Rudd checks the nation’s pulse

The announcement today by Kevin Rudd at the National Press Club was a big one. It took the “political narrative” by the scruff of the neck and yanked it well and truly to that of the Government’s choosing. If the Opposition opens up Question Time on Monday with questions about insulation they will look like they are lacking policy on either health or education. They will have to go after Rudd (and Roxon and Gillard). Anything else is to abandon the playing field to the ALP in the two areas that will go a big way to determining the election. 

Today Rudd proposed taking a third of the GST revenue from the states, and in turn funding 60% of hospital and GP funding (or to be more specific):

The Australian Government will take clear financial leadership in the hospital system, permanently funding 60 per cent of the efficient price of every public hospital service provided to public patients.

We will fund 60 per cent of recurrent expenditure on research and training functions undertaken in public hospitals.

We will fund 60 per cent of capital expenditure - both operating and planned new capital investment - to maintain and improve public hospital infrastructure.

No previous Australian Government has accepted any responsibility for the funding of hospital infrastructure - let alone 60 per cent.

Over time, we will also pay up to 100 per cent of the efficient price of 'primary care equivalent' outpatient services provided to public hospital patients.

All Rudd has to do is get the states to agree to it, and then get it through the Senate.

Oh good, I was worried for a minute it might be difficult.

Now I’ll be the first to admit I know very little about Health Economics (I did Home Economics till Year 10, but I don’t think there’s much cross over…). I don’t know anything about the costs of various types of health care versus other types. I know very little about delivery of aged care etc etc. So I’ll just focus on the politics and leave the policy to others more learned than I (try the Crikey Health Blog, Croakey).

The politics of this are that Rudd needed to be seen to do something big, but more than that he needed to look to be delivering on his promise of a takeover of the hospital system. Today he announced he’ll take over 60%. Peter Dutton has already come out bagging the plan, but has also said Rudd has failed to keep the election promise of taking over 100%. So Dutton is against the Federal Govt taking over 60%, suggesting it is too big for the Federal Govt to handle, and yet thinks Rudd should have said he’ll take over 100%.

No, logic is not Dutton’s strong suit.

What Rudd promised in 2007 effectively boiled down to picking a fight with the states on health. This policy, by cutting GST revenue, certainly does that. It also counters the argument that it’ll create a big central bureaucracy because the plan intends to create:

Local Hospitals Networks, run by local health, financial and managerial professionals, rather than state or, for that matter, federal bureaucrats, will be put in charge of running the hospital system.

This also has the impact of pretty well neutering the Libs’ attack as Abbott has also been suggesting a form of local boards.

So now the nitty gritty. Rudd has to get all the Premiers to agree. If he doesn’t then he says:

… we will take this reform plan to the people at the next election - along with a referendum by or at that same election to give the Australian Government all the power it needs to reform the health system.

The question is, what will the referendum actually be – will it include the third of the GST aspect? Referenda fail when they are too complex, and it will be hard to come up with a question that is simple and that also delivers what the Government needs it to deliver. Referenda also fail generally when there is not bi-partisan support – and Abbott has already said he is against the plan.

But let’s assume (a big one I know) that the states agree: we still have the Senate. This I think is much easier. I cannot see the Greens or Xenophon or even Fielding blocking this if all the states have already agreed to it. To do so would be very courageous of them – imagine being the one Senator in Australia who blocked major reform of the health system in favour of keeping the same system going now (a system which has very little popular support).

So I think it’ll get through the Senate, because unlike the ETS it’ll only get to the Senate if it already has support of the states, and also there is no ideological foolishness involved that may tickle Fielding's ear. Those Senators will also be struggling when you have the AMA reaction being reported like this:

The peak doctors' lobby has given in principle support to the Rudd government's reform plan for Australia's hospital system. Australian Medical Association president Andrew Pesce told reporters the framework appeared worthy but in the end it would come down to funding.

"This is good health reform in principle," he said. "If we can seen that it's going we can accept a timeline to its final implementation."

Dr Pesce said the changes would hinge on funding. "One of the things that this will succeed or fail on is the delivery of the extra funds that are needed. The prime minister ... seemed to acknowledge that."

and Catholic Health Australia saying:

"The prime minister deserves full marks for recognising the role the private sector can play.”

And then there is the Royal Australasian College of Surgeons:

The Royal Australasian College of Surgeons also said the plan had the potential to improve health care outcomes by introducing national accountability standards. "For too long state governments have often responded to injections of federal funding into the health system by quietly cutting their own health expenditure," college president Professor Ian Gough said in a statement.

"Such sleight of hand has been particularly prevalent in NSW and the results are there for all too see - a public hospital system on the verge of collapse. A single funding source would put an end to such practices."

The Government is starting from a very good point.

And so to the Liberal's: what does this mean for them? Well the problem is they are not helped by their Treasury and Health spokespersons, Hockey and Dutton. Hockey came out and said:

"Where is this magic pool of money that Kevin Rudd says is a great substitute for the black hole in the health system," he said. "If I were a state premier I would be very reluctant to put money into something I do not control."

Well done Joe: put yourself on the side of the state premiers. Perhaps those rumours about you wanting to be NSW Premier weren't all hooey!

Then there’s the true lightweight, Peter Dutton. On radio this afternoon he said:

We’ve gotta change some of the work practices in the hospitals, if you talk to the doctors and nurses they’ll say, “On the private list as an oncology specialist I can see seven or eight or nine patients, when I get into Royal Brisbane I can see three or four during the day because if somebody doesn’t turn up.. ah ‘who cares’ you know, they go back to playing on Facebook or whatever the case may be”.

Yes that’s right, the big problem with public health is all the nurses and health workers are spending all their time on Facebook. This from a guy who tweets during Question Time! Fairfax radio journalist Latika Bourke rang Royal Brisbane and asked about the comment, and was told that

Royal Brisbane Hosp… staff's computer use is monitored and no abuse of sites like Facebook is allowed.

She also reported on twitter the reaction of a worker at a NSW Hospital:

'That's bullshit,' she vented. 'We're not even allowed on Facebook.'

So well done Peter, on the day of the biggest announcement on Health you have belittled hospital workers. Well done, no wonder people said you were future leadership material. (The effect of that sentence really works best if you imagine Hugh Laurie as Greg House saying it in a sarcastic voice)

Tony Abbott did put out a media release, though it is so devoid of anything specific that I wouldn’t be surprised if were written last night. This suspicion is also due to some of the odds things it mentions:

However, the Prime Minister’s announcement of wide-ranging changes to the funding of the public hospital system is light on actual detail and includes little information on how it is to be funded despite it being released 10 months after their June 2009 deadline.

Errr it did mention the GST revenue…

The Rudd Government’s proposed changes will not deliver control of public hospitals to local people.

Errr it did mention the local hospitals network to be run umm… locally.

And then this:

If the Prime Minister was serious about tackling public hospital reform he would implement his plan well before the slated 2012-13 start date

Hang on, you said Rudd rushed the insulation scheme, now you want him to rush this?

A weird media release – very much an “Oh geez, we have to put out something, here’s something, put it out”!

The selling of this scheme is crucial to its success. Rudd and Roxon and all the Government will have to go front foot all day, every day – they had better have learned their lesson from the ETS. This policy needs to be sold again and again and again. The states will come on board if they can see it is popular (or more to the point, unpopular to oppose). And that will only happen if Rudd and the ALP sell it well.

And it is not just the policy it is selling: in many ways this is Day 1 of the 2010 election campaign. Strap yourself in, it’s going to be a long ride.