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Another expert blast Government's $2 billion private health rebate.

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Senator Meg Lees Parliamentary Leader and Senator for South Australia Australian Democrats spokesperson for Health

Press Release Dated: 16 Mar 2001

Press Release Number: 01/169 Portfolio: Health 

Another expert blasts Government’s $2 billion private health rebate The Australian Democrats have again called on the Federal Government to finally take some notice of the experts and review its wasteful and inefficient private health insurance rebate.

Democrats’ Leader and health spokesperson, Senator Meg Lees, said new research by the Australian National University, joins a long list of expert advice which has concluded the $2 billion tax rebate has been a waste of taxpayers’ money.

Senator Lees said an economist at the ANU has concluded that "the insurance subsidy may be simply shifting resources to the private insurance industry with little potential gains to the public sector".

“This is exactly why the Democrats opposed the private health insurance rebate in the first place,” said Senator Lees.

“We were concerned that the money would go to people who already had private insurance and would do nothing to take the pressure of the public hospital system.

“We suggested numerous amendments in the Senate including capping and means-testing the rebate.

“We also proposed an amendment to provide some accountability by requiring the rebate scheme to be reviewed independently against its objectives.

“The Government, along with Senator Brian Harradine, voted against our amendment so the community has no way of testing the scheme’s outcomes in terms of health gains.

“In light of this new research, the Democrats once again, call on the

Government to review the private health insurance rebate,” said Senator Lees.

“At the very least the rebate scheme should be capped and mean-tested. It is disappointing and very revealing to note that the ALP has refused to cap or means-test the scheme should it win government.

“Now that lifetime cover has been introduced, high-income earners are unlikely to drop their private insurance as they would face penalties if they chose to re-join.

"The health insurance rebate puts millions of taxpayer dollars into the pockets of wealthy Australians who don't need help to afford their premiums. Means-testing the rebate would provide an extra billion dollars to fix the major infrastructure problems in Australia’s public hospitals,” concluded Senator Lees.

Democrats’ five-point accountability plan for private health:

1) A mandatory Code of Conduct governing the advertising of private health insurance needs to be developed and enforced by the ACCC;

2) Any promotional material produced by funds for existing or potential members needs to contain a simplified Key Features Statement. The Government has been dragging its feet developing the KFS.

3) The Private Health Insurance Ombudsman powers need to be strengthened. Funds should be required to abide by their decisions (as happens with Super Funds), rather than the Ombudsman merely being advisory

4) The Government needs to account for its $2 billion Private Health Rebate subsidy by showing clearly what impact this has had on pressure on public hospitals and whether the cost-benefits of the rebate are in fact worth it.

5) The funds should fund a central consumer hotline that explains very simply across all funds what is covered by private health insurance and what is not.


Top | Email | Authorised by: Jim Downey, 10 Brisbane Avenue, Barton ACT 2604. Copyright © 2001 Australian Democrats Last modified: Thu, 18 May 2000 13:51:26 Today: Thu, 22 Mar 2001 14:01:21