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Tuesday, 9 February 1999
Page: 2257


Dr LAWRENCE (10:28 PM) —I have been approached in recent weeks—as I am sure many members have—by constituents complaining particularly about the advertising surrounding the private health insurance rebate. We understand that the Commonwealth government has spent or will spend approximately $8 million on advertising and up to $20 million on associated costs. They see in both the print and television advertisements—very clearly, very simply, and unequivocally—that private health cover will now be 30 per cent cheaper for all Australians. There are no ifs or buts. In the fine print of the advertisements they give three ways in which you can do that: by premium reduction, a tax rebate, or a cash payment from a Medicare office. Private health will now be 30 per cent cheaper for all Australians—no exceptions, no different figures depending on your category.

Similarly, the biggest private health insurance fund in Western Australia advertised in the following terms in the West Australian of 6 January 1999: `HBF health premiums are down by 30 per cent.' Again, there are no qualifications. Of course, a great many people believed the Commonwealth government and the big health funds of which they have been members for many years. Indeed, HBF started advertising in these terms before the legislation was passed. I thought that was more than a bit cheeky, Mr Speaker.

One constituent who approached me is a long-term member of the HBF. He was very annoyed indeed, when he approached the fund to get his 30 per cent reduction in premium, to be informed that they were experiencing administration difficulties—this was toward the end of January—and, as a result, that he would not be receiving his 30 per cent rebate. When he inquired further, he was told that instead they would extend the term of his insurance. In fact, they cut him off from the other two options available to him—either the tax rebate or the cash payment from the Medicare office. In their generosity, they said no, they would not reduce his premium; they would extend the term of his insurance premium. He did not want that. He actually wanted to have reduced cost or he wanted to get the cash payment, but because of their `administrative difficulties', they were not able to do that.

When we approached the organisation they told us that they were having such difficulties and that they were not able to oblige. I think by now they may have changed their tune. But this was not how the rebate was advertised and, as my constituent argues, he was being penalised both ways. His insurance company would not pay the 30 per cent rebate and as he wishes to remain privately insured, he has to continue to pay the higher premiums which are deducted from his pay. He is a loser all round.

This manipulation of the rebate scheme by the private health insurance company has, not surprisingly, left my constituent feeling very unhappy and cheated, both by this company and by the government. These changes were certainly not outlined in any recent advertising, nor was he given notification by HBF, or the Commonwealth government for that matter, that changes would be made to the scheme that effectively would deny him this 30 per cent rebate.

However, this constituent was not alone and I have complained to, amongst others, the trade practices people under the act. I will also be complaining on behalf of another constituent who was, like this one, under the impression that he would get a 30 per cent rebate. As it says, `Private health cover will now be 30 per cent cheaper for all Australians,' and the associated ad, `HBF health premiums are down by 30 per cent.' There are no qualifications in any of that. He was under the impression, along with a lot of others, that he would automatically be entitled to a 30 per cent reduction in his premiums. No such luck.

This constituent assumed that that 30 per cent reduction would apply to his current premium payments. Instead, he was advised that his premiums would revert to their former level under the old scheme and then the 30 per cent would be calculated on that. In due course, the HBF sent him a note in those terms. But that is not what the advertising says. It is misleading in every respect. Taxpayers' money is being used to mislead the very people to whom this scheme is directed. I think they have every reason to be very angry indeed. As my constituent put it to me, this was certainly not advertised in either the HBF or government campaigns promoting the scheme and he, like many other Australians, is very unhappy indeed at being cheated in this way.