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Medicare safety net back down

Worrying trends in MBS review - Featured Image

Health Minister Sussan Ley has been forced to back down on proposed changes to the Medicare Safety Net after failing to convince crossbench Senators to back the savings measure.

In a decision that blows a $267 million hole in the Turnbull Government’s Budget, Ms Ley has pulled legislation that would have made it harder for patients to get financial assistance with medical expenses.

The changes, announced in the ill-fated 2014 Federal Budget and introduced to Parliament in October this year, were to have come into effect from 1 January 2016. But the Minister’s decision means that the reforms will be held over until at least next year – raising the risk that they become an issue in the lead-up to the next Federal election, due by late 2016.

Ms Ley tried to put a positive spin on the reversal by arguing she was unwilling to compromise on key aspects of the proposal in order to secure the support she needed to get it passed.

“This is a good measure that aims to address significant inequities in a system failing to help the very people it’s designed to protect – our most vulnerable patients with complex and costly medical needs,” she said.

Despite what she described as “constructive” discussions with the Greens and crossbench Senators, Ms Ley said she was “unwilling to compromise over the fundamental integrity of the policy’s intention and design in favour of a quick political solution”.

“Cutting and dicing good policies might result in short-term political fixes, but is not the way governments should manage a $65 billion health care system,” the Minister said.

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The Federal Government wanted to replace the Original Medicare Safety Net, the extended Medicare Safety Net and Greatest Permissible Gap with a single Medicare Safety Net, increase the out-of-pocket costs patients pay before being eligible for assistance, and impose a universal cap on safety net benefits.

AMA President Professor Brian Owler said the proposed changes would have hurt the sickest and most disadvantaged the hardest, and called on the Government to scrap them altogether.

“The Government’s changes would have created a financial and emotional burden for Australian families with considerable and unavoidable health needs,” Professor Owler said. “We recommend that the Government scrap the proposed changes altogether.”

While the Minister’s decision will add to the pressure on the Budget, the AMA President urged her not to seek to fill the savings gap by turning the multiple reviews she has commissioned into the MBS, primary care and private health insurance into cost-cutting exercises.

“The Government must not be tempted to use the reviews to recoup the almost $267 million in Budget savings it was pursuing with the Safety Net changes,” Professor Owler said.

The safety net changes were expected to hit patients in need of complex and ongoing treatment, including cancer sufferers and those with mental illness, particularly hard, increasing Australia’s already high level of out of pocket costs.

Shadow Health Minister Catherine King said the Government’s back down was a vindication of Labor’s opposition to the changes.

Ms King said that although the Opposition was prepared to discuss what it considered to be sensible reforms, “we could not support this unfair and flawed legislation in its original form”.

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But Ms Ley hit back, saying that changes made by Labor while in government had not worked.

“Labor’s own failed safety net reforms taught us that tinkering around the edges by placing inconsistent caps on the claiming of some Medicare items, such as IVF, but not others, will not solve the problem,” the Minister said, and indicated that the Government had not given up on the reform proposal altogether.

The Minister said the Government would look to revisit the changes as part of its broader overhaul of Medicare and primary health care.

“The current measure will remain on the table while we continue to work…on an agreeable solution as part of our broader discussions on Medicare and primary care reform,” she said.

Adrian Rollins

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