Charting the path to a future-proofed healthcare system: Leaders gather to discuss Federal Budget impact

MedTech & Diagnostics News: In a gathering of esteemed healthcare leaders, Professor Henry Cutler, Director, Centre for Health Economy at Macquarie Business School and Professor Eric Knight, Executive Dean and Professor of Strategic Management at Macquarie Business School hosted a dynamic discussion on the ramifications of the recently announced Federal Budget on the health and aged care sectors. With valuable insights from the Macquarie University Centre for the Health Economy’s (MUCHE) latest report, the event aimed to pave the way for an improved and sustainable healthcare system.

The ongoing COVID-19 pandemic has brought the nation’s healthcare system to the forefront of public attention, prompting the National Cabinet to prioritise health as its top agenda in 2023. This auspicious timing presents an opportune moment for governments at all levels to align their values, cooperate, and converge on a shared mission of future-proofing the healthcare system.

While the May Budget unveiled significant increases in general practitioner (GP) revenues, it is widely acknowledged that pouring more money into the healthcare system alone is not a sustainable solution. With government net debt expected to exceed pre-pandemic levels until 2033-34, fiscal constraints necessitate a prudent approach that eliminates waste in healthcare expenditure.

The government has made clear its intention to initiate comprehensive reform in the healthcare system. The Strengthening Medicare Taskforce Report, which sets out the government’s vision, emphasises the delivery of more equitable and affordable care through enhanced provider integration, holistic treatment approaches, advanced technology adoption, and cultural change facilitated by effective change management.

Implicit within the Strengthening Medicare Taskforce Report is a shift from the traditional fee-for-service funding model to a model that incentivises collaboration among healthcare providers and rewards them for achieving better health outcomes.

The journey towards this transformative vision has commenced with the latest Budget’s allocation of $445.1 million over five years to encourage GPs to work within multidisciplinary teams and expand their workforce by employing more nurses, allied health professionals, and other specialists. Additionally, $79.4 million has been earmarked to support Primary Health Networks (PHNs) in commissioning allied health services, thereby improving access to multidisciplinary care.

Despite promising discussions regarding innovative funding environments such as blended funding, there is currently no indication that the government has progressed towards their implementation. Nonetheless, the Budget takes crucial steps in building the necessary foundation by investing in essential digital technologies.

Key among these investments is the allocation of $19.7 million to establish MyMedicare, an initiative that enables patients to voluntarily register with a GP practice. While the funding amount may not be substantial, the significance lies in the fundamental shift in government and stakeholder perspectives towards healthcare delivery. Just a decade ago, the notion of patient registration would have been deemed unthinkable. Complementing this initiative are investments of $429 million to enhance My Health Record and $325.7 million to ensure the Digital Health Agency remains effective and up-to-date.

The ambitious vision outlined in the Strengthening Medicare Taskforce Report will ideally extend into the ongoing review of the National Health Reform Agreement 2020-25 into public hospital funding. Currently, state, territory, and federal governments are lagging behind their initial schedules for implementing reforms, highlighting the need for sustained commitment and collaboration.

One critical aspect that Australian healthcare policy has often overlooked is the utilisation of financial incentives to drive value improvement. Existing fragmented funding models tend to keep healthcare providers isolated from one another. To address this, a paper advocating for scalable value-based payments in Australian healthcare emphasises the need for funding reforms that prioritise value and outcomes, even if it means challenging entrenched healthcare provider business models.

The national vision and a 10-year plan for integrating value-based payment into the healthcare system would include an independent national payment authority to implement this plan in coordination with relevant government agencies at the federal, state, and territory levels. Improving data collection, analysis, and access, aiming for seamless information flow between government and providers is also critical.

However, the road to funding reform will not be without its challenges and expenses. Yet, maintaining the status quo is unsustainable for delivering a modern healthcare system that meets the needs of patients. It requires unwavering leadership to navigate potential constitutional challenges from providers. The reform process will undoubtedly encounter failures, but a strong and transparent evaluation and learning culture will facilitate continuous improvement.

One persistent issue facing the Australian healthcare system is workforce shortages. Addressing this challenge necessitates robust collaboration among government departments, public and private healthcare organizations, and education and training providers.

While previous governments have released long-term workforce strategies, the current government appears more focused on bridging immediate workforce gaps. The latest Budget reflects this commitment with a 12% increase in expenditure for the Health Workforce in 2023-24. The funding includes initiatives such as allocating $445.1 million to assist GPs in employing more nurses, allied health professionals, and other healthcare providers. Moreover, $238.5 million is dedicated to enhancing First Nations cancer outcomes through workforce capability and capacity building, with an additional $91.3 million allocated over five years to expand psychology placements.

Recognising the pressing needs in aged care, the government has committed $10.9 billion in aged care price increases to enable residential and home care package providers to cover increased wage costs. Furthermore, $654.9 million in savings from reduced dispensing fees will be redirected to expand the scope of practice for community pharmacies.

However, despite these investments, Australia still needs to attract more overseas health and aged care workers, improve working conditions, expand telehealth services, and enhance the scope of practice for non-specialist practitioners.

The government plans to conduct a National Scope of Practice Review in 2023, exploring how non-specialist practitioners can efficiently and safely deliver a broader range of services. This review aims to identify barriers and incentives for health professionals to work to their full scope of practice, particularly in rural and remote areas where healthcare worker shortages are most acute. However, this review may face opposition from lobby groups representing providers currently delivering those services.

As the nation embarks on these transformative initiatives, all stakeholders must prioritize the interests of the patients. The journey toward a reformed healthcare system will require commitment, collaboration, and an unwavering focus on achieving better health outcomes for all Australians.

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