'Announcements coming out of the blue': Hospital bidding war sparks warnings
Voters are being promised a spending surge on hospitals over the next five weeks in an election bidding war that has sparked fears of political deals to favour marginal electorates while neglecting those in safe seats.
Labor and the Coalition are escalating their contest to commit taxpayer cash to health services in key seats with a combined $4 billion in promises, but they are being warned against making "invented" announcements to win votes.
Opposition Leader Bill Shorten's promised a $50 million upgrade to Concord Hospital.Credit:Alex Ellinghausen
An analysis of the two major parties' funding promises shows that they each have hundreds of millions of dollars still to be allocated from competing funds to pay for hospital upgrades, cancer treatment, health clinics and other services.
It comes as Opposition Leader Bill Shorten on Monday unveils a $250 million pledge to fix elective surgery waiting lists to give Australians faster access to procedures such as cataract surgery, knee and hip operations.
Labor has committed $764 million over the next four years for a "better hospital fund", which it used to promise a $50 million upgrade of Concord hospital in the marginal Sydney seat of Reid on Sunday. The fund swells to $2.8 billion over six years.
The Coalition has set aside $1.25 billion over the next four years for a similar program, including $880 million in yet-to-be-announced funding at the latest count.
While health experts have welcomed the combined promises of $4 billion from the two parties, they are warning against a spate of ad-hoc decisions in marginal seats and calling instead for a more strategic consideration.
Grattan Institute health economist Stephen Duckett urged the major parties to resist targeting marginal seats with politically-motivated announcements and instead pursue a long-term strategy in cooperation with the states.
"In my view, we ought to have a system of rational priority setting," Dr Duckett said.
"What we know about most projects in other areas like infrastructure and roads is that by and large things announced during election campaigns go over budget.
"So I think we've got to be really careful about major capital projects which are not already part of a state strategic plan."
Dr Duckett said Labor's promised National Health Reform Commission could help clarify "what the priorities should be into the future," rather than "announcements coming out of the blue".
"It's better for those announcements to be part of state strategic plans than invented," he said.
National Rural Health Alliance chief executive Mark Diamond said country Australians needed more local services and preventative measures to prevent hospital admissions.
"It's less about hospitals and more about getting Allied Health into rural areas," Mr Diamond said.
"Health care is more than hospitals, and unless you're getting primary health services on the ground you'll just default to hospitals."
The two parties' approaches allocate different amounts over different periods but give both parties the scope to promise cash to individual projects over and above the hospital funding agreement negotiated between Canberra and the states.
The government argues its agreement with the states and territories will double the federal funding for public hospitals over the years ahead, lifting the amount from $13.3 billion in the last year of the Gillard government to $28.7 billion in 2025.
The special funds from the two major parties are in addition to these agreements with the states.
The government program, called the Community Health and Hospitals Program, starts with $250 million this financial year, followed by $250 million next year, then $350 million and $400 million.
The Labor policy, called the Better Hospitals Fund, offers $764 million over the next four years but then surges to $1 billion in each of the two subsequent years. The fund is worth $2.8 billion from 2019 to 2025.
While Mr Shorten described $2.8 billion as the amount needed to restore the federal govenment's contribution to hospital funding to the 50-50 split with the states that existed under the Gillard government, it is not clear when a new agreement would start.
On Sunday, Labor's finance spokesman Jim Chalmers would only say that $2.8 billion "represents the restoration of the 50-50".
Asked to clarify this comment, a Labor spokeswoman said: "We will sit down with the states and negotiate a return to 50-50".
The current hospital agreement is due to expire in mid-2020, and the Morrison government has been unable to secure the support of all states for a new deal that would continue the current 45-55 split, with Labor state governments in Victoria and Queensland holding out.
The Australian Medical Association is lobbying for a move away from activity-based funding, which it argues "forces public hospitals into a spiral of cost minimisation and patient churn to survive".
AMA President Tony Bartone said the government should invest to "improve quality and safety of patient care" - including after being discharged from hospital - and called for "an explicit ongoing Commonwealth contribution above and beyond the activity-based formula".
"We're keen to see that it doesnt just fund activity, but quality and capacity," he said.
"Public hospitals have been chronically underfunded for too long."
Health Minister Greg Hunt said Mr Shorten had been "caught lying on hospital funding".
"Despite the desperate attempts from Bill Shorten to run another Medi-hospital scare campaign, the facts on hospital funding are clear and show record funding each year, every year under the Coalition," he said in a statement.
"The new national hospitals agreement will provide an additional $31 billion in public hospital funding from 2020-21 to 2024-25, taking overall funding during this period to $131 billion.
"Bill Shorten’s hospital proposal does not mean more money for hospitals."
Dana is health and industrial relations reporter for The Sydney Morning Herald and The Age.
David Crowe is Chief Political Correspondent of the Sydney Morning Herald and The Age.