SPEECH TO THE NATIONAL PRESS CLUB
“Delivering on the promise of Medicare: Labor’s vision for a truly universal health system”
WEDNESDAY, 13 FEBRUARY 2019
Thank you Sabra for that introduction and thanks everyone for having me here today.
Tomorrow, Bill Shorten and the Prime Minister will deliver their annual Closing the Gap statements to Parliament.
It’s now 11 years since Labor established the Closing the Gap framework, which includes a bipartisan commitment to end the gap in life expectancy within a generation.
We’ve seen some progress. Aboriginal and Torres Strait Islander smoking rates are down, and First Nations children have some of the highest immunisation rates in the country.
But the stark reality that will confront the Parliament again tomorrow is that we are not on track to meet our national target of closing the life expectancy gap by 2031.
Shockingly, in Australia in 2019, Aboriginal and Torres Strait Islanders can still expect to live around a decade less on average than other Australians.
And so today, as I always do, I begin by acknowledging the traditional custodians of the land on which we meet and I pay my respects to their elders past, present and emerging.
But I also re-commit myself to listening to and working with Aboriginal and Torres Strait Islander Australians to Close the Gap in life expectancy, in health and wellbeing.
I’ve been Shadow Health Minister for quite a while now.
In fact my staff recently informed me that I have just become the longest-serving federal Shadow Health Minister in Australian history.
That’s not a record to which any politician has ever aspired!
But it does speak to the stable and united team that Bill Shorten and Tanya Plibersek have led since 2013.
But it’s not a record I want to extend any further. I’m ready for a change – and I think most Australians are too.
In my address today I want to talk about the health challenges that we face, put the case for continued health reform, and outline the broad approach Labor will take to improving our health care system and the health of all Australians.
In five-and-a-half years as Shadow Minister – and in my previous roles at the Health Department, at KPMG and as a social worker – I’ve had a lot of time to think about Australia’s approach to health.
The experts tell us that Australia has one of the best health care systems in the world.
I see examples of that every day as I travel around the country.
The young woman in a public hospital in Queensland who is receiving world-class cancer care – for free.
The GPs in Melbourne who lead walking groups to keep their patients healthy and prevent illness, rather than waiting to treat it.
The Aboriginal medical services in every corner of the country that provide integrated and culturally safe primary care.
Stories like those are why the Commonwealth Fund rates Australia’s health system number two in the world.
But I also think of the young sisters in remote South Australia – one of them dangerously overweight, the other dangerously underweight – who have no access to care until the Royal Flying Doctor Service visits.
Or the aged pensioner in my own electorate who needs urgent cataract surgery – but has to choose between a 12 month wait or a $3000 bill.
And the literally hundreds of Australians I’ve met who can’t afford to visit a GP or fill a script, or are on long waiting lists for public hospital care.
Those stories aren’t unusual. They are symptoms of the well-known challenges that our health system faces.
We have an ageing population with increasingly complex health needs.
The burden of chronic disease on patients, our health system and our society is immense and growing.
We have ageing health infrastructure, which is struggling to accommodate those needs.
The cost of health care generally is rising. And the pace of change in medical technology is accelerating rapidly.
Too many Australians still encounter barriers – high costs, long waiting times or doctor shortages – to accessing high-quality care when they need it.
And there are persistent inequalities for Aboriginal and Torres Strait Islanders, people in rural Australia and many of those on low incomes.
We’ve known about these challenges for years. They haven’t just snuck up on us.
And in many cases we know how to fix them – or at least we have a good idea where to start.
But for decades now health reform has been repeatedly undermined by two features of our political system.
The first is what I describe as a “boom and bust” cycle where progressive Labor reforms are undone by subsequent Liberal Governments.
Take Medicare for example.
Gough Whitlam established Medibank; Malcolm Fraser scrapped it; Bob Hawke resurrected it as Medicare.
It was only because Hawke and Keating were in power for so long they were able to embed – to ingrain – Medicare into our health system.
Today it’s one of the cornerstones of Australian society – one of our greatest public policy achievements.
But what if things had been different?
What if the winds of political change had blown in 1987 and John Howard had taken power then, when Medicare was still in its infancy?
Make no mistake: he would have dismantled it.
By 1996, when John Howard finally took power, it was no longer politically feasible to abolish Medicare.
So instead the Liberals – under Howard, Tony Abbott, Malcolm Turnbull and Scott Morrison – have found other ways to systematically undermine our health system.
That was on stark display in the 2014 Budget.
To take just one example: in 2011 the federal Labor Government had signed the National Health Reform Agreement with the states and territories.
It effectively ended the blame game on hospitals by replacing ad-hoc funding deals with the long-term certainty of an activity-based funding formula that rewarded efficiency.
This was an historic change – the crucial first step in remaking our hospital funding system for the 21st century.
So what did the Liberals do?
In their very first Budget they scrapped the agreement and announced they would revert to the previous system.
Patients, doctors, states – and yes Labor – eventually forced them into a partial backdown.
But hospitals policy is still a pale shadow of what it was.
Which brings me to the second feature of our political system that undermines health reform: the ongoing cost- and blame-shifting that results from federalism.
The split between Commonwealth-funded primary care and state-run public hospitals makes it impossible for any single jurisdiction to reform Australia’s health care system alone.
It also creates powerful incentives to game the system.
When the federal Liberals imposed a six-year Medicare freeze, they knew they’d make GP visits less affordable and drive thousands more Australians into public hospital emergency departments.
Their Budget papers were premised on that very fact.
Not surprisingly, some states have fought back by chasing private patients or outsourcing services to the private sector, where they’re billed back to the Commonwealth via Medicare – a vicious cycle.
My colleague Mark Butler has often talked about the “climate wars” that have prevented us from taking meaningful action to address climate change; well, political short-termism has also prevented meaningful long-term reform in the health sector – our very own “health wars”.
The question for an incoming Labor Government then is how do we break free of this cycle?
How do we make the Commonwealth and the States partners in health reform, rather than combatants?
And how do we ensure that our reforms will survive the next change in Government, whenever it may come?
We need long-term health system reform. Everyone knows it – experts, clinicians, industry and most importantly patients. They all know we can and must do better to overcome the challenges I outlined earlier.
We can and must do better to deliver on the vision of Medicare.
To realise Labor’s vision of a truly universal health care system in which every Australian has affordable access to the high-quality health care they need whenever they need it.
That is Labor’s vision for our health care system. That is my vision. But as I’ve outlined today, we’re a long way off.
That’s why today I am announcing that a Shorten Labor Government will establish a permanent Australian Health Reform Commission.
This Commission will be an independent, legislated body – comparable to the Productivity Commission – charged with developing and overseeing a long-term health reform agenda that transcends our election cycles.
Where the Productivity Commission has an economic and financial focus, the Australian Health Reform Commission will focus on finding ways to improve our health care system and health outcomes for all Australians.
It will be a body explicitly charged with reducing health inequality and improving the universality of our health system.
And it won’t just develop long-term reforms – it will hold Governments accountable for delivering on them.
Commissioners will be appointed for at least five years – giving them the time to develop rigorous and durable solutions that cannot easily be unpicked by one side of politics or another.
And it will report not just to the federal Health Minister but to all Governments through COAG – meaning a federal government will not be able to simply conceal or ignore inconvenient recommendations.
I’m doing something unusual for a politician.
I am acknowledging that no one minister in one jurisdiction can solve the problems facing us alone. They’re simply too big. We have to work together.
Moreover the Commission’s recommendations will be public – and Governments will ignore them at their own peril.
Now as I said, its standing focus will be on improving our health care system and the health of all Australians. It will have the broadest of mandates to achieve that, although COAG will be able to direct its priorities.
Today, I want to identify two early priorities.
The first will be access to specialists through public hospital outpatient clinics. These provide free specialist care to people in the community with cancer and other conditions.
But Liberal cuts to public hospital funding have encouraged states to shift costs on to Medicare, or forced Australians onto long waiting lists or into the private system, where they can face large out-of-pocket costs.
The Commission will examine public hospital outpatient clinic funding and services with a view to expanding access.
The second priority will be primary health care reform.
We need to find, trial and evaluate new models that meet the increasingly complex needs of an ageing population struggling with a massive chronic disease burden.
And then, crucially, we need to fund and roll out these models across the country.
The Liberals made a half-hearted attempt at primary care reform this term with their Health Care Homes trial.
During the 2016 campaign Malcolm Turnbull claimed Health Care Homes would be the biggest health reform since Medicare – but it has been a near-total failure.
Still, we should learn the lessons of that failure and use them to guide future reform efforts.
Similarly, independent experts have been reviewing the Medicare Benefits Schedule throughout this term.
But hundreds of their recommendations to Government seem likely to be unresolved by the election.
My point is that reforming primary care is a big job – and we won’t be able to achieve it with half-baked or under-funded proposals.
The Australian Health Reform Commission will build on Health Care Homes and the MBS Review and give us a realistic and detailed appraisal of how to achieve primary care reform.
Now, I have great respect for the men and women of the Department of Health. I was one of them for several years.
But they are only one department in one jurisdiction and their primary role is to administer the system we have now – not to redesign it, and certainly not to hold governments accountable for their performance.
In many ways it would be easier for me to keep the status quo as minister. But that’s not the way to improve our health care system and the health of all Australians.
Now I know what some might say: here we go again, more bureaucracy.
But I want to emphasise there will be no increase – the costs of the Commission will be offset within the existing resources of the Department of Health.
And in time, I want the Australian Health Reform Commission to occupy a similar place in our institutional landscape as the Productivity Commission.
Neither the Commission nor a Labor Government will make change for change’s sake.
We will always fight the Liberals on health where we must.
But as I’ve suggested today, incoming governments should build on the work of previous governments where they can.
For example, Labor voted for the Medical Research Future Fund in the Parliament and we will maintain and strengthen the MRFF in Government.
We do have concerns about the Fund’s governance and the Government’s claims about its funding levels. But we will work with the sector to address those, and continue to support Australia’s world-leading health and medical researchers.
Similarly, Labor will honour the 6th Community Pharmacy Agreement and lead early and inclusive negotiations towards a new agreement.
We will work with pharmacists and the medicines sector to improve access to medicines on the PBS and the National Immunisation Program, reducing the unnecessary delays and withdrawals we’ve seen under this Government.
I’m not announcing the Australian Health Reform Commission because I think it will win us any votes.
I’m announcing it because it’s the right thing to do, in the long-term interests of our country.
Labor is determined to break the cycle of short-termism that all too often afflicts policymaking in this country.
Labor has a long-term vision for our health care system: truly universal, in which every Australian can access the affordable, high-quality health care they need whenever they need it.
We have a long term mission to improve the health of all Australians, particularly where health inequality keeps people from participating in social and economic life.
The Australian Health Reform Commission will help us map out how to achieve that goal.
But that is of course a long-term journey.
There are also issues that need urgent attention from an incoming Labor Government.
You’ve no doubt heard Bill and I talk about some of these.
Like better hospital funding.
The Liberals promised not only to maintain our reform agreement with the states, they promised to fund an equal 50% share of the growth in hospital costs.
They broke that promise the first chance they got, in the 2014 Budget, resulting in a $2.8 billion cut between this year and the end of the next agreement in 2025.
Labor will return that $2.8 billion through our Better Hospitals Fund – increasing core funding, investing in urgent infrastructure projects and bringing down emergency department, elective surgery and outpatient wait times.
Labor can make these kinds of investments because we have made hard choices to fund them.
It’s a credit to our economic team of Chris Bowen and Jim Chalmers that they’re prepared to weather the Liberal scare campaigns over unaffordable tax giveaways in order to properly fund our hospitals and our schools.
On private health insurance, Labor will cap premium increases at 2 per cent for two years, saving consumers an average $340.
This will stabilise the system and stop the exodus which is seeing tens of thousands of Australians ditch or downgrade their cover.
While the cap is in place the Productivity Commission will conduct a root-and-branch review of the entire private healthcare system to identify longer-term reforms.
We have also announced early investments in life-saving Australian health and medical research for cancer and juvenile diabetes – and to eliminate HIV.
You’ll hear us talking more about all of those plans in the months ahead.
But we’ll also, of course, be talking about Medicare.
Last year Bill announced in his Budget Reply speech that Labor will invest in new Medicare MRI licences.
That means more affordable access to life-saving scans for communities across the country.
After five years of complete neglect on this issue the Government adopted our MRI policy late last year. Better late than never.
We have also announced that we will end the Liberals’ six year Medicare rebate freeze once and for all.
The Liberal freeze began in 2014 – and has so far ripped more than $3 billion out of Medicare.
That’s $3 billion out of the pockets of patients and consumers – and it’s a major reason why out-of-pocket costs to see both GPs and specialists have spiralled out of control under this Government.
As a result of these soaring costs, 1.3 million people are either delaying or skipping seeing a doctor or getting a test when they need to – putting their wellbeing and possibly even their lives at risk.
Despite all this, the Government seems determined to actually increase out-of-pocket costs.
Two years ago they trumpeted that they would lift the freeze. But parts of it are still in place – and under the Liberals it will be in place for another 18 months to come.
It was and it remains a GP co-payment by stealth.
As the election draws near it’s worth remembering the GP co-payment.
Because before an election, the Liberals always insist they’ll make no cuts to health. But they lie, every time. Surely by now Australians know that they simply cannot be trusted on health funding.
Never forget that before the 2013 election Tony Abbott promised no cuts to health.
Six months later, in his very first budget, he sought to cut $57 billion from public hospitals and billions from elsewhere in the health system.
There was a plan to increase the co-payment for prescription medicines too.
There were cuts to the PBS safety net and the Medicare Safety Net – meaning people with chronic or complex health problems would have got less support.
There were massive cuts to dental funding and prevention programs. To diagnostic imaging and pathology. The destruction of Labor’s Medicare Local system.
And let’s never forget this section of the 2014 Budget papers, and I quote: “Market testing of the payment of health services by commercial payment service providers”.
That’s a fancy way of saying they planned to invite the private sector to take over the Medicare payments system.
Coupled with the cuts – designed to Americanise our health system, to shift it from a universal to a user-pays system – it’s no wonder that this became a key election issue in 2016.
We campaigned hard to Save Medicare from this Liberal attack. And we make no apologies for it.
When the Government claims it was a scare campaign, remember that it was two senior and respected journalists who broke the privatisation story – it was not some fiction peddled by Labor.
And Malcolm Turnbull himself later conceded there was “fertile ground” for our campaign. What he meant was, the Liberals had such an appalling record on Medicare that people simply don’t trust what they say.
And they’re right not to.
Let’s also remember that much of this carnage was inflicted by Peter Dutton – voted by clinicians as Australia’s worst Health Minister in a generation despite only occupying the role for 15 months.
And yet just six months ago nearly half the Liberal party room – including the current Health Minister – voted to make Peter Dutton the Prime Minister.
Surely the Australian people need no better signal about how little the Liberals care about health care. Each party room vote for Peter Dutton was an endorsement of his cuts and his incompetence in the health portfolio.
Now, the current guy isn’t any better. Scott Morrison cut from health in every Budget he authored as Treasurer.
And one of his first acts as Prime Minister was to pursue retrospective cuts to state hospital funding.
He’s trying to claw back more than $600 million for services the states have already delivered.
All the states and territories – even the Liberal ones – are understandably furious over this attack.
And Scott Morrison could have ended the Medicare freeze at any point in the last three-and-a-half years.
But he’s chosen not to do so.
So health was a major issue at the last election – and it will be at this one too. We’ll make sure of it.
Because we know the Liberals cannot be trusted. They say one thing before an election and they do another thing afterwards.
None of the cuts they’ve inflicted in health care since coming to power did they actually have a mandate for – they promised no cuts and then they swung the axe anyway.
So when the Liberals ask Australians to trust them on health remind yourself of their record and ask yourself: do they deserve that trust?
The answer is surely a resounding no.
We will campaign on Medicare in the coming months because it is core business for us. Philosophically, it’s at the centre of everything the modern Labor Party stands for.
And the choice whenever the election is held will be clear.
A Labor Party that will deliver better hospital funding – or a Liberal Party that only ever cuts from hospitals.
A Labor Party that will rein in private health insurance costs – or a Liberal Party that has failed to do so after six years in power.
A Labor Party that will make sure Australians can afford to see their doctor – or a Liberal Party that has frozen the rebate to doctors and tried to introduce a $7 co-payment.
A Labor Party that will always save and strengthen Medicare – or a Liberal Party that has spent six years slashing from it.
A Labor Party with a long-term vision for the future of Australia’s health care system – or a Liberal Party bereft of vision.
Thank you and I’m happy to take your questions.