E health

Budget Review 2012–13 Index

Dr Rhonda Jolly

In the 2010–11 Budget the Government committed funding in of $466.7 million over two years to establish key components of a person-controlled electronic health record system (PCEHR).[1] While there was some strident opposition to the idea of a PCEHR, based on concerns about issues such as the security and privacy of records in the system, most health stakeholders initially expressed cautious support for the idea of electronic health records. This was because it was generally agreed that these records could save lives and help limit escalating health expenditure.[2] From the beginning, however, many stakeholders doubted whether the amount of funding allocated by the Government would be sufficient to deliver promised outcomes.[3]

In the months leading up to the 2012–13 Budget more and more stakeholders expressed alarm that funding for the PCEHR was running out and that certainty was needed to ensure that a viable system was delivered, given that the Government continued to promote 1 July as a start date for the PCEHR. In announcing continuing funding for health record initiatives ($233.7 million over three years) the Government argues the Budget will provide the certainty stakeholders have sought, as e health moves from the developmental to operational stage.[4]

Stakeholders have been notable by their absence in commenting on the new PCEHR funding. Long time critic of government e health policy, Dr David More, is one of the few to provide an assessment, labeling the budget measure ‘a cut in resources for the PCEHR.[5] One other assessment also interprets the commitment as ‘underfunding’.[6]

Uncertainty for e health

Stakeholders may have said little because they feel that they have put their case a number of times without success. For example, a number have consistently pointed out e health is more than personal health records.[7] While the PCEHR is a fundamental component of e health, in recent submissions to the Government stakeholders have noted that funding for the PCEHR cannot occur in isolation, funding for other components must be provided in conjunction if an electronically oriented health system is to be viable into the future. Overseas examples indicate that the successful implementation of e health involves an integrated approach; but despite such advice, there appears to be no funding to assist other components of e health in this Budget.[8]

Similarly, analysis of the direction of the Australian e health program in general, and the PCEHR specifically, has noted that there are fundamental problems with the management of the system, which need to be addressed. The Medical Software Association for example stated strongly in a recent submission to a Senate Committee that the National E Health Transition Authority (NEHTA) should be answerable for ‘poor planning, failure to complete to deadlines and a range of other unacceptable behaviour that contravene normal Australian business practices’.[9] Less severe criticism—and an alternative management suggestion—was contained in a Deloitte research document upon which the government has based its e health strategy.[10] Yet, in continuing funding for NEHTA to operate and maintain critical services and standards for the PCEHR, it may appear to stakeholders that the Government is unwilling to accept that there may be room for improvement in developing, managing and delivering the PCEHR . It could be suggested that in the view of certain critics at least, this will be to the detriment of the final system outcome.

Angst for medical practitioners

It has been suggested in relation to the PCEHR that if clinicians’ workloads are significantly increased without accompanying tangible benefits, the system will fail because medical practitioners will not support the system.[11] In 2011, however, the Government argued that it was not its job to fund general practice to keep up with modern technology.[12] This Budget confirms the Government’s stance and places a further requirement on general practices; in order to remain eligible for the Practice Incentives Program (PIP), general practices must participate in the PCEHR system.[13]

The Royal Australian College of General Practitioners (RACGP) argues it is unreasonable that practices lose their PIP payments ‘due to software conformant issues’. The RACGP considers there may be a likelihood of this occurring if the software industry is not able to deploy systems in time for the implementation of the PCEHR—an argument supported by the software vendors in recent submissions to the Senate.[14]

The Australian Medical Association (AMA) has labelled the PIP requirement ‘a threat’ which it sees as coming on top of the Government’s failure to provide compensation to general practitioners for helping patients prepare shared health summaries as part of the PCEHR. The AMA concludes: ‘This double whammy represents a substantial roadblock to the effective implementation of the PCEHR and threatens Australia’s efforts to be a world leader in e-health’.[15]

The RACGP has also expressed disapproval with the budget funding cuts of $183.9 million to telehealth services. These cuts will be achieved by introducing a distance requirement for certain specialist consultations and phasing out incentives payments for general practitioners to participate in telehealth consultations earlier than expected.

While the RACGP agrees it is reasonable for some patients to travel to see a specialist, it is concerned that the change will affect access to specialist services for those most in need of those services, including elderly patients with mobility issues. Furthermore, whilst the College recognises that the incentive payments for general practitioners to participate in telehealth consultations were for a finite period, it sees the funding cuts in the Budget as premature, ‘as uptake has been confounded due to both interoperability difficulties between [general practitioners] and other specialists, and the lack of a provider directory’.[16]

Both associations have signalled their intentions to lobby the government intensely to reconsider the budget changes. 

All quiet on the Opposition front

Given that e health is such an important component of health reform, and that there has been significant stakeholder engagement with, and criticism of government e health policy, it is surprising that there has been little comment from the Opposition on Budget funding in this area. Health spokesperson, Dr Andrew Southcott, noted only that the cuts to telehealth in the Budget, along with other budget cuts, clearly showed that Labor policies and announcements had proven ‘wasteful’.[17]

As the Opposition has yet to articulate a firm policy alternative in response to the Government’s strategies, it appears that it will continue an approach of monitoring government spending, which it articulated in late 2011.[18] Some may argue, a sensible approach, given that there is little actual funding to monitor, and much to learn for future reference from watching the PCEHR process take shape.



[1].       Australian Government, Budget measures: budget paper no.2:2010–11, Commonwealth of Australia, Canberra, 2010.

[2].       Booz and Company, Optimising e-health value: using an investment model to build a program for success, 2010, Sydney, viewed 10 May 2012.

[3].       The consulting firm Booz and Company for example had estimated Australia would need to spend between $4 and $8.5 billion to implement an overall e-health strategy.

[4].       T Plibesek (Minister for Health and Ageing), Budget delivers certainty for eHealth system, media release, 8 May 2012, viewed 10 May 2012.

[5].       D More, ‘There were a few wrinkles in the detail of the Budget that are worth pointing out’, Australian Health Technology blog site, 9 May 2012, viewed 10 May 2012.

[6].       ‘E-health, PCEHR, NEHTA: losers in Australia’s budget’, Aussie views news blog site, 9 May 2012, viewed 10 May 2012.

[7].       This is discussed in R Jolly, The e health revolution—easier said than done, Research paper no. 3, 2011–12, Parliamentary Library, Canberra, November 2011, viewed 10 May 2012.

[8].       See discussion of a number of example in Jolly, op. cit.

[10].     Deloitte, National E-Health and Information Principal Committee, National e-health strategy, September 2008, viewed 10 May 2012.

[11].     Audit slams British EHR program for being largely unsuccessful’, iHeathBeat, cited in Australian College of Health Informatics (ACHI), Response to request for comment on the draft PCEHR Concept of Operations, June 2011, viewed 11 May 2012.

[12].     K Dearne, ‘E health rebates ruled out’, The Australian, 13 September 2011, viewed 11 May 2012.

[13].     Australian Government, Budget measures: budget paper no.2:2010–11 Commonwealth of Australia, Canberra, 2012, viewed 10 May 2012.

[14].     RACGP, RACGP overview of the Federal Budget 2012-13 (Health and Ageing), 8 May 2012, viewed 11 May 2012.

[15].     Australian Medical Association(AMA), Cuts to Practice Incentive Payments (PIP) penalise GPs and pose public health risks, media release, 9 May 2012, viewed 11 May 2012.

[16].     RACGP, op. cit.

[17].     A Southcott (Shadow Parliamentary Secretary for Healthcare), General practice short-changed in Labor’s cooked-books budget’, media release, 9 May 2012, viewed 11 May 2012.

[18].     D Ramli, ‘Medibank points to data privacy woes’, The Australian Financial Review, 19 October 2011, viewed 10 May 2012.

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