NACCHO #HealthElection16: Labor to unveil $12b Medicare rebate freeze rollback


The Federal Opposition will today make the first big-ticket promise of the election campaign and vow to spend $12 billion over a decade to unwind the controversial freeze on Medicare rebates the Government pays doctors for services.


In 2013, the then Labor government capped the amount of money it paid doctors who provided services under Medicare, and the current Coalition Government has followed suit.

That decision enraged GPs who said they were being starved of funds they needed to provide quality care.

In this month’s budget Treasurer Scott Morrison announced the freeze on indexation for Medicare rebates would continue until the 2019-20 financial year.

That is estimated to save the Government $925 million over the four-year forward estimates.

But despite the freeze on the rebate, bulk billing rates have continued to grow and are at a high of 84 per cent.

Opposition Leader Bill Shorten will announce a Labor government would reverse the freeze of Medicare rebates from the start of 2017 and shell out an additional $12 billion over the next 10 years for doctors.

Usually, the Medicare Benefits Schedule rebate is indexed and increases a small amount each year.

Proposal ‘fully funded’, Labor says

Australian Medical Association president Brian Owler said doctors were worried a continuation of the freeze would discourage doctors to bulk bill.

“That really angered many people and again it’s reignited anger amongst particularly general practitioners,” Professor Owler said.

“The reality is that lifting the freeze is a very big deal [not just] for general practice, but for all doctors and particularly their patients.”

Labor’s plan would cost $2.4 billion over the next four years and apply to all services provided by GPs, allied health and other medical specialists — but not pathology and diagnostic imaging.

Opposition health spokeswoman Catherine King said the policy would be paid for through savings.

“We’ve fully funded our proposal from existing revenue measures including not proceeding with the tax cuts for multinational companies,” she said.

Ms King denied Labor was to blame for the freeze being introduced in the first place, despite the 2013 decision.

“This is entirely Malcolm Turnbull’s work and we will stop it,” she said.
“Having failed three times to introduce its GP Tax – due to Labor’s opposition in the Senate – the Liberals imposed a GP Tax by stealth, freezing the indexation of the rebates paid to doctors for four years,” Mr Shorten said.
“Then in his first budget, Malcolm Turnbull ripped another $925 million out of Medicare by extending the freeze by a further two years to 2020.”
The Parliamentary Budget Office has costed the proposal and predicts a four-year price tag of $2.4 billion with $1.1 billion of that falling in the fourth year. Over a decade, the cost of indexation would be $12.2 billion, according to the PBO modelling.
In recent weeks, both the AMA and the RACGP have warned of doctors abandoning bulk-billing completely after being required to absorb rising costs without passing those on to their patients.
The RACGP campaign, which will run nationally and via local media in key marginal regional electorates in New South Wales, Queensland and Tasmania, represents a serious attempt by the College to assert a stronger role in public health policy, and in the protection of its approximately 33,000 members.
Both parties have used freezes on indexation in the past to help balance the federal health budget.
Labor froze indexation for eight months in 2013, lifting it briefly for GPs in 2014-15. The Coalition extended it for four years in 2014, and this year extended it a further two years to 2020, to save $925.3 million.


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