THE HON BILL SHORTEN
LEADER OF THE OPPOSITION
MEMBER FOR MARIBYRNONG
THE HON CATHERINE KING
SHADOW MINISTER FOR HEALTH AND MEDICARE
MEMBER FOR BALLARAT
LABOR WILL STOP TURNBULL’S PRIVATE HEALTH HIKE
13 million Australians will receive relief from rising private health insurance premiums with a Shorten Labor Government to cap the price increases of private health insurers at 2 per cent for two years.
This will put an average $340 back into the pockets of Australian families.
Labor knows every dollar counts – and that the status quo in private health insurance cannot continue.
Wage growth is at an all-time low. But the profits of private health insurers are at an all-time high.
Families are paying an average of more than $1,000 every year for private health than they were when the Liberals came to power in 2013.
Australians are being ripped off – it’s time to shift the balance back in the interests of families, rather than the big health insurance companies. Prices are up, profits are up – but quality and value are way down.
That’s why we are making this unprecedented decision to shift the balance back to consumers – helping families access the health care they need while taking pressure off the weekly budget.
With the ten-year average annual premium increases at 5.5 per cent, Labor’s move to enforce a two per cent premium cap will see savings across the board:
Single currently paying average $1975 in 2018 – will save $143
Young couple with no kids paying average $3993 in 2018 – will save $290
Single parent currently paying average $3641 in 2018 – will save $264
Family currently paying average $4731 – will save $344
Older couple paying $4771 – will save $347
The private health industry receives $6 billion each year in taxpayer subsidies – Australians deserve a better deal.
Labor will also task the Productivity Commission with the most significant review of the private health system in 20 years to make private health insurance to improve the value, quality and affordability for every Australian. Labor will begin consulting with the sector on terms of reference that will include:
Improving the affordability of private health insurance for consumers;
Underlying cost drivers including insurer margins;
The range of sticks and carrots that encourage insurance coverage; and
The balance between the private system and Medicare – Australia’s universal public health insurance scheme.
Private health plays an important role in Australia’s world-class health system, but under Turnbull, Australians are questioning the cost and value of private health more than ever. In 2017, private hospital coverage dropped to the lowest level since 2011.
The Turnbull Government is failing to address this crisis and help Australians with the affordability of private health insurance, and as a result, people are walking away from private health altogether.
Labor is choosing to put Australian families first, instead of the interests of the multi-billion dollar private health industry.
Labor understands that Australians are struggling with the cost of living under Turnbull. We understand the importance of protecting our world-class health system – Labor built Medicare and we will always fight for Medicare.
And we know more needs to be done to help people access the health care they need through private health insurance – and that’s why we are backing Australians, not private health insurance giants.
FACTS ON PRIVATE HEALTH INSURANCE
In 2016-17, Australians paid $4 billion more in private health insurance premiums than they got back in benefits, and the private health insurance industry made pre-tax profits of $1.8 billion.
At the same time, premiums increased by almost 2.5 times the consumer price index – an average $200 increase for families.
Premiums have increased by 27 per cent since the Liberals were elected in 2013 – including the rise due in April. This includes the two highest premium increases since 2005.
Australians are paying a lot more for their health insurance policies and getting a lot less. Ten years ago, only 8.6 per cent of health insurance policies contained exclusion, now it’s 40 per cent.
Last year, the private health insurance industry raked in $1.8 billion in profit before tax. Most publicly companies get a return on equity of about 8 per cent. The banks average in excess of 10 per cent. Some of the biggest health insurance providers pocket a return of over 20 per cent.