A July poll?

It appears increasingly likely the country will go to the polls on 2 July after Prime Minister Malcolm Turnbull brought forward the Budget and recalled Parliament to debate controversial industrial laws.

A week after pushing through Senate voting reforms, Mr Turnbull announced the Federal Budget would be delivered on 3 May, a week ahead of schedule, and Parliament would resume on 18 April so the Senate could debate legislation to reinstate the Australian Building Control Commission.

By bringing forward the Budget, the Prime Minister has created room to call an early July election if, as is expected, the Government fails to muster the support in the Senate it needs to pass the ABCC Bill.

The Government needs the support of six crossbench Senators to have the legislation become law, but just two have indicated they would back it. Three have said they will oppose it, and three others are uncommitted.

If the Bill is rejected, it would give Mr Turnbull a trigger to call a double dissolution election, which the Government hopes – thanks to the Senate voting reforms – would wipe out many of the minor party and independent Senators and deliver it a working majority in the upper house.

If the Government goes ahead with a 2 July poll, it means the AMA National Conference will take place in the thick of the election campaign, providing an opportunity to boost health and health funding as an election issue.

Adrian Rollins

Putting a cost on sickly sweet

The Turnbull Government is facing calls to emulate its British counterpart and introduce a tax on sugary drinks in the 3 May Budget as part of measures to reduce the nation’s waistline.

In a move lauded by celebrity chef Jamie Oliver and public health advocates, UK Chancellor George Osborne last month made a surprise announcement that the British Government would impose a sugar levy on the soft drinks industry, taxing them according to how much sugar they put in their products.

Mr Osborne said the measure was being introduced to help tackle child obesity, citing estimates that within a generation half of all boys and 70 per cent of girls in Britain could be overweight or obese.

“I am not prepared to look back at my time here in this Parliament, doing this job, and say to my children’s generation, ‘I’m sorry. We knew there was a problem with sugary drinks. We knew it caused disease, but we ducked the difficult decisions and we did nothing’,” the Chancellor said.

Under the tax, set to come into force in 2018, soft drinks with more than five grams of sugar per 100 millilitres, such as Fanta, would be taxed at 18 pence (A34 cents) a litre, and those with more than eight grams per 100 millilitres, such as full-strength Coca-Cola, would be taxed at 24 pence (A45 cents) a litre. Pure fruit juices and milk-based drinks will be exempt.

The British Government expects the tax to raise $A974 million, and will use the revenue to increasing funding for school sports programs.

Mr Oliver said the British move would “travel right around the world”, and called on the Turnbull Government to “pull its finger out” and introduce a similar levy in Australia.

The idea of a sugar tax had been backed by the British Medical Association, which had recommended a duty on sugar-sweetened beverages that increased prices by at least 20 per cent as a useful first step in encouraging the widespread adoption of healthier eating habits.

But so far there seems little appetite for the idea in the Australian Government, and it is meeting stiff resistance from the beverage industry.

Coca-Cola is among a group of companies planning to sue the British Government over the tax, and parent company Coca-Cola Amatil told The Age that the measure would be ineffective in combating obesity.

The company said a sugar tax was “not the solution to this complex problem”, arguing that obesity was increasing despite a 26 per cent decline in per capita sugar contribution from carbonated soft drinks.

However, while not explicitly calling for a sugar tax, the AMA has nonetheless said that taxation should be among the instruments used by the Government to help people make healthier food choices.

There is evidence that a levy on soft drinks can change consumer behaviour. When Mexico introduced a 10 per cent tax on sugary drinks three years ago, sales fell 6 per cent.

But critics, including the beverage industry, claim that it has just shifted the problem, with consumers looking for their calories elsewhere, such as in fruit juices or sweetened milk-based drinks.

The AMA has cautioned against a focus on any one single nutrient or aspect of diet, and said tackling obesity would require a broad range of measures that may include a price signal such as a tax, but should also involve action to reduce the exposure of children to the advertising and promotion of unhealthy foods in general – not those only containing added sugar, but also those high in saturated fat and added salt.

It has made a submission to Free TV Australia, the peak television industry group, highlighting concerns about the marketing of unhealthy foods to children during broadcasts and called for designated child viewing times to be increased and restrictions on advertising of processed foods at peak viewing times, such as live sports broadcasts.

Adrian Rollins

Rich told: stop taking from the poor

Rich countries have been urged to reduce their reliance on overseas-trained doctors and improve workforce planning to help address severe shortages of medical practitioners in developing nations.

A dramatic upsurge in the number of doctors has averted fears of a world-wide doctor shortage, but the Organisation for Economic Cooperation and Development said large numbers were flocking to wealthy nations from Africa, exacerbating problems with access to care among the poor.

According to the OECD report Health Workforce Policies in OECD countries: Right Jobs, Right Skills, Right Places, there were 3.6 million doctors practising among its member countries in 2013, up from 2.9 million in 2000 – a 24 per cent increase in just 13 years.

Much of this increase has been driven by a sharp expansion in medical school intakes and training programs.

Australia has been part of a global trend toward boosting medical school intakes – since 2004, the number of medical school places has soared by 150 per cent to reach more than 3700, creating problems further along the training pipeline, where there has not been a commensurate increase in capacity.

But the growth in doctor numbers has also been fuelled by recruitment from overseas.

The report found that 17 per cent of all active doctors working in OECD countries came from overseas, and though a third originated in other OECD nations, “large numbers also come from lower-income countries in Africa that are already facing severe shortages”.

While the United States and the United Kingdom are the two most popular destinations for overseas-trained doctors, Australia is among the most heavily reliant on them to help plugs gaps in the medical workforce.

They comprise about a quarter of all doctors working in Australia, and make up more than 40 per cent of those practising in rural and remote regions.

The OECD said this reliance was coming at a heavy cost to poor countries that were training doctors, only to see many of them emigrate rather than ease the local shortage.

OECD Secretary-General Angel Gurria said that with the threat of a global doctor shortage averted, it was time to focus attention on improving the distribution of the medical workforce to ensure all had access to high quality care.

“The evolving health and long-term care needs of ageing populations should stimulate innovation in the health sector, where attention should focus on creating the right jobs, with the right skills, in the right places,” Mr Gurría said. “Countries need to co-operate more to ensure that the world gets the strategic investments in the health workforce that are necessary to achieve universal health coverage and high-quality care for all.”

The AMA has anticipated the OECD’s call, late last year releasing a Position Statement recommending that Australia not recruit doctors from countries which have an even greater need for them.

Australia is already a signatory to the World Health Organisation’s Global Code of Practice on International Recruitment of Health Personnel, which calls for improved workforce planning to allow nations to respond to future needs without relying “unduly” on the training efforts of other countries, particularly low-income ones.

But some researchers have argued that not only would it be unfair to constrain the ability of doctors from poorer countries to choose where they would like to practice, but such restrictions could also have the perverse effect of discouraging people in these locations from considering a career in medicine, exacerbating the shortage of medical workers.

AMA Vice President Dr Stephen Parnis said that improved workforce planning was an “urgent priority”.

The Abbott Government abolished Health Workforce Australia and absorbed its functions within the Health Department, a move Dr Parnis condemned as short-sighted.

In its final report, the HWA confirmed that Australia had sufficient medical school places, and instead urged attention on improving the capacity and distribution of the medical workforce – a task that the AMA hopes the National Medical Training Advisory Network will be able to fulfil.

A particular concern is difficulties in recruiting and retaining doctors in rural and regional areas.

The OECD has urged countries to use a mix of financial incentives, regulations and technologies such as telemedicine to help reduce regional disparities in access to care.

The Federal Government has announced the establishment of 30 regional training hubs and an expansion of the Specialist Training Program, but the AMA has voiced doubts that these initiatives on their own will be enough, and has instead called for a third of all domestic medical students to be recruited from rural areas.

The Government has so far resisted the suggestion, and Health Minister Sussan Ley told the AMA Federal Council last month that she was “not interested” in imposing regulations that would tie doctors to practice in a particular geographic area.

Adrian Rollins

E-cigs: a help or a harm?

In December, the AMA issued a Position Statement on Tobacco Smoking and E-Cigarettes in which it called for nationally consistent controls on the marketing and advertising of e-cigarettes, including a ban on sales to children. The AMA has raised concerns that e-cigarettes are appealing to young people, undermining tobacco control efforts, and says there is no evidence to support their use as an aid to quitting smoking.

Below, AMA member Dr Colin Mendelsohn, a tobacco treatment specialist, raises objections to the AMA’s current position on e-cigarettes, and the AMA responds.

Is the AMA statement on e-cigarettes consistent with evidence?

By Dr Colin Mendelsohn, tobacco treatment specialist, The Sydney Clinic*

* Dr Colin Mendelsohn has received payments for teaching, consulting and conference expenses from Pfizer Australia, GlaxoSmithKline Australia and Johnson and Johnson Pacific. He declares to have no commercial or other relationship with any tobacco or electronic cigarette companies.

The recent AMA statement on smoking takes a very negative position on electronic cigarettes (e-cigarettes). While there is still much to learn about e-cigarettes, there is growing evidence to support their effectiveness and safety for smoking cessation and harm reduction. Many experts feel that e-cigarettes are a potentially game-changing technology and could save millions of lives. ¹

The AMA position statement does not reflect the current evidence in a number of areas. For example, there is currently no evidence for the AMA’s statement that ‘young people using e-cigarettes progress to tobacco smoking’ (the gateway effect). In the UK for example, regular use of e-cigarettes by children is rare and is confined almost entirely to current or past smokers. ² Research in the US has found that increased access to e-cigarettes is associated with lower combustible cigarette use, rather than the opposite being true. ³

Understandable concerns are raised that increasing the visibility of a behaviour that resembles smoking may ‘normalise’ smoking and lead to higher rates of tobacco use. However, since e-cigarettes have been available, smoking rates have continued to fall. In the US, daily smoking by adolescents has dropped to a historic low of 3.2%. Adult smoking rates in the US and UK are also at record lows.

A recent independent review of the evidence commissioned by the UK Public Health agency, Public Health England (PHE), concluded that e-cigarettes are around 95% less harmful than smoking.⁴ This assessment includes an estimate for unknown long-term risks, based on the toxicological, chemical and clinical studies so far. Any risk from e-cigarettes must be compared to the risk from combustible tobacco, which is still the largest preventable cause of death and illness in Australia.

Three meta-analyses and a systematic review ^5-8 suggest that e-cigarettes are effective for smoking cessation and reduction. The evidence indicates that using an e-cigarette in a quit attempt increases the probability of success on average by approximately 50% compared with using no aid or nicotine replacement therapy (NRT) purchased over-the-counter.

Most of the research to date has used now-obsolete models with low nicotine delivery. Newer devices deliver nicotine more effectively and have higher quit rates.

In the UK, e-cigarettes are now the most popular quitting method and are used in 40% of quit attempts. ⁹ In the UK alone there are currently over one million smokers who have quit smoking and are using e-cigarettes instead, with considerable health benefit.¹⁰ It has been estimated that each year in England many thousands of smokers quit using e-cigarettes and would not otherwise have quit if e-cigarettes had not been available. ¹¹

Many organisations disagree with the AMA’s view that ‘currently there is no medical reason to start using an e-cigarette’. The Australian Association of Smoking Cessation Professionals, Public Health England and the UK National Centre for Smoking Cessation and Training recommend e-cigarettes as a second-line intervention for smokers who are unable or unwilling to quit smoking using approved first-line therapies. In the healthcare setting there is empirical evidence that combining e-cigarettes with counselling and other pharmacotherapies such as varenicline and NRT can improve outcomes further.¹²

The regulatory agency in the UK (MHRA) recently licensed an e-cigarette which will be available on the National Health Service in 2016. It can be prescribed by doctors to help smokers quit and will be provided free.

In Australia, we need to have an evidence-based debate on the potential benefits and risks of e-cigarettes. Careful, proportionate regulation of e-cigarettes could give Australian smokers access to the benefits of vaping while minimising potential risks to public health. The popularity and widespread uptake of e-cigarettes creates the potential for large-scale improvements in public health.

The AMA has made a major contribution to reducing smoking rates in the past. It is well placed to take a leadership role in this debate to ensure that the potential benefits from e-cigarettes are realised.

References

1. Hajek P. Electronic cigarettes have a potential for huge public health benefit. BMC Med. 2014;12:225

2. Bauld L, MacKintosh AM, Ford A, McNeill A. E-Cigarette Uptake Amongst UK Youth: Experimentation, but Little or No Regular Use in Nonsmokers. Nicotine Tob Res. 2016;18(1):102-3

3. Pesko MF, Hughes JM, Faisal FS. The influence of electronic cigarette age purchasing restrictions on adolescent tobacco and marijuana use. Prev Med. 2016

4. McNeill A, Brose LS, Calder R, Hitchman SC, Hajek P, McRobbie H. E-cigarettes: an evidence update. A report commissioned by Public Health England. PHE publications gateway number: 2015260 2015. Available at https://www.gov.uk/government/publications/e-cigarettes-an-evidence-update (accessed February 2016)

5. McRobbie H, Bullen C, Hartmann-Boyce J, Hajek P. Electronic cigarettes for smoking cessation and reduction. Cochrane Database Syst Rev. 2014;12:CD010216

6. Rahman MA, Hann N, Wilson A, Mnatzaganian G, Worrall-Carter L. E-cigarettes and smoking cessation: evidence from a systematic review and meta-analysis. PLoS One. 2015;10(3):e0122544

7. Lam C, West A. Are electronic nicotine delivery systems an effective smoking cessation tool? Can J Respir Ther. 2015;51(4):93-8

8. Khoudigian S, Devji T, Lytvyn L, Campbell K, Hopkins R, O’Reilly D. The efficacy and short-term effects of electronic cigarettes as a method for smoking cessation: a systematic review and a meta-analysis. Int J Public Health. 2016

9. West R, Brown J. Electronic cigarette use for quitting smoking in England: 2015. Public Health England., 2016. Available at http://www.smokinginengland.info/latest-statistics/ (accessed March 2016)

10. Use of electronic cigarettes (vapourisers) among adults in Great Britain. Action on Smoking and Health, UK., May 2015 Contract No.: Fact sheet 33. Available at http://ash.org.uk/information/facts-and-stats/fact-sheets (accessed June 2015)

11. West R. Estimating the population impact of e-cigarettes on smoking cessation and smoking prevalence in England. 2015 [(accessed 30 October 2015)]. Available from: http://www.smokinginengland.info/sts-documents/.

12. Hajek P, Corbin L, Ladmore D, Spearing E. Adding E-Cigarettes to Specialist Stop-Smoking Treatment: City of London Pilot Project. J Addict Res Ther. 2015;6 (3) http://dx.doi.org/10.4172/2155-6105.1000244

Clarification on the AMA’s position

The recently updated AMA Position Statement Tobacco Smoking and E-Cigarettes – 2015 states:

that the AMA has significant concerns about e-cigarettes. E-Cigarettes and the related products should only be available to those people aged 18 years and over and the marketing and advertising of e-cigarettes should be subject to the same restrictions as cigarettes. E-cigarettes must not be marketed as cessation aids, as such claims are not supported by evidence.

As noted in the background to the Position Statement, the evidence supporting the role of e-cigarettes as a cessation aids is mixed and low-level.

The stance taken by the AMA on e-cigarettes is consistent with that of the World Health Organisation, Cancer Council Australia, the National Heart Foundation, the National Health and Medical Research Council (NHMRC) and the Therapeutic Goods Administration (TGA) – the latter two organisations being the key decision makers on whether or not e-cigarettes have a role in smoking cessation in Australia.

It is worth noting that a number of smoking cessation aids, backed by evidence, are already available through the Pharmaceutical Benefits Scheme.

The assertion that there is no evidence that e-cigarettes are a potential gateway for young people to progress to tobacco smoking is incorrect.

The AMA’s Position Statement refers to international research [1] showing that some young people who use e-cigarettes do in fact progress to tobacco smoking. Given the risk, the AMA supports a precautionary approach for children and young people.

E-cigarettes will continue to be topical. Research is being published regularly and the AMA will continue to monitor the issue.

The AMA Position Statement, which covers a range of issues, can be viewed at: position-statement/tobacco-smoking-and-e-cigarettes-2015

[1] For example see, Primack, BA., Soneji, S., Stoolmiller, M, Fine, MJ & Sargent, D. (2015). Progression to traditional cigarette smoking after electronic cigarette use among US adolescents and young adults. JAMA Pediatr. and Bunnell RE, Agaku IT, Arrazola R, Apelberg BJ, Caraballo RS, Corey CG, Coleman B, Dube SR, King BA.(2014). Intentions to smoke cigarettes among never-smoking U.S. middle and high school electronic cigarette users, National Youth Tobacco Survey, 2011-2013. Nicotine and Tobacco Research. 2014.

[Correspondence] Integrating social health insurance systems in China

Leaders in China recently announced the decision to merge the Urban Resident-based Basic Medical Insurance Scheme and the New Rural Cooperative Medical Scheme, two of its three main social health insurance schemes.1 For the first time, the Chinese Government has officially endorsed a unified insurance scheme for residents in urban and rural areas, with unification of coverage, a fund pooling mechanism, a benefits package and reimbursement rates, a basic medical insurance drug list, unified selection of health providers, and fund management.

Hospital handout ‘dismally short’ of need

The injection of an extra $2.9 billion of Commonwealth funding for public hospitals will provide some relief for cash-strapped health systems, but still leaves institutions desperately short of the resources they need to meet growing demand for their services, state premiers have warned.

Echoing AMA concerns that the extra money fails to bridge the huge $57 billion hospital funding shortfall created by the 2014 Budget, the leaders of New South Wales, Victoria, Queensland and South Australia said the additional funds would be helpful, but details of how hospitals were to be adequately funded in the longer term remained unresolved.

AMA President Professor Brian Owler said the states would be grateful for any new funding, but the outcome of the COAG meeting was disappointing.

“Today’s agreement goes nowhere near meeting the long-term needs of the nation’s public hospitals, and falls dismally short of replacing the funding taken away from the states in the 2014 Federal Budget,” Professor Owler said.

He said the extra funds would relieve some of the pressure on hospitals in the short-term, but did not provide the funding certainty that was vital for the decade ahead.

Prime Minister Malcolm Turnbull, who hopes to neutralise public hospital funding as an issue in the forthcoming Federal election, used the 1 April Council of Australian Governments meeting to thrash out a deal under which the states will receive an additional $2.9 billion between July 2017 and June 2020, capped at an annual growth rate of 6.5 per cent, in exchange for greater efforts to reduce hospitalisation rates through improved chronic disease care and fewer hospital-acquired infections and other complications.

The deal means that activity based funding and national efficient price mechanism, two reforms that were driving hospital efficiency and which were facing the axe next year, will be sustained until at least 2020.

In announcing the deal, Mr Turnbull acknowledged that the Commonwealth shared responsibility with the states and territories to provide universal health care, but warned that it had less revenue to pay for it.

“We are recognising that we have a serious structural budget problem,” the Prime Minister said. “We have to be clear eyed about our choices”.

Mr Turnbull had hoped the COAG meeting would back his radical plan to give the states the power to raise their own income taxes as a way to increase hospital funding, giving his Government scope to go into the election promising Federal income tax cuts.

The Prime Minister said the change would give states access to a broad revenue base that grew in line with the economy, would reduce the number of tied Commonwealth grants they receive, giving them greater autonomy and flexibility in tailoring their spending.

But the proposal failed to win consensus support among the premiers, and has been held over for further discussion and development.

Instead, while welcoming the short-term funding injection, state leaders warned the Commonwealth needed to provide much more significant funding if a looming crisis in public hospitals was to be averted.

Victorian Premier Daniel Andrews said that while the agreement signed at the COAG meeting would provide his state’s hospitals with “hundreds of millions in extra funding…it doesn’t replace the billions taken away”.

“I would ask to remain focused on the context here. The fact is that many billions of dollars which will not be flowing to our hospitals because of decisions made in 2014,” Mr Andrews said.

New South Wales Premier Mike Baird struck a more positive note, expressing the hope that there would be a “coming together” between the states and the Commonwealth on long-term hospital funding.

Queensland Premier Annastacia Palaszczuk said Mr Turnbull had recognised that health was the “most fundamental issue” facing the nation, and welcomed the short-term funding deal, which would inject an extra $445 million into Queensland’s public hospitals.

“But there is still a huge gap [in funding] that is going to place a huge strain on our hospitals,” Ms Palaszczuk said.

Adrian Rollins

GPs are where the home is

The AMA has called on the Federal Government to consult closely with the nation’s GPs in advancing plans to introduce its Health Care Homes model of primary care.

In its first major response to the Primary Health Care Advisory Group report finalised late last year, the Government has announced it will trial Health Care Homes as a way to improve care for patients with complex and chronic health conditions.

AMA President Professor Brian Owler said the peak medical group welcomed the Government’s acknowledgement of the pivotal position played by GPs in primary care, particularly in the ongoing treatment of patients with chronic disease.

Professor Owler said the Government’s Health Care Home concept reflected many of the principles recommended by the AMA, including voluntary enrolment, the continued use of fee-for-service for routine care, and a focus on patients with complex and chronic conditions.

But he said Health Minister Sussan Ley’s announcement left many critical questions unanswered, particularly the scale of investment the Government would make to support the initiative.

“I think this concept of a Health Care Home is a good one,” Professor Owler said. “Having a stronger bond between patients and a practice or a GP is a good thing, but we need to see how the funding is going to work. The proposals are good, but it needs to come with investment.”

The AMA President said he was particularly concerned that funds were not diverted from elsewhere in the health system to fund the initiative.

He said Australia’s GPs had been the target of repeated funding cuts in recent years, most particularly the current freeze on Medicare rebates, and if the Health Care Home concept was to improve patient care and reduce pressure on public hospitals, “significant new funding is needed”.

Internationally, the term Medical Home is used to refer to a model of primary care that is patient-centred, comprehensive, team-based, coordinated, accessible and focused on quality and safety.

It is envisaged patients would nominate or register with a GP or medical practice as their Medical Home, making it the hub for coordinating and integrating their care among a multidisciplinary team of health professionals.

Releasing the AMA’s Position Statement on the Medical Home earlier this year, Vice President Dr Stephen Parnis said in Australia these attributes were already embodied in general practice.

“The concept of the Medical Home already exists in Australia, to some extent, in the form of a patient’s usual GP,” Dr Parnis said. “If there is to be a formalised Medical Home concept in Australia, it must be general practice. GPs are the only primary health practitioners with the skills and training to provide holistic care for patients.”

The Medical Home concept is seen as a way to improve the care of patients with complex and chronic illnesses, helping them manage their conditions will living in the community rather than needing regular expensive and disruptive hospitalisation.

The Federal Government has made improved primary care of chronically ill patients a priority in order to reduce the pressure on the health budget.

While GPs and hospitals have greatly improved the efficiency and cost-effectiveness of the care they provide, the chronic disease burden has swollen as the population has aged and patients have developed significant co-morbidities.

Dr Parnis said the Medical Home concept had the potential to deliver improved support for GPs in providing well-coordinated and integrated multi-disciplinary care for patients with chronic and complex disease, and it made sense for this to be the focus of Government thinking on adopting the Medical Home idea in Australia.

Evidence suggests patients with a usual GP or Medical Home have better health outcomes, and 93 per cent of Australians have a usual general practice, and 66 per cent have a family doctor.

Earlier this year, the AMA issued a Position Statement in which it backed the concept of a GP-centred Medical Home, as long as it was tailored to local conditions and maintained the fee-for-service remuneration system.

“You can’t just transplant models of health care from other countries without acknowledgement of local conditions and what is already working well,” Dr Parnis said. “Australia needs to build on what works, and ensure that a local version of the Medical Home is well-designed and relevant.”

The AMA said establishing the Medical Home concept in Australia was likely to involve formally linking a patient with their nominated GP or medical practice through registration – a process it said should be voluntary for both patients and doctors.

The Government will appoint a Health Care Home Implementation Advisory Group to help steer the introduction of the scheme.

The AMA Position Statement on the Medical Home can be viewed at: position-statement/ama-position-statement-medical-home

Adrian Rollins

PM’s tax plan no hospital fix

The Prime Minister’s suggestion that states be given the power to levy their own income taxes will not fix the funding crisis hitting the nation’s public hospitals, according to AMA President Professor Brian Owler.

Professor Owler said public hospitals needed a significant ongoing increase in funding if they were to meet growing demand for their services, and it was “very unclear” how Malcolm Turnbull’s proposal to allow the states to impose income taxes would provide that.

Mr Turnbull has floated a radical change in the tax system under which the Commonwealth would cut its income tax take and allow the states to set their own income taxes while keeping the overall tax burden the same.

The idea, which has been rejected by the Opposition and received only lukewarm responses from State leaders, is due to be discussed at a meeting of Federal, State and Territory leaders and treasurers tonight before formal discussions at tomorrow’s Council of Australian Governments meeting.

The Prime Minister is under pressure to unwind $57 billion of cuts to public hospital funding unveiled by his predecessor Tony Abbott in 2014, and is expected to propose a short-term injection of up to $7 billion to help ensure the issue does not figure prominently in the forthcoming federal election.

But Professor Owler said that although extra money would be welcome, an extra $7 billion would not fix the long-term problem of inadequate Commonwealth funding.

And he said simply reallocating income tax responsibilities between levels of government was not an answer.

“Unless there’s going to be extra funding that’s put into health by the Commonwealth, I fail to see how this new policy is going to fix the problem of funding public hospitals,” the AMA President told ABC News 24.

Professor Owler said the policy was likely to exacerbate existing differences in access to care between the states, because New South Wales, Victoria and Queensland had a much bigger potential revenue base to draw on than smaller states like Tasmania and South Australia.

“While the larger states and territories might be okay, we know that the smaller states already struggle,” he said. “If you’re relying on income tax, we know that their economies and revenue would be much less, in a proportional sense, than the revenue raised from some of the bigger states. So I think we just create more inequality across the country.”

Instead, he has called for COAG use any breathing space created by a short-term injection of funds to engage in “a much broader, in-depth discussion about how we are going to fix the problem around Federal reform, about long-term funding of public hospitals.”

And he dismissed suggestions by Mr Turnbull that there needed to be a greater focus on improving hospital efficiency.

Professor Owler said that doctors and nurses had been working to improve hospital efficiency for decades, and had achieved huge improvements, such as in reducing patient length of stay.

But instead of supporting this process, the Abbott Government had axed the activity-based funding mechanism which was specifically designed to drive greater efficiencies, and the AMA President said the Turnbull Government should “get back” to some of those structural mechanisms.

Adrian Rollins

Even brain surgeons bamboozled by Govt policy process

AMA President Professor Brian Owler has confessed he is struggling to follow the logic and coherence of a flurry of health policy and tax reform announcements made by the Federal Government ahead of a crucial Council of Australian Government’s meeting.

Professor Owler said it had become “difficult to follow the logic” of Government pronouncements on public hospital funding after Prime Minister Malcolm Turnbull unveiled a shock proposal to hand over some income tax revenue powers to the states just a day before meeting with his State and Territory counterparts.

“I am AMA President and I’m a brain surgeon with a PhD and I’m struggling to keep up with the policy process,” he told ABC News 24. “I mean, we’ve been talking about COAG and tax reform, Federation reform, productivity reviews, multiple reviews in health, and we still don’t seem to have a coherent vision for the path forward.”

In his proposal, Mr Turnbull suggested the states be given power to levy income taxes of their own, while the Commonwealth would reduce its own income tax take, keeping overall income tax receipts the same.

But Professor Owler lambasted the idea, which he said would do nothing to increase funding to hospitals, and would instead exacerbate existing inequalities between the states in the delivery of hospital services.

“If you’re relying on income tax revenue, then that is going to disadvantage the smaller states,” he said. “I mean, it is becoming more and more difficult to follow the logic around funding of public hospitals and the tax policies that are coming from the Government.”

Professor Owler said the Government seemed to be taking an ad hoc approach to major policy challenges.

“We’ve had months to sort this out, yet the policy seems to be leaked out a few days, seemingly made on the run, a few days before a COAG meeting. I don’t think that is the way that policy should be developed, particularly when it’s such an important long-term policy.”

Adrian Rollins

Hospital funding deal ‘not enough’

A deal to inject up to $7 billion from the Commonwealth into the public hospital system was being mooted ahead of this Friday’s Council of Australian Governments meeting amid warnings it will not be enough to sustain services in the face of spiralling demand.

As Australian Medicine went to print, speculation was mounting that Prime Minister Malcolm Turnbull was close to arranging a deal with his State and Territory counterparts to provide a multi-billion dollar funding boost to public hospitals amid warnings that $57 billion of cuts unveiled by the Abbott Government in 2014 would plunge the system into financial crisis and cause a blow-out in waiting times.

Less than a week after meeting with AMA President Professor Brian Owler and the AMA Federal Council on 17 March, Mr Turnbull told reporters he would “have more to say in the lead-up to [the COAG meeting] relating to health and schools and so forth”.

At the AMA meeting, the Prime Minster showed keen interest in reports from Council members that public hospitals were experiencing a rapid increase in demand that vastly outstripped the pace of population growth.

Mr Turnbull wanted to know why this was occurring, and was told a big factor was increased life expectancy, which meant that patients were more likely to present with multiple chronic health conditions that were more expensive and complex to treat, placing huge demands on hospital resources.

These stresses have been reflected in the AMA’s Public Hospital Report Card released earlier this year, which showed that improvements in the performance of public hospitals had already stalled, and in some respects were starting to go backwards.

Professor Owler said this was only going to get worse as big Budget cuts began to bite next year, and warned that suggestions the Federal Government might stump up $6.7 billion over four years, to be shared among the states, would not be enough.

It is understood the Government was considering an increase in the tobacco excise and reduced tax breaks for superannuation to provide the extra funds.

But the AMA President warned that injecting an extra $6.7 billion into the system was inadequate.

“[The] figure of $6.7 billion has been talked about over the next four years to deal with both health and education, …I’m afraid that’s just not going to cut the mustard. It’s not going to mean that states can continue to provide the level of services that patients expect and deserve,” he said. “By any stretch of the imagination, cobbling together $6.7 billion over a four year period for states and territories to fund health and education is just not going to make it.”

Professor Owler said the Commonwealth needed to dump plans to index hospital funding at inflation plus population growth, which he said was completely inadequate to ensure hospitals were able to maintain their services.

Adrian Rollins

Photo: Nils Versemann / Shutterstock.com