RURAL DOCTORS ASSOCIATION OF AUSTRALIA. Pre-Budget Submission

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1 RURAL DOCTORS ASSOCIATION OF AUSTRALIA Pre-Budget Submission Via Contact for RDAA: Jenny Johnson Chief Executive Officer 08 February 2016 PO Box 3636, Manuka ACT 2603 Phone: Web:

2 ABOUT RDAA The Rural Doctors Association of Australia (RDAA) is a national body representing the interests of all rural medical practitioners and the communities where they live and work. Our vision for rural and remote communities is accessible, high quality health services provided by a medical workforce that is numerically adequate, located within the community it serves, and comprises doctors and other health professionals who have the necessary training and skills to meet the needs of those communities. OVERVIEW Australia s future prosperity is dependent on the health of its population. Almost one third of our population lives in the range of farming, mining, tourism, Aboriginal and Torres Strait Islander and other communities that make up rural Australia. People living in these communities make a considerable contribution to Australia s economy, particularly through the resources, agriculture and tourism sectors, and to the social and cultural fabric of the nation. Yet they are disadvantaged by poorer access to local health services, significantly higher rates of disease and injury, worse health outcomes and a significantly shorter life expectancy compared to people living in urban centres. Improving these rural health outcomes is challenging for a system already pressured by the demands of an ageing population, an increasing burden of chronic disease, a greater demand for health services, and an increasing quantum of health expenditure. Access to a highly skilled and numerically adequate health workforce is crucial to meet the broad ranging health needs of rural communities. Attracting and retaining the right doctors and allied health professionals through appropriate training, infrastructure and professional and personal support mechanisms, will facilitate effective responses to the challenges facing our health system. The Australian Government has instigated a number of reviews, including into reformation of the Federation and the tax system, to inform its work while at the same time seeking to rein in federal government spending by rationalising and streamlining government operations and deployment of resources to reduce the Budget deficit. RDAA recognises that these and other health sector specific reviews and processes, including the review of the Medicare Benefits Schedule (MBS), have the potential to improve health system efficacy and achieve a maximum return on investment. The stated aim of these reviews is to support high quality, coordinated care as well as to improve systemic cost effectiveness. Any savings achieved through these reviews should be re-invested back into the health care system. In rural and remote communities the degree of isolation and other geographic, demographic, socio-economic, cultural, climatic and environmental circumstances increase levels of complexity and costs. Changes to funding models and 1

3 administrative, legislative or regulatory mechanisms will potentially have a greater impact in these communities and may place an increased economic burden on rural households and the rural health sector. The past two years have seen a significant contraction of resources directed to the health sector and changes to the ways in which these resources are allocated and programs supported. This has had a destabilising effect on the provision of health services in some areas. This has been especially challenging in rural and remote communities, where access to health services is already compromised. It is essential to ensure that rural patients and rural communities are not disadvantaged by any rationalisation and streamlining of the health system. Policies and strategies must be informed by broad consultation to minimise any unintended or adverse consequences. Local knowledge and networks are essential to effectively meet the health care needs of their communities. Rural doctors and their practices are the mainstays of rural health. They require a supportive policy environment and realistic levels of funding and business certainty to ensure that they can operate sustainably. RECOMMENDATIONS RDAA has developed a number of recommendations for consideration during pre- Budget deliberations: 1. Provide realistic levels of funding targeted to improving primary healthcare capacity and general practices in rural and remote areas: Create a supportive policy environment and business certainty for rural medical practices Maintain and augment incentives and supports for rural medical practice and direct them to the areas and services of greatest need Immediately discontinue the MBS indexation freeze Ensure that Primary Health Networks engage effectively with rural doctors and rural communities and clarify their role in addressing market failure. 2. Develop a coordinated, innovative and flexible approach to the funding of rural health infrastructure: Provide supports and incentives for public-private partnership investment in rural practices Provide realistic levels of funding to support the development and utilisation of ehealth and telehealth services in rural and remote areas Ensure telehealth items are included in and appropriately remunerated by the MBS. 2

4 3. Promote quality of care and access to a wider range of services by supporting rural generalist services: Provide incentives to support rural general practitioners and rural specialists Establish a National Rural Generalist Training Program. 4. Provide flexible rural training pathways to support rural recruitment and retention efforts and sustainability of the rural medical workforce in the longer term. 5. Improve coordination of funding and service delivery between the Commonwealth and States/Territories. KEY ISSUES 1. Provide realistic levels of funding targeted to improving primary healthcare capacity and general practices in rural and remote areas: Create a supportive policy environment and business certainty for rural medical practices Maintain and augment incentives and supports for rural medical practice and direct them to the areas and services of greatest need Immediately discontinue the MBS indexation freeze Ensure that Primary Health Networks engage effectively with rural doctors and rural communities and clarify their role in addressing market failure. A strong primary healthcare system increases efficiency; reduces health inequities; delivers improved health outcomes; improves population health; and decreases health costs for individuals, households, communities and the nation. However, despite wide acknowledgment of these benefits, overall levels of funding for the primary care sector have not significantly increased. Viable, stable and sustainable general practices are a key to delivering effective primary care and improving health outcomes in rural and remote communities. A rural practice, whether a general practice or another specialist craft group, is most often run as a private small business. Many rural practices face mounting professional, economic, systemic and structural pressures that threaten their capacity to provide for the health needs of their communities and, ultimately, their survival. Like any small business, private investment requires certainty to mitigate risk. There will be limited future investment in the business of rural practice without certainty and realistic funding. This lack of investment will compromise the ongoing provision of 3

5 care to many rural communities and have detrimental flow on effects that will impact on their viability and on the local and broader economies. The MBS has failed to keep up with inflation or accurately reflect practice costs and its structure has driven volume-based practice funding models. The negative impact that the continuing MBS indexation freeze is having on general practices in particular has been well publicised. If the freeze continues, more rural doctors will be forced to pass on these increased costs to their patients, or reevaluate their capacity to maintain their rural practice. Given the role they play in providing hospital and emergency services this could then have a detrimental impact on rural health services more broadly. The MBS indexation freeze must be immediately discontinued. There are indications that the current programmes to address medical workforce maldistribution and recruit and retain doctors in rural areas are beginning to have a positive impact. It is important to maintain and augment these incentives and supports and ensure that they are targeted to the communities and services where they are most needed. Incentive programmes should also recognise and reward rural doctors for the complexity of work they perform and the services they provide. Funding models should be focused on ensuring quality practice and better outcomes for patients. Whether the channeling of funding into Primary Health Networks (PHNs) to commission health services will have a positive impact on the accessibility and affordability of primary health care particularly in rural and remote areas where increased complexity of the task makes market failure more likely remains to be seen. Rural doctors are central to health care arrangements in these areas, often providing hospital- and community-based care as well as general practice services. It is therefore imperative that PHNs engage effectively with rural doctors and their communities to address local issues. 2. Develop a coordinated, innovative and flexible approach to the funding of rural health infrastructure: Provide supports and incentives for public-private partnership investment in rural practices Provide realistic levels of funding to support the development and utilisation of ehealth and telehealth services in rural and remote areas Ensure telehealth items are included in and appropriately remunerated by the MBS. Investments in the core physical and technological infrastructure of rural practices will provide better access to care and better health outcomes for rural and remote patients by supporting high quality, integrated models of team-based care; and assisting practices to create spaces to employ more health professionals and provide 4

6 a wider range of services, including telehealth services. These investments also support the teaching of future doctors and bolster practice viability. Consideration should be given to more innovative and flexible infrastructure funding models that encourage investment from the wider community. These models should meet identified community needs; support existing services; match the community s economic and social circumstances; and support other activities such as workforce training, recruitment and retention. In addition to the traditional Government grants, possibilities include rental assistance programmes for rural practices; support for loan repayments; and investment incentives for Local Government, the commercial sector and individuals. The secure management of health information through a highly functional, integrated ehealth system and greater access to health professionals and care through telehealth will be of significant value to the rural health sector, and therefore to patients, but it will take time before meaningful use will be possible. Realistic levels of funding must be directed to supporting the development of digital services and to addressing the barriers to access, and limitations on the uptake and use of technology in rural and remote settings, to realise the potential of available digital tools, applications and services. Ongoing funding support through inclusion of telehealth items targeted to support rural practices in the MBS is also necessary. The use of telehealth should complement, not detract from, existing doctor-patient relationships and care arrangements to support continuity of care to better patient outcomes. Funding arrangements for telehealth services must not compromise the the economic viability of rural general practices or the delivery of face-to-face services in communities where they are most needed. 3. Promote quality of care and access to a wider range of services by supporting rural generalist services: Provide incentives to support rural general practitioners and rural specialists. Establish a National Rural Generalist Training Program Health resources continue to be skewed towards expensive, specialised acute care delivered in hospitals located in the major cities, but rural communities need locally available doctors who have the appropriate generalist skills to effectively respond to the broad ranging health needs of their community. Supporting general practice and generalist specialist services (such as general surgeons) that meet community needs, enhance continuity of care and build rural workforce capacity, is a proven strategy that should be continued and further developed. RDAA also supports the establishment of a National Rural Generalist Training Program that offers a fully supported training pathway into rural medicine and national recognition and transferability of credentials. This program would provide trainees with specific placements and learning opportunities to develop the 5

7 necessary general practice, procedural and other advanced skills that are crucial for a career in rural generalism. 4. Provide flexible rural training pathways to support rural recruitment and retention efforts and sustainability of the rural medical workforce in the longer term. Flexible and well-supported rural training pathways that are responsive to the changing aspirations and life circumstances of medical students and doctors, and include prevocational and general practice experience and Continuing Professional Development, will underpin the recruitment and retention of rural medical practitioners. RDAA welcomes in principle, the MYEFO announcement of an Integrated Rural Training Pipeline and the Rural Junior Doctor Innovation Fund which will provide prevocational general practice exposure to general practice. These initiatives build on evidence that doctors who undertake the majority of their training in rural areas and have positive rural experiences during their training are more likely to become rural doctors. RDAA also welcomes the continued funding of the Specialist Training Programme (STP) to enhance opportunities for regionally-based training in specialty areas other than general practice. 5. Improve coordination of funding and service delivery between the Commonwealth and States/Territories. The complexity of health funding arrangements and division of responsibilities for different aspects of the health system is yet to be meaningfully addressed and continues to be problematic for the rural health sector. Current arrangements for the funding and delivery of health services and programs can be duplicative and inefficient not least because of our tiered system of government responsibility. Improving coordination between the Commonwealth and State/Territory governments would reduce the potential for cost shifting; clarify responsibility for various aspects of the health care budget; reduce the potential for double dipping and duplication of services; and facilitate efficient and effective delivery of health care services and continuity of care. In identifying savings, the health care system should be considered in its entirety, rather than in jurisdictional silos. 6