Why Australia should resolve its healthcare financial ‘schism’

Professor Robert Phillips has a striking analogy for the way primary care funding is set up in Australia.
 
The Executive Director of the Center for Professionalism and Value in Health Care in Washington DC, Professor Phillips is attending WONCA this week.
 
With a track record of leading reform in what he calls the ‘foundational level of healthcare’, helping to produce policy-shaping primary research in the US, he notes the ‘peculiarity’ of the Australian system.
 
Of particular note for Professor Phillips is the funding division, with the Federal Government largely supporting primary care while state governments focus more on tertiary care.
 
Speaking to newsGP ahead of the conference, he says it is a structure that could lead to a lack of cohesion and poorer outcomes.
 
‘What if the Federal Government paid for all roads, and states only paid for parking lots,’ he said.  
 
‘You would have a very different road system and fewer roads, and they would not go where you need them to go.
 
‘And you would have a lot more parking lots, most of which were trying to handle the people that really needed to be on roads but couldn’t get to where they needed to go.
 
‘That’s the best analogy I’ve been able to come up with so far about the schism that you have on who finances what.’
 
Back in the US, he has been a firm advocate for primary care funding to reach a 10% threshold of all healthcare funding – and has pushed for state governments to increase their funding to help address the decline in primary care investment.
 
‘The idea of a minimum primary care spend originated with my good friend Chris Koller when he was the first health insurance commissioner for the state of Rhode Island more than a decade ago,’ he said.
 
‘He realised that primary care was shrinking as a proportion of healthcare spending as hospitals and pharmaceuticals ate more and more of the healthcare dollar.
 
‘His goal was to at least double the funding supporting primary care.
 
‘It is a blunt instrument but creates a level playing field for insurers and creates a measurable, accountable funds-flow.’
 
Professor Phillips says nearly two dozen states have followed suit and are at some stage of instituting the policy, as detailed at the Primary Care Collaborative website.
 
Financial involvement in primary care is a crucial component for local success, he believes.
 
‘If [the states] keep looking to the Federal Government to solve that problem, then they lose the context,’ he said.
 
‘All politics is local, and I like to change it to all healthcare is local.
 
‘If the states don’t have a financial stake, it means that they’re not figuring out where the healthcare outcome problems are, and how we enable primary care to be part of the solution.’
 
As for Professor Phillips’s sense of primary care in Australia more broadly, he believes it is still working more effectively than in his home country, despite the funding complexities.
 
‘I think the state of primary care here is better than in the States,’ he said.
 
‘Otherwise, we would enjoy life expectancy more similar to Australia than where we find ourselves now.
 
‘I think primary care in Australia probably gets a higher percentage of total cost of care than in the States.’
 
For Professor Phillips, longitudinal relationships are at the heart of primary care’s impact, allowing disease to be prevented, costs to be avoided, and life expectancy to be boosted. But it also means that it will likely take years before the true outcomes are revealed.
 
‘The Robert Graham Center previously showed that state primary care spend was negatively associated with emergency care visits and hospitalisations, meaning that the higher the primary spend, the lower these outcomes were,’ he said.
 
‘Our Centers for Medicare and Medicaid Innovations just released a payment demonstration model … which acknowledges that changing primary care’s model and impact takes at least a decade.
 
‘[Eventually], it should reduce healthcare costs … [and] also improve productivity across the economy.
 
‘I would add that it’s best delivered by teams, who can really meet most of the patient’s needs.’


Professor Robert Phillips, who is in Australia to speak at the WONCA World Conference. 

Back in the US, Professor Phillips believes the value of primary care is becoming better understood.
 
He also hopes that much-needed reform is now underway, particularly with the release of the report from the Implementing High-Quality Primary Care committee he co-chaired. That research presented evidence that robust primary care is associated with improved health, reduced costs, and longer lives.
 
‘[That] has opened the policy window for us where we can actually make some changes,’ he said.
 
‘Some of that is furthering the state level policies of the percentage of healthcare dollar that goes to primary care.
 
‘Part of that is creating some infrastructure in our federal government to coordinate on primary care and how it can help solve problems like growing health inequities, mental health crises and opioid addiction crises.
 
‘Having someone who wakes up every morning in the Federal Government worried about primary care, and how it can help solve the nation’s most pressing health problems, is I think what we’re on the verge of.’
 
Whether it is in the US, Australia or elsewhere, Professor Phillips is clear on the implications of a reduced focus on the coordination and continuity of primary care.
 
‘When we don’t allow primary care to provide those functions, our costs go up,’ he said.
 
‘Our hospitalisation rates go up, our ED visits go up, and the Norwegians have actually shown our death rates go up.
 
‘If we don’t support those functions, they cost us in the end.’
 
For full details of the WONCA program, and to register, see the conference website.
 
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