Andrew Wallace (Fisher, Liberal Party) Share this | Hansard source

I rise to speak on the Private Health Insurance Legislation Amendment Bill 2018.

Australia's healthcare system is a unique and effective balance of the public and private systems. A report last year by the New York based The Commonwealth Fund found that our system was the second-best in the world and delivered both the best administrative efficiency and best health outcomes. Its performance is built on combining the universal coverage of Medicare with a genuinely robust private health system. By properly supporting, integrating and incentivising Australians into private health cover we reduce demand on our universal public system and avoid the worst excesses of cost and waiting times faced elsewhere.

The importance of the private health system in Australia is hard to overstate. In 2017, private health insurance paid for 11.9 million days of treatment in hospitals. That's $14.8 billion worth of treatment paid for by the private sector and by Australians who are better able to afford it. It's $14.8 billion worth of government revenue that can best be spent, instead, on supporting our most vulnerable. Private health insurance pays for almost two-thirds of non-emergency surgery, 70 per cent of joint replacements and 88 per cent of retinal procedures.

Private health does not just improve lives, though, it saves them, paying for 60 per cent of chemotherapy treatment. Of particular interest to me, and I know to the Minister for Health, private health also funds 90 per cent of day admissions for mental health and 50 per cent of all mental health admissions in total. Without private health insurance, there would have been an additional 4.6 million episodes of hospital treatment for our governments to pay for in 2017 alone. That's 4.6 million reasons every year to get the policy settings right on private health.

Unfortunately, the proportion of people choosing to take out private health care is falling. Since 2014, the percentage of Australians with hospital cover fell by more than one percentage point from 47.2 per cent to 46.1 per cent. Coverage has in fact fallen in nine consecutive quarters. Very few indicators in public life show such a consistent performance, and this is a trend that is imperative we reverse. Unfortunately, despite the lifetime health cover loading, some of the largest declines have been among the 20 to 24 and 25 to 29 age groups. The system relies on these younger participants, who don't need to use the health services as frequently, to help pay for the higher risk, often older participants.

On its own, of course, this will increase costs to the taxpayer by requiring ever more treatments to be undertaken in the public system. However, without action to check this decline we're also in real danger of reaching a point of no return. As more people drop out, the premium costs for those remaining in schemes will increase faster and drive more people toward cancelling their insurance. Eventually, without action, the system would become unable to sustain itself.

Declines this serious require a substantial policy response. The last time the nation saw a decline in private health coverage this large, under the Hawke and Keating Labor governments, the newly elected Howard government responded immediately by introducing three groundbreaking reforms, which are still cornerstones of our current healthcare system: the Medicare levy surcharge, the 30-per-cent premium rebate and lifetime health cover. This swift, comprehensive and decisive action was what was required, and it is what the coalition delivered. In just four years, coverage rose from 30.5 per cent to more than 45 per cent. Though we are not yet at a rate of decline which calls for such radical steps, we do need comprehensive reform to reverse the trend and prevent increasing pressure on the public health system.

In 2015-16 we held an extensive consultation to ascertain what needed to be done: 40,000 online consumer survey responses, roundtable discussions with more than 100 stakeholder organisations and a host of community consultations showed that we need to improve value for money, improve transparency and increase the efficiency of competition. That is exactly what the government's wide-ranging reforms, its package of reforms announced in October 2017 and encapsulated in part in these bills, will do. The bills before us will improve value for money both by reducing costs for consumers and by improving the quality of services which can be offered by private insurers.

In terms of reducing costs, the bills will allow private insurers to offer lower cost premiums to those younger consumers who are least likely to need treatment. In particular, it will allow insurers to offer discounts on standard premiums for customers who are aged 18 to 29, including discounts of up to 10 per cent for under 25s. These discounts will then be ongoing for those consumers, beginning phase out from the age of 41. Though the existing measures, which prohibit the modification of premiums based on age, were well-intentioned, they are now proving to be a critical barrier to young people taking up much-needed policies. The time has come to allow a degree of flexibility.

The bills will also reduce costs for consumers by increasing the maximum excess levels that are allowed to be offered for insurance products which qualify for the Medicare levy surcharge exemption. Many consumers, especially those who are younger and less frequent users of healthcare services, want health insurance but find the premiums prohibitive, given the diminished likelihood that they'll frequently need to use the cover provided. Many in this group would be willing to pay a larger excess on those occasions if it meant that they would afford their monthly premiums. These bills give them that option, increasing take-up and reducing costs for everyone.

The bills also improve value for money by improving the range of services that can be provided. Although the Sunshine Coast is now very well served for healthcare services, that was not always the case. For decades, people living on the coast had to travel to Brisbane for a wide variety of procedures and treatments. In many regional areas, that is still necessary. These bills increase value for money by allowing insurers to offer these regional consumers travel and accommodation benefits as part of their hospital cover.

The bills before us will increase transparency by prohibiting the use of benefit limitation periods, which consumers have told us are confusing. They'll also strengthen the powers of the Private Health Insurance Ombudsman, allowing it to conduct inspections and audits at the premises of health insurers in order to follow-up complaints or ensure compliance. Finally, the bills will improve the information available to consumers by introducing private health insurance statements in place of the existing standard information statement. These new statements will give more useful information and will be available to consumers in a wider range of formats.

Finally, the bills will improve the efficiency of health insurance companies by allowing them to discontinue older products which are no longer appropriate. Maintaining these policies, sometimes with small numbers of participants, can be an expensive drag on the efficiency of insurers. This drives up premiums for everyone. Frankly, in total, the bills before us show us the stark contrast that will face the Australian people at the next election when it comes to health.

On our side the coalition and our excellent Minister for Health, who has joined us here now, are addressing the real challenge of an ageing population and growing demand on our health services by working all of the levers available to a government. We are providing record funding to our public hospitals and record funding to Medicare to do what we can to ensure that the public system has the expanded capacity that it needs. That has delivered the highest bulk-billing rates ever recorded, ensuring that more Australians than ever are able to visit their GP without paying, and keeping as many as possible away from the hospital system.

Alongside that action to increase capacity we're also working to reduce demand, through this bill and its associated reform package. Already our reforms have seen the lowest private health premiums increase in 17 years. Whilst Labor talk about it, we do it. However, this government never rests on its laurels. Now is the time to capitalise on that achievement and go further. By making private health insurance more affordable for younger Australians, by increasing the attractiveness and flexibility of the services offered and by allowing insurers to be more efficient, we're helping to reverse the decline in private health insurance membership and thus reducing the demand on our public hospitals.

What in contrast is Labor's approach to solving the ballooning demand on our health services caused by our ageing population? Empty promises, budget black holes and bald lies. When it comes to private health insurance they want to increase the cost of premiums by 16 per cent, by banning the most affordable policies. They have failed to rule out cutting the rebate, as they did by $4 billion when they were last in government.

Just this week we saw more of this in my electorate of Fisher. As members will know, the Sunshine Coast is a growing healthcare hub and at its heart is our new multibillion dollar Sunshine Coast University Hospital. This is a fantastic facility, filled with dedicated and hardworking healthcare professionals, including my own daughter. However, just 14 months after opening, despite increasing Commonwealth government funding, my LNP state colleague Mark McArdle, the member for Caloundra, has ascertained that ramping is on the increase, that ambulances are facing longer waits for their patients to be admitted, and that local patients are being forced to divert to the older Nambour facility.

I am sad to say that it would appear that our hospital is becoming a victim of the state Labor government's total incompetence and mismanagement. State Labor health minister Steven Miles's response was as predictable as it was useless. He said, 'Everything is fine; nothing to see,' despite the evidence to the contrary, and, 'In any case, it is the fault of the Turnbull government for cutting hospital funding and Medicare.' Commonwealth hospital funding in our state is at record levels, growing from $2.7 billion in 2012-13 to $3.9 billion in 2016-17. That's an increase provided by the Turnbull government of 46 per cent in just four years. In contrast, Minister Miles's Queensland Labor government reduced health services funding in 2017 by $63.8 million. These are straightforward lies in place of any plan to fix the problem.

I'm pleased to say that the people of Australia have seen through this Labor Party and their dishonest 'Mediscare' campaign orchestrated by the leader of the lamentables, the patriarch of the pitiful, the master of the miserable and the commander of the calamitous—that is, the Leader of the Opposition. The people of Australia are onto this bloke. They know that a fantasy funding promise and a fake Medicare card covered in lies won't get you very far when you're ill and in need of treatment. They know that a torrent of dodgy and baseless complaints about imaginary cuts is no substitute for the Turnbull government's pragmatic and comprehensive policymaking.

The people of my electorate of Fisher and all Australians want to see a public hospital system that works. To do that, we need the extra investment that the Turnbull government is already providing and we also need to reduce demand through increasing the take-up of private health insurance. That is what this legislation will achieve. For that reason, I commend this bill to the House.

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