life.

Work, social and educational aspirations of health professionals and their families influence decisions about where to live and practise.

These and other factors have led to problems in the supply and distribution of the health workforce.   

There are serious shortages of health care jobs for general practitioners, dentists, nurses and key allied health workers.

Shortages are more significant in outer metropolitan, rural and remote regions, especially in Indigenous communities, and in particular areas of care, such as mental health, aged care, and disability care.

Overseas-trained doctors now make up 25% of the medical workforce compared with 19% a decade ago. 

Health Care Costs 1009-2010

Health care reform has to take place as health expenditure in Australia in 2009-10 increased to $121.4 billion. As a percentage of GDP it was 9.4% of the GDP, 0.4% higher than in 2008-09. 

Public hospital services accounted for under one-third (31%) of the total increase in 2009-10, while medications accounted for over one-fifth (21%) of the total growth.

2009-10 marks the first year of the transition to the National Health Care Agreement, a new health care funding arrangement between the Australian government and state and territory governments.

released: 28 Oct 2011 author: AIHW media release

Health Care Funding

The next Australian Government will confront major challenges in the funding and delivery of health care. Australia’s health care system ranks well internationally, as reflected in our continuing high average life expectancy and low rate of infant mortality.

Australia has always had a health system that relies on public and private financing and service delivery. This has been presented as a matter of choice. However, the private health insurance surcharge can be seen as unfair by those who live in rural areas where access to private health facilities is limited.

Some areas of surgery are now performed predominantly in the private sector, and the 57% of Australians without private health insurance must wait, often for months, for elective surgery in the public system.

This creates an equity challenge where access to care is based on ability to pay rather than need. Specialist surgical training remains concentrated in the public sector, where the caseload is diminishing.

 The mix in health care reform funding

The public–private mix to health care funding is becoming less equitable.

Health care reform is needed if the Patients’ out-of-pocket costs keep growing at over 50% in the past decade. 

The private health insurance sector is heavily regulated.   Premiums for private health insurance are the same for the active and the indolent, the prudent and the profligate. Should this be so? Health funds respond by shifting their bad risks back to the public sector — for example, they do not pay for home renal dialysis and limit payments to specific dialysis.

The reinsurance scheme, which evens out the risk to insurance companies irrespective of performance, obliterates incentives for funds to seek out and develop imaginative solutions to chronic disease management and prevention. Innovations linking health services to health service financing are forced to the margins, and flourish in the health management programs of the Department of Veterans’ Affairs.

An example is the program to improve hospital discharge planning and prevent hospital readmissions, which is expected to deliver savings of $46.1 million in hospital costs over the next 4 years