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Wednesday, 25 November 1998
Page: 572

Mr JENKINS (9:56 AM) —The debate so far on the Private Health Insurance Incentives Bill 1998 has been rather disappointing, especially contributions from the other side. This has been a discussion about a very narrow aspect of a very narrow policy solution. This should be a debate about the wider question of health economics in Australia. It should be a wider debate about what the community expects from its health care system. It should be a debate about what are the real problems. It should be a debate about what are the possible solutions.

We have this very narrow proposal to give a 30 per cent free kick to those who already have private insurance. If the problem is that there are declining numbers with private health insurance, why is it that this proposal gives the largest quantum of the benefit to those who are not part of the way in which this `problem' has developed? Why has the government not done a broader analysis of the reasons for those deserting the private health insurance system? Why is it that they believe the price signal, the cost of the premiums, is the only problem?

Why is it that government members do not listen to the same sorts of people who come and visit electorate offices of opposition members, who say that the real problem is that after paying many years for private health insurance when they unfortunately have the opportunity to use that private health insurance they have to dip into their pockets yet again. Why is it that those opposite, in entering in this debate, will not go into a deeper discussion about the types of products, for want of a better word, that private health insurance funds are offering? Why is it that they will not be honest and acknowledge that under Labor governments attempts were made to ensure that private health funds put to gether packages that were attractive to those who were paying the premiums.

Even more disappointing is the fact that members opposite have tended to shy away from the substance of the argument and, in fact, directly politicise it. The parliamentary secretary might laugh, but the thread that is running through the contributions from those opposite is to rattle off the number of people with private health insurance in marginal seats, to rattle off the margins. Obviously the department or the minister's office has been beavering away to supply government backbenchers these figures.

But, on an only slightly unrelated matter, it is strange that either the department or the minister's office can find the resources to do that and supply that sort of information to government backbenchers but they cannot even provide to the chamber a copy of the minister's second reading speech. Why do they want to hide it? Perhaps because it does not really tell us much about the proposal.

Just to dwell on that point: when you go to the Bills and Papers Office and you get the usual swag related to the legislation, traditionally you are provided with a copy of the bill, the explanatory memorandum and the second reading speech. But in this instance no second reading speech was provided by the department. We may then query why—and, as I have said, perhaps it is because of the lack of detail.

The former Labor government put in place the Health Legislation (Private Health Insurance Reform) Amendment Act 1994, and it is a piece of legislation which, until now, has not been acknowledged in debate. However, in selectively quoting from various ministers under former Labor governments, where it has been maintained that Labor has no commitment to the private health sector, those opposite have avoided notions such as that piece of legislation in respect of which the honourable member for Fremantle, as the then minister, said:

Private health insurance offers a choice for those who want it, but it needs to be seen for what it is—a supplement to the public health system.

I just want to stress, `a supplement to the public health system'. The member for Fremantle went on to say:

However, those persons who choose this product are entitled to high quality and good value in the same way as buyers of any other product.

So far in the debate on this piece of legislation we have heard no discussion about what the government intends to do to ensure that people are getting value for money. To simply reduce the cost directly out of the consumer's pocket is not good enough, because the total quantum of the cost will be that which the government contributes and from the individual themselves. And has anybody opposite tried to convince us that the spiralling rise in the cost of premiums will not continue? No, because they cannot; because, if those opposite do not put in any other measures, it will not stop, it will continue—and that is the problem.

As I have said, the government in the last parliament had a piece of legislation called the Health Legislation Amendment (Private Health Insurance Incentives) Bill. In the second reading speech, the Minister for Health, Dr Wooldridge, had this to say:

These costings are based on the assumption that the private health insurance participation rate will stabilise at just under a third of the population by 1 July 1997, and will then increase by two percentage points over time.

What is the present situation? The present situation is that, on the latest figures, the level has continued to drop; it has dropped to 30.3 per cent.

So we use the proposal that was put in place post the budget of 1996, post the election, as the basis for the piece of legislation we have before us. We have a policy that has failed in its intent, although, to give credit, at least there was an attempt to target the policies that were put in place last time; there was a means testing of the benefit; there was a disincentive put in place for higher wage earners by increasing the Medicare levy—and it has failed. So what is the government's response? To widen the benefit. Yet in this debate we still have not had the basis on which the government believe that there is any success. To make matters worse, we will not get—because we never get from this government on any matter—a target. We do not really know what they hope to achieve.

Back on 14 November, in the Australian, a spokesperson on behalf of the minister even admitted that they felt they would succeed if they were able to maintain the level at just over 30 per cent. What is going on? The costings that the government has provided—as raised with and asked of government ministers and the Prime Minister by the shadow minister and the Leader of the Opposition—of about $1.5 billion indicate that the government has an expectation that it will remain constant at 30 per cent. So what is going on?

Other bodies, such as the AMA and other interest groups, claim that perhaps under this proposal the level can go up to 45 per cent. Again, if that were the case, we would be looking at a cost of this proposal of some $2.25 billion—not what the government is maintaining. So what are we really on about with this proposal?

Other members opposite have quoted other Labor health ministers. It is very interesting that in the context of a debate like this the much maligned—when he was a member of the Senate—Senator Richardson should suddenly become the flavour of the month for coalition members.

Mr Horne interjecting

Mr JENKINS —Exactly, because that is what government backbenchers are doing—whatever it takes, including the selective quoting of proposals that Senator Richardson put up for discussion at the time he was the Minister for Health.

The former President of the AMA, the honourable member for Bradfield, made a contribution last night. He was able to quote from discussions that he had had with various ministers when he was in the position of head of the AMA—the head of one of the most powerful organised labour units in Australia. But, if he went to his discussions with Senator Richardson, he did not really put on the table the full breadth of what Graham Richardson was considering. Some of those elements are worth airing today.

Not only were there increased levies for those not in private health insurance; there was a proposal for higher income earners to have an increased levy across the board. These things were put on the table for discussion. There was also a proposal for the government to buy beds in the private hospital system—a proposal which it was believed would relieve pressure on the public hospital system. What did the government get for its troubles in putting that on the table? Absolutely no cooperation at all. Only a very narrow portion of the private hospital system came to the table for the discussions. They were the hospitals controlled in the catholic health system. It was a genuine, serious attempt to have a partnership between the beds that are provided in the public system and the beds that are provided in the private system.

Let us be fair dinkum if we are going to discuss what has happened. Let us be fair dinkum and have a discussion that is based on the whole health system. If we are going to have a discussion that highlights the private health system, let us discuss the whole private health system, not narrowly discuss the private health insurance schemes. It is interesting that we have not had a discussion about the way in which the private health insurance system operates. I was interested to hear yesterday morning a spokesperson on behalf of the industry talk about buying health care. I do not believe that is what they actually do.

I believe that Dr Con Costa, the President of the Doctors Reform Society, has it right in an article headed `Howard's private agenda for health care' dated 19 August this year. He states:

The private funds have never been more than a passive conduit of money from patients to the doctors and the private hospitals.

I stress: `a passive conduit of money from patients to the doctors and the private hospitals.' He then quotes Professor Jeff Richardson, a health economist, who says it is `an inefficient system that anaesthetises market forces and cannot integrate nor deal with larger issues of the health system'. Those opposite are preaching the power of market forces, but they will not underpin aspects of the private health insurance system and the wider private health system that will truly induce that type of competition and a way in which we can get better value for the dollar that is being spent.

Let me get back to the very narrow argument that is put—the political angle that in this marginal seat there are so many people on private health insurance who will miss out on the $150, the $400 or the $600 rebate. If they want to go down that political road, it should be remembered that in nearly all those electorates there are more people outside of private health insurance. There are more people who have indicated in surveys over many, many years their support for Medicare. That is what we should be talking about today. We should be talking about the fact that we have a system that has changed the way in which people approach their decisions about the level of care that they wish to have about health concerns.

It was not until the Whitlam government and Medibank that we saw radical change. Honourable members ought to remember that at that time 80 per cent of people had private health insurance. The Industry Commission report which has detailed some of this history makes for interesting reading, because it highlights the types of changes that have occurred and what effect they have had on the way in which the line which represents the level of health insurance cover has declined. There have been many things that have changed.

Last night, whilst perhaps I was outside the standing orders, I tried to assist the honourable member for Kooyong in his contribution. Most of what he contributed I did not agree with. He highlighted certain aspects of the Industry Commission. He talked about the need to look at the changing culture in the way in which people approach their health cover. I think that is an important aspect to note. We now have generations of health consumers that have known a universal health system such as Medicare for their whole life. The world has changed a lot. I, as a young person in a family with a GP, can remember the types of hours that were provided by general practice. I also remember the pro bono aspect that existed that ensured people had accessibility to proper medical care. I hope we do not want to go back to that system.

The honourable member for Hinkler in the beginning of his contribution on this legislation asked what type of health system we wanted. He asked whether we wanted a system such as the one in Britain or in the United States. We certainly do not want a system such as that in the United States, but this proposal is heading down that track. That is something that we ought to avoid.

There is another element to this piece of legislation and its proposals which gives an incentive to health insurance that we ought to question. It is a point which has been raised by the honourable member for Jagajaga on behalf of the opposition: the fact that premiums for ancillary services will also get the incentive. We are widening the types of interests that the Commonwealth has in health cover in this piece of legislation. Yesterday the honourable member for Jagajaga quite correctly asked the Minister for Health and Aged Care about the anomaly in the quantum of benefit that would be attracted to those who have dental care as part of their ancillary cover. She compared it with the amount of money that was in the former Commonwealth dental health scheme, and it is about the same level. On the one hand the minister approached the dispatch box and, in answer to the question, said, `This is a matter of Commonwealth-state responsibilities,' but on the other hand he wants to enter into that area through the backdoor by this type of incentive.

I believe that perhaps we would be better placed if the Commonwealth had a greater say in the overall health system. We would not have the types of headlines that are continually in the papers in Melbourne about the Victorian health system, a matter that I have raised from time to time in this place—the crisis of confidence that people have in especially the public hospital system and the increase in the number of complaints that people have. Whilst basically we still continue to have a good system, the real problem is that people continue to hear the rising number of difficulties and the rising number of anomalies in the way in which people get treated, and that is a concern.

This is a system that should be judged on 100 per cent of its effort, not on what it can do in 60 per cent of the cases. People have an expectation that they should have access to the highest quality health care that can be provided, and that is what is lacking within the community's expectations. (Time expired).