(Image: Tom Red/Private Media)

Contrary to what we often hear, access to public healthcare in Australia isn’t free. It costs the taxpayer almost $100 billion each year. That’s about $4000 per resident or 6.5% of GDP. Our total spend on healthcare — both public and private — is 9.4% of GDP. 

That money comes at the expense of other potential areas of public spending. Every dollar spent on healthcare is a dollar that cannot be spent on education, infrastructure or defence, or simply left in taxpayers’ pockets.

Local outbreaks of SARS-CoV-2 have put pressure on public hospitals. Treating COVID-19 patients uses resources that can be spent on other health problems or in other public policy domains altogether. The financial cost of ventilating a patient in a public hospital for four days approaches $100,000. If ICUs are at capacity, the additional cost is someone else missing out on care.

Given that, one, we now have strong evidence that vaccination significantly lowers the risk of not only transmitting the virus but of hospitalisation and death, and two, vaccines are now readily available in Australia, debating how to deal with vaccine refusers seems quite legitimate.

Denying treatment to those who are eligible but refuse, as touted by the Victorian AMA, is quite distasteful. A public system must treat all comers based on need and capacity to benefit. End of story.

The principal lever to address vaccine hesitancy and minimise refusal must be public education. Mandates play a role. But there may be a palatable way to incentivise vaccination and recoup some of the costs of additional treatment. 

All taxpayers are charged an annual Medicare levy of 2%. Medicare is the federal scheme that funds general practice and specialist care, with individual patients paying the “gap” between the Medicare fee and what their practitioner charges. 

In addition, individuals that do not have private hospital cover face a Medicare Levy surcharge (MLS) of 1%, 1.25% or 1.5% depending on their taxable income. In the absence of an equivalent levy for public hospitals, a similar scheme could be introduced for those who refuse vaccination without a valid exemption. The MLS kicks in at a taxable income of $90,000 per annum (the highest rate of 1.5% is applied at $140,000 and above).

Such a scheme would ensure continued access to care while applying a small financial incentive to get the jab and recouping some of the financial burden created by refusing to participate in a mainstream, evidence-based public health intervention.

It would be relatively easy to coordinate, given that vaccination status is easily recorded and difficult to falsify — the logistics would be far easier than (accurate) verification of vaccination status at venues or shops. Its binary nature sets it apart from behavioural risk factors that increase healthcare use like smoking or poor diet, which are not only difficult to quantify objectively but also linked to socio-economic status and potentially difficult for individuals to change. 

It would not be regressive. If there is a social gradient for vaccine hesitancy, like there is for obesity and smoking, it is taken care of by a progressive design. Just like the MLS, a marginal rate could be applied, and low-income earners could be exempted. Wealthy refusers would thus be charged disproportionately more than the poor. A potentially elegant solution.

There’s the coercion argument. Yes, it is a financial incentive to get the vaccine. But then we tolerate the MLS — a financial inducement to buy private health cover, a policy explicitly designed to “encourage people to take out private patient hospital cover … [and] reduce demand on the public system”.

There’s a range of other similar policies: punitive tobacco taxes, traffic infringement penalties, compulsory schooling or indeed the ‘no jab no play’ mandates for childcare. A junk food tax — proposed by many public health experts — would, in fact, be more regressive than a vaccine levy.

Should we bother given Australia is on track to be one of the most vaccinated populations on earth anyway? The answer is probably yes, both epidemiologically and politically.

COVID-19 is becoming an epidemic of the unvaccinated and it is far from over. Getting as close as possible to 100% will help Australians maintain personal freedoms especially once winter comes around. It will also suppress the chance of vaccine resistant variants, although this obviously needs to be a global effort. This is a stated reasons why, despite having reached 85%, Singapore will soon be charging COVID-19 patients who have refused to be vaccinated without a valid exemption for their medical costs.

Politically it’s a signal that there exist a small number of democratic obligations that, if adhered to by everyone, generate the many freedoms we enjoy. Vaccination is a modern embodiment of these.

All policy interventions entail some risk of unintended consequences. A surcharge may give vaccine refusers self-ordained licence to refuse other limitations. “I’ve paid my way so it’s unreasonable to deny me entry into this [insert place where vulnerable people could be at risk]” would be a regrettable outcome.

Nevertheless, we should consider policies that discourage people from placing the health of fellow citizens in in danger without a reason that aligns with secular, democratic values.

Note: this piece has been amended since publication.