Future income security policy and health care policy should be integrated rather than treated separately, as political editor Christian Kerr explains.

Come back, Peter Shack, all is forgotten! Remember poor old Shacky? He was the Young Turk from WA who was shadow health minister in 1990 when it was decided that the Liberal Party’s health policy was not to have a health policy. But better no detail than some of the commitments that Labor has made with its Medicare Gold promise.

Medicare Gold is the equivalent of 1987’s “No child will live in poverty”. No wrinkly will be without a hospital bed. Let’s forget the costings for the moment. The Government seems to have with most of its promises. Let’s just look at the equity issues involved.

Medicare Gold guarantees free, immediate health care for the over 75s. Stuff you if you’re younger or sicker. This isn’t age before beauty. It’s age before need. If you’re under 75 you’ll be dumped down the waiting list. Yes. Even if you live in a marginal seat.

If you’re one of the 35 per cent or so of elderly Australians who have shelled out for private health insurance so you had quick access to medical treatment when you need it – and not all of these are silvertails, by any means – stuff you, too.

Then there’s the access to doctors and medical staff issue. Both of these are in short supply. Will they be able to meet the new demand – and even if they can, what will that mean for younger patients. Or younger would be patients. Even longer delays as the wrinklies soak up the services they need?

John Howard has been pork-barrelling the oldies shamelessly since his panic attack early in 2001 – open ended, non means-tested goodies for an expanding demographic. He’s been blowing the surplus ever since. He has no right to complain about the cost of Medicare Gold. But (still just) thirtysomethings like me can. People my age – Mark Latham’s and Julia Gillard’s age, come to think of it – have every right to demand some independent bean counting. Our generation should know just how much we will be up for.

Around 10 per cent of the population are over 70. Medicare Gold is a pitch to voters nearing retirement age, in addition to this 10 per cent – along with those lovely empathetic yet impractical people who work in universities and press galleries.

They’ve already had a free education and free health care. Do the boomers expected that their retirement will be another free ride? Dream on. The boomers may find that we’re too busy – let alone the people in their mid twenties and early thirties – paying off our HECS debts, trying to get into the housing market and seeing if we can afford to have their grandchildren to pick up the bill for a disintegrating welfare state.

Want something that will really challenge you on the issue of health care and an aging population? Here’s an interesting paper Crikey readers might like to have a look at http://www.sprc.unsw.edu.au/seminars/Tim%20Smeeding%20paper.pdf. It’s called “The Future Costs of Health Care in Aging Societies: Is the Glass Half Full or Half Empty?”, published in 2002 by Deborah Freund from the Center for Policy Research and Provost, Syracuse University and Timothy M. Smeeding, Visiting Professor, Social Policy Research Centre, UNSW, Center for Policy Research, and Luxembourg Income Study The Maxwell School, Syracuse University.

Here’s how it ends:

“Most analyses of the future health care costs of an aging society are entitled something like ‘The Fiscal Challenge of an Aging Industrial World’ (England 2001). They point to the steep overall costs of aging for social retirement, acute and chronic health care costs. They speak of rationing, large intergenerational fiscal inequities, and the like. They conclude something like the following:

“ ‘In sum, it is important to recognize the expanding financial risks for governments that medical technology poses for aging populations. Demographic miscalculations have already taken a significant toll on welfare state finances. Continued increases in longevity, combined with intractably low birthrates, raise the danger that government old age benefit systems could collapse unless appropriate reforms are adopted in the near-term.’ (England 2001: 3).

“The major problem we find with these discussions is that they do not consider the benefits as well as the costs of health care improvements. And were they to examine the benefits more specifically, researchers and nations may rethink the way that health care treatments for the elderly are financed and provided. Clearly, rising incomes among the old, and the perceived (and oftimes now substantiated) benefits of improved medical treatments and technologies, will improve both elder willingness and ability to pay for these treatments. More studies of the type undertaken by Lichtenberg (2001a, 2001b, 2002), Cutler and McClellan (2002) in the United States can help identify future net benefits and costs, not only for prescription drugs, but also for hip replacement, cardiac treatment, oncology, and other types of treatments.

“As long as public health organizations can certify the likely benefits of these treatments, they should be made available to elder consumers. And as long as national health care agencies continue to push for cost-effective use of new technologies and drugs, the major issue in future health care costs among the aged will be ‘who should pay?’ not ‘should these be available?’ We believe that future income security policy and health care policy should be integrated rather than treated separately. These policies should set limits on what is expected from public vs. private expense, due to competing budgetary needs and due to the rising ability of the elderly to pay for their own care. Society should protect the at-risk elders from both low incomes and high medical expense for equity sake, but then let non-poor elders spend their own money on additional treatments, drugs, and other medical services which directly improve their quality and quantity of life. After all, what better expenditure can these increasingly rich generations make?”

Punters, of course, particularly older and more feeble minded punters – let alone selfish boomers – might find all that a bit hard to digest in a campaign.

Still, think it through. What’s better? The “we have no health policy” Peter Shack offering or the Latham/Gillard “stuff the cost, stuff the detail” option?

Julia Gillard, of course, is thought by many to be the next leader of the Labor Party. Some people thought last year that the bruvvers would recycle Beazley, let him lose this election, then dump Gillard in. Others have speculated over the past 10 months that if Latham imploded or loses, Gillard will take over.

However, if Labor goes down because Medicare Gold collapses, both Gillard and Latham will be trapped in the rubble – and who will be leader then? And will those Queenslanders up the back there stop smirking. Yes. We’re talking about you, Mr Rudd, Mr Swan.

And while Peter Shack went on to make a motza selling Amway after he retired in 1993 – a very suitable career for a former politician who tried what he tried in 1990 – we doubt if Julia Gillard could even make a convincing product demonstrator for K-Mart. Until she gets a better hair colour, anyway.