Patrick Secker (Barker, Liberal Party) Share this | Hansard source

because it will be unaffordable for many, patients at Keith hospital will also drop out. This will create a two-tiered system, like the USA, because it will be the less well-off who drop out but those better-off will mostly be able to stay in private health insurance. This is backward logic. The government does not see the logic here because it is not just Keith hospital, it will be hospitals all around Barker and all around Australia.

This government will not be taking pressure off the public system—it will be adding to it in an enormous way. In the instance of Keith hospital, very clearly, by trying to save $300,000 they will probably add $2 million to the public health system. It is the worst form of cost-benefit analysis and, obviously, it has not been done. There will be a huge influx of people who drop off the private health system and onto the public health system. Private hospitals support 40 per cent of all patients in this country and, in regional areas, it is much higher. They cover the majority of elective surgery.

It is estimated around 12 million Australians hold private health insurance and, as I stated earlier, nearly half—5.6 million—of those earn $50,000 or less. Of those, 3.4 million earn less than $35,000. This government is seeking to punish those who have done the right thing by taking out private health insurance. I have heard those on the other side state that we are wrong, that not many people will be affected and those will be just the rich. Well, the rich will still afford to stay on. It will actually be the poorer who drop off—and who cares about them? That is what the government thinks.

I have no doubt that premium prices will rise. Due to the shrinkage from dropouts, premiums will rise for those who the government calls rich, when in fact it will not be those who drop out. I believe that about 2.4 million will be affected by increases in their premium of various stages from 14 per cent to 29 per cent or 43 per cent, depending on their incomes. Deloitte has predicted that up to 1.6 million Australians will drop their cover over the next five years. They have forecast that up to 4.3 million Australians will downgrade their cover over the next five years. Not only this, but premiums will increase 10 per cent and an extra 845,000 Australians will be admitted to public hospitals. This is a huge addition to an already struggling public system and there does not seem to be anything in the forward estimates to take account of that.

This government states that only 25,000 people will drop out of the private health system. Well, like that good Aussie film says, 'You've got to be dreaming' if you think it is only 25,000 people compared to the 1.6 million modelled by the Deloitte analysis. Discrepancies in this government's numbers are something that the Australian public is getting used to, and it is a pretty sad state of affairs. Labor hates private health insurance—it is in their DNA. This is just the first step. This is the first of the many changes with which this government will seek to wind back private health insurance. You only have to look at their record from 1983 to 1996, when such a wind-back actually happened. It is a fallacy to say that the poor subsidise the rich, because the so-called rich will always pay more through their Medicare levy anyway. This legislation has been twice rejected by the Senate and I will be watching its progress closely, as the Greens are still stating that they are opposed to the Medicare levy surcharge aspect of it.

The coalition supports private health rebates; the coalition understands that private health insurance helps reduce waiting lists and keeps pressure off the public health system—which is already under so much pressure because it has been mismanaged by many Labor state governments over many years. This legislation is bad for the health system. I do not support these bills and I call on the crossbench members to stand up for the people in their electorates, who will be worse off under this government and this legislation.

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