A first step in the long road to health reform

By Stephen Leeder

Australia provides good health care to the majority of its citizens most of the time and compares well with like countries. The capacity for illness to destroy families financially, seen in the US and in many less economically advanced countries where governments make small or no contributions to the cost of health care, is much diminished by Medicare, public hospitals and subsidised pharmaceuticals.

Medical misadventure remains rare enough to be newsworthy. Thousands of Australians are treated in hundreds of hospitals, both public and private, and 100 million services are provided by general practitioners each year.

But all is not well. Beds are in short supply, emergency departments struggle, and mental and dental health services are woefully inadequate.

The meetings this week of the Council of Australian Governments (COAG) provided welcome evidence that all jurisdictions in Australia were aware of the need to change the way we pay for publicly funded health care to deal with these problems. This was not, thank goodness, a performance of COAG as Copenhagen.

Beyond the predictable theatrics of an encounter among heads of Australian governments, matters of substance were nevertheless determined. COAG's agreement to move to a nationally unified system of payment for publicly funded health care reduces the likelihood that one layer of government will push patients out of the facility they pay for (a hospital, for example) into another form of care paid for by another government (e.g., general practice).

But because states/territories retain a continuing financial commitment to public hospital care in the reformed system of the future - 40 per cent - cost shifting will not be eliminated, but should be less. Nor will it be helped by compromises that were necessary to win the states and territories over, together with lots of new money to help ease the transition from the old system to the new.

Reducing cost shifting is important for the adequate care of patients with heart ailments, stabilised cancer, complicated diabetes, stroke and other chronic problems, who need both hospital and community care. If primary care is inadequate, patients will come to hospital more often in crisis. If hospitals are crowded, the occasions on which patients with chronic problems really need hospital care will become crises, often miserable and sometimes fatal.

By agreeing on new approaches to care in the community, funded entirely by the Commonwealth, complementing the Commonwealth's 60% funding in public hospital care, the first steps have been taken on a long pathway to providing adequate care for patients with chronic illness.

A huge amount remains to be done to turn these new arrangements into more than policies and plans. Linking patients' medical records electronically is a critically important development. While it may make little sense to have an e-record for generally healthy citizens, the case is strong for those patients who require care from several doctors, a pharmacist, a physiotherapist and a hospital to have one that all carers can use.

COAG also settled on a revised governance structure to health care, admittedly (by compromise) left to the states to hammer out, whereby health services are to be managed as smaller entities than they are in several states at present.

In Mr Rudd's original proposal he argued that groups of four or so hospitals might be managed by a common board, the hope being that the services the hospitals provide would thereby better reflect the needs of the community they served, giving clinicians a stronger voice in their running.

It would be a seriously lost opportunity if these health areas and regions were developed only around hospitals, because the hospital and community services of the future demand to be developed and managed in tandem. Great care is needed to ensure that network areas are neither too big nor too small. On average, an area of about 300-500,000 people allows for most services to be available locally without patients having to travel for care other than hi-tech support for rare conditions.

Hospitals are not the right agencies to sponsor large scale prevention programs, health promotion, environmental health and public health for the whole community. A comprehensive network board would assume responsibility for several of these functions, others remaining at a state or national level.

But the networks must surely develop their services in strong consultation with doctors, both general practitioners and specialists, psychologists, nurses and all the other community health workers essential in managing ageing populations in our cities and in the country. Network health boards should be composed with great care and preferably depoliticised and avoid deeply vested and conflicting interests.

The two major topics that Mr Rudd emphasised initially in his reform agenda were financing and governance. The sandpaper of COAG has smoothed the edges but they remain essentially intact. He set out to reform hospital financing and that he has done, insisting that in large part payment should follow activity.

Although a series of announcements subsequent to Mr Rudd's national press club presentation of his plans have followed, and make considerable sense, many readers of the plans and health advocates have professed concern that we have been offered a hospital reform proposal, not a health reform.

The huge potential for prevention, which Mr Rudd acknowledged at Summit 2020, remains vestigial and unsophisticated. It is a pity that this has been so minimised, as a thoughtful account of what we need to do to move on from chronic diseases in a generation or two is sorely needed and much sound thinking is available in the report of the preventative service task force Effective preventive approaches to the massive and growing problem of dementia have not even been mentioned and instead this socially embarrassing disorder has been pushed out of the medical system, perceived more as a matter of discrete warehousing.

There is more. Huge problems confront us today and into the foreseeable future in mental health. The plight of schizophrenic adolescents struggling with their illness, with high copayments for essential medications unless they are on social benefits and with seeking to develop identities as workers has received only tokenistic recognition to date. A much more intelligent approach, amply supported with many times more resources than we currently devote to it, remains to be put in place.

Nothing much emerges from the reform process to date for dental care, on which we currently spend more private dollars than all those we devote - both private and public - to either heart or cancer care. There is little explicit support for effectiveness research into the reform proposals to guide us for the future efficient use of health dollars and shape of the system.

So reform has begun, and this is a cause for celebration. But it is a form of celebration tinged with the restraint because we have a long way to go.

Weary premiers, ministers and prime minister, returning home after an exhausting week, should have their security details check their destination airports for flags that say "Mission accomplished" and quietly confiscate them.