Professor John Dwyer - UNSW & Aus Health Care Reform Alliance - Medicare on the brink. What now for new models of care?


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Professor John Dwyer delivered the presentation at the 2014 Future of Medicare Conference.

The Future of Medicare Conference was a timely event as the Abbott government debates a full over haul of the Australian healthcare system. This conference presented a chance for government representatives, regulators, health care providers in the public and private sector, educators and private investors to come together and debate the proposed changes to Medicare as well as discuss the best practice methods of implementing new measures and frameworks.

For more information about the event, please visit:

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Professor John Dwyer - UNSW & Aus Health Care Reform Alliance - Medicare on the brink. What now for new models of care?

  1. 1. Medicare on the Brink What now for Medicare’s support for urgently needed new models of Primary Care? Professor John Dwyer The “Future of Medicare” conference Sydney August 2014
  2. 2. Health Care Reform • Our goal– • A system focused on the individual that emphasises prevention is demonstrably equitable, sustainable and provides evidence based quality care in a timely manner available on the basis of need not personal financial wellbeing.
  3. 3. Medicare at the crossroads • Two very divergent views • Australians to pay more for the current system or • Provide a new approach to Primary Care enriched with the necessary infrastructure to better focus on prevention and community care.
  5. 5. The Co-payment model • Logic? Medicare costs are unsustainable we need more revenue, then • Many of us visit our GP too often, need an upfront cost as a deterrent, then • Drs must collect the $7 but can keep it. • No you can keep $5 but we are reducing your standard visit remuneration by $5. ($31.60)
  6. 6. The Co-payment model • Also adding $7 per script, imaging or pathology test. • Maybe Medicare costs pa at $19B are not that unsustainable after all as we will use the money collected to build the world’s largest research fund ($20B) • General opinion—counterproductive and unfair.
  7. 7. The Co-Payment model • Government wants competition for GP services to be focused on quality not price!!! • Increasing quality invariably requires additional expenditure.
  9. 9. Inequity • With the exception of illness related to excessive alcohol consumption, all the major risk factors related to the development of Chronic and Complex diseases are more prevalent among socio-economically disadvantaged Australians. • Inequity is Un-Australian and very expensive.
  10. 10. Inequity • If after fiscal inefficiency tackled and prevention models embraced Medicare really does need more dollars the fairest way to raise the money would be to increase the Medicare Levy. • The Levy currently raises about $9B pa. • Surveys show that as the wealth of Australians increases they are willing to spend more on health.
  11. 11. • THE GP WORKFORCE
  12. 12. Increasing GP dissatisfaction • 70% of GPs do not want to be tax collectors for the government • Many Practices with a socio- economically disadvantaged clientele will try and adsorb the $7 costs • GPs feel undervalued and their professional lives not being sought by new graduates
  13. 13. Attracting the next generation of GPs • Only 13% of Medical graduates want to be GPs. Rural crisis worsens. • GPs are trained as specialists and are the backbone of our health system but poorly paid. • Dissatisfaction with current model of care has GPs exploring other options (corporates etc) . Unhappy with FFS
  15. 15. What did we reasonably expect? • A clearly delineated vision for the health system contemporary Australia needs • The necessary changes to unshackle reform efforts i.e. a commitment to system reform not just asking us to pay more for the same old! • A renewed commitment to health care equity
  16. 16. Request to Abbott Government • Almost all health reform experts said to the government pre budget---- • “GDP expenditure on health is only 9.1%, no cause for panic, and your concern for the rising cost of Medicare (19 B $ a year )is misplaced when hospital expenditure exceeds $140 B a year and is growing faster than Medicare”.
  17. 17. Advice to Abbott government • “ We know Mr. Dutton that you are focusing on Medicare expenditure because of the wretched jurisdictional divisions that uniquely plague Australian Health care, but true leadership from your government would see more spent on Primary and Community programs to save many more dollars from reduced hospital admissions”.
  18. 18. Wasted or poorly used health dollars • $30 Billion on avoidable admissions • $20 Billion on low value/no value care • $5 Billion on PHI rebate • $2-4 Billion on DOH duplication • $2-3 Billion on “Supplements” and pseudoscience • $2 Billion on unnecessary length of Medical Education
  20. 20. Instead! • Co-payment for Dr visits etc. • National body for Prevention abolished! • OOP expenses already fastest growing area of health expenditure ($29B pa) but we are asked to pay even more • Huge research fund for future cures while we struggle to implement current EB strategies. • Tinkering with Medicare Locals but no needed structural reforms.
  21. 21. • COAG agreement on Commonwealth contribution to hospital funding ripped up • States loose 80B dollars of promised funding and a partnership in sharing rising costs equally • Plus hundreds of millions from needed Commonwealth grants cancelled. Instead!
  22. 22. Governments thinking re its health responsibilities? • Minimise the Federal government’s fiscal footprint for promoting health and providing care. • Would like to abolish Medicare and have Australians rely on PHI for PC • Take so much hospital money away from the States that they scream for a GST increase.
  24. 24. Some pertinent facts • Many quality studies have been done looking at preventable hospital admissions in Australia. • Defined as “avoidable” had there been an effective community intervention in the three weeks prior to admission. • 600,000 avoidable admissions utilising 7 million bed days pa. Economics 101? • NSW, 8.9% readmission within a month
  25. 25. Public Hospital problems • Demand outstrips financial and physical capacity • On average a 3-5% increase in admissions of sicker, older medical patients each year • In NSW ED’s experienced 7-11% increase in visits 2103. • Physical infrastructure hinders efficiency
  26. 26. Future of Quality Hospital Care • Already most ON beds in OECD • Need more in present system! • Quality hospital care into the future all dependant on demand reduction • Fewer medical cases but more surgery • Gap payments for surgery will only fall with public hospital competition.
  27. 27. Some pertinent facts • Management of a huge societal burden associated with Chronic and Complex disease management costing us a fortune and results in much personal suffering. • There is no doubt that much of this suffering is preventable but only by providing our PC system with the prevention infrastructure needed.
  29. 29. What do we need from contemporary Primary Care? • Personalised medicine to prevent illness • Currently 2% of budget • Early intervention strategies • “Team Management” of C & C disease • “Hub and Spoke” models for better clinical, business and quality outcomes • Care in the community for many currently sent to hospital.
  30. 30. Integrated Primary Care • World wide shift • “Team medicine”; Practice team consists of doctors nurses and allied health professionals (including dentists) with team funded by extension of MBS • Team learning to prepare for IPC practice.
  31. 31. Integrated Primary Care • Importance of voluntary enrollment • Mutual contract to keep you and your family well • Emphasis on appropriate continuity of care and case management led by the most appropriate health professional • Care model attractive to health professionals (young doctors)
  32. 32. IPC well established internationally • KP in western USA good model • IPC and electronic record for ten years • Best outcomes in USA for 8 of 10 most common Chronic conditions • 2 million face to face consultations now done by email • Very significant reduction in hospitalisation
  33. 33. Primary Health Networks • Replacing Medicare locals which did need better role delineation • Lost a lot of PC Money • Fewer but larger PHNs. How will they be better aligned with hospital networks? • Asked to align themselves with PHI providers!
  34. 34. Private health insurance for Primary Care • International experience shows costs increase when PHI covers PC. Clinical governance may be compromised. • Totally unacceptable to have patients with PHI receive a superior set of services from their medical home not available to those without PHI.
  35. 35. PHI and Primary Care • We want to reverse already problematic movement towards a two tiered health system • PHI like all of us wish to see better PC reduce hospital admissions. • Should consider partnering with government in promoting better health for all Australians.
  36. 36. Health Reform in Australia • Definition: - “ A nebulous ‘pie in the sky’ concept beloved by well meaning masochists who spend much time preaching to the converted while converting nobody” Catherine Dwyer 1995-2014 and beyond.
  37. 37. How do we promote Health Reforms? • Present a clear vision to the public of an improved model of care the benefits of which they would like to have available. • Calm the 3-4 year cycle jitters of politicians by promoting health reform as a journey that will generate voter support but not require an immediate political/fiscal revolution.
  38. 38. Concept of a Reform Journey • One plans a journey after deciding definitively on a destination. • Plan--a month in Paris next summer! • Hurdles along the way, careful and thorough planning essential. • Unforeseen problems must be addressed
  39. 39. The Reform Journey. • COAGs “Paris” should be the introduction of the described reforms. • We need a transition authority to help us take the journey. • The destination (model of care) is non- negotiable • The length of the journey is less predictable but the journeys milestones are well marked.