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Budget 2014-15

Health Budget briefing

In advance of the budget, Osteopathy Australia made written submissions to the Treasury, the National Commission of Audit and conveyed important positions on a range of policy matters.

Osteopathy Australia attended the 2014/2015 Health Budget Briefing in Canberra on May 13 and has analysed the budget papers.

Most budget measures will require legislation, and we will make representations about some of those bills. 

We also have ongoing dialogue with respect to Medicare, MBS, e-health, and other budget measures.

The first two points affect osteopaths specifically. The remainder affect osteopaths in the sense that the general health landscape is affected.

1. Copay

The Government announced a copay of $7. It’s uncapped for most people, but capped at 10 visits/services/blood tests/images (counted cumulatively together) for concessional patients.

The copay applies to almost all primary care MBS items, including bulk billed / no gap services, plus out-of-hospital pathology, and diagnostic imaging. A single GP appointment can incur more than one $7 co-payment.

Allied health services, including osteopathic CDM services, are exempt from the co-pay.

This means that the copay will apply to the GP referral, but not to the services you provide.

Diagnostic imaging costs will rise by the copay amount for our patients who have Medicare-rebated imaging, but the admin burden will be borne by the providing practitioner (e.g. Radiologist), not the osteopath.

The Commonwealth will remove the current (longstanding) restriction on states charging copay on hospital ED presentations. Some states have today ruled out charging such a hospital copay.

Most allied health consumers are already used to paying for access to services. However, this will increase the overall out of pocket health expenses for consumers and may reduce their discretional spend on health services.

2. MBS indexation

The former government deferred indexation.

The current government has continued the deferral indexation, with no change until 2016. In real terms, due to inflation the deferral of indexation means all rebates will gradually reduce in real value.

This is unfortunate news, but it’s shared across the Health portfolio. This also affects DVA payments, since veterans' health items are based on the MBS.

3. Safety Nets

The Safety nets are being “simplified” by having their thresholds increased.

4. Medicare Locals

Medicare Locals will be abolished by the end of the 2014/15 financial year. They will be funded until then.

They will be replaced by Primary Health Networks. Unfortunately, it is likely these will return to being more GP-centric.

Tenders will be called for in late 2014, and will commence on July 1 2015.

5. Agency consolidation/abolition

Several health agencies will be consolidated or abolished, including Health Workforce Australia, the General Practice Education and Training Network, and the National Preventative Health Agency. Their “necessary functions” will transfer to the Department. Health Workforce Australia had a significant focus on allied health and their role in expanded scope of practice. Osteopathy Australia will continue to lobby for the Department to continue such programs. The Department had not previously been a driver of positive change.

6. Hospital funding

The National Partnership Agreement on Improving Public Hospitals is being discontinued after two years.

What will come instead is unknown. The Government plans a “Federal white paper.”

7. Preventative Health

The National Partnership Agreement of Preventative Health is abolished. This saves $53 million this year and $367 million over the forward estimates period. This leaves federal health policy with a significant gap in driving preventative health care.

8. E-health

The Government is committed to a Personally Controlled Electronic Health Record (PCEHR) that is “effective, functional, easy to use” and “clinically relevant to all health providers.”

Osteopathy Australia continues to lobby for fair and equitable participation in the PCEHR, for the benefit of patients and the efficient delivery of health care.

On the other hand, the only money in the forward estimates for this is $140 million, and it’s all this year. Nothing in the next three.

9. New spending

There’s a $100 million expansion to the National Bowel Cancer screening program, and substantial grants for dementia research.

10. New savings

With the savings from all the copays, the safety net threshold changes, the hospital funding saves, and the consolidation/abolition of various agencies, there’s a lot of money saved. Part of this is in aid of the overall budget position.

In this respect, Health is no different to other portfolios. Nearly every portfolio faced spending cuts.

A portion of the savings will go to a “$20 billion Future Fund for Medical Research." Apparently the fund will be in addition to the NHMRC grants, and apparently it will (eventually) provide $1 billion a year to be spent on medical research. But the $20 bn figure is a long way off.

We will watch closely to see if this is just medical research or a focus on broader health research. 

Summary

The health budget contains some real policy changes.

Many will be subject to intense debate and negotiation in the Senate, and the outcomes are not predictable.

Even for announced policies, the actual implementation of various budget measures will be revealed in due course over the coming months.

Osteopathy Australia will remain engaged and will continue to represent the interests of osteopaths and patients.

We will also keep you informed of the implementation details for various budget measures when they are available.