Analysis: The Medicare co-payment is dead, buried and cremated

This was a policy virtually no one wanted and that the Abbott government could never sell to Australian voters, writes Chief Political Correspondent Catherine McGrath.

Health groups say the government remains set on bringing in a Medicare co-payment, despite concerns. (AAP)

This was a policy virtually no one wanted and that the Abbott government could never sell to Australian voters.

In dumping it, the Prime Minister reverted to the words he used about the end of WorkChoices, the much criticised Howard Government era policy.

"The Medicare co-payment is dead, buried and cremated," Mr Abbott told the House of Representatives.

The plan was politically dead from the moment it was announced on Budget night last year.

It was a budget measure that began as a $7 co-payment for bulk billed visits to the GP. It was later reduced to a $5 optional payment but that didn’t make any difference.

The issue of the co-payment is emblematic of everything that was wrong politically about the 2014 budget.

Most Government backbenchers hated it and resented that it was dropped on them with no consultation and they were expected to sell it to voters in their electorate.

Doctors lobbied against. Most importantly the cross bench Senators were never going to pass it.

"I should have known better than to attempt health reform without the strong cooperation and support of the medical profession" Prime Minister Abbott said.

New Minister Sussan Ley took the plan to cabinet. She has been given the job in December of sorting this out.

Minister Ley announced the decision in a press conference.

"It is clear the proposal for a co-payment and associated $5 cut to the rebate do not have broad support and will not proceed." 

Associate Professor Brian Owler was pleased by the outcome. The AMA had lobbied hard against the policy.

"I don't want to see this as a win or loss, this is actually a good thing for General Practice patients.'"

The issue of the co-payment is emblematic of everything that was wrong politically about the 2014 budget.

It was announced without consultation, it was unpopular and there was no way voters were ever going to support it.

It was a catalyst for recent backbench discontent and the leadership struggles that emerged for Prime Minister Tony Abbott last month.

This now dumped co-payment was the basis of the Government’s healthcare policy. Now it is back to the drawing board.