Background Note Index

Background Note

Dental benefits for chronic conditions—an update

Online only 30 October 2008

Contents

Introduction

In March 2008, the Rudd government announced it would introduce a new Commonwealth Dental Health Program (CDHP), to be established in agreement with the states and territories.[1] But funding for the new program is dependent on the cancellation of an existing program that provides dental benefits under Medicare for patients with chronic conditions. This program was established by the former Howard government in late 2007 and demand has skyrocketed since its introduction. Attempts to cancel this program have met with opposition in the Senate; meanwhile expenditure on the program is accelerating and the planned commencement of the CDHP on 1 July 2008 has been delayed. This Background Note provides a brief update on the existing program, its uptake, expenditure and prospects for the introduction of the new CDHP.

Chronic illness dental health benefits

In July 2004, the Howard government introduced a limited range of dental benefits for the chronically ill whose dental problems were exacerbating their chronic condition and who were being managed by a GP under an Enhanced Primary Care (EPC) plan. This was part of a range of Medicare benefits relating to allied health care that the government introduced, known more broadly as the Allied Health and Dental Care Initiative (AHDCI). It was the first time that community-based dentistry services had attracted Medicare benefits.[2]

The government subsequently expanded the dental benefits available under this measure. In the 2007–08 Budget the types of dental services that could be claimed were expanded and eligibility for the program was extended to residents of aged-care facilities.[3] The cap on dental benefits was lifted to $2000 per calendar year.[4] In August 2007, further changes were announced; benefits for dentures were introduced and the cap lifted again to $4250 over two years. The expanded program came into effect from November 2007, following passage of legislation (which was required due to the benefits accruing towards the Medicare Safety Net being capped).[5] The government forecast this measure would cost $384.6 million over four years.[6]

In the lead-up to the 2007 federal election Labor announced the EPC dental program would be scrapped, citing poor performance and uptake. Funding from the cancelled program would be redirected to establish a Commonwealth Dental Health Program (CDHP) and a Teen Dental Plan.[7] The Teen Dental Plan has been implemented, but the CDHP is yet to be introduced.[8]

Attempts to cancel EPC Medicare dental benefits

In May 2008, the government attempted to give effect to its plan to cancel the dental benefits available under the EPC/AHDCI program through the Health Insurance (Dental Services) Amendment and Repeal Determination 2008.[9]

The Ministerial Determination proposed preventing new patients from accessing the scheme from 31 March 2008, but would allow existing patients to continue to access the scheme until 30 June 2008. The Department of Health and Ageing had advised GPs and dentists by letter not to refer or take on new patients from 31 March 2008.[10] Because the Ministerial Determination cancelling the benefits is a disallowable legislative instrument, the Coalition moved a motion of disallowance in the Senate on 18 June 2008.[11] This motion was subsequently passed the next day, effectively repealing the Ministerial Determination.

Subsequently, on 15 September 2008, the government gave notice of a motion to rescind the successful motion of disallowance.[12] On 16 September 2008, the Senate blocked this motion by not agreeing to rescind its resolution of 19 June 2008 disallowing the determination.[13] The Greens and Senator Fielding argued that the government could fund both Medicare benefits for chronic conditions and the proposed CDHP program. The Opposition argued it was a successful program filling a real need in dental care.[14] The government countered that in order to maintain the budget surplus it could not fund both programs; funds for the promised CDHP program are dependent on the cancellation of the EPC program.[15]

With this failure to rescind, dental benefits for patients with chronic conditions remain available.

Uptake of the EPC Medicare dental program

Uptake of the dental services that were originally available under this program fell well short of expectations.[16] In its first three years of operation between July 2004 and June 2007, just 16 000 services were provided to patients and $1.8 million in benefits were paid.[17] However, from the time the expanded dental program commenced in November 2007 uptake of dental services increased significantly, although this varied across jurisdictions.

See the table below:

Source: Medicare Australia, Medicare Statistics database[18]

The number of dental services provided under the EPC program up to August 2008 has totalled 818 749, with total benefits paid reaching $133.8 million for the period.[19] This expenditure represents nearly one-third of the original allocation for the entire four-year program, raising concerns of a major cost blow-out. The National Rural Health Alliance (NRHA) has warned that if national demand for the program reaches the levels seen so far in NSW, the total cost of the program could be $900 million per annum.[20]  

The vast majority of services have been accessed in New South Wales (603 685), followed by Victoria (148 656), Queensland (36 754) and South Australia (21 375). In NSW per capita benefits totalled $14, three times higher than per capita benefits for Victoria and nearly 40 times higher than Western Australia.[21]  

It has been suggested that these differences may reflect variations in how the program has been promoted across jurisdictions, or the availability of state-funded public dental services.[22] Some have accused the government of intentionally choosing not to promote the program, resulting in jurisdictions that undertake their own promotion experiencing higher uptake rates.[23]

Support for the program in the dental profession is mixed. Professor Hans Zoellner from the Association for the Promotion of Oral Health supports the program but wants to see it better promoted.  Others, such as the President of the Australian Dental Association in WA, argue the program is a poor use of taxpayer funds and fails to target the needy.[24] Some groups are concerned about inequities in service provision between urban and regional areas, or the lack of access to allied dental health services.[25]

Following the Senate’s successful blocking of the government attempt to cancel benefits in July 2008, the rate of uptake of dental services has further accelerated.

Although there is a cap on benefits ($4250 over two years), the number of services being accessed suggests this financial cap is no barrier for many patients.

Prospects for the Commonwealth Dental Health Program

As noted previously, the government intended that the funds from the cancelled EPC program be redirected to establish two new dental programs: a means-tested check-up for teenagers under the Teen Dental Plan—which subsequently commenced in July 2008—and a new Commonwealth Dental Health Program. The CDHP will provide specific funding to the states and territories to assist them to provide an additional one million public dental services.

The range of groups to be targeted under the proposed CDHP includes financially disadvantaged groups, indigenous Australians, pre-school children and those with chronic illnesses, although concerns have been expressed about the capacity of state dental services to deliver the program effectively.[26]

The total cost of these two new programs was estimated at $780 million, with the CDHP expected to cost $290 million over three years.[27] However, the Coalition argued that the government has reduced its funding for dental health from its original commitment of $800 million.[28]

The state and territory breakdown of funding and services under the proposed CDHP is shown in the table below, with NSW set to receive the most funding:

Source: Department of Health and Ageing[29]

A number of states have already established protocols and procedures in anticipation of the introduction of the new program.[30] There have also been concerns that the Senate blocking of the cancellation of the EPC program and the delays to the introduction of the CDHP may strain state-funded public dental services and increase waiting list times further.[31]

Various options to improve equity in the existing EPC program have been proposed. The Australian Dental Association supports directing funding to the most financially disadvantaged.[32] Other suggestions include means-testing benefits, placing limits on dental services (for example excluding crowns and bridges), introducing schedule fees, improving eligibility criteria and improving monitoring.[33] It has also been suggested that widening the scope of practice to include dental hygienists and therapists would allow for services to be delivered across a wider range of locations, such as residential aged care facilities or community health centres.[34]

Concluding comments

While there remains opposition to cancelling the EPC program outright, the government may have to consider measures to quickly rein in expenditure and to better target the program to those who are most in need, particularly the financially disadvantaged. Even so, it risks being unable to deliver a key election commitment without impacting on the budget surplus, as expenditure under the EPC program accelerates to nearly half the funds promised for the new CDHP program.

[1].    N. Roxon, ‘First steps in implementing new Commonwealth Dental Health Program’, media release, 2 March 2008, http://www.health.gov.au/internet/ministers/publishing.nsf/Content/mr-yr08-nr-nr027.htm?OpenDocument&yr=2008&mth=3, accessed 27 October 2008; see also: Department of Health and Ageing, ‘Commonwealth Dental Health Program’, http://www.health.gov.au/internet/main/publishing.nsf/Content/dental-commonwealth, accessed 27 October 2008.

[2].    For some time Medicare benefits have been available for a range of surgical and clinical services associated with cleft lip or cleft palate, as well as for surgical treatment of diseases of the oral cavity. For an overview of Commonwealth involvement in dental care see: Amanda Biggs, ‘Overview of Commonwealth  involvement in funding dental care’, Research Paper, no. 1, 2008–09, Parliamentary Library, Canberra, 13 August 2008, http://www.aph.gov.au/Library/pubs/rp/2008-09/09rp01.pdf, accessed 27 October 2008.

[3].    New services included diagnostic items. See: T. Abbott, ‘Improving Medicare and hearing services’ media release, 8 May 2007, http://parlinfo.aph.gov.au/parlInfo/download/media/pressrel/S25N6/upload_binary/s25n63.pdf, accessed 27 October 2008.

[4].    ibid.

[5].    For more detail on this program see: Department of Health and Ageing, ‘Dental services under Medicare’, http://www.aodgp.gov.au/internet/main/publishing.nsf/
Content/Dental+Care+Services, accessed 23 October 2008.

[6].    For a fuller analysis of this legislation see: Amanda Biggs, ‘Health Insurance Amendment (Medicare Dental  Services) Bill 2007’, Bills Digest, no. 35, 2007–08, Parliamentary Library, Canberra, 31 August 2007, http://www.aph.gov.au/library/pubs/bd/2007-08/08bd035.pdf, accessed 27 October 2008.

[7].    K. Rudd & N. Roxon, ‘Federal Labor clear dental backlog by establishing a Commonwealth Dental Health Program’, joint media release, 18 September 2007, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=
Id%3A%22media%2Fpressrel%2FCCBO6%22, accessed 27 October 2008.

[8].    See: Department of Health and Ageing, ‘Medicare Teen Dental Plan’, http://www.health.gov.au/internet/main/publishing.nsf/Content/dental-teen, accessed 27 October 2008.

[9].    ComLaw, ‘Health Insurance (Dental Services) Amendment and Repeal Determination 2008’, http://www.comlaw.gov.au/ComLaw/Legislation/LegislativeInstrument1.nsf/
0/CEE938FAD4277C7CCA257418007A0C29?OpenDocument, accessed 27 October 2008; The Health Insurance Act 1973 permits the disallowance of specific Medicare services through Ministerial Determination. See Section 3C(1) of the Act.

[10]. S. Blackmore, ‘No more dental items for GP referral’, Medical Observer Weekly, 14 March 2008, p. 13, http://parlinfo.aph.gov.au/parlInfo/download/library/jrnart/
Y8WP6/upload_binary/y8wp65.pdf, accessed 27 October 2008.

[11]. Senate, ‘Disallowance alert 2008’, http://www.aph.gov.au/senate/committee/regord_ctte/alert2008.htm, accessed 27 October 2008.

[12]. ‘Senator Ludwig to move on the next day of sitting: That, for the purposes of paragraph 48(1)(a) of the Legislative Instruments Act 2003, the Senate rescinds its resolution of 19 June 2008 disallowing the Health Insurance (Dental Services) Amendment and Repeal Determination 2008, made under subsection 3C(1) of the Health Insurance Act 1973’, Senate, Debates, 15 September 2008, p. 35.

[13]. See: ‘Health Insurance (Dental Services) Amendment and Repeal Determination 2008: Motion for Disallowance: Rescission’, Senate, Debates, 16 September 2008, p. 4862.

[14]. ibid.

[15]. N. Roxon (Minister for Health and Ageing), ‘Questions without notice: Dental Health’, House of Representatives, Debates, 16 September 2008, p. 5.

[16]. The government had expected around 23 000 patients to benefit. Many patients faced high out of pocket costs. See: Amanda Biggs, ‘Health Insurance Amendment (Medicare Dental Services) Bill 2007’, Bills Digest, no. 35, 2007-08, Parliamentary Library, Canberra, p. 4, http://www.aph.gov.au/library/pubs/bd/2007-08/08bd035.pdf, accessed 27 October 2008.

[17]. ibid., p. 3.

[18]. Medicare Australia, ‘Medicare Statistics, Group N1 Dentist Services, Group N2 Dental Specialist services, Group N3 Dental prosthetics services’, https://www.medicareaustralia.gov.au/statistics/dyn_mbs/forms/mbsgtab4.shtml, accessed on 17 October 2008.

[19]. ibid.

[20]. National Rural Health Alliance, ‘Dental health programs: equity hinges on introduction of CDHP’, media release, 14 October 2008, http://nrha.ruralhealth.org.au/cms/uploads/mediareleases/media%20
release%2014%20october%202008.pdf, accessed 27 October 2008.

[21]. Medicare Australia, op. cit. Per capita is calculated by dividing the ‘per 100 000 rate’ used in the Medicare statistics by 100 000. Victoria attracted $4.59 in benefits per capita; WA attracted $0.36 per capita.

[22]. A. Tillett, ‘Dentists split on Rudd’s treatment shake-up call’, West Australian, 17 October 2008, p. 44.

[23]. L. Shanahan, ‘Seriously ill Victorians miss out on dental care’, The Age, 21 October 2008, p. 6.

[24]. ibid.

[25]. See: National Rural Health Alliance, op cit. See also: Council of the Ageing (COTA) Over 50s, ‘Dental health reform needs bite not bickering’, media release, 17 September 2008, http://www.cotaover50s.org.au/e107_files/COTA_documents/news/dental.pdf, accessed 27 October 2008.

[26]. See for example: Australian Dental Association, ‘Government fails to deliver on dental health’, media release, 13 May 2008, http://www.ada.org.au/newsroom/article,documentid,128161.aspx, accessed 27 October 2008.

[27]. N. Roxon (Minister for Health and Ageing), ‘Second Reading Speech: Dental Benefits Bill 2008’, Debates, House of Representatives, 29 May 2008, p. 61.

[28]. Senator Colbeck raised this in Senate Estimates hearings in February 2008. See: ‘Standing Committee on Community Affairs: Therapeutic Goods Administration: Discussion’, Senate, Debates, 20 February 2008, p. 57.

[29]. N. Roxon (Minister for Health and Ageing), ‘One million more dental services under threat’, media release, 28 August 2008, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=
Id%3A%22media%2Fpressrel%2FNNVR6%22, accessed 27 October 2008. Figures are rounded to the nearest decimal point. The total is slightly less than the $290 million allocation due to $5 million being allocated for ‘contingency funding’.

[30]. See for example: New South Wales Health Department, ‘Priority oral health program and list management protocols’, Policy Directive, 26 September 2008, http://www.health.nsw.gov.au/policies/pd/2008/pdf/PD2008_056.pdf, accessed 27 October 2008.

[31]. Australian Healthcare & Hospitals Association, ‘Break the dental impasse–AHHA’, media release, 23 October 2008, http://www.aushealthcare.com.au/news/news_details.asp?nid=12449&ao=s, accessed 27 October 2008.

[32]. Australian Dental Association, ‘Update: Medicare chronic disease dental scheme—Senate action?’, media release, 27 August 2008, http://www.ada.org.au/App_CmsLib/Media/Lib/0808/M138008_v1_
633554485441732227.pdf, accessed 27 October 2008.

[33]. National Rural Health Alliance, op. cit.; Australian Healthcare & Hospitals Association, op. cit.

[34]. COTA Over 50s, op. cit.

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