The Australian’s headline to Rudd’s new hospital plan says it all:
I’m not in favour of a government take over of anything, state, federal, local….whatever. The problems will still be the same. Rudd’s hospital proposal is like a mutant cross between Abbott’s local control concept and Rudd’s desire to control everything. The proposal is destined to fail. And basically stealing state GST revenue to pay for it all is consistent with Rudd’s desire to reward failure.
WESTERN Australia’s Liberal government yesterday warned Kevin Rudd it would not surrender 30 per cent of its GST takings and allow health decisions to be made in Canberra.
Currently WA subsides east coast ALP government incompetence via GST re-distribution arrangements, whereby WA has to give up 30 cents in every GST dollar to NSW. So Barnett knows what Rudd’s plan is designed to do to the Coalition’s re-election prospects in WA. Deny the WA government valuable GST revenue in order to squeeze their budget.
Premier Colin Barnett said the commonwealth’s proposal to increase its contribution to health by taking money from the states was a “sleight of hand”, “very unsatisfactory” and unachievable without the co-operation of the states…”We will not tolerate a situation where, from Canberra, all the decisions relating to our hospitals and most of the healthcare decisions are made,” he said.
If Colin Barnett wants to really torpedo Rudd’s plan and secure WA independence then he should privatise WA hospitals. Use the proceeds from the sale to establish a health fund to help pay private insurance premiums for those without, while offering tax relief from saved annual health spending for those with. Nearly half of all Australians currently have private hospital cover as it is. Tax relief could come in the form of reimbursment of Federal income tax, GST and/or land tax.
A massive injection of private investment is the only way to remedy the current state of public hospitals. More government never solved anything.
UPDATE I
Scary stuff from Rudd:
States have until a Council of Australian Governments meeting on April 11 to give their answer. Mr Rudd said if they do not ”sign up to fundamental reform” he will hold a referendum either before or at this year’s federal election ”to give the Australian government all the power it needs to reform the health system”.
The hospitals issues is symbolic of Rudd and his desire for ‘all the power’ across a range of other issues as well. Colin Barnett should head Rudd’s bushranger gang off at the pass by selling WA’s public hospitals to private investors or local communities. The alternative is having Rudd trying to run hospitals, a venture infinitely more complicated than any other project failing he has so far embarked on – ceiling insulation, school lap tops, school building investment, etc…all abject failures. How well do you think he will do on health? At least with a sell off, Barnett could continue to exercise some meaningful control over health in the state, independent of a socialist meddling PM in Canberra.
UPDATE II
Here are some quick calculations to make people think.
Total public health care spending in WA is forecasted to be $4.6 billion in FY 09/10. Let’s assume in getting out of the health care game the government keeps $200 million for random health services, etc… making $4.4 billion – not including mental health, etc…. The population of WA is 2.2 million - guessing around 30 per cent having private health insurance not just to avoid tax. The national average is nearly 50 per cent so I am being generous. That works out on a per capita basis of around $2850 on public health care spending. Now there is around 120 public hospital/service facilities across the state. Let’s assume that the average sale price for all the facilities is $40 million giving a total sale price of $4.8 billion. Which is significantly less than the total assets reported by the Department of Health. Now $4.8 billion at 5 per cent – with 2.5 per cent retained for inflation - averaged over 10 years equals $120 million per annum. Making total annual cash available for tax cuts and/or private health premium subsidies of $4.52 billion or nearly $3000per non-private hospital person in WA. To put this in perspective, the top of the line no deductible ‘blue ribbon’ Medibank Private hospital premium for a single person is between $1200 – $2000 per year not including the 30 per cent Federal government rebate and any potential discounts from bulk ordering such as families, businesses, etc…. I know which option I would rather have – take my $3000 and get my own insurance policy and get the government out of my life.
UPDATE III
Almost on queue a story has appeared which illustrates my main point:
THIS is the list of 117 NSW hospitals senior health clinicians claim will struggle to survive under Kevin Rudd’s health reforms. They include services in remote areas of NSW, regional centres, as well as inner-city hospitals in Balmain, Rozelle and Auburn. All are currently block-funded and considered financially unviable under the Federal Government’s plans for a pay-for-service model. They don’t perform enough medical procedures to fund their own existence.
Here’s a revolutionary idea. Instead of closing the hospitals down, because the government can’t run them, why not try and find a private buyer for all or at least some of the facilities?
UPDATE IV
Gee, is this an admission of government failure:
The Rudd government doesn’t need to wait for state approval of its hospital plan to move public patients on waiting lists into private hospital beds, a leading health group says….
It says an investment of $450 million would move the estimated 89,000 patients on public surgery waiting lists into private beds.
“There is the option today of using private hospital beds to treat a large number of those people, you don’t have to wait,” CEO Martin Laverty told ABC Radio.
So Rudd seeks to solve public health sector incompetance with private sector help?