Jennie George (Throsby, Australian Labor Party, Shadow Parliamentary Secretary for Environment and Heritage) Share this | Link to this | Hansard source

I take this opportunity in parliament today to raise concerns that have been expressed to my office by numerous constituents about the impact of increased private health insurance costs on their household budgets. I put this concern in the context that, back in 2001, the Howard government promised that it would keep private health insurance affordable and put downward pressure on premiums. As we know, it is another broken commitment, for in the period since then we have seen premiums rise on an annual basis. This year there has been a 5.86 per cent increase; last year, there was an average increase of eight per cent; in 2004, 7½ per cent; and in 2003, 7.4 per cent—increases well above the rate of inflation and increases which suggest to me and the constituents I represent that the government is not exercising enough scrutiny over the costs and profit levels of a number of health industry funds.

When you look at the increases in aggregate, since 2001 the overall increase in premiums has been an astounding 39 per cent. For some funds, the increases have been much higher. Let me give you an example that came to my attention last year. Many of my constituents reported to the office that fund increases under the NIB fund were on average 17.3 per cent at a time when the government was claiming an average increase of just under eight per cent. So the figures have been deliberately obfuscated. When the minister talks about average increases, you can be sure that the 5.68 per cent average increase that he talks about for this year will translate into much higher increases in a number of funds.

I thought these exorbitant increases were worth pursuing with the Private Health Insurance Ombudsman on behalf of the people who wrote to me. I took the matters up with the Private Health Insurance Ombudsman but no redress was offered. So I want to make the point that average increases do not tell the true story about the impact of the changes on household budgets. Further to that, many constituents report increases in gap fees. It is no wonder that, in a sample survey that I did in my electorate, over 60 per cent of the respondents told me that they believed they were not receiving value for money from their health fund.

So it is the case that Australians are paying more and more each year but getting less from their private health insurance coverage. You have to ask the question: why is it that that industry, which is subsidised by taxpayers to the tune of $3 billion a year, cannot even come up with a standard product that covers all the costs of patients when they use a private hospital?

With regard to the round of increases that will apply from 1 April, I have already had a number of constituents contact me. I want to put on the public record a submission made by one of my constituents, Mrs Storey, who does not mind that I refer to her particular circumstance. She says:

As a pensioner who has kept up private health insurance, and at a great cost—over $2000 per year, now to find these health insurance companies again want to increase the contributions we make, at the rate of 6% is now going to put the cover we now have, right out of our reach and the increased contributions difficult.

Rightfully, we should pull out of the fund due to the costs, plus costs for returns, as it becomes difficult to keep this up, but as you know, Mr Howard has it in such a way that if you require medical/hospital treatment/surgery and you do not have private health insurance, you wait for the public system to become available and in the mean time you suffer pain and agony and whatever else one goes through.

I think it is greatly unfair that in this day and age with the difficulties the communities around us are suffering and the high costs of everything the government continually allows these high increases with little to no increase in wages/pensions or how these people are going to cope with yet another increase.

I think the words of Mrs Storey reflect the exasperation that many people in my electorate are experiencing. There is no doubt that the increases projected from 1 April this year will in many cases be much larger than the six per cent average increase that is quoted by the minister. These increases continue to be a breach of government commitments and are putting enormous pressure on household budgets and affecting in particular those with the least capacity to pay and the large number of pensioners whom I represent in the electorate of Throsby.