Mark Metherell
February 6, 2012





HEALTH Minister Tanya Plibersek has revealed the disproportionate benefits wealthier people get out of the health insurance rebate in a fresh bid to swing support for means testing of the rebate.

Ms Plibersek has revealed to The Age that while just 12 per cent of couple taxpayers earn above $160,000, they comprise 21 per cent of the couples benefiting from the rebate. That rebate reduces a typical hospital/extras policy premium by about $1000 a year.

High-earning singles are even more likely to get the perk than their lower-paid peers. Ms Plibersek says 14 per cent of single taxpayers earn above $80,000 a year, but make up 28 per cent of singles with health insurance.


''Lower-income Australians, some of whom can't afford private health insurance, still pay for it through their taxes as a subsidy for higher-income earners who choose to take out a policy,'' Ms Plibersek said.

Her remarks come as the government struggles to woo sufficient cross-bench MPs to back legislation that would impose means testing on the rebate for singles earning above $83,000 and families on $166,000. The measure would remove it entirely for singles earning $129,000 and couples earning $258,000.

The move is a vital budget measure, estimated to generate $2.4 billion in savings over three years.

But a confidential report to health industry insiders indicates the government risks unsettling historically high public attachment to health insurance if it introduces the means test.

The Ipsos survey figures seen exclusively by The Age show that the proportion of privately insured people saying they are likely to opt out at present is at 1 per cent, the lowest level the poll has recorded in 20 years.

And there has been a significant rise in health fund members stating that their private hospital cover is one of the last things they could do without. The survey, of 5500 people undertaken last year, found that 48 per cent held that view, up by more than 10 percentage points compared with 2009.

The results from the Ipsos survey also show that the means testing proposed by the government would prompt about 35,000 people to bail out of insurance in the first year, with that likely to compound into losses of hundred of millions of dollars in premiums over five years.

While that figure is significantly lower than the big losses in members forecast by the health insurance industry, Ipsos says that adding additional layers of complexity to health insurance would increase the high levels of confusion that turn off many people who would potentially join.

The survey finds that more than three-quarters, or 78 per cent, of Australians say there is an urgent need to simplify health insurance.

Of those recently inquiring about taking out private health insurance, 66 per cent said complexity and confusion deterred them from proceeding.

Tony Quint, a co-director of the Ipsos project, says a means test will certainly add to the complexity and confusion.

The proportion of the population who believe the $4.5 billion spent on the health insurance rebate is a good use of government funds remains largely unchanged at 64 per cent.

Read more: http://www.theage.com.au/national/new-push-for-means-testing-of-health-rebate-20120205-1qzth.html#ixzz1lXM9rOLV

''Lower-income Australians, some of whom can't afford private health insurance, still pay for it through their taxes as a subsidy for higher-income earners who choose to take out a policy,'' Ms Plibersek said.   :(

Wont happen, the ALP are to weak to put it up.

It will be a watered down nothing if it even makes the floor.

Health is an absolute mess in this country.

Notice the first thing a specialist doctor says to you before he books you in.. "Do you have health insurance?"

Why?  Because he has the choice of taking you as a public patient, where medical might pay him $100/hour, or taking you on as a private patient where he can charge $600/hour.  Obviously he's doing it tough so he pushes his patients to the $600/hour. Doesnt matter if the patient then has a few hundred or few thousand gap to pay. Thats tough. I'm in it for the money, not the good of the patient.

Its a rort, and the soon we get off the private health care teat the better. It will actually lower costs all around. Although there will be more going through the public system, the amount of tax rebates on private will decrease, and the amount of indirect tax (gap) put on people for routine procedures will also be removed.

I re-post the following, because it is relevant here -

perceptions_now wrote on Feb 5^th, 2012 at 9:15pm:

A few observations - 1) Cutting the Health Budget will be very, very difficult. 2) In fact, I would suggest impossible! 3) A large chunk of the Health Costs, go on the elderly and with the largest generation in history, the Baby Boomers, currently starting their "official retirement years", the Health costs can be expected to soar, over the next 20 years or so, as that generation age, then leave us forever! 4) A huge number of Health Professionals, are actually Baby Boomers themselves and something like 40% of Health Professionals are due to retire, in the next 10-15 years or so. 5) Anyone who has been into a large hospital recently will realise that a large number of staff are not Australian, they have been "imported" from other countries, such as Asia, Africa, Europe & elsewhere. 6) As the current Baby Boomer Health Professionals retire over the next 10-20 years, I would suggest that both the & Liberal party's plan is for the majority of replacements to come from overseas, not from Australia. 7) That plan will fail, as many of countries will be bidding for that relatively small number of Global Health Care Professionals and the countries we will be trying to take them from will be in much greater need than us. In short, a few things are likely to happen - 1) Health Costs, as a % of the total Budget, is likely to go up, not down! 2) Health Care, in general, is likely to get worse, not better, as the number of Health Care Professionals, as a % of the total population decreases, not increases. Oh and off topic, which is what she often does, unless Maqqa can be relevant to the topic, instead of just going over the same, boring Political spin, she may as well not bother!