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1 Health By health expenditure had reached $6.2 billion, which represented 7.7% of GDP and a near trebling of costs since The Government had made an election commitment not to raise health insurance rates before the middle of 1979, but planning for financially inevitable changes proceeded. On 17 April, Cabinet considered a submission from the Health Minister, Ralph Hunt, which recommended that patients should pay a higher proportion of their health care costs in order to curb demand for services, reduce Commonwealth outlays and slow the increase in insurance costs. Hunt noted, however, that draconian measures such as full hospital cost recovery or confining insurance to catastrophic expenses would be politically unacceptable. Cabinet decided to increase hospital bed charges by one third, allow private health funds to offer their client the option of paying lower contributions in return for lower benefits, and confine bulk billing to pensioners (Decision 5125). As finally introduced on 1 November, the revised health scheme abolished the health insurance levy and compulsory health insurance and provided free basic hospital treatment. For medical services, the Government would pay 40% of the scheduled fee (subject to a maximum patient contribution of $20 per service), but patients had the option of taking additional cover by private insurance. Bulk billing would pay doctors 75% of the scheduled fee for treating the poor and 85% for pensioners, but they could not ask patients to make up the difference (Decision 6245, 12 and 13 July 1978). The Pharmaceutical Benefits Scheme put further pressure on the health budget. In July, Cabinet considered a submission from Ralph Hunt summarising complaints from the pharmaceutical manufacturers about declining profitability. The manufacturers threatened job losses, factory closures and a winding back of research and development unless they received an increase in payments of around 30 cents per prescription. Finance was sceptical, suggesting that it was in the manufacturers interests to understate their profits, but Hunt recommended an increase of 15 cents per script. Cabinet considered the issue three times and finally decided on a 5 cent increase and a full-scale inquiry into the industry, possibly by Mr JB Reid of James Hardie Asbestos (Submission 2308). The sensitive issue of abortion came before Cabinet in March. Ralph Hunt recommended that private health funds opposed in conscience to abortions should have the right not to pay benefits for them. Hunt conceded though that this would not placate the Right to Life Association, which opposed the payment of benefits for abortions in any circumstances. Cabinet deferred a decision pending a more general review of benefit issues (Submission 1934). Cabinet was also concerned about the increasing volumes of illicit drugs reaching Australia, particularly heroin. In January, the Minister for Business and Consumer Affairs, Wal Fife, briefed Cabinet on measures already taken to combat drug smuggling, including improved air and sea surveillance in northern Australia. Cabinet approved further administrative and publicity initiatives and also amendments to the Customs Act 1901 to provide for the use of listening devices, telephone interception, internal body searches and seizure of assets (Submission 1858) CABINET RECORDS SELECTED DOCUMENTS

2 Selected documents Decision 5125, Review of health insurance arrangements 242 Decision 6245, Interdepartmental committee on health financing arrangements 250 Submission 2308, Pharmaceutical Benefits Scheme: across-the-board price increase 253 Submission 1934, Private health insurance National Health Act Submission 1858, Drug enforcement measures CABINET RECORDS SELECTED DOCUMENTS

3 Decision 5125, Review of health insurance arrangements [A13075, 5125] CABINET RECORDS SELECTED DOCUMENTS

4 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

5 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

6 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

7 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

8 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

9 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

10 Decision 5125 cont CABINET RECORDS SELECTED DOCUMENTS

11 Decision 6245, Interdepartmental committee on health financing arrangements [A13075, 6245] CABINET RECORDS SELECTED DOCUMENTS

12 Decision 6245 cont CABINET RECORDS SELECTED DOCUMENTS

13 Decision 6245 cont CABINET RECORDS SELECTED DOCUMENTS

14 Submission 2308, Pharmaceutical Benefits Scheme: across-the-board price increase [A12909, 2308] CABINET RECORDS SELECTED DOCUMENTS

15 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

16 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

17 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

18 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

19 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

20 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

21 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

22 Submission 2308 cont CABINET RECORDS SELECTED DOCUMENTS

23 Submission 1934, Private health insurance National Health Act 1953 [A12909, 1934] CABINET RECORDS SELECTED DOCUMENTS

24 Submission 1934 cont CABINET RECORDS SELECTED DOCUMENTS

25 Submission 1934 cont CABINET RECORDS SELECTED DOCUMENTS

26 Submission 1934 cont CABINET RECORDS SELECTED DOCUMENTS

27 Submission 1934 cont CABINET RECORDS SELECTED DOCUMENTS

28 Submission 1934 cont CABINET RECORDS SELECTED DOCUMENTS

29 Submission 1858, Drug enforcement measures [A12909, 1858] CABINET RECORDS SELECTED DOCUMENTS

30 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

31 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

32 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

33 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

34 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

35 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

36 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

37 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

38 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

39 Submission 1858 cont CABINET RECORDS SELECTED DOCUMENTS

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