FRIDAY, 13 OCTOBER 2017
SUBJECT/S: Turnbull’s private health insurance fail.
CATHERINE KING, SHADOW MINISTER FOR HEALTH AND MEDICARE: This package is too little too late. We’ve already seen the damage that the Turnbull and Abbott Governments have done to private health insurance premiums, increasing under their watch by 23 per cent. You’ve seen average families now paying over $900 extra for their private health insurance because of the decisions taken by the Abbott-Turnbull Government. We’ve of course, seen this all before. We saw Tony Abbott go to the 2013 election promising lower private health insurance premiums. We saw Malcolm Turnbull say the same thing in 2016. The reality of this package today is that for families, for older Australians – who rely on private health insurance the most – will not benefit from this package.
There are some things that are positive in this package. We welcome certainly the Government’s decision to negotiate with the medical devices industry to ensure that there is better pricing for medical devices within private health insurance. But there are also some concerns. The government’s decision to allow the private health industry to actually increase their excesses might mean for some patients that they actually think in order to get a lower premium product that they might decide to go with a higher excess. But when they actually go to use their private health insurance, trying to access the health care they need, there’s certainly concern that that might lead to greater out-of-pocket costs for consumers.
We also welcome the government’s decision to follow Labor’s policy of removing the private health insurance subsidy from non-evidence based therapies, some natural therapies. That’s something that Labor has been saying for some time should be in the system. But again overall in terms of the package, for families, for older Australians, they’re still going to see their private health insurance premiums rise in April next year and there is very little in this package for them.
JOURNALIST: Private health insurance premiums went up 4.8 per cent in April, do you expect the next rise will be lower or do you think it’s going to rise again?
KING: Well there is absolutely no guarantee in this package that there will be a lower private health insurance premium rise in April next year, no guarantee at all. Certainly we’d welcome if there is any downward pressure on private health insurance premiums but from what we can see from this package there is no guarantee it will be less than 4 per cent.
JOURNALIST: One of the goals of the shake up is to get more young people to buy private health insurance. Do you think this reform will have this effect?
KING: Well when you look at the detail of the package, what this means for a young person for an average product it’s about 70 cents a week. I think when you’ve seen such huge wage stagnation, you’ve seen increases in costs of utilities for example, there are a range of decisions young people make, I am not convinced that 70 cents a week is in fact actually going to make a huge difference to young people. Of course we do want to see more young people getting into private health insurance, they’re an important part of the system, I’m not sure this is going to be enough to actually drive that change.
JOURNALIST: What else do you do to try and bring prices down and get more people in?
KING: Well one of the things that concerns me is that the Government made a promise that it was going to get rid of junk policies. The amount of times, when you look at the complaints that go before the Private Health Insurance Ombudsman, of people who have expected to be able to get within a product particular issues covered. The fact that we’ve had increasingly junk policies on the market, the fact that the Government has broken its election promise and retained junk policies remains concerning to me. Labor has said very clearly we think junk policies should go. We also think that the rebate that the Commonwealth pays should not be paid on junk policies, they are not worth the money and that people need to be very wary of these products. But what we’ve seen now is the Government retain junk policies and now calling them basic policies instead, in fact they actually don’t offer very much value to people. So certainly that is an area that needs further reform.
I think equally we’ve seen massive profits from private health insurers. We had the Government take the decision to privatise Medibank Private. What that’s meant is that there is now a very big player in the market. We were told that was going to drive premiums down, that that was going to be a really good thing and make it more affordable for consumers. That hasn’t been the case and the Government really hasn’t done very much to actually address what’s happening in market power of the private health insurance industry. There are a lot of good not for profit players that are trying to keep their premiums down and trying to keep their costs down but I think there is more that can be done in that space.
JOURNALIST: What do you say to those young people who are looking at maybe signing up looking at the fact that premiums have gone up every year and they feel like they’re being rorted by these for-profit companies, why should they try to get private health?
KING: Well, certainly remembering private health insurance is an additional product on top of our terrific universal health insurance scheme that is Medicare – there are services available within the public hospital system, within the general practice system and other allied health professionals. Private Health Insurance relieves some pressure from public hospitals, it also of course does provide people with choice of surgeon and also being able to access private hospitals. They’re important parts of our system and young people need to shop around, look for the best value that they need but also ask questions – are these the services that I need at this point in time in my life. Particularly if you’re a sports person, if you’re someone who may suffer injuries as a result of sport, making sure that you’ve got reasonable coverage I think would be important but really understanding your product. The government has increased, again which we have welcomed, some transparency measures around the nature of products. There are thousands of them out there and I think many people when they go to use their private health insurance or in fact they go to buy private health insurance are very confused about what is happening. So we certainly welcome the government’s attempt to make it more simple for people to get information. I think young people certainly need to avail themselves of that information.
JOURNALIST: On the whole would you say it’s a positive package, is there more good than bad?
KING: Look, certainly our view is that anything that puts downward pressure on private health insurance premiums is a good thing but for older Australians and for families who have already experienced a $900 increase in their private health insurance, a 23 per cent increase in their private health insurance premiums, there is very little for them in this package and unfortunately premiums will still go up for them in April.