The leaked proposal??brings into play the prospect of the states having to raise the GST or find another funding source??by accepting that the “ongoing financial durability??of this option is likely to be challenged” unless the states could find the money by cutting back on hospital??admissions and??addressing shortfalls in primary care.
“Durability will also be challenged if the states and territories do not have access to adequate revenue,” the proposal says.
The option is one of five presented by PM&C in a green paper on reforming the Federation by seeking more efficient ways to run the public hospital and public school systs.
The leaked green paper on health says the five options stmed from consultations with stakeholders and the states and territories.
The states provided about 54 per cent of public-hospital funding totaling $34.7 billion in 2012-13, while the federal government contributed 37 per cent, which will soon level off at about $18 billion a year, while the rainder comes from individuals, health insurers, workers compensation and motor-vehicle insurers.
Option one, which mirrors the recommendations in the government’s commission of audit, would give the states and territories full operational responsibility for public hospitals.
Leaking of the option follows the disclosure of the options to change the funding of schools, including means-testing public schools so wealthier parents had to pay more.
The opposition has accused the government of contplating a ‘school tax”, prompting the prime minister, Mr Tony Abbott, to rule it out “not today, not tomorrow, not ever”.
