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Thursday, 1 September 1994
Page: 799


Senator ZAKHAROV —My question is directed to the Minister representing the Minister for Human Services and Health and follows on from the question asked earlier by Senator Woods. Can the minister outline to the Senate the ways in which consumers will benefit from the reforms to the private health insurance industry announced yesterday by the Minister for Human Services and Health?


Senator CROWLEY —It is very good to have an opportunity to put on the record in this place the benefits of yesterday's announcements on behalf of consumers because these changes will make a very big difference to consumers. This series of proposed changes and policies will mean that consumers will no longer be in the dark. Under the changes, consumers will be required to know more about the costs and charges. There is an encouragement that they will be assisted with single billing. Most opposition senators know very well that if there is no single billing, the bills dribble in over many weeks and months and that is not user-friendly for consumers. So there is an expectation that the private health industry will move to provide a single billing.

  The other very important change for consumers is that a patient will be able to establish the cost before going into hospital or undergoing a procedure. This will also be very important in enabling patients to make choices about which sort of health insurance package they want to buy.

  For the first time, funds will also be able to offer private health insurance that covers the full cost of medical expenses—as long as the doctors agree that they will not then provide any other out-of-pocket expenses. It is, of course, quite different from the point that was being raised in a wrong way by Senator Woods.


Senator Newman —Have the doctors agreed?


Senator CROWLEY —During an interim transition period safety net arrangements will provide a level of benefits for private hospitals which have not entered into contracts. So by giving the funds more negotiating power—more bargaining power—they will be able to negotiate much better deals with doctors and with hospitals.

  I think somebody over there just asked whether I think the doctors will agree. I do not know. It will be very interesting to find out if they do. But if they do not, they know that they will be priced out of the market and they will be revealed as not really being interested in providing a good package that is a user-friendly, consumer-caring one.

  There will also be a patient charter which will set out the rights for private patients in plain language. That is what a lot of people do not have at the moment. It is not only the consumers who do not understand private health insurance at the moment; neither do surgeons, as they have explained to us in the many times they have come before our committees. They do not know about how to drive their way through the complexities of the current systems for private health insurance. This package of changes will certainly make that possible.

  I believe it is very important that the consumers appreciate that, while the opposition may carp and criticise, we are delivering the changes of competition, encouraging those products to become cheaper, and allowing the private health funds to be unregulated and to get on with talking to hospitals and doctors to reduce the cost of the visit to hospital and to make consumers much better off. There are some other protections we keep in the system, particularly community rating, to make sure that we protect those people who may have a bigger demand on the system. Dr Nelson of the AMA, in an article in the Sydney Morning Herald, said:

The issues it—

the package—

addresses, such as consumer rights, are important but they are at the margin of the main game.

That is Dr Nelson of the AMA—`consumer rights are at the margin of the main game.' I do not believe the consumers of Australia will have that response to falling premium costs and protection for their health. Dr Brendan Nelson says that consumer concerns are at the margin of the main game. He is about to learn that the consumers, the people of Australia, are the main game. That is what this package is about. It is about putting those consumers at the centre of private health insurance.