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With talk of Medicare reform, let’s not neglect vertical equity

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Equal treatment for equal need is not enough — positive discrimination for disadvantaged groups is also required

With the “reform” of Medicare on the political agenda, it is timely to reflect on the objectives of fairness and equity that are key goals of our national health scheme. These objectives include both “horizontal equity”, or equal treatment for equal need, and “vertical equity”, which involves appropriately different treatment for those with different needs.

The goal of horizontal equity was made explicit by Neal Blewett, then minister for health, in his second reading speech of the Health Legislation Amendment Bill 1983. He stated that a goal of Medicare was “to produce a simple, fair, affordable insurance system that provides basic health cover to all Australians”.1

The goal of vertical equity is implicit in the more recent government policy of Closing the Gap — improving health outcomes for Indigenous Australians relative to the general population.2 The objective of this policy is to eliminate the difference in life expectancy between the two groups within a generation (by 2031) and to halve the excess mortality for Indigenous children under 5 years of age by 2018.2

Disadvantaged populations and vertical equity in health care in Australia

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