Health budget has big changes – reviving our worn-out Medicare fee-for-service system and boosting bulk billing

• The big news on budget night was a tripling of the bulk-billing incentive, a key plank to strengthen Medicare.
• Bulk billing is unevenly distributed and in some low-income areas (bulk-billing deserts) fewer than 50% of people have all their GP attendances bulk billed.
• Practice owners could simply pocket the increased incentive for patients who are already bulk billed, leaving bulk billing rates unchanged.

1. Primary care is now a priority

• Typically, health budgets are focused on hospitals, with primary care an afterthought, or worse: the target of budget cuts.
• In the lead up to the budget, Health Minister Butler emphasised the centrality of primary care to the health system.

2. Funding the plan to strength Medicare

• Health Minister Butler signalled the focus on primary care as one of his first acts when he appointed the Strengthening Medicare Taskforce, which I was a member of.
• Read more:
  New Medicare reforms won't fix everything but they start to tackle the system's biggest problems

  A key challenge for primary care policy is the reliance on fee-for-service payments.

• Team-based health care The Strengthening Medicare Taskforce also recommended more multi-disciplinary or team-based primary care, involving nurses, physiotherapists and a range of other health providers and administrative supports.
• The increased funding in this budget will reward that past behaviour, making these practices more viable, as well as encouraging an expansion in other practices.

3. Extended prescription dispensing length

• The third budget change, announced in April, reduces prescription costs for medications by extending prescription quantities to two rather than one month’s supply for many common medications.
• It doubles the amount of medication that may be dispensed under a single prescription, reducing patient co-payments and dispensing fees paid to pharmacists.

4. Digital health time bomb

• The Strengthening Medicare Taskforce identified contemporary digital health capacity as essential for a modern health system.
• Yet peculiarly, the previous government did not provide funding for the Digital Health Agency and My Health Record on an ongoing basis.

What’s missing?

• Although funding has been provided for more budget time bombs – programs which otherwise would have ended – and funding for additional places in psychology courses, mental health reform is still a work in progress.
• The government has recognised this gap, titling its mental health budget announcement “laying the groundwork”.
• It signals a new priority for primary care and provides a new foundation for funding reform for the future.