In the decade of the 1970s there were some significant changes to the Australian health system while the health systems of most other countries remained stable. By comparing the Australian health system with that of a number of other countries in the 1970s, the paper examines both the causes and consequences of these changes. The substance of the various Australian health system initiatives was a change from a voluntary to a mandatory health insurance system and then, after a short period of 'catastrophic' health insurance, a return to a voluntary system. Most of these changes appeared to be motivated by political and ideological preferences rather than by a rational assessment of their likely efficiency or effectiveness. In any event, and despite claims to the contrary, these changes were minor when viewed in the broad context of international systems of health care. The conclusions of the analysis, while tentative, suggest that the health system changes had little, if any, direct impact on health costs, service use and indicators of health outcomes.