Treating Australia’s Healthcare System

23 September 2009 (Last Updated September 23rd, 2009 18:30)

When Kevin Rudd became Australia's Prime Minister in 2007 he pledged to reform its ageing healthcare system. Natalie Coomber looks whether tangible effects are being felt in the country's hospitals.

Treating Australia’s Healthcare System

Australia has the second-highest life expectancy in the world, behind only Japan. In contrast to the US, the Australian Government provides universal healthcare coverage and manages to spend only 8.7% of its GDP – around half of the US figure – on paying for health services. Despite these glowing statistics many aspects of the country's hospital system have long been criticised.

The Australian Labor Party's 2009 election pledge was to reform the healthcare system and pump money into improving its services. When Kevin Rudd was inaugurated as prime minister he had key goals that included improving preventative healthcare and primary care, as well reducing waiting times for elective surgeries and improving access to emergency departments. Two years on and the difference is starting to be felt.

Australia's publicly funded universal healthcare system, Medicare, is intended to provide affordable treatment by doctors and in public hospitals for all resident citizens. Since 1999, the public health system has been supplemented by a Private Health Insurance Rebate through which the government funds at least 30% of any private health insurance premium.

"In the 2009–2010 budget, the government began delivering a record A$64bn boost to health and hospital funding."

Standards in Australia's hospitals have been criticised in the past and as a solution past governments have pushed to increase private healthcare coverage to stop the strain on public hospitals. Although many feel the Labor Party will go down this road, it is showing a commitment to improving standards in public hospitals.

Key initiatives

In the 2009–2010 budget, the government began delivering a record A$64bn boost to health and hospital funding, an increase of more than A$20bn on the last Australian Healthcare Agreements under the previous government. The total figure includes A$1.1bn over the next four years to train more health professionals and A$9.9bn to support the aged care needs of older Australians. In addition, A$60bn will be spent on public hospital services over the next five years.

In September, the government released its first National Primary Health Care Strategy to focus on the steps the government can take to improve frontline healthcare. The strategy has been built on the National Health and Hospital Reform Commission's work, as the country's healthcare system faces a number of challenges including an ageing population, rising rates of chronic disease and the need to address rural communities.

Two key focuses of the government's strategy have been to reduce elective surgery waiting times and establish a number of GP super clinics across the country. It committed A$600m between 2007 and 2008 to reducing waiting times and will spend A$3.2bn on 36 major hospital projects across hospitals and research institutions. The money already spent in the surgical arena has proved successful and has resulted in more than 40,000 additional elective surgeries being conducted in 2008. However, Rudd's plan for super-sized doctor's practices is proving a little less popular.

Over the past few months alone, work on super GP clinics has begun in Devonport, Tasmania, Queanbeyan in the state of New South Wales and Wodonga in Victoria, to name but a few. The idea is that the clinics will be operated by a consortium of GPs and will offer a wealth of primary care services such as disease self-management, pathology and pharmaceutical services, dietitians and act as regional training points for medical, pharmacy and nursing students.

"Two key focuses of the government's strategy have been to reduce elective surgery waiting times and establish a number of GP super clinics."

Frost & Sullivan ANZ medical technologies healthcare consultant Sourabh Janardan Kankhar says the scheme is aimed at taking the pressure off hospitals. "The initiative would be particularly valuable in rural and regional communities where there is a shortage of specialist and other services," he says.

But Kankhar admits there has been criticism. "There is a belief that the GP super clinics won't solve the hospital crisis due to the ageing population in Australia," he explains. "The real problem is that public hospital beds have been cut since Medicare was established in 1984."

Opposition to the initiative has come most notably from lobby group the Australian Medical Association (AMA). It says that the super clinics will only benefit a limited number of Australians and damage existing general practices that provide valuable patient care. "AMA says that if the government is intent on implementing the super clinic policy, GP super clinics should only be located in areas where there are identified gaps in the delivery of local health services and clear evidence of significant GP shortage," Kankhar says.

Health promotion

With 47% of women and 63% of men in Australia overweight or obese, health promotion and preventative medicine is becoming increasingly important. It is predicted that by 2010 70% of Australians will be above their healthy weight range and with chronic diseases predicted to account for 70% of the country's overall disease burden, it is an area that needs desperate attention.

Along these lines, the Australian government will invest A$872m over the next six years in preventing lifestyle risks that cause chronic disease. "The 2009–2010 budget commits to funding the single largest investment ever made in health promotion in Australia, which will be focused on tackling the health problems caused by tobacco, obesity and excessive consumption of alcohol," Kankhar says.

The government will hope to build on schemes such as the Hospital in the Home programme to improve outcomes for patients cared for in their own home, Kankhar says. This was implemented in the state of Victoria from 1994 onwards and has resulted in improved flow through hospital beds and reduced lengths of stay in hospital.

"Australia is also showing a strong commitment to electronic health records, building on work already carried out through its HealthConnect initiative."

With so much money being pumped into the hospital system it is not just hospital operators and patients who are set to benefit. In addition, medical device firms and pharmaceutical companies should feel knock-on effects. In particular, drug development firms will benefit as the government continues to list more drugs on the pharmaceutical benefits scheme that makes a range of necessary prescription medicines available at affordable prices to all Australian residents.

In comparison to the US's promotion of healthcare technology through its American Recovery and Reinvestment Act, Australia is also showing a strong commitment to electronic health records, building on work already carried out through its HealthConnect initiative.

This nationwide scheme established almost a decade ago is defined as a change in management strategy. "After billions of dollars of investment, the programme saw limited success because of the limited coordination of e-health plans and investment," Kankhar says. Today, there is added emphasis on connecting state health records across public hospitals and many have spent millions of dollars in replacing legacy systems.

It seems that with regards to healthcare the government has its hands full. In such a vast country, providing adequate healthcare for all is not going to be easy and schemes to recruit rural doctors and improve accessibility are desperately needed. Pumping funds into the system is pleasing many but the government will need to ensure these are focused in the right areas for it to have any real benefit.