Canberra Times
April 3 2018

Political battle over private health insurance rebate heats up


The Labor opposition has said it would only remove the private health insurance rebate - an average 27 per cent discount - from "junk" policies and make no other changes to the rebate.

After being accused by the federal government of "constantly changing their position", Labor's health spokeswoman Catherine King said it was not considering any additional changes to the rebate beyond "what [they've] already announced" - removing it from so-called junk policies.






However, Ms King did not clarify whether "what [they've] already announced" also captured the possible rebate-related recommendations of Labor's promised Productivity Commission review into health insurance if in government.

So-called "junk" policies generally refer to those that cover public hospital treatment only, and Labor's plan to remove the rebate from these policies is supported by consumer groups such as Choice.


    Battle looms over rebates as Labor eyes changes to private health insurance

“Insurers will still be able to offer them, and consumers will be able to buy them, taxpayers just won’t subsidise them," Ms King said.

"This was announced almost two years ago – it isn’t anything new, the minister is just desperate to scaremonger and distract from his own failure to make private health more affordable."   


But Health Minister Greg Hunt continued to mount pressure on the Opposition, saying it could not guarantee that the means-test rebate will continue.




"Will Labor rule out cutting the private health insurance rebate if the Productivity Commission review recommends it?" his spokesman asked.





Choice is calling for an end to tax concessions and rebates on junk policies as they offer little value.

The Consumer Health Forum is not calling for its removal, but believes it should be better targeted to policies that offer "real value".

Ms King said the Coalition was simply "teaming up with their big private health insurance mates" and "defending the profits", but Mr Hunt said Labor's plan would increase the premiums of 6 million pensioners and families who hold low-cost policies.

Mr Hunt's office said if Labor scrapped the rebate from cheap policies, premiums would increase by $1080 for an average family product and $540 for an average singles product.

The rebate provides a discount to Australian families, on average by 27 per cent, and up to 35 per cent for many pensioners.

He said of Australia's 13 million health fund members, about 77 per cent earned less than $90,000 a year and relied on the rebate.

"We understand every single dollar matters, that’s why our policies are focused on lower premiums," he said.

Ms King said the government was trying to distract the public from the government's failure to make health insurance affordable and good value for Australians.   

"In contrast, Labor has a plan to make health insurance more affordable and strengthen private health for the future – by capping premiums at 2 per cent for the first two years' of government," she said.

Health insurance premiums rose an average 3.95 per cent this week.

Leanne Wells from CHF said instead of debating on one thing - the rebate - policymakers should examine the wider system. CHF was among the first to call for a Productivity Commission review.

“Many are being priced out of the market for private health insurance and private health care altogether. The causes are deep-seated, complex and difficult to resolve," she said.

"We need to examine the contribution of the rebate to the future sustainability and stability of our health system."

Australian Medical Association president Michael Gannon said he supported Labor's plans for a Productivity Commission review and it was fair for Labor to wait for the results before making promises.

"It's longstanding Greens policy to abolish the $6 billion which goes into the rebate. It's longstanding Coalition policy to maintain it," he said.   

"I'm perfectly comfortable with Labor, from that point of view, saying let's look at what it comes up with and let's look at the recommendations."

Private health insurance is nothing more than grubberment condoned THEFTH

none of them is worth the promises of a politician

Valkie wrote on Apr 6^th, 2018 at 5:00pm:



You dont have to have it ergo, it cannot be theft. It can be poor value, but not theft.

Will Marie be making a comeback anytime soon longy ?

stunspore wrote on Apr 6^th, 2018 at 9:06am:

The subsidies are making the PHI industry fat and bloated and encouraging inefficiency. They are increasing year on year at an unsustainable rate. About 20% of the subsidies are paid out directly to shareholders as government-funded profits. They are just wealthfare and should be considered for Budget cuts. Deep cuts.

The system is need of rationalisation to make it more efficient. Scrap the subsidies. Scrap the Medicare levy surcharge for high income earners. Remove the Health Minister's veto over premium increases. Put the savings towards the public health system.

Let the market decide.

No battle - you want private healthcare, you pay for it, and use only private hospitals.  Stop clogging up the public system and putting old ladies in pain at the back of the queue so you can have your botox.

No more subsidy - put that public money into public healthcare - and if you want to be 'special' go for it on your own.  After all - you're driving a red car there, bro....