Mandatory health insurance urgently needed

November 19, 2015

Associate Professor Francesco Paolucci is calling for an overhaul of the Australian health care systemA new report co-written by a Murdoch University economist calls for one of the greatest health care overhauls since the introduction of Medicare.

Associate Professor Francesco Paolucci, who heads the Health Policy program in the Sir Walter Murdoch School of Public Policy and International Affairs, says a national health insurance scheme could be the right medicine for Australia’s ailing health care industry.

The report calls on the Australian government to adopt a blended insurance model, with a focus on care for chronic illness to stabilise the health care sector.

The report was launched by Victoria University’s Australian Health Policy Collaboration (AHPC), a health policy and research think tank.

Professor Paolucci said Australia’s health policies, funding and service models are failing about one quarter of the population.

“Preventable diseases and chronic conditions like diabetes, heart disease and stroke affect a huge number of Australians, and this number is growing day by day,” he said.

“Without an aggressive focus on reducing preventable illness and improving chronic disease management, governments’ fears of increasing health costs will be realised.”

The report finds that the key issue is not to control or reduce health expenditures but to provide a framework for a sustainable insurance system. It proposes the adoption of a model that focuses on equity, as well as demand and supply.

It also highlights the need to tackle duplication in private health insurance and fragmented care.

AHPC Director Rosemary Calder said: “These are some factors that have caused the current system to become an inefficient maze, where providers and patients face dead ends and diversions when seeking treatment”.

The report suggests ways to fund a new health insurance system taking into account the financial incentives of insurers, providers and covered individuals. They also provide a ten-year implementation strategy and timeline.

Ms Calder said a large part of current health care problems is due to funding and service models focusing on treatment instead of preventative care.

“It seems that for some Australians, access to preventative health care is an optional extra, and being chronically ill is an acceptable state. We need this to change,” Ms Calder said.

The report, The Case for Change Towards Universal and Sustainable National Health Insurance & Financing for Australia, is available online at

View Professor Paolucci's opinion piece: Want real health reform? Integrate public and private health into one mandatory insurance system, on The Conversation website.

About the Australian Health Policy Collaboration

The AHPC is a health policy and research think tank that promotes and supports a national policy agenda for the prevention and management of chronic diseases. It aims to inform an efficient whole-of-population approach to policies, funding, structures and services through evidence-based research.

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