Budget 2023 starts to fill some big cracks in our health system

Tuesday’s Budget outlined $28 billion in new health spending and included the usual blizzard of programs and announcements. But stepping back, you can see a government starting to fill some of the cracks in our health system. Those fissures include a weak preventive health system, a broken primary care funding model, and outdated workforce roles.

Australia has a good health system, but we lag far behind leading countries in these areas and change is urgent. Without sustained investment and reform, it will only get harder to give Australians the healthcare they need. That’s because most Australians now have a chronic disease. And rates of chronic disease continue to rise.

To respond, our health system must do more to prevent these conditions and to set primary care up to manage them. Otherwise, we’ll continue to see avoidable illness, hospitals under pressure, and runaway spending growth. And as we need more care, and more complex care, health care workers will need to work as a team and use all their skills.

Prevention is often a casualty when budgets are tight, but there is new funding to increase vaccination, combat vaping, and screen for lung cancer. Much of this will be funded by a 5 per cent increase to the tobacco tax. And $91 million will set up a Centre for Disease Control, a national prevention agency.

These investments are a good step towards fixing the prevention funding gap. Prevention makes up less than 2 per cent of health funding, well below the average among wealthy countries. And prevention funding is poorly co-ordinated and unfocused. The Centre for Disease Control could help fix this by telling governments what works.

When it comes to primary care, as Health Minister Mark Butler has long said, Medicare is in crisis. The blockbuster response is $3.5 billion to triple bulk-billing incentives, the payments GPs get when they don’t charge a fee to children and concession card holders.

This is intended to increase bulk-billing and boost investment, but it won’t fix deeper problems with how clinics are funded. We have a fee-for-service model that treats care as a one-off visit, the shorter the better, rather than an ongoing relationship. This Budget introduces ‘My Medicare’, the beginning of a new approach.

Patients will be able to register with a GP. The GP will then get a flexible budget as part of their funding. That will reward clinics for ongoing care, give them flexibility to plan and deliver care in new ways, and make it easier to work as a team. While this is not one of the biggest outlays in the budget, it could make one of the biggest impacts in the long term.

A third theme that’s threaded through several budget investments, including in general practice and prevention, is a focus on teamwork and professionals using all their skills. Compared to other countries, many of our health workers are constrained by red tape and funding rules. And GPs in Australia are more likely to work on their own, or to have little support.

More than half a billion dollars will build up bigger teams in general practices, adding nurses and allied health workers to support GPs. The Budget also funds a review of workforce roles in primary care, which will create opportunities to take this further.

Pharmacies will get funding to make good use of their skills by delivering more vaccinations and supporting people managing opioid addiction. This is funded by savings from 60-day prescriptions. The government will pay pharmacists for providing valuable services, instead of dispensing pills more often. Despite scaremongering from the Pharmacy Guild, this reform is good for patients, takes prescribing workload off doctors, and positions the local chemist as the place to get vaccinated.

Hopefully we will be able to look back on this Budget as marking the beginning of a sustained effort to shift the focus of the health system towards prevention, primary care, and multidisciplinary care to tackle the underlying pressures on our health, and on our healthcare system.

Peter Breadon

Health Program Director
Peter Breadon is the Health Program Director at Grattan Institute. He has worked in a wide range of senior policy and operational roles in government, most recently as Deputy Secretary of Reform and Planning at the Victorian Department of Health.

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