Experts sceptical about Health Minister Peter Dutton's health funding 'crisis'
Peter Dutton has been alleged to be "spreading a carefully cultivated falsehood" and "using scare tactics". Photo: Alex Ellinghausen
Health Minister Peter Dutton has misled Australians with
exaggerated claims about the unsustainability of the healthcare system,
say economists and public health experts.
Contrary to claims by Mr Dutton, four health and economics
experts interviewed by Fairfax Media said there was little evidence that
Australia's healthcare costs were unsustainable.
And patient advocates warned the adoption of the National
Commission of Audit's recommendations – including compulsory fees for
doctor visits, emergency hospital charges and relegation of Medicare to
only the needy – would bring about the end of universal healthcare.
Illustration: Matt Golding.
"[Mr Dutton] is using scare tactics about unsustainability,"
said Stephen Leeder, emeritus professor of public health at the
University of Sydney's Menzies Centre for Health Policy.
While healthcare costs are the fastest growing area of
government spending and growing at a faster rate than national
productivity, Professor Leeder said there were "many areas of
inefficiency" that could be tackled before dismantling Medicare bulk
billing. The minister and those in charge of the commission of audit
were "too far removed from the front line" and were doing "accounting
rather than health policy", he added.
Health economist Jeff Richardson said Mr Dutton was spreading
a "carefully cultivated falsehood to say Medicare is unsustainable".
"Australia is not generous in terms of the amount of money we
put into health through government," said Professor Richardson,
foundation director of the Centre for Health Economics at Monash
Commonwealth health spending is currently about $65 billion a
year or a little more than 4 per cent of GDP. It is forecast to rise to
7 per cent of GDP by 2050. But even if Australia reached that figure,
the government would still be spending less on health as a proportion of
GDP than currently spent by OECD countries such as Germany, the United
States, Japan and Britain.
A modest rise in health spending was inevitable as
Australians grew richer and older, said the chief economist of Bank of
America Merrill Lynch Australia, Saul Eslake, adding that "to call it
unsustainable is probably an exaggeration".
Far from having a health funding crisis, Australia had "one
of the best health systems in the world", said Stephen Duckett, health
program director at the Grattan Institute.
"We are less than the OECD average on health spending per
capita," he said. "We're better than the OECD average on life
expectancy. So we're actually in the healthcare system sweet spot."
But Mr Dutton said the current Medicare system was
"unsustainable" and Australia's health spending was "heading to a point
where it will become unmanageable".
"Health spending is not sustainable when it is above economic growth," he said, responding to the economists' criticisms.
"We have to ensure that taxpayer dollars are spent wisely
– on services, not [an] endless[ly] growing bureaucracy, like it was
"On top of current expenditure, we have an ageing of the
population, medical technology, personalised medicines and genomics to
pay for over coming decades. None of which has been accounted for in the
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