Justine Elliot (Richmond, Australian Labor Party) Share this | Hansard source

I rise to speak on the Private Health Insurance Bill 2006. As has been stated before, federal Labor supports this package of private health insurance legislation and I certainly support the amendments moved by the member for Gellibrand. While some of these changes are sensible, if indeed long overdue, there are certainly some items of concern relating to the potential increases in private health insurance premiums and the impact they will have on families who have private health insurance cover. There are major concerns about the potential for this legislation to create a very distinct two-tiered health system. This certainly is a concern for many people in my electorate of Richmond who are already having difficulty accessing health services. There are also many concerns about this being a wasted opportunity, as this bill does nothing to address some very real issues that consumers have in relation to private health insurance.

Arguably, the expansion of private health insurance to medical services provided outside hospital is the most significant policy change contained in the package. These changes should allow private health insurance funds to provide coverage for medical treatment in a way that reflects modern clinical practice. This is good news for private health insurance clients who may undertake dialysis or chemotherapy, as there are now provisions for these services to be covered when provided in more comfortable surroundings. It will also give private health insurance holders access to chronic illness management which is not available through Medicare. This makes good fiscal sense. As we all know, prevention is better and cheaper than cure. However, it begs the question: what about access for people without private health insurance, those who cannot afford it? What is the situation for them?

This change, whilst being beneficial for holders of private health insurance, could see a direct and unfair disadvantage for people who do not have private health cover—the most disadvantaged members of our community. In other words, people with private health insurance will have access to a better overall quality of health care. In effect we will see a widening gap between the two tiers of health coverage.

If the broader health cover provisions give people with private health insurance access to services and treatment options which people without private health insurance may not have access to then the package undoubtedly creates a two-tiered system. People who cannot afford private health insurance will be more likely to end up in hospital, because unlike people with private health insurance, they will not be able to access programs which will prevent them from having to go to hospital. Having private health insurance is indeed out of the reach of many hardworking Australian families—a result in no small part due to the policy of the Minister for Health and Ageing of never denying a request for an increase in premiums.

Private health care should be an additional choice for Australian people. It should not be the only choice. If the cost of such insurance is out of the reach of ordinary Australians then it is no choice at all for them. Having introduced these changes for people with private health insurance, we urge the government to work towards addressing access to these kinds of services for the uninsured.

There is a very real and present likelihood that the changes in this legislation will result in higher premiums. If funds are offering a broader range of products, it follows that they will be expecting to be paid more, and it is therefore likely there will be a spike in premiums as a result of these changes. The Australian Medical Association agree. In their submission to government, the AMA argue that because the private health insurance industry is primarily based on fee-for-service rather than macro-economic funding models, private health insurance funds will have great difficulty persuading anyone that they can expand the range of services covered by their products without any increase in premiums.

This bill weakens the existing legislative framework with regard to government regulation of premiums. Under the National Health Act currently, one of the objectives of the Private Health Insurance Administration Council is to minimise premium levels. However, in the Private Health Insurance Bill, this objective has been removed. Nothing has been done to address the rising cost of private health insurance. This bill encourages further rises. The cost of private health insurance is sadly already out of reach for many residents in my electorate of Richmond. In particular it is out of reach for our seniors who are on a fixed income. The cost of health services continues to rise astronomically and this government has done nothing to address that.

What about taking some real action to drive down premiums? All this government has been interested in is selling off Medibank Private, taking items off the PBS and reducing access to Medicare. On behalf of the people of Richmond I say: enough! Local residents deserve access to affordable health care, in particular seniors who have much greater demand for health care. Premiums have risen by almost 40 per cent in five years under this government, which has made an ideological decision not to regulate the cost of private health insurance. Prices will rise even further. In the future, how will our children and grandchildren ever be able to afford private health cover if we see the continued escalation of premiums? Couple these further changes with the sale of Medibank Private and consumers can expect a massive hike in fees in the very near future.

This government has said previously that premiums will not rise as a result of the sale of Medibank Private. In 2001, this same government said that the introduction of the 30 per cent rebate on private health insurance would put downward pressure on private health insurance premiums. Since then we have seen a 40 per cent rise in private health insurance premiums. As we have said before in this House, federal Labor supports the 30 per cent rebate for private health insurance—we have repeatedly said that. But we certainly do not support this government’s inaction on private health insurance increases. We have a situation now where the Minister for Health and Ageing approves every application from the private health insurance sector for increases in their premiums. This government can come out and say as many times as it likes that premiums will not rise as a result of this bill but we have heard it all before. The fact is that this government cannot be trusted on private health insurance premiums.

This government’s determination to sell Medibank Private will have a huge impact on premiums and will also result in a reduction in services. Indeed, services are already being cut. In my electorate of Richmond we saw that, as a precursor to the sale of Medibank Private, the Medibank Private office at Centro Tweed shopping centre closed just before Christmas last year. This office was then relocated to Elanora on the Gold Coast in Queensland. The sudden closure of the Tweed Heads office caused a huge outcry from locals. This was particularly distressing for the many residents who use that local Medibank Private office. In particular, a gentleman I was speaking to last week, Mr Carl Reman from Cudgen, was telling me how distressed he was that he has to travel all that distance to the Gold Coast. They have four Medibank Private offices up the coast. It is a long way for him to travel, and it is a long way for many other residents—particularly elderly residents.

There are many other health problems within Richmond that this government has failed to address, one in particular being the shortage of GPs. Just recently, I was speaking to the people at the Panorama Plaza Medical Centre in West Tweed, who have been trying desperately to recruit a new GP because their GP is 80 years old and very frail. They were hoping to employ an overseas trained doctor under the workforce shortage criteria, but have been denied that. I implore the minister for health to make an exemption in their case, because they desperately need a GP there to service the many people in that area and surrounding areas—particularly the elderly residents, who, as I have said, have much greater healthcare needs and are very distressed about the fact that they desperately need another GP at Panorama Plaza.

This bill will introduce a requirement for private health insurance funds to produce standard product information on their private health insurance products. Labor supports this change as this requirement is designed to make it easier for consumers to compare different private health insurance products and to understand their entitlements.

Under the current lifetime health cover scheme, private health insurance gets more expensive as you get older. What is supposed to be an incentive to take out private health insurance at a younger age actually turns into a disincentive and a penalty for older Australians. This has not changed with this bill. Currently, people pay a two per cent loading on top of their premium for every year they are aged over 30 when they first take out hospital cover. The only concession made is that the private health insurance bill will introduce a change to the lifetime health cover scheme whereby people who have retained private health insurance for over 10 years will no longer be subject to loadings on their private health insurance premium.

There are further concerns in relation to this bill. Labor is concerned that this legislation allows for a 15-month lag between the implementation of broader health cover in April 2007 and the implementation of the standards and quality provisions in July next year. What assurances do holders of private health cover have in terms of standards and quality of service within that time? This represents a completely unacceptable risk to consumers of private health insurance. The government has also wasted an opportunity to address the issue of informed consent. This package should be doing more to address the issue of informed financial consent. Consumers deserve to be fully informed about the costs of treatment. Locals often tell me of the concerns that they have about not being fully informed about costs and then being whacked with huge bills. It is often a very distressing time for them and they are very concerned about all the information that they are not getting. They often end up with big bills because of not having had adequate information. That is an issue that should have been addressed in this bill.

While Labor supports this bill and the positive changes that it will bring for holders of private health insurance, there is a real concern about the impact on those people who do not have private health insurance. Many locals tell me that they are worried about the Americanisation of our healthcare system. There is definitely a two-tiered system, and that is true no matter what level of health care a person wants to access. There is a difficulty in finding bulk-billing GPs. People may have difficulty in accessing dental care. Right across all areas of health, people are very concerned about the spiralling costs, particularly elderly people. Twenty per cent of people living in Richmond are aged over 65. As I have said before, that ratio is estimated to be the ratio for Australia’s population in 2040. We have already got that ratio in Richmond, and we see how extreme the health needs are. They are not being met by this government, which needs to be taking more action in that regard.

There are some problems with this bill. There are problems with quality assurance and there is a risk of an increase in premiums. So many families out there are already doing it tough with the increases in the cost of living. They are telling me that they simply cannot afford an increase in premiums. It would make things very difficult. This bill is a wasted opportunity to make some very positive changes in respect of the sustainability of the industry and about informed financial consent. While there may be some positive changes for those who have private health insurance, it leaves many people behind who are not able to afford or access private health insurance. I urge the government to look at other areas to ensure that those people who do not have private health insurance have access to decent affordable health care. All Australians should be able to access those levels of health care, regardless of their financial situation.

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