Here's a recipe for a more equitable health care system in Australia

Many of the inequities in Aboriginal health have been investigated and brought to the attention of politicians and public in various reports. The problem is that so little action is taken to address these inequities. It is, for example, 24 years since the now Minister for Immigration and Multicultural and Indigenous Affairs, Philip Ruddock, argued:

When innumerable reports on the poor state of Aboriginal health are released there are expressions of shock or surprise and outraged cries for immediate action. However ... the appalling state of Aboriginal health is soon forgotten until another report is released.

As a report into Indigenous health in 20002 noted:

The continuing poor state of Indigenous health in Australia over the last twenty years ... has generated a continuous (sic) flow of further reports about the problem.

There have been at least 20 reports into Indigenous health since 1979.

Private funding

Australia has a large share of private spending on health care compared to most OECD countries. All private health care is inequitable.

The ability of the rich to pay is greater. Recent attempts by the Federal government to cajole more people into private health insurance increased inequities across income groups in Australia.

Private health insurance has been taxpayer subsidised to the extent of an additional $2 billion a year.

What is now in danger of happening is that as the private sector grows, Medicare will become a safety net for the poor and, in reality and in perception, cease to be a universal system.

This is what Margolis's fair-shares model seems to predict. The "participation utility" that individuals get through paying taxes for health care for all - a form of "social solidarity" - will, if more and more opt out to the private sector, not be stable. A key aspect of this model is that the individual is a member of the group, and thus concern for the group is not strictly altruism, not "the rich paying for the poor"'. When feelings of social solidarity are breached, however - "we are paying for them" - the decline in participation utility is likely to be rapid. It may well be that we are approaching that point in Australia.

Public funding seems likely to lead to greater equity. We can learn about funding for equity from Scandinavia, where public funding dominates and the tax-based system is much more progressive in allowing redistribution of the burden of health-care costs from the well to the sick and from the rich to the poor. Where ability to pay is a significant factor in access to health care, then the existence of a private sector creates barriers for the poor.