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Monday, 18 November 2002
Page: 6587


Senator McLUCAS (2:44 PM) —My question is to Senator Patterson, the Minister for Health and Ageing. Does the minister recall the Prime Minister promising the Australian people before the election last year that there would be downward pressure on health insurance costs for families and that this government's policies would `lead to reduced premiums'? Isn't it true that already this year the policies that you, as health minister, have presided over have led to the approval of average premium increases of seven per cent, health funds will be freed up to raise their premiums by CPI without the need for government approval and Medibank has removed discounts for its products, resulting in 2.7 million Australians paying up to six per cent more for their health insurance?


Senator PATTERSON (Minister for Health and Ageing) —Let me say that I can guarantee that, under a Liberal government, private health insurance will always be cheaper than under a Labor government, because we believe that we should have a strong public sector and a strong private sector. Despite the fact that there may be a few people on the other side who believe that, the majority of them do not have any commitment to private health insurance at all. Australian families who take out private health insurance are, on average, $750 better off with the rebate than they would have been under Labor and will be if Mr Smith fiddles with the rebate, which he is claiming he will do. Everybody knows that the pressures on health costs are higher than the CPI. The health index—I have forgotten it, and I may stand corrected, but I think it is about 5.8 per cent at the moment—is significantly higher than the CPI. We know that people expect the best equipment: they expect the best prostheses for their hips; they expect the best prostheses when they have a joint replacement; they expect the best stent when they have a stent put in. Those expectations place increased demands.

I am not going to be an apologist for the private health insurance funds. At the end of last year or the beginning of this year when they were looking for increases, I told them that I expected them to be as efficient as possible and the private hospitals to be as efficient as possible, to keep those pressures down. Anyone who believes that health costs will not go up significantly deludes themselves. They go up in the public system. The Pharmaceutical Benefits Scheme goes up too, I might remind you, but the Labor Party will not assist us by passing the legislation to have a small—I know it is difficult—but modest increase in the Pharmaceutical Benefits Scheme. That is going up. It is the fastest growing part of our health system. As well, the private hospitals have the increased costs of the medications that they give their patients. So there are increased costs. One of the costs is insurance. It is not as great as they would sometimes have us believe, but it is another cost pressure.

What we are doing is ensuring that the downward pressures on private health insurance are as strong as possible. Under Labor, there would not have been those downward pressures. They would not have undertaken the sorts of reforms that Senator Coonan has undertaken—she has held four conferences!—to drive down public liability. Public liability affects private hospitals and affects private health insurance in turn. There is, as I said, $750 on average for every family in the rebate which they get and which they would not be guaranteed under the Labor Party. To anyone who comes in here and talks about increases in private health insurance, let me just say: under Labor, it will be higher. It will be higher because they will not guarantee the rebate. They will not guarantee the membership of the private health funds, and they do not seem to understand that when people leave health funds the cost of private health insurance goes up. That actually drives more people out, and it is a spiralling downward effect, which is what happened under Labor to the point where private health insurance was not viable.


Senator McLUCAS —Mr President, I ask a supplementary question. Can the minister confirm that it is the case that, as a result of the premium increases approved by the Howard government, taxpayers will be forced to contribute around quarter of a billion additional dollars each year through the 30 per cent private health insurance rebate?


Senator PATTERSON (Minister for Health and Ageing) —I remind the honourable senator opposite that we put an extra $3 billion into the public hospital system through the states and last year got a minus one per cent decrease in the number of people who went into public hospitals. With the private health insurance rebate and the increase in membership, we saw a 12 per cent increase in admissions to private hospitals. What we have seen is people getting access to hospitalisation, hip replacements, surgery for breast cancer and other forms of surgery much faster than they would have under Labor, when private health insurance was at an all-time low and the private hospitals were under threat of not being able to continue. We have seen people being able to get access to surgery at a rate which is a 12 per cent increase over that of last year, and a minus one per cent decrease. For $3 billion, the state governments delivered a one per cent decrease in hospital admissions. That is the question the opposition should be asking their Labor state governments. (Time expired)