30th anniversary of Medicare – talk

The issue

Today we are celebrating the 30th anniversary of Medicare. In recent weeks there has been much talk of reforming it, and questions have been asked about whether or not the current government will make changes to some of its core features, such as bulk‐billing.

What happens to Medicare in the future, however, depends to large extent on its past. While history does not determine the future, it is important to remember that we are not starting with a clean slate.

In this talk, I will point out some of the ways Medicare’s past is likely to affect the chances and prospects of reforms in the future.

Overview

Medicare has had a chequered history. Its first incarnation, Medibank, was implemented in 1975 in the dying days of the Whitlam government after a particularly fierce political battle, both inside and outside Parliament.

Medibank was only operational for about a year before the Fraser government began to dismantle it. By 1981, Medibank had been abolished and Australia went back to having a system of voluntary private insurance subsidised by government. Many Australians, and observers from overseas, were stunned. Other countries were trying to establish universal health systems, not get rid of them.

At the time, the Medibank ‘experiment’ was considered a failure. Perhaps the idea of compulsory, national insurance was too ambitious for a country that already had a well‐established private insurance scheme?

Turns out, it wasn’t. Labor revived its Medibank scheme, calling it Medicare so it wasn’t associated with the Whitlam era. It made Medicare a central part of its election platform in 1983. After the election, the Medicare legislation sailed through Parliament and officially started on 1 February 1984.

When I interviewed Neal Blewett, the health minister who introduced Medicare, about the experience, he said that he had a relatively easy time of it, compared with Medibank (that easy time did however, include a national doctors strike). Blewett did point out though that it would probably not have been possible for them to introduce Medicare if Medibank had not preceded it; Medibank softened much of the opposition to Medicare, and meant that much of what was needed to run a national insurance scheme was already in place.

It is easy to forget all the controversy surrounding the introduction of Medibank and Medicare because it was so long ago. But, if you delve into history, as I have, it is easy to find lessons that are relevant today. Here are three.

Lessons from history

Lesson 1 ‐ Health reform is nearly always controversial, no matter how big or small, so reform advocates need to be very, very well prepared.

• The original Medicare proposal was developed by John Deeble and his colleague Richard Scotton. They were experts and working, initially, outside the public service. They developed their idea using the best available data. They drew on current theories and experiences from other countries. They fully costed the proposal and subjected to public scrutiny years before legislation was introduced.

• There are lessons here for today’s policymakers. Good policy nearly always requires substantial input from those with expertise – this includes academics, practitioners and consumers. They need to be included in the policy development process, not just consulted about it. So look outside the public service for advice. Go on: be brave! But feel free to seek advice from us if you need help to work with academics.

• Medicare also has lessons for academics and reform advocates. There is no point pushing half‐baked reform options, or proposals lifted from other countries with completely different health systems. While an idea might be good in theory, policymakers need to see how it could be implemented….in the real world. If the work hasn’t been done to help them, the idea is less likely to get taken up.

Lesson 2 ‐ Major reform is possible, but it is much more likely if you build on what already exists.

• While Medicare was a major reform, it did keep many of the elements of the existing system – fee‐for‐service medicine, for example, the option of taking out private insurance and going to a private hospital, and a patient benefit scheme that partially covered the cost of out of hospital medical services.

• More radical options – such as salaried medical service and a NHS‐style health system – were being pushed around the time Medibank was proposed, but they got nowhere. The political, constitutional and practical barriers were considered just far too great. It’s frustrating for advocates to hear that sometimes, good policy ideas just aren’t going to make it, but that’s the truth of it. However there is hope.

Lesson 3 ‐ Successful reform is often preceded by what seems like failure

• As Neal Blewett explained, Medicare was only possible because of Medibank. But failed reform attempts must push future governments in a sensible direction. They have to facilitate reform somehow, for example by helping build coalitions of support, changing the nature of debates, prompting academics to start thinking differently about the problem, or softening opposition. Many of these things happened before Medicare was introduced.

• For policymakers interested in the long game, not just what is possible within the political cycle, try and think of ways of making sure what you are working on now doesn’t disappear in a puff of smoke if the government changes, or program funding is cut. When working on implementation strategies, push for things that can’t easily be wound back – build buildings, for example, or create jobs, or make sure the people who use the service think it is really great! Strong community support might be the best chance of making sure the idea revived in the future.

• And for advocates of reform, don’t give up. Some good ideas are a long time coming. Australian advocates for national insurance, for example, started pushing for it in 1911! They finally got it in 1984.

Conclusion

The ‘heavy hand of history’ will have a strong bearing on the future of Medicare. When debating reform options, developing policy solutions or designing implementation strategies, there is an onus on us to draw on the lessons from Medicare’s past. If we do, we are likely to implement reforms, like Medicare, that make our health system better.