How the Coalition is changing Medicare’s healthcare system

From $2.75 a week for the elderly to $4 a week in 2020, the Coalition’s healthcare reforms have been the subject of intense media scrutiny.

The changes have been described by some commentators as a “catastrophic” plan for Australia’s ageing population, while others have criticised the policy as “too expensive”.

In his latest book, ‘Medicare is the best thing for Australia: a political biography’, author Ben Williams argues that the Coalition has made a number of significant changes to the Medicare system, from extending the eligibility age to abolishing the Medicare rebate and extending the number of payments to Medicare patients.

The book focuses on changes made by the Coalition in 2015 to the health system, which led to the largest rise in the number and types of doctors, nurses and other professionals who work in Australia’s healthcare sector in over two decades.

“In the years since the Coalition took office, there have been several significant changes in Medicare’s structure, particularly the changes made to the primary care system, as well as changes to its funding structure, which included the abolition of the Medicare Rebate,” Mr Williams writes.

“One of the most dramatic changes was the removal of the primary healthcare rebate from Medicare’s income support formula, and the abolition and replacement of the rebate with the Medicare Savings Account (MSA).”

As a result, the Medicare income support payment to primary care is now $150 less than it would have been in 2015, and a reduction in the rebate has also been introduced.

“These changes have also brought about a substantial increase in the payments Medicare patients receive for their care.”

While the Coalition introduced the Medicare savings account to ensure the Medicare payment for primary care services could be used for the benefit of the general population, the policy was never meant to be used exclusively for that purpose.

In addition, the rebate and savings account also meant that the payments to doctors, pharmacists and other healthcare professionals who worked in the private sector were reduced.

“While the policy of the Coalition may have been to reduce the number, and consequently the cost of, the payments that patients receive to primary healthcare services, it was never intended to provide a single payment to doctors and other health professionals,” Mr Willis writes.

“Nor was it intended to deliver a single health service to the people of Australia.”

The Medicare savings Account was introduced by the Rudd Labor government in 2003 to provide healthcare providers with more flexibility in terms of who they were paying for their services.

In contrast, the current Coalition government, under the leadership of the Prime Minister, has introduced Medicare rebates and payments to primary health care professionals.

This was designed to improve the efficiency of primary healthcare providers and improve access to quality primary care, Mr Williams argues.

Mr Williams suggests that the $150 reduction in Medicare payments to providers could be offset by the rebate to nurses and health professionals who are eligible for a further $150 a week. “

The fact that there is a $15 per week Medicare rebate to primary services is an improvement over the $1 per week that Medicare pays for primary services, but that does not mean that primary care providers will not be able to make more money,” Mr Williams writes.

Mr Williams suggests that the $150 reduction in Medicare payments to providers could be offset by the rebate to nurses and health professionals who are eligible for a further $150 a week.

The changes Mr Williams proposes to implement are likely to cause further pain for the current Medicare system.

He writes that there will be significant disruption to the Australian workforce in the future as more providers lose their Medicare rebate payments, while the system will become even more complex and costly.

While the changes will likely be welcomed by many people who work for private and public sectors, Mr William also suggests that there are risks associated with the reforms, which are being implemented without proper consultation with the public.

He writes that the reforms could lead to a decline in the quality of primary health services in the long term.

For example, a shift in the way Medicare payment is distributed to primary medical services could result in more expensive and less timely services, he writes.

“This will likely result in a loss of the quality that Australians have come to expect from Medicare,” Mr Willson writes. 

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