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Thursday, 25 June 2009
Page: 7174


Mr DUTTON (10:53 AM) —The Private Health Insurance Legislation Amendment Bill 2009 is a distinct change from recent legislation brought before this House by the Minister for Health and Ageing. Several measures brought before this House in recent weeks will have the effect of driving people out of private health insurance in this country. Measures such as the Fairer Private Health Insurance Incentives Bill 2009 will be a detriment to private health insurance and will cause further harm to the already stressed public health system in our country. They were desperately created by this government to pay for its reckless cash splashes and the mountain of debt that it is now saddling the nation with for many years to come. On the other hand, this legislation actually seeks to encourage people to take out and keep private health insurance with all the attendant benefits that it brings to the nation’s health system.

The bill will add a new category to the insured groups to which private health insurance can offer insurance policies. Currently the Private Health Insurance Act requires that insurers only be allowed to offer policies to particular insured groups, namely singles, couples and families with dependent children. Since late 2007 the rules have been changed to include another extended family category, ‘dependent children non-student’. At this point I would like to take this opportunity to recognise the work of former Health Minister Tony Abbott and the way in which he was able to work with the private health insurers and also recognise the private health insurers for their efforts in maintaining a situation where more people could potentially come into the privately insured pool in this country. This category allowed family policies to cover people between the ages of 18 and 24 who were single and not in full-time education. The category was developed by health insurers to encourage young adults to maintain health insurance cover into adulthood. The arrangements, however, have been temporary. This bill proposes amendments to insert the category ‘dependent child non-student’ in the Private Health Insurance Act and will enable insurers to offer policies to this group on a permanent basis. Health insurers will be able to charge a higher premium for these extended family policies than for others. But that premium is expected to be less than that charged to a young single individual.

With the percentage of people in the 20- to 24-year age group covered by private health insurance in decline, down to 3.9 per cent in 2008, this measure will hopefully make insurance under a family policy umbrella more attractive and see younger people remain covered by insurance. We will have to wait and see though because the government’s other actions will make the price of insurance that much more expensive for many Australians. Insurance premiums will rise for 2.3 million people by between 14.3 per cent and a staggering 66.7 per cent as a direct result of the Rudd government’s decision to make changes to the health insurance rebates put in place by the coalition to actually boost private health membership. I remind the House that the government promised over and over again it would not make those changes—just one of the many broken promises as to health. I think that shows that this government does not have a proper direction as to the way in which it is taking health in this country. Pressure for premiums to rise even further will flow from the rebate changes which the government now admits could see 40,000 people drop out of insurance altogether. That is the Treasury’s conservative estimate, I might add. Others, including the respected firm Access Economics, estimate the rebate changes could force 100,000 people out of private health insurance. That is on top of the 492,000 that the government still expects to quit insurance over last year’s decision to change the Medicare levy surcharge thresholds.

So we have a series of measures that are sure to have substantial negative impacts on private health insurance. Those impacts will flow on to all Australians including those who rely on the public hospital system. Fewer people with insurance means more people waiting for treatment in hospitals, longer queues and, under the Rudd government, longer waiting times. That from a government that promised to fix those very same hospitals by the end of this month! That is only a matter of days away. Clearly, the Rudd government cannot claim that it has fixed Australia’s 750 public hospitals. No doubt the Prime Minister and the minister for health are already drawing up their spin to tell Australians they have fixed Australia’s public hospitals when every piece of evidence is to the contrary—and every Australian knows that. The coalition in government worked hard to reverse declines in health insurance membership. Under the Keating Labor government insurance membership had plunged to just 30 per cent of the population. Through the rebates and other measures it took, the Howard government reversed that trend and more than 44 per cent of Australians are covered. But now we have another Labor government and the message is clear: private health insurance is under attack once again. We will hold this government to account for its claim that it will fix public hospitals by the middle of this year. Its blatant attack on private health insurance over the last 18 months has been quite remarkable, almost without precedent. You would have to look back to the Hawke-Keating years to recognise a similar attack on people with private health insurance.

We should be holding up people in this country who have private health insurance as heroes of our nation who share some of the burden of the health system. People who insure for themselves—who have a capacity to do so—relieve some of the pressure on the public hospitals in the services that they, quite rightly, provide to people who are more needy and do not have the capacity to provide support or insurance for themselves. This country should always maintain a health system that protects those who are most vulnerable, but we should also put in place incentives—a system that provides benefits to those who are able to self-insure and defray some of the costs that otherwise would have to be met by the Australian taxpayer. We should recognise and start a debate in this country to recognise that these people should be embraced and should not be excluded from holding private health insurance, because, ultimately, under a Labor government or a Liberal government, regardless of what colour of government you have in this country, there will always be a system that provides for those Australians who cannot provide for themselves; there will always be universality, and that should always be the case.

But if you have a case, such as we have with this government at the moment, where they seem completely determined to drive private health insurance into the ground yet again, then the pressures on the public system will again become unbearable. I know that the member for Herbert, who is in the chamber today, has been a great champion for health services in Townsville and the surrounding region in his electorate and he would be horrified to hear a suggestion by the Rudd government that they had fixed public hospitals, not just in Queensland but around the country. It is a remarkable claim that they have made and of course they have said nothing about it in the intervening period. We are approaching the 30 June deadline for the Rudd government to meet their obligation—their election commitment to fix public hospitals—and yet they still have not detailed one criterion or suggested one benchmark that will be the benchmark against which they are determining whether or not they have fixed public hospitals. It is a remarkable situation and all Australians would know that Mr Rudd cannot claim that he has fixed public hospitals. He cannot suggest that there is no more work to be done. He made a commitment: he said to people that he would fix public hospitals, he would end the blame game and he would somehow—somehow!—fix public hospitals by 30 June. He has only a week to go and there is nothing on the table from this government that would suggest that they are even serious about meeting this obligation. With their claims that they have fixed public hospitals, Australians must really wonder, in the face of all of the evidence, what is going on with this government, particularly in the area of health policy.

We hope that measures in this bill will make it somewhat easier for families with young adults to keep the young adults covered by private insurance. That is why when we were in government we put in place this framework—we allowed this framework to take place—to work with the private health insurers to encourage young people to take up private health insurance and to stay on their parents’ cover as an incentive for them to remain in private health insurance when they go onto their own policy and relieve some of the pressure, and this is incredibly important, particularly when you look at waiting lists around the country. People in this country would be amazed to hear that if they lived in Townsville, as the member for Herbert does, there is now in Townsville Hospital a waiting list to get on a waiting list; it is quite amazing—


Ms Hall —Mr Deputy Speaker, I rise on a point of order. I have been quite indulgent in not standing up before and bringing the member back to the debate—


The DEPUTY SPEAKER (Mr S Sidebottom)—What is the point of order?


Ms Hall —The member is not speaking to the legislation before the House.


The DEPUTY SPEAKER (Ms AE Burke)—I remind the speaker that the legislation is the Private Health Insurance Legislation Amendment Bill and I would ask the speaker to be relevant to the legislation.


Mr DUTTON —My old sparring partner, the honourable member who interjected, always engages in these debates. Her contributions are always worthy. I always enjoy reading Hansard as it is a much clearer way of understanding the argument that she puts than being here at the time!

There is a reason I raised this very important waiting list issue. If we return to the basics, the reason we have private health insurance in this country—for the benefit of the member who interjects—is that if we stop private health insurance, if we push those 10 or 11 million Australians out of private health insurance into the public system, then we would have no capacity whatsoever—


Ms Hall —I raise the same point of order, Mr Deputy Speaker.


The DEPUTY SPEAKER —I have made it clear to the speaker that I wish him to speak on the Private Health Insurance Legislation Amendment Bill and the speaker was mentioning private health insurance in his comments. But I am listening very carefully to make sure that he returns to it.


Mr DUTTON —As I said, for the benefit of the member who interjects trying to comprehend the correlation between hospitals, waiting lists and public policy in relation to health and private health insurance, I will slow the message down.


Ms Hall —Mr Deputy Speaker—


The DEPUTY SPEAKER —Both members will resume their seats. The member is speaking about the Private Health Insurance Legislation Amendment Bill. He is mentioning private health insurance—


Ms Hall —It has got nothing to do—


The DEPUTY SPEAKER —Thank you, I am speaking. I will ask the member, as the shadow minister in charge of this area of legislation for his side, to return to the legislation.


Mr DUTTON —As I was saying, in relation to this bill, and for the benefit of the member, the reason that we have private health insurance in this country is that if we force people out of private health insurance by not bringing measures like this into the parliament then our public system would collapse. The difficulty is that this government seems wont to crash the private health insurance market in this country. If the government puts these bills up as a genuine attempt to try to help people stay in private health insurance, then they provide ways in which we can manage our health system into the future for this country.

If the honourable member opposite seriously believes that we should not be supporting the 11 million Australians in private health insurance—if the Labor Party believes that we should be crashing the private health insurance market—that would be a devastating day for the health system in this country. The previous government was able to increase coverage of people with health insurance and therefore relieve some of that pressure experienced by our public hospitals. This is a concept that clearly escapes the honourable member opposite, as she flees the chamber to get an additional briefing before she speaks so that she can at least give some semblance of a contribution to this debate.

The important point is that waiting lists are crushing older Australians in particular around this country. If we force people out of private health insurance and into the public system, it will only make for a more devastating situation. People who are now waiting years for treatment in the public system will wait years longer if people are not taking out private health insurance and sharing some of the burden into the future. It would be an amazing situation to see this Rudd Labor government return to the devastating days in the private health insurance market that we saw in the Hawke-Keating years, when Labor really was determined to crush private health insurance in this country.

About one million Australians on incomes of $26,000 a year or less have private health insurance in this country. They will be impacted directly by the Rudd government’s decision. The government projects that the changes it has made to private health insurance will raise about $1.9 billion over four years, which will make private health insurance premiums higher for all Australians. I mentioned earlier in my speech on this debate that the government, on its own figures, projects that about 40,000 people will drop out of private health insurance, but at the same time the government claims that it will raise about $1.9 billion in revenue over four years, or about $500 million per annum. How is it that $500 million is going to be obtained from 40,000 people dropping out of private health insurance? It is a nonsense. Hundreds of thousands of Australians will grin and bear the extra premiums, but they will remain in private health insurance. They might be older Australians, and pensioners in particular, who are concerned about the deterioration of their health and the conditions and complications that might approach as they age. They might be people who are planning to start a family and want to have cover. It may be that many families around the country, regardless of their financial status, are scared about the situation in our hospitals and that is the reason they maintain their private health insurance. Whatever the reason, we should be encouraging people into private health insurance because it offsets the debt that would otherwise be ultimately incurred by the taxpayer.

That is why I say, particularly for the benefit of the member for Shortland, that it is good to have people offsetting some of their own costs in relation to health. If people pulled out of private health insurance today and went into the public health system, it would collapse overnight. This government’s intention to wreck the system is unsustainable and it is un-Australian. We need to make sure that we take the fight up to the government.

I say to those 11 million Australians who are going to face higher health insurance premiums into the future: write to your local member of parliament and make sure your voice is heard. It is very difficult indeed for young families, for older Australians and for people on low and middle incomes to maintain private health insurance cover at a time of economic difficulty, not just in this country but in other parts of the world, even without the additional burden of extra and higher insurance premiums. This will make it more difficult for people to balance their budgets, and ultimately a crunch point will come. When that crunch point comes, if people drop out of private health insurance, with the Prime Minister not having lived up to his promise to fix public hospitals, that will put even greater strain on those wonderful people—the doctors and nurses and other allied health professionals—who on a daily basis perform in an environment which for many of them remains completely intolerable. Many of the doctors and nurses that I have spoken to around the country are devastated by the conditions in which they are expected to work.

This is a country which should be providing better health outcomes to the Australian public. The government should acknowledge that it would be much preferable if we had better hospital environments in particular for people to work in. On that basis, the coalition supports the bill.