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Medicare (Australia)
Encyclopedia
Medicare is Australia's publicly funded universal health care
system, operated by the government authority Medicare Australia
. Medicare is intended to provide affordable treatment by doctors and in public hospitals for all resident citizens and permanent residents except for those on Norfolk Island
. Residents with a Medicare card can receive subsidised treatment from medical practitioners who have been issued a Medicare provider number, and fully subsidised ("free") treatment in public hospitals.
Visitors from countries which have reciprocal arrangements with Australia have limited access to Medicare, as detailed below.
The Australian Government has signed Reciprocal Health Care Agreements (RHCA) with the governments of the United Kingdom, Sweden, the Netherlands, Belgium, Finland, Norway, Slovenia, Malta, Italy, Republic of Ireland and New Zealand.
The program was introduced in 1975 as Medibank, and supplemented by a government-owned private health insurance fund in 1976. It was renamed Medicare in 1984.
Since 1999, the public health scheme has been supplemented by a Private Health Insurance Rebate, where the government funds at least 30% of any private health insurance premium covering people eligible for Medicare. Including these rebates, Medicare is the major component of the total Commonwealth health budget, taking up about 43% of the total. The program is estimated to cost $18.3 billion in 2007–08. This figure is projected to rise by almost 4% annually in real terms over the next few years.
's Australian Labor Party
government in 1975. Despite a rise in the number of Australians covered by health insurance plans following the end of the Second World War, a large proportion of the Australian population continued to lack coverage for health risks by the early Seventies. In 1972, it was found that 17% of Australians outside of Queensland
(which had a free public health care system) were uninsured, most of whom were on low incomes. The Labor
government elected that year sought to put an end to this two-tier system and extend healthcare coverage to the entire population.
Medibank commenced on 1 July 1975 after the passing of the Medibank legislation by a joint sitting of Parliament on 7 August 1974. According to the Second Reading Speech of the Health Insurance Bill 1973 delivered by the Hon. Bill Hayden on 29 November 1973, the purpose of Medibank was to provide the 'most equitable and efficient means of providing health insurance coverage for all Australians'. The Health Insurance Bill 1973 and the accompanying bills were rejected by the Senate on three occasions (12 December 1973, 2 April 1974 and 18 July 1974) but were subsequently passed at a joint sitting of both Houses (7 August 1974) following a double dissolution election.
Medibank started on schedule, on 1 July 1975. In nine months, the Health Insurance Commission had increased its staff from 22 to 3500, opened 81 offices, installed 31 minicomputers, 633 terminals and 10 medium-sized computers linked by land-lines to the central computer, and issued registered health insurance cards to 90% of the Australian population.
After the dismissal of the Whitlam Government, the Fraser
Government established the Medibank Review Committee in January 1976. The Committee findings were not made public but the new program was announced in a Ministerial Statement to Parliament on 20 May 1976. 'Medibank Mark II' was launched on 1 October 1976 and included a 2.5 per cent levy on income, with the option of taking out private health insurance instead of paying the levy. Other changes included reducing rebates to doctors and hospitals.
On 1 October 1976, the Fraser
Liberal
Government passed the Medibank Private
bill. This legislation allowed the Health Insurance Commission (HIC) to enter the private health insurance business. This legislation also led to Medibank closing in 1981. The Fraser Government is the only government in the world to have dismantled an existing universal health care system.
Government. The major changes introduced by the Fraser Government were largely rejected by the Hawke Labor Government, which returned to the original Medibank model. Although the financing arrangements were different, and there was a name change from Medibank to Medicare, little else differed from the original. Medicare came into effect on 1 February 1984, following the passage in September 1983 of the Health Legislation Amendment Act 1983, including amendments to the Health Insurance Act 1973, the National Health Act 1953 and the Health Insurance Commission Act 1973.
The program is now nominally funded by an income tax surcharge known as the Medicare levy, which is currently set at 1.5%. An exemption applies to low income earners.
There is an additional levy of 1.0%, known as the Medicare Levy Surcharge, for individuals on high annual incomes (which increased to $70,000 in the 2008 federal budget) who do not have adequate levels of private hospital coverage. This was part of an effort by the former Howard Coalition
Federal Government to encourage people towards private health insurance.
Universal health care
Universal health care is a term referring to organized health care systems built around the principle of universal coverage for all members of society, combining mechanisms for health financing and service provision.-History:...
system, operated by the government authority Medicare Australia
Medicare Australia
Medicare Australia is an agency of the Australian Government that administers health-related programs including Medicare, the Pharmaceutical Benefits Scheme , and others. It is a prescribed agency under the Financial Management and Accountability Act 1997 and a statutory agency within the...
. Medicare is intended to provide affordable treatment by doctors and in public hospitals for all resident citizens and permanent residents except for those on Norfolk Island
Norfolk Island
Norfolk Island is a small island in the Pacific Ocean located between Australia, New Zealand and New Caledonia. The island is part of the Commonwealth of Australia, but it enjoys a large degree of self-governance...
. Residents with a Medicare card can receive subsidised treatment from medical practitioners who have been issued a Medicare provider number, and fully subsidised ("free") treatment in public hospitals.
Visitors from countries which have reciprocal arrangements with Australia have limited access to Medicare, as detailed below.
The Australian Government has signed Reciprocal Health Care Agreements (RHCA) with the governments of the United Kingdom, Sweden, the Netherlands, Belgium, Finland, Norway, Slovenia, Malta, Italy, Republic of Ireland and New Zealand.
The program was introduced in 1975 as Medibank, and supplemented by a government-owned private health insurance fund in 1976. It was renamed Medicare in 1984.
Since 1999, the public health scheme has been supplemented by a Private Health Insurance Rebate, where the government funds at least 30% of any private health insurance premium covering people eligible for Medicare. Including these rebates, Medicare is the major component of the total Commonwealth health budget, taking up about 43% of the total. The program is estimated to cost $18.3 billion in 2007–08. This figure is projected to rise by almost 4% annually in real terms over the next few years.
Medibank
Medibank was the name given to Australia's system of universal health insurance when it was first created by Gough WhitlamGough Whitlam
Edward Gough Whitlam, AC, QC , known as Gough Whitlam , served as the 21st Prime Minister of Australia. Whitlam led the Australian Labor Party to power at the 1972 election and retained government at the 1974 election, before being dismissed by Governor-General Sir John Kerr at the climax of the...
's Australian Labor Party
Australian Labor Party
The Australian Labor Party is an Australian political party. It has been the governing party of the Commonwealth of Australia since the 2007 federal election. Julia Gillard is the party's federal parliamentary leader and Prime Minister of Australia...
government in 1975. Despite a rise in the number of Australians covered by health insurance plans following the end of the Second World War, a large proportion of the Australian population continued to lack coverage for health risks by the early Seventies. In 1972, it was found that 17% of Australians outside of Queensland
Queensland
Queensland is a state of Australia, occupying the north-eastern section of the mainland continent. It is bordered by the Northern Territory, South Australia and New South Wales to the west, south-west and south respectively. To the east, Queensland is bordered by the Coral Sea and Pacific Ocean...
(which had a free public health care system) were uninsured, most of whom were on low incomes. The Labor
Australian Labor Party
The Australian Labor Party is an Australian political party. It has been the governing party of the Commonwealth of Australia since the 2007 federal election. Julia Gillard is the party's federal parliamentary leader and Prime Minister of Australia...
government elected that year sought to put an end to this two-tier system and extend healthcare coverage to the entire population.
Medibank commenced on 1 July 1975 after the passing of the Medibank legislation by a joint sitting of Parliament on 7 August 1974. According to the Second Reading Speech of the Health Insurance Bill 1973 delivered by the Hon. Bill Hayden on 29 November 1973, the purpose of Medibank was to provide the 'most equitable and efficient means of providing health insurance coverage for all Australians'. The Health Insurance Bill 1973 and the accompanying bills were rejected by the Senate on three occasions (12 December 1973, 2 April 1974 and 18 July 1974) but were subsequently passed at a joint sitting of both Houses (7 August 1974) following a double dissolution election.
Medibank started on schedule, on 1 July 1975. In nine months, the Health Insurance Commission had increased its staff from 22 to 3500, opened 81 offices, installed 31 minicomputers, 633 terminals and 10 medium-sized computers linked by land-lines to the central computer, and issued registered health insurance cards to 90% of the Australian population.
After the dismissal of the Whitlam Government, the Fraser
Malcolm Fraser
John Malcolm Fraser AC, CH, GCL, PC is a former Australian Liberal Party politician who was the 22nd Prime Minister of Australia. He came to power in the 1975 election following the dismissal of the Whitlam Labor government, in which he played a key role...
Government established the Medibank Review Committee in January 1976. The Committee findings were not made public but the new program was announced in a Ministerial Statement to Parliament on 20 May 1976. 'Medibank Mark II' was launched on 1 October 1976 and included a 2.5 per cent levy on income, with the option of taking out private health insurance instead of paying the levy. Other changes included reducing rebates to doctors and hospitals.
On 1 October 1976, the Fraser
Malcolm Fraser
John Malcolm Fraser AC, CH, GCL, PC is a former Australian Liberal Party politician who was the 22nd Prime Minister of Australia. He came to power in the 1975 election following the dismissal of the Whitlam Labor government, in which he played a key role...
Liberal
Liberal Party of Australia
The Liberal Party of Australia is an Australian political party.Founded a year after the 1943 federal election to replace the United Australia Party, the centre-right Liberal Party typically competes with the centre-left Australian Labor Party for political office...
Government passed the Medibank Private
Medibank Private
Medibank is an Australian government-owned private health insurer, established under the Fraser government in 1976 through the Health Insurance Commission . It is Australia's largest health insurance provider with 3.6 million members under two brands, and the only health insurer present in every...
bill. This legislation allowed the Health Insurance Commission (HIC) to enter the private health insurance business. This legislation also led to Medibank closing in 1981. The Fraser Government is the only government in the world to have dismantled an existing universal health care system.
Medicare
On 1 February 1984 Medicare was established by the HawkeBob Hawke
Robert James Lee "Bob" Hawke AC GCL was the 23rd Prime Minister of Australia from March 1983 to December 1991 and therefore longest serving Australian Labor Party Prime Minister....
Government. The major changes introduced by the Fraser Government were largely rejected by the Hawke Labor Government, which returned to the original Medibank model. Although the financing arrangements were different, and there was a name change from Medibank to Medicare, little else differed from the original. Medicare came into effect on 1 February 1984, following the passage in September 1983 of the Health Legislation Amendment Act 1983, including amendments to the Health Insurance Act 1973, the National Health Act 1953 and the Health Insurance Commission Act 1973.
Funding and legal framework
Program funding
The original Medibank program proposed a 1.35% levy (with low income exemptions) but these bills were rejected by the Senate, and so Medibank was originally funded from general revenue. In October 1976, the Fraser Government introduced a 2.5% levy.The program is now nominally funded by an income tax surcharge known as the Medicare levy, which is currently set at 1.5%. An exemption applies to low income earners.
There is an additional levy of 1.0%, known as the Medicare Levy Surcharge, for individuals on high annual incomes (which increased to $70,000 in the 2008 federal budget) who do not have adequate levels of private hospital coverage. This was part of an effort by the former Howard Coalition
Liberal Party of Australia
The Liberal Party of Australia is an Australian political party.Founded a year after the 1943 federal election to replace the United Australia Party, the centre-right Liberal Party typically competes with the centre-left Australian Labor Party for political office...
Federal Government to encourage people towards private health insurance.