Introduction by Croakey: Diverse views and agendas on health reform priorities are hitting the headlines and causing Twitter storms, sometimes generating more heat than light.
Below Croakey editor Jennifer Doggett and contributor Associate Professor Lesley Russell, with input from Charles Maskell-Knight and Dr Ruth Armstrong, discuss some of the key health reform challenges facing the Federal Government’s Strengthening Medicare Taskforce, and Dr Tim Senior provides insights from his perspective as a GP.
They offer some ways forward, based on appreciation of the importance of addressing health inequities, the needs of patients, and strengthening critical relationships.
Jennifer Doggett and Lesley Russell write:
Health and Aged Care Minister Mark Butler told a webinar hosted by the Consumers Health Forum on 5 August that the key focus of the Strengthening Medicare Taskforce is to “strengthen the relationship between doctors and people with chronic needs.”
This makes a lot of sense. Our ageing population has increasing rates of chronic disease, and improving this area of care, in particular among currently under-served populations, provides the best opportunity for us to achieve better health outcomes and reduce demand for hospital care.
However, achieving this goal will be a challenge. Medicare was not designed to support the type of care required by people with chronic conditions and it will be difficult, both practically and politically, to make the structural changes needed to deliver on the Minister’s goal.
Medicare was set up at a time when the burden of chronic disease in the Australian community was much lower and our greatest need was for the treatment of self-limiting acute problems, such as infectious diseases.
A funding system like Medicare, which ties remuneration to episodic care provided by a single health professional, can work well to provide this type of care.
But chronic disease prevention and management requires a different type of healthcare, typically involving multiple health professionals, coordination over a longer period of time and including a more active role for consumers (and their families and carers). Additionally, there is often a need for the involvement of social welfare services.
Medicare was not designed to support this type of care and is one reason why our system of primary care is failing many Australians with chronic conditions (there are others, such as fragmentation of services across federal and state/territory areas of responsibility and a lack of integration between the health and social care sectors).
The result of this failure is not just poorer health outcomes for people whose care needs are not being met, but broader societal impacts such as increased downstream health costs and productivity losses. This failure also contributes to the burden of work confronting general practitioners and subsequent burnout.
Medicare’s “design faults”
Some of the specific “design faults” that make it difficult for Medicare to provide effective chronic disease care, include:
- A doctor-centric funding system which does not (except in very limited situations) fund services provided by other primary healthcare providers such as nurses and allied health professionals.
- A failure to fund and integrate access to culturally safe social welfare and support services which are crucial for many populations currently under-served by our health system and vital for both prevention and management of chronic disease.
- An inability to control doctors’ fees which leads to an uncoordinated and inequitable approach to out-of-pocket costs
- A lack of integration between health services and public health policies and programs which address the drivers of chronic disease
- An inability to direct resources and funding to geographic (and other) areas of need, leading to inequities in access for general practice and in particular for specialist care
- A focus on activity (rather than quality) which incentivises doctors for the number of services provided rather than the outcomes achieved and encourages more shorter consultations over longer services
- Insufficient recognition of the time needed for planning, coordination and consultation with specialists and non-health services such as Centrelink
- A time-based remuneration system which correlates complexity with the time taken in a consultation, rather than other aspects of complexity such as cognitive load or time requires outside of the consultation for the coordination and management of care
- A lack of support for generalists in acute care (where they can provide important benefits) and relevant specialists, such as geriatricians in primary care.
- A complex billing system and inadequate compliance processes, leading to rorting and wastage.
Other systemic issues
These structural problems are not the only reason that our health system is failing to meet the needs of many Australians.
A major barrier to the provision of more comprehensive and integrated care is the division of responsibilities between federal and state/territory governments and acute care, community care, aged care and mental health services, and a siloed approach to heath funding within those jurisdictions and sectors, leading to fragmentation, gaps and poor coordination. This particularly affects people with chronic conditions who often require continuity of care as they move between sectors.
Also important is the overall under-resourcing of primary healthcare relative to other areas of the health system, despite the evidence that investments in this sector deliver better health outcomes for a lower cost. This under-resourcing is partly due to the failure of successive governments to increase rebates in line with the rising costs of medical care and its impact on access to care has been compounded by workforce shortages and maldistribution particularly impacting outer urban, rural, regional and remote areas of Australia.
It may be too late to reverse some of the adverse impacts of under-resourcing, according to GP Dr Tim Senior.
“The bulk billing genie is out of the bottle now. So many general practices have dropped bulk billing, I don’t see them taking it up again. The problem is that general practice is unsustainable in communities where people can’t afford a co-payment, which is exactly the communities where GPs/primary care are needed most.”
Combined, these factors combine to deliver a health system that is “universal” in name only, where those with resources can buy access to the care they need (through both direct payments and indirect costs such as travel and time) but where too many of those who need it most miss out.
Many of these “design faults” have a compounding impact on population groups who already experience the most disadvantage such as Aboriginal and Torres Strait Islander people, and people with disabilities, living in rural and remote areas and with low incomes.
The resulting situation is a clear example of the “inverse care law”: the principle that the availability of good medical or social care tends to vary inversely with the need of the population served.
Reversing this situation will only be possible if at least some of these structural problems are addressed, in addition to increasing overall resourcing for primary healthcare and addressing workforce shortages.
Moving away from fee-for-service
The most challenging aspect of any Medicare reform is making changes to the way in which health services are funded, in particular any move away from the current doctor-centric, fee-for-service payment system.
There is good evidence that a fee-for-service funding system is not optimum to support the prevention and management of chronic disease (also recognised by the MBS Review Taskforce) but medical peak bodies have always resisted any move away from fee-for-service in favour of an exclusive focus on increasing rebates.
This resistance has created political barriers to reform, although it is not clear to what extent these groups represent the views of doctors at the coal face who may be more open to new models of care and remuneration. Indeed salaried GPs are the norm in some areas of the health system, such as the ACCHO sector.
Capitation-based funding systems
Alternative funding options, such as a capitation based approach were providers or services are paid a fixed amount to manage the care of a population, are common in many health systems overseas and have been tried in a limited way previously in Australia (for example, through the coordinated care trials). In its final report the Aged Care Royal Commission recommended a capitation-based payment system to support the care of older people by GPs.
One common benefit claimed for capitation-based payment systems is that they incentivise outcomes rather than services, as GPs (or fundholders) are rewarded for achieving outcomes, such as keeping people out of hospital, rather than for providing a certain number of services.
In principle this approach is appealing but GP Dr Tim Senior warns that that unless done very carefully a funding system rewarding outcomes can have the unintended effect of worsening health inequalities.
This is because so many of the potential outcomes have a social gradient, so services in well off areas get rewarded for “achieving” better outcomes, such as improved blood sugar levels or smoking cessation rates, and those in less affluent areas miss out.
“Pay for performance” systems which focus on a small number of easily measured metrics can result in poorer outcomes overall by reducing the emphasis on those aspects of primary care which are harder to define but which may be where its value lies, such as the whole-of-person focus and contextualisation of care within a relationship and community context.
One example he cites is the UK’s Quality and Outcomes Framework which achieved a short term improvement in the measures reported on, but no improvement (and possible worsening) of the conditions which weren’t (such as epilepsy). It also resulted in an overall worsening of patient-centred care, because services based their care on checklists to ensure practice income.
Senior also notes the need for a balance between providing accountability to government and taking resources away from patient care, using the example of reporting requirements for the ACCHOs against nKPIs, which he says creates a significant addition workload.
Other controversial reforms
Also controversial would be any attempt to address some clear areas of failure in the current system, such as the Government’s inability to direct Medicare services to areas of need or to stop doctors who charge excessive fees for their services from accessing rebates.
Both of these issues are challenging and require significant actions which governments have not to date been prepared to take (in the case of geographical concerns, it may need a constitutional change).
However, if not addressed they could undermine the ability of the Taskforce to make progress in improving the access and affordability of Medicare-funded services.
Another challenge for the Taskforce is how to integrate with other Federal Government initiatives in the community-based health and aged care sectors.
The Minister has not clarified how he sees the Taskforce fitting in with these programs and processes despite the fact that there is a clear overlap between them and the focus areas identified for the Taskforce.
It’s also not clear what role Primary Health Networks (PHNs) will play in the Taskforce’s agenda, although with a representative on the Taskforce they will have the opportunity to influence its work. PHNs fill some of the gaps in Medicare-funded primary healthcare, such as through commissioning after-hours and mental health services, although the specific services they provide are not always well documented and vary across the country (see here for more detail).
It is clear that the main focus for doctors’ groups represented on the Taskforce is for more MBS items that are better remunerated. While this approach may be part of the solution, if it is done at the expense of the needed structural reforms, the benefits will be fleeting and poorly aligned with population needs.
If the Taskforce does not align its recommendations with these and other existing programs and processes, its efforts risk adding to the already siloed and uncoordinated approach to chronic disease management, increasing complexity and bureaucracy without achieving better integration and coordination.
Learning from previous reform attempts
Previous governments have made multiple attempts to reform Medicare in order to improve the prevention and management of chronic disease and it is important the Taskforce learns from these experiences.
These include the coordinated care trials, primary care partnerships, the forerunners of PHNs – Divisions of General Practice/Medicare Locals, and funding for step down care provided to states and territories by the Commonwealth for sub-acute care and geriatric and palliative care. More recently the previous Coalition Government developed a Primary Health Care 10 Year Plan and conducted an MBS Review. [A detailed evaluation of the Health Care Homes Trial has just been published, and Croakey will report on its findings in a future article.]
Many of these reform measures have not delivered clear benefits for consumers and none have resulted in system-wide change. One factor may be that many of these were pilot programs with a limited lifespan and were evaluated before they could have demonstrated long term benefit, highlighting the importance of a rigorous and long term evaluation process for future reforms.
Other factors that worked against meaningful and sustained reforms include a lack of involvement of healthcare professionals at the coal face, a one-size-fits-all approach to national initiatives, and a failure of political leadership.
As well, it’s important to acknowledge the difficulties of trying to achieve integration and coordination at a local level within an overall system that works against these processes, suggesting a need for structural reform rather than another siloed program.
There are also lessons to be learnt from existing examples of community-based approaches to chronic disease in Australia and internationally.
These include the Aboriginal Community Controlled sector, community health centres like co-health and rural health services, which often provide a more integrated and multidisciplinary approach than urban areas (such as the ability of hospitals to link in with GPs and the importance of transfers of care).
Examples from other countries that the Taskforce could consider include Aotearoa/New Zealand’s District Health Boards, the UK’s Integrated Care Systems and community health centres and some managed care organisations in the USA.
While none of these approaches are perfect, they all provide some useful learnings for how to improve chronic disease prevention and management in the Australian healthcare system.
Filling the data and information gaps
Successful health reforms require evidence and one challenge facing the Taskforce is the lack of robust data on general practice. Due to the fragmented and privatised nature of general practice, it is difficult for policy makers to get a handle on what GPs actually do, the quality and safety of primary care services, or the outcomes they achieve. Even basic information on who is accessing services and who is missing out is not readily available.
This is not always because this data doesn’t exist.
General practices collect data on their patients and the services they provide, which goes to a variety of places, including PHNs, the Department of Health and to private organisations, but this is not always made available to governments and researchers and is not linked to other relevant data sources, such as public hospitals.
Some important primary healthcare data is collected by groups such as the Australian Institute of Health and Welfare, the Australian Bureau of Statistic, PHNs and universities (and other research institutes) but there is no systematic approach to using this data to inform the development of policies and programs.
Better data from general practices would help design funding mechanisms and programs to achieve the desired outcomes. However, there are a number of barriers, including the reluctance of GPs to provide their data to government and a lack of resourcing for data collection in general practice.
Issues of data governance and data sovereignty would also need to be resolved before data from general practices could be made more widely available to governments.
It’s important to note that two decisions by the former Coalition Government in 2016 have significantly reduced the evidence base for current reforms: the de-funding of the BEACH surveys and the closure of APHCRI.
The Taskforce will not be able to improve data collection in the short term but it can focus on ensuring there is a more robust data set available to make it possible to evaluate the eventual reforms against key goals, such as prevention of hospitalisation.
Where to prioritise resources?
For such an ambitious agenda, the Government has allocated only $750 million (over three years) to support implementation of the Taskforce’s recommendations.
Given that 13 million Australians have at least one chronic condition, this spending will not go far if it is distributed evenly across this population as it equates to only $19 dollars per person per year.
This suggests a need to clearly define the targets for this additional spending, for example by disease, population group or geographic area, and who are the target groups for these reforms, whether on the basis of chronic disease, population group or geographical area.
It’s also important to recognise the limitations of what this funding can achieve.
As stated above, one of the barriers to improving chronic disease prevention and management is the overall under-resourcing of primary healthcare. Increasing funding to this sector can occur either through directing more money into the health system or by re-directing funding from other areas of the health system to primary healthcare.
Both of these options will be difficult politically, even though the evidence suggests that this would deliver benefits to the community.
Raising more revenue for health requires convincing tax payers that they will need to contribute more if they want a world class health system.
Redirecting funding from other areas of the health system involves taking funding away from existing programs and services which governments are often reluctant to do, even though there is a good argument for directing funding from some low value areas, such as the private health insurance rebate, to primary healthcare.
Senior urges the Taskforce to avoid thinking of health spending as a zero sum game. He says:
I think we need to move away from thinking of the health budget being so constrained. It’s not. It’s a political choice.
If we can spend however many billions on submarines we’ll never receive, we could spend it on primary care!
I think also healthcare looks expensive, but it’s much, much more expensive not to have it, or to put money into hospital care at the expense of primary care.
Health is what keeps people able to work, able to look after relatives, able to enjoy hobbies and recreational time, and as such is a good investment, not an expense.”
Governments, politicians and business need to see that investments in good health outcomes contribute to our productivity and national economic status – something that is rarely measured in Australia, but could be, for example through adopting a health-in-all-policies approach.
A way forward – focus on equity and relationships
Without significant additional funds, it will be challenging for the Taskforce to deliver meaningful reform in this politically sensitive area with many competing interests.
Senior suggests that adopting an overarching goal of equity would help focus reforms on those who most need them and by doing so improve the system for everyone.
“I think it’s really important that there is a very strong focus on health equity and the Inverse Care Law, as one of the main considerations, not just as an afterthought. Multimorbidity comes in 10-15 years younger in the poorest communities, so when we are thinking of planning 10-15 years ahead for the aging population, that’s what should be happening now in the poorest communities,” Senior says. (See here for more detail.)
“If Medicare or the health system works for these communities, then it will work for everyone. Well off communities will do OK whatever the health system is, including if it works well for poorer communities. But poorer communities will only benefit if the health system is designed to work for them.”
It’s telling that while the Federal Department of Health and Ageing has sections that look after the interests of doctors, hospitals, the pharmaceutical and medical device industries and the private health insurance funds, there is no section that addresses some of the most important issues for consumers, such as health disparities, coordination of care across sectors and out-of-pocket costs. This means that there is little data collected on these issues and no dedicated policy attention given to finding solutions to address consumers’ needs.
Senior also suggests seeing primary care as a relationship-based system, rather than a system carrying out a discrete series of tasks.
He describes how the health activities and behaviours in primary care (especially for chronic disease and mental health) emerge from the context of a relationship.
“Prioritising relationships, and the needs of the patient will get better outcomes than just focussing on the cost of the provider,” he says.
Relationships at the political level, between doctors’ groups and the government, are also important to progress meaningful reform.
It will be difficult to achieve any structural reforms to Medicare without buy-in from doctors and this will require a degree of trust and goodwill that currently does not exist.
The Taskforce has inherited an environment in which relationships between GP groups and government is at an all-time low, due to ongoing failures on both sides to understand and meet each other’s needs. Relationships within the medical profession also appear to be fracturing with a very public stoush between the RACGP and psychiatrist and mental health advocate Professor Ian Hickie currently being played out on social media.
Senior describes how previous attempts to reform Medicare have been seen as a way to reduce funding to healthcare and that this has left GPs sceptical of the Government’s motives. “There is a lot of resistance to change at the moment, because every change is seen as a way of trying to limit investment in general practice/primary care,” he says.
“GPs are wary of any change at the moment because they feel so stretched, they are under real strain from frozen Medicare rebates, and it looks like any reform is there predominantly to restrict funding. Even if a large increase to funding were announced tomorrow, GPs would be really wary, wondering about what strings were attached, there is such a lack of trust in government currently.”
It is fair to describe the current situation in primary care as a crisis and this adds impetus to the important work of the Taskforce.
But while some short-term solutions may be necessary, a substantial and long-term focus on meaningful reforms – with the active involvement of all stakeholders, in particular consumers and representatives of communities currently under-served by primary care – is essential if the universality of Medicare is to be protected and the health and wellbeing of all Australians is to be improved.
Specialist and mainstream media are awash with stories on health reform…
See Croakey’s archive of articles on the Strengthening Medicare Taskforce