PARLIAMENT HOUSE, CANBERRA
WEDNESDAY, 14 FEBRUARY 2018
SUBJECT/S: Turnbull’s private health insurance crisis; Heart Kids.
CATHERINE KING, SHADOW MINISTER FOR HEALTH AND MEDICARE: I just want to comment on the latest APRA quarterly statistics on private health insurance. What we’ve seen reported today is a further 12,000 Australians have dropped their private health insurance and, in particular, hospital cover is at its lowest since 2011. What this shows is that more and more Australians are in fact finding private health insurance unaffordable, dropping their private health insurance cover. We know that under the Abbott -Turnbull Government, private health insurance premiums have increased by $1000 and these latest statistics again show that many people are saying that this product is not a viable product for them to continue to keep.
With wages stagnating, with the costs of utilities going up, and with increasingly, private health insurance taking a large proportion of families budgets, something has to give. Labor has a plan to cap private health insurance premiums for our first two years in office at two percent, and also ask the Productivity Commission to undertake a substantial review of private health insurance. Something has to give and at the moment the only thing that is giving unfortunately is family budgets. Happy to take questions.
REPORTER: Can you guarantee that no bigger out-of-pockets costs will result from that two per cent cap?
KING: I think unfortunately what we’ve seen at the moment, and the facts in the APRA statistics that have come out is that out-of-pocket costs have increased yet again and that is becoming unsustainable for families as well. They are questioning what is the value of this product. What we’ve said in our policy announcement is that will give the ACCC and the Private Health Insurance Ombudsman new powers to ensure that under our policy of the two year, two percent cap, that those exclusions and those out-of-pocket costs don’t increase. We will of course want to work with the private health insurance industry about how they actually get costs out of the system, but they have responsibility here. This is a sector that is heavily subsidised, six billion dollars in the private health insurance rebate each year, it is an important part of keeping affordability in private health insurance but equally again the figures in the APRA report show that their profits have gone up yet again by I think 7.3 percent. Something has got to give and it has got to stop being consumers constantly that are the ones paying the price for it.
REPORTER: The last time government put a freeze on private health insurance premiums in 2001, they were limited to zero percent, the following year they went up by seven percent. Is there a risk that your policy will just delay a massive premium increase for two years?
KING: Well the missing part of that picture, when there was a zero per cent in 2001, is that there was no root and branch look at private health insurance premiums. There wasn’t the reform initiatives to actually then try and drive costs down in the sector and actually start to get private health insurers to look at what their responsibilities were within the sector. That’s what happened, it was just a zero percent freeze, it was a political solution, it actually wasn’t looking at overall reform. That’s why we’ve said two percent, we’ve looked across what we think is important for consumers, we haven’t said zero percent, we’ve said two percent over two years plus a Productivity Commission.
REPORTER: Is Labor committed to scrapping junk policies?
KING: That’s not actually our policy; that was the government’s policy that they took into the last election, something that they then subsequently ditched despite the fact that the Australian Medical Association continues to call on them to act. The government went to the last election with the policy to scrap all junk policies; they have to explain why they have decided not to honour that commitment. Labor’s policy is to not pay the 30 percent rebate on junk policies, a very different proposition to what the government had.
REPORTER: If massive medical fee increases are part of the thing that is driving health insurance costs up, is it time for the government to publish or force doctors to publish a list of their fees?
KING: Look I think there is significant policy reform needed in the area of transparency around fees. I know that the government has started to talk a little bit about that and we’d welcome sitting down with them to discuss how you might go about doing that. I note that in other countries where that has happened that hasn’t always necessarily seen fees being driven down and it is certainly a policy area that we will have a look at if we are fortunate enough to form government.
REPORTER: This morning the government has made a small announcement regarding Heart Kids, do you have any comments to add to that?
KING: Well what a lovely thing to do on Valentine’s Day, I think it’s really important to recognise that we have significant issues with young children’s heart health and I know that’s something that Steve Ciobo has campaigned heavily on for a long period of time. We certainly welcome that announcement today on Valentine’s Day. Thank you.