Luke Hartsuyker (Cowper, National Party) Share this | Link to this | Hansard source

I welcome the opportunity to speak on the Private Health Insurance Bill 2006 and related bills, which will enhance the role of private health insurance in our healthcare system. I believe it is right to extend the freedom of choice to those who can afford it whilst ensuring the position of those who cannot. I believe it is right that we should take measures which seek to relieve the pressure on our publicly financed health services.

The introduction of broader health cover in the private health sector seeks to: firstly, remove the artificial financial incentive for hospitalisation in the private sector where clinically appropriate alternative treatments exist; secondly, reflect contemporary clinical practice in Australia which has been facilitated by advances in medical practice and technology; and, thirdly, align private health financing of chronic disease management and prevention with the public sector.

There are those, of course, who see no role for the government encouraging the private sector, whether in the health service or in our schools, and I will address some of those arguments later. But, first, let us look at the demands being placed on our health system. The number of patients admitted to hospitals in 2004-05 was seven million, an increase of some 2.6 per cent over the previous financial year. These figures are likely to continue to rise.

We already know that in the years to come we are likely to be in a position where a smaller proportion of working people are supporting a higher proportion of people entitled to various taxpayer funded benefits. It is also true that those working people will be supporting a rapidly increasing bill for public health services. The pressure on cost comes from not just population factors. Advances in medical science mean that more treatments and more expensive treatments are available. At the same time we are all aware of the demand for new and expensive drugs to be included in the Pharmaceutical Benefits Scheme, often for the benefit of a relatively small cohort of patients, but which are capable of making a huge difference to the quality of life of those patients. This is not to say that decisions about providing new treatments or drugs should be decided on the basis of the numbers who benefit. What it does say is that a humane and prosperous society like ours will have to think long and hard about how it finances its health care if it is going to continue to meet the legitimate demands of its citizens.

How much is the health service costing at present? The coalition government will spend some $48 billion in the current financial year, an increase of 138 per cent since 1995-96, representing 22 per cent of total Australian government spending. On public hospital funding alone, the coalition government will spend $42 billion between 2003 and 2008 under the Australian health care agreements, an increase of 83 per cent over previous agreements for 1993-98.

There are those who say that the current arrangements for funding hospitals should be changed. But let us put aside for the moment any arguments about the wisdom of disbursing this much money through the states and territories with little control over whether it is used effectively. That is something we should question. Let us put aside any arguments about whether that makes political sense. Whatever one’s position on those matters, we can surely agree that this is an issue that needs careful management. Why? We are dealing with, currently, more than one-fifth of government spending. The amount allocated has already increased more than 2½ times over 10 years and, according to some, is still too little. The numbers contributing to providing those resources through taxes will suffer a relative decline in the coming years. We have no direct control over the demands made on the resources. People will always fall ill, people will always break limbs and people will always want to have children. And, as I say, we are a humane and prosperous society and therefore we need to meet these demands, as well as those for education, transport, the environment and all the other areas of government responsibility. The question is: how?

Part of the answer, at least, must be to encourage those who can afford to do so to turn to the private sector, which is bearing an increasing share of the load. In 2003-04, private hospitals treated 2.64 million patients, an increase of 57 per cent since 1996-97. More than 55 per cent of all surgery is now performed privately. Thanks to measures such as the 30 per cent rebate and a focus on lifetime cover, 43 per cent of the population now has private health cover, compared to 34 per cent under Labor. I am pleased to say that we should be able to claim some cross-party support on this issue. Labor’s own health minister in 1993, Graham Richardson, warned that the health system would be in danger of collapse if private health insurance coverage were to drop below 40 per cent. This is what he said:

We’ve always had the view that the private system has to co-exist with a public system. If it doesn’t, the public system can’t cope.

We haven’t had private health insurance numbers this low in the last ten years and I think it’s time we did something about it.

Is a taxpayer subsidy in the form of a rebate worth it? I think the answer is a resounding yes for both the recipient and the taxpayer. The rebate is worth almost $1,000 a year for the average family with two children, and it has been estimated that every dollar spent on the rebate itself saves $2 in government spending, including state government spending on public hospitals. More broadly, the existence of a viable private health sector takes pressure off the public system. In 2003-04 private hospitals treated some 2.6 million patients, a 57 per cent increase since 1996-97. More than 55 per cent of surgery is now performed in private hospitals. Private hospitals are making a huge contribution to the health system in this country. All this activity in the private sector translates into shorter waiting lists in the public sector.

To restate the problem: the health service requires a large and growing portion of the government’s budget. Our ability to finance this from tax revenue is likely to diminish. We cannot control demand, and developing the private sector is a rational response to the problem.

Let me now turn to the measures proposed in this bill, particularly those which extend private cover into new areas. It has long been accepted that health care does not begin and end in hospital. It may be an overused adage that prevention is better than cure, but never has it been more applicable on both an individual and an institutional basis. As part of the solution to the problem of the rising demand on health services generally, it is clearly good policy that we encourage people to take better care of themselves and adopt more healthy lifestyles, including, particularly, giving up or not starting smoking.

It is this element of personal responsibility that part of these measures seeks to encourage under the heading of broader health cover. Being able to include wellness and prevention services, including suitable exercise programs, in health insurance packages will surely make the take-up of private health insurance more attractive for many and save public costs further downstream by, hopefully, avoiding hospitalisation.

I also welcome the extension of private cover into services that substitute for hospital care in the form of outpatient or day admission. Relieving hospitals of some of the demand for, say, post-discharge care or dialysis and at the same time relieving those patients of the need to re-enter the clinical environment and enabling them to receive treatment in the comfort of their own home will benefit all concerned. Broader health care will provide for more diverse offerings from private health insurance companies through the wider range of services that can now be covered by insurance.

We know that many members opposite abhor the spending of public money in private schools while conveniently ignoring the load that the private sector takes off our public schools. If all students who currently attend private schools were to enrol in state government schools then the taxpayer would need to contribute an additional $3 billion to $4 billion. In the case of New South Wales, the state government is already failing to meet demand from its schools, though by way of excuse it points the finger at the federal government for supporting the private sector.

Similarly, many members opposite will oppose the extension of private health insurance. I believe this is a blinkered and short-sighted view. It is blinkered because it stems from an archaic, socialist mindset that services such as health and education are the business of the state and that the private sector has no business being involved. What can possibly be wrong with the private sector offering a service that people want at a price they are prepared to pay? It is short-sighted because it ignores the rising demand for and rising costs of health services and therefore offers no solution. Somehow, I do not think members opposite will be pressing for tax increases anytime in the near future.

In my electorate some 30,000 people enjoy the benefits of private health insurance. It plays a vital role in providing improved health outcomes in our community. I believe the balance between private and public health services should be maintained. I commend the bill to the House for being part of that strategy.

Sharon Grierson (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

The Private Health Insurance Bill 2006 has been described by the minister as groundbreaking. Apparently this is the most significant change to private health insurance policy since the introduction of the government’s rebate and Lifetime Health Cover scheme in 2001. Let us have a close look and see if it lives up to those expectations. This is a package of seven bills in total but the Private Health Insurance Bill 2006 is the main bill and very central to the package. The key focus of this package is to allow private health funds to provide what the government has called ‘broader health cover’—that is, medical services outside the hospital gate.

More specifically, these bills implement a series of changes to current private health insurance policy. These include the expansion of private health insurance to cover medical services provided outside hospital which either substitute in home or community settings for in-hospital services, such as chemotherapy and dialysis, or are designed to prevent hospitalisation in the first place, such as health promotion and chronic disease management. This broader health cover and the expansion of private health insurance to medical services that come under this umbrella is the most significant policy change in the package.

The package also includes changes to Lifetime Health Cover, the scheme introduced by the government to make private health insurance more expensive as you get older if you fail to take out private health insurance by the time you turn 30. In this new legislation, people who have retained private health insurance for over 10 years will, when they get to the 10-year mark, no longer be subject to lifetime health cover loadings on their health insurance premiums. So there is incentive for people over 30 to join again. It also introduces requirements for private health insurance funds to provide standard product information to consumers. That sounds quite reasonable.

This bill also implements changes to existing administrative and regulatory arrangements for the sector and will therefore, it is assumed, streamline the legislative framework for private health insurance by bringing the main components of the existing legislative framework—currently in three acts—all under one act. That sounds like a sensible thing to do.

It also includes changes to existing reinsurance arrangements where companies offset their risk, but, interestingly and quite curiously, the government has chosen to adopt the private health insurance industry’s preferred model for reinsurance rather than its own recommended capitation model. In the explanatory memorandum to this bill it is made clear that the government’s preferred model would have been ‘the best strategic option for the long term’. So the question remains: why didn’t the government have the nerve to pursue its own advice and go for that better long-term option? The other bills in the package are to provide for transitional arrangements and consequential amendments—quite technical matters—to existing legislation.

If this legislation is so good, as the minister claims, what is Labor’s position? We are supporting the package, but I can tell you why. It is because this is the only deal on the table. This is the only legislation put forward that we can even consider. There is no legislation to address chronic medical workforce shortages. There is no legislation to address the inequities in health funding between metropolitan and regional areas. There is no legislation for the expansion of Medicare funding to cover these new innovative services and treatments or any bold reforms to the Commonwealth-state health divide. No, this is the only deal we have on offer.

But, that said, there are aspects of this package that Labor welcomes. The move to standardise private health insurance product information for consumers is a good thing—a bit of consumer comparison shopping is essential when you are taking out insurance. The changes to Lifetime Health Cover are worth noting as well. We would hope that the requirement to provide standard information to consumers and therefore allow them to compare different private health insurance products and to understand their entitlements will give consumers more security and certainty about what they are signing up for. We are told that information would include things like the costs of premiums, waiting periods, exclusions, gaps and excesses—because every day we have conversations in our electorates with people who say: ‘I’ve got private insurance and I’ve just been sick,’ or, ‘My wife’s just been in hospital—I had no idea what costs I would be up for. I thought I would be covered for everything.’ So they have been crying out for that sort of information for some time.

In conjunction with this provision, the Private Health Insurance Ombudsman has also been funded to develop a website to enable consumers to easily compare product information. We support these initiatives and we hope they will assist all consumers. The removal of the loading on premiums for people who have retained Lifetime Health Cover or had long-term membership is a bonus which hopefully will assist them with the costs included in private health insurance.

Those are the best aspects of the bill, but Labor has many concerns about the package and they are outlined in the second reading amendment moved by the member for Gellibrand. We hope the government will support the amendment. Labor is particularly concerned about the likely consequences of this legislation. We fear that inequities will now exist for the majority of Australians who do not have private health insurance—such as the entrenchment of a two-tiered healthcare system where access to services is based on ability to pay and not on need. We are concerned that this further undermines Medicare and the universality of our health system. Labor’s amendment highlights these concerns, and we should look more closely at them.

Firstly, there is inequitable access, which we think this bill just about guarantees. If, as the minister suggests, these measures will enable the private health sector to:

... adapt to the realities of early 21st century health care: a way of care that does not always centre on admission to hospital—

but instead focuses on—

day procedures, outpatient services, hospital in the home, wellness and prevention—

then the question remains: if that is so good why is the minister happy to allow this just for private patients but not for public patients? Clearly not all Australians are equally deserving in this minister’s eyes.

Indeed, if the minister were seriously interested in delivering quality innovative health care for all Australians, regardless of wealth or location, we would today be debating an expansion of services to be provided under Medicare and the inclusion of out-of-hospital treatments and new forms of service delivery in the Australian health care agreements, under which the federal government pays for public hospitals throughout the country. To date, these agreements have completely ignored out-of-hospital services. The Commonwealth funds only those people who are admitted patients.

So what will happen to those who are not insured and therefore not covered by these changes? If the minister’s track record is anything to go by, those without private health insurance will simply go without. There will be no access to new innovative medical treatments or to service delivery beyond the hospital for the majority of Australians who do not have private health insurance.

These changes will entrench a two-tiered system of health care which, again, threatens the universality of our health system. Most people out there in the community say governments are there to deliver services for all of us. The most important one, they will tell you, is health. If the broader healthcare provisions give people with private health insurance access to services and treatment options which people without private health insurance will not have access to, then the package just further entrenches the division in the delivery of health services in Australia. If the government were genuine about ensuring the best possible health care, regardless of wealth and location, we would be debating very different legislation today. Where is the legislation to provide funds to expand the range of treatments and services available under Medicare?

Unfortunately, there is no legislation to deal with some of the major health catastrophes that are occurring in this country, but obviously some people will benefit—and who are they? The private health insurance sector. This is one way for them to increase their membership. They can development a membership drive; you can see the advertising coming now. The providers will make themselves more financially viable with these expanded services.

I think it should be noted that there are some very interesting electorates that also stand to benefit. It is worth noting these electorates, where they are located and who holds these seats, to demonstrate the skewed nature of private health insurance coverage in Australia and the very limited demographic reach of the benefits of this legislation. Just 35 out of 150 electorates across the nation have constituencies with rates of private health insurance coverage at 50 per cent or more. That means just 23 per cent of the electorates represented in this chamber have a majority of constituents with private health insurance of 50 per cent or more. So 77 per cent of all the representatives in this House do not have more than 50 per cent of their constituents covered by private health insurance.

According to the latest figures, coverage in the Hunter ranges from 38.6 per cent in Paterson to 45.3 per cent in Charlton. In my electorate of Newcastle the coverage of private health insurance has been stagnant for two years at 44.2 per cent, which is close to the national average.

Let us look at the electorates at the top of the pops—the ones that are going to do very well. Leading the list of the top 10 electorates for private health insurance coverage is the electorate of Bradfield, held by the Minister for Defence, with a staggering 79.8 per cent of constituents with private health insurance. Bradfield is followed by the electorates of Berowra, held by Attorney-General Phillip Ruddock; Kooyong; Tangney; Menzies, held by the Minister for Immigration and Citizenship; Goldstein, held by the Minister for Vocational and Further Education; North Sydney, held by the Minister for Employment and Workplace Relations; Warringah, held by the Minister for Health and Ageing; Cook; and Wentworth, held by the Minister for the Environment and Water Resources, Malcolm Turnbull. They are the top 10, they are all blue-ribbon Liberal seats and they will all do very well, thank you very much.

The electorate of Bradfield has not only the highest rate of private health insurance coverage but also one of the highest Medicare spends in Australia, so it is reaping benefits from both the private health dollar and the public health dollar. So much for the government’s argument that an invigorated private health sector takes the pressure off the public health system and the public purse!

Rural and regional Australians are the big losers here. With no genuinely national private health insurance fund and a scarcity of private health facilities in rural areas, the Howard government simply cannot ensure that all Australians will have choices in accessing these new programs and services. If you are living in isolated regional Australia, just try to get a chemotherapy service to your home. We are not treating the people of this country fairly. That National Party members come into this chamber and tolerate second-rate treatment by their coalition partners of the people who elect them I think is quite unforgivable. Where are they on this legislation? Where are they in defending their constituents and their access to services?

When determining the range and location of services to be provided, private health insurance funds are under no obligation to ensure that they remain focused on health outcomes and health needs instead of costs. There are no guarantees that patient groups with the greatest need will ever be able to access these services. I am sure that Aboriginal people living in rural and remote communities, who are up to 50 per cent more likely to need dialysis than the national average, would love to have access to dialysis treatments at home instead of travelling 500 kilometres or more to their nearest renal clinic. But I do not see anything in this package to suggest that people in rural or remote communities will ever have access to such programs, despite a clearly demonstrated need.

In my region—and this is appalling—the Hunter’s alarming death rate is worsening relative to the rest of the state and has risen to second place behind the most remote and rural areas of New South Wales. These are some of our statistics. We have the highest rate of colorectal cancer in men and women in New South Wales. We have the second highest rate of melanomas in the state. Hunter women experience an above average number of asthma deaths. The Hunter also has a higher rate of death by injury or poisoning. The region’s biggest killers are coronary heart disease and stroke, followed by cancer. The region has the highest prostate cancer death rate in the state of New South Wales. Community mental health teams have been cut by half, preventing home visits after 5 pm. I have heard it before. What will the government say about this? Blame it on the states. Let us not blame it on the states; let us have an evidence based healthcare system based on need, and perhaps we will be able to hold our heads up high for a change.

Medical workforce shortages are most acute in rural and regional Australia, and there is nothing in these bills to redress that crisis. Nor is there any reason to believe that private providers will be rushing to set up health services in areas of need in regional Australia. These bills manifestly fail to deliver equal access for the 43 per cent of Australians with private health insurance—let alone for the majority of Australians who are not insured.

There is also no evidence to support the government’s argument that the package will not increase premiums, and premiums keep going up. The last time the government said it would reduce pressure on private health insurance premiums was in 2000-01, when it introduced the 30 per cent rebate and Lifetime Health Cover. Since then, there has been a 40 per cent increase in premium costs. Between 1998 and 2006, the cost of private health insurance increased twice as fast as general inflation.

The government cannot be trusted; we know that. We learnt long ago that the ‘ironclad guarantees’ of the health minister count for nothing after polling day. Where is the logic in the argument that expanding services offered will reduce premiums? Where are the assurances in these bills that any savings made by the private health insurance industry will be passed on to consumers? Do not bother to look; you will not find them; they are not here.

If the government is genuine about wanting to protect consumers, why does this legislation strip the Private Health Insurance Administration Council of its current role to minimise premium levels? Why remove those kinds of consumer protections if it is serious about keeping premiums down? I guess there is one solution. Remember that private health insurance premiums are also predicted to rise once Medibank Private is sold. When will that be sold? The legislation is there. As soon as the election is over, if the government wins, Medibank Private will be sold. What is the solution to that? Do not re-elect the government. Let us do something serious about health in this country and have a Labor government once and for all.

These bills also fail to provide safety and quality assurances. There is no quality assurance mechanism for broader health cover services until July 2008—15 months hence. Some services, such as telephone advice lines, do not have any quality standards in the bills. Who is going to be giving advice when you pick up the phone? Is it going to be a scripted text that someone reads? Is it going to be a doctor, a nurse or a paramedic? Who knows! That is a risk to consumers that no-one should have to bear.

Recent disturbing reports that one of the country’s largest private health insurance funds, HCF, has been passing on medical records of patients discharged from mental health facilities to a contractor, McKesson Asia-Pacific, which then pushed patients to accept follow-up services, show the importance of having some quality assurance in this sort of legislation. I urge the government to ensure that this legislation will protect patients’ privacy and rights. We have to get everyone to lift their game.

The AMA has also expressed concerns about the lack of sufficient safeguards in the bill for doctors to expressly continue to make clinical decisions about the best interests of their patients. Others have raised concerns about the package for moving towards managed care. That is a system whereby the private health insurer assumes responsibility for the health costs of its members and therefore, for example, directs contract arrangements with doctors and other providers. They become bidding wars. They become all about the costs of service delivery rather than the benefit of that service or the quality of that service. I have so many concerns about this bill, as a matter of fact, and we will be moving an amendment during the consideration in detail stage to strengthen this bill’s protections of doctors’ clinical freedoms.

The $50 million worth of advertising to sell this measure is free advertising for private health insurers and comes straight from the taxpayer’s dollar. That is there for the next four years, and I guess mates rates apply. I think everyone would agree it is pretty outrageous that this government collects taxes from all Australian families to fund a marketing campaign for the private health insurance sector. It is a shameful waste of taxpayers’ money and scarce health resources.

That $50 million would actually provide an additional 1.5 million GP consultations for the country. I know what we would do with that $50 million in my electorate of Newcastle. It would fund the Medicare licence we desperately need for a PET scanner, the refurbishment of the Hunter dementia resource centre, a GP after-hours access service and its long-term funding, and a Commonwealth dental scheme—the sorts of things that my electorate calls out for over and over again. I think the private health insurance sector is already generously subsidised.

This legislation fails to address the real issue of the sustainability of the private health sector and it certainly fails to address the real health needs of this country. There is really no choice in this legislation. I think it is about time that members of the National Party stood up to its big brother in government and demanded a fairer deal for the health and wellbeing of rural and regional Australia. It is about time that the government removed its ideological blinkers and did something about our health system. It should restore some equity, fairness and quality to our national health system in Australia.

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

I rise with great pleasure to the support the legislation that we have in front of us today. Before I commence outlining the reasons why I support the Private Health Insurance Bill 2006 and related bills, I will refer to the speech by the member for Newcastle. I feel it is imperative and incumbent upon me to assure Australians that it is absolutely not a crime to have private health insurance. The member for Newcastle would have you believe—if you listened to her speech and the assertions she made within it—that it is. She has not represented those in her Newcastle electorate who would dare to have such a thing as private health insurance. Given the statements that she made in the House today, she has clearly told the electors of Newcastle that if you have private health insurance then your interests will not be represented by your member. Far from paying out on members of The Nationals, she should note this. The one thing that you can be assured of about National coalition members is that they will represent all constituents equally. There is no discrimination in the way in which we voice the concerns of the constituents. Regardless of whether we agree with them or not, the voices of the constituents can be heard, and they will get representation. That is certainly what people have been told by the member for Newcastle they will not have if they have private health insurance.

I will now move on to the reasons why I support this bill. The particular area of the bill that I want to mention concerns the broader health cover that has been sought for so long by my electorate. When this is introduced, it will mean insurers will be able to pay benefits for medical services that are provided outside a hospital. What a very sensible decision to make! While private health insurers must offer a product that covers hospital treatment, they will now be able to develop a health insurance policy that can pay benefits for hospital services that can be safely delivered outside a hospital environment and setting. This allows for the best care to be provided in the most suitable location for the person who has taken out private health insurance. Who knows: it could move on to the public health system as well and enable pressure to be taken off that system as people who have private health insurance take that action, so that more public patients who are unable to have private health insurance can access treatment.

They probably cannot if they live in the electorate of Riverina, which is under the Greater Southern Area Health Service run by the New South Wales state Labor government of Premier Iemma. It is not easy to access any service, whether it be inside or outside a hospital. You have got a significant waiting list. I was told recently of a man with an injury who does not have private health insurance. The fact is he was told he would have to wait three years before he could even have a remote chance of being put on the list to have his bicep repaired. That is what we have to bear in New South Wales under the Iemma Labor government.

Once the Private Health Insurance Bill goes through, it will enable patients to receive benefits for services which do not require admission to a hospital. Take someone with cataracts. Having cataracts is a common reason why an elderly patient or a not so elderly patient has to be admitted to hospital, although now they could have their procedure done safely and effectively in a very low-acuity setting. The second most common reason for admission to hospital is chemotherapy. We all know people who are in the unfortunate circumstances of suffering from cancer and requiring admission for chemotherapy. But this chemotherapy can be provided just as conveniently and safely in a community setting, either in a person’s home or in a low-acuity health facility. You should be able to access this treatment under your private health insurance and you should not have to be forced into hospital.

The changes will mean that pressure is taken off our health system, as I have indicated, through fewer people being admitted to hospital and these additional hospital costs being avoided. The idea is that, when you factor in the high cost of providing health care in a hospital setting with nurses, the overheads and all of the issues that go into making up a day charge for a hospital, you will be able to stop premiums from rising to account for the additional costs of providing medical treatments or services to those in hospital who simply may not need to be there because those types of services could be delivered elsewhere. Broader health cover will also allow health insurers to work with a wide range of service providers to develop more flexible and innovative products that reflect our modern clinical practices and our consumer expectation. Again, these are things that are so beneficial for somebody recovering from an illness or needing the appropriate and adequate treatment for an illness that could be available outside the system rather than within the hospital system itself. Health insurers will be better able to assist consumers to manage and prevent acute and chronic conditions. Many people could benefit from tailored programs that support and sustain a healthy lifestyle, such as a personalised health check, dietary guidance, exercise supervision and support to quit smoking. All of these things can now be taken into consideration in the way in which private health insurance is paid for.

Broader health cover is set to come into effect on 1 April 2007, and it will include: outpatient and day services; in-home services such as dialysis and post-discharge care; and condition management, wellness and prevention services. The previous speaker outlined that she thought many of the people in her electorate would love to be able to get dialysis at home and be able to claim it. Yes, that is the case, but many of the people who need dialysis want to take comfort in the public hospital system. If you take the pressure off dialysis units in the public hospital system by enabling people to utilise their health benefits and set up dialysis at home, it has to be better in the long term for access for public patients. We have a whole suite of options that can come into play to give everybody better opportunities to access the treatments they require.

There are also dental and optical services, out-of-hospital chemotherapy, nursing, dietitians, domestic assistance, ambulances, hearing services, theatre fees, physiotherapy and podiatry. All of these will be eligible for the 30 per cent and over-65 higher PHI rebates plus public health insurance rates. Nothing will stop private patients being treated in public hospitals, but this will encourage private-insured wellness, prevention and early intervention for fund members, which could prevent or minimise expensive hospitalisation. That is the priority of the government, and it should be. We need to offer a suite of services and choices and try to minimise the cost overall by always being innovative and enabling new practices to come into play that can reduce or contain costs in an ever-burgeoning health world where many of our health treatments are so expensive and sometimes cannot be avoided. I think that it will greatly appeal to younger and healthier people who currently feel that hospital cover is not relevant to them. In some circumstances these services may be more suitable, safer and more cost-effective for members. Health funds, as I have mentioned, may also offer to cover preventative services which, in helping people to better manage their health, may place downward pressure on premiums over the long term. That is all that we can hope for. We need to start putting into practice policies to put downward pressure on premium hikes and prices.

Individual funds will decide what services they include in the private health insurance product. I would encourage them to be expansive, and innovative and to explore any and all options that can contain health costs over time. In my electorate of Riverina there is only one private hospital to cater to the entire electorate, so it is under enormous pressure. If I had a hip replacement, I could decide to go into the private hospital, as I have private health insurance, in order to free up one extra space in the public hospital for somebody else who will hopefully come off the three- to four-year waiting list—and sometimes longer—for the same type of procedure. If I go into a private hospital to have my operation and then am very well, I will still need some physio and somebody to occasionally check on my wound. For me to be in a position where I am going to run up the cost of all of the nursing and health services provided in the hospital that come into the costing of that bed seems quite ridiculous to me. It seems to me that I should be able to go home and have somebody come in and dress my wound and still claim that on my medical insurance. It would be much better and healthier for me as the patient, it would establish an external practice that is able to accommodate and assist those services and, at the same time, it would take the pressure off the hospital system and not be so costly for the private health insurance fund that it has to continue to raise its premiums. I think it is such a sensible idea to be able to have these options.

In rural and regional areas it is often easier to have treatments for a serious illness in a more comfortable setting, such as home environments, due to isolation and lack of beds. This legislation can assist in these situations for those people who have committed no crime. They have private health insurance; that is simply not the crime that previous speakers in this debate would have people in this House believe. If people are prepared and willing to do that to take the pressure off the public hospital system then this is what we should have, but it should have a multiple choice factor.

The fact that these changes can, as I say, lead to lower premiums for residents is welcome, especially for those rural people who outlay an enormous amount in travel costs in order to be treated. Serious illness is very difficult for people in rural areas. They travel to hospital because they are not covered for that treatment at home or in another setting. The costs can be extraordinary, as can the social and family isolation and dislocation. It is very sensible to broaden health cover to enable them to access the treatments they are entitled to.

Currently, private health care must be performed in hospital if members are to receive a benefit from their health fund. Hospital tables with ancillary insurance are able to cover only other kinds of health services. As a result, many patients, such as the people in my electorate of Riverina, seek in-hospital treatment in order to utilise their private health insurance, even though safe and suitable out-of-hospital services exist at less cost for that particular treatment. I am not saying that this is the case for all treatments, but it is a simple matter of horses for courses. Until now, health funds have been prevented from covering preventative treatments and services that are provided as a substitute for in-hospital care, and this change is the most sensible decision I have seen in health in a long time. I congratulate the Minister for Health and Ageing for entertaining this possibility, for giving cost options and for looking at ways to put downward pressure on spiralling health costs for those people who take out private health insurance.

The change is not expected to have an impact on the premiums people pay now but it will effectively remove the current boundaries between hospital insurance and ancillary insurance. It will not be mandatory for health funds to offer broader health products, but I suggest it would be a very smart thing for any private health insurer to consider for all of the reasons I have outlined—and the lower the cost the better. The government’s changes will allow people to have that opportunity which they do not have now.

The government and the minister expect that this type of cover will become the principal form of private health insurance product, and I certainly endorse that. Research into broader health cover found that it would not lead to higher premiums, because health funds would have more flexibility in how they cover services. In offering broader health cover, a health fund may include a wider range of services than is currently available. It is an issue that we have needed to address for a long time. These guidelines were developed in consultation with the industry and with consumer representatives. We should not forget the consumer, because it is a consumer choice. If I had a family member who needed treatment, I would hope that I would be able to access that treatment at home in a comfortable, warm environment if that treatment could be delivered by a health service that could come to the house. I should be able to claim that and it would save the pro rata cost of a hospital bed when insurance premiums came to be determined.

I want to reiterate my absolute support for this bill, and in particular the area of the legislation I have spoken on today, because it enables private health insurers to provide myriad choices for the consumer. I also want to reiterate that, far from being ashamed of having private health insurance, as some in this House would advocate, people should be proud of wanting to have higher health insurance. In turn, those people who do not have health insurance because they cannot afford it should not be ashamed. They are entitled to quality public health services and access, off waiting lists, to procedures. It simply is not right that people who can afford to pay for treatment do not pay for it and take up valuable positions in the hospital and health system at the expense of having more and more people on waiting lists. In the New South Wales Greater Southern Area Health Service we already experience a disgraceful waiting list.

I think this legislation is one way of being able, quite rightly, to assist people who do not have the resources or the finances to purchase health insurance which would enable them to access treatment faster. If you are a person who pays into a health insurance scheme, far from feeling ashamed and that you should not undertake new and innovative treatments, you should feel that you are contributing to the health of other Australians who are not as fortunate as you. That will always be the case. In enacting this bill, we hope that other valuable and worthwhile Australians will be able to access the public hospital and health system far more readily, and particularly those in New South Wales. I commend the minister on his ability to cut to the chase and pick up these initiatives and I commend the bill to the House.

Annette Ellis (Canberra, Australian Labor Party) Share this | Link to this | Hansard source

I am pleased to have the opportunity to rise in the House today to speak on the Private Health Insurance Bill 2006 and related bills, but I speak with a little bit of concern. I have concern for those with private health insurance who may in the future—we do not know, but we can predict—find themselves eventually facing higher premiums; I have concern for those in our community who cannot afford private health insurance; I have concern for the professional independence of medical professionals; and, in particular, I have great concern about where this government is taking our nation when it comes to health care. I am happy to say that we on this side of the House are honestly supporting this bill. My colleague the member for Gellibrand has moved a second reading amendment that is essential, in my mind, to making this package of bills fair and worthwhile, and I am happily, wholeheartedly supporting that amendment.

For the first time ever I actually agree with the Minister for Health and Aging when he says these bills represent the most significant change to private health insurance in the last five years. The provisions in the bills covering broader health cover are certainly welcome. Where it is deemed clinically appropriate by a medical professional, out-of-hospital services should be able to be covered by private health insurance. Services such as chemotherapy, dialysis and allied health services can be effectively and efficiently delivered in domestic or community based settings. These services should not be limited to hospitals, where scarce hospital beds are occupied unnecessarily in those cases.

For the first time these out-of-hospital services will be covered by private health insurance. We on this side of the House welcome that initiative. The broader health cover provisions in the bills will also allow private health cover for preventative treatments, health promotion programs and chronic disease management. The government should be congratulated on finally taking action on preventative disease management particularly. This is an area that Labor has been very vocal on in the last 10 years, and I welcome the government’s decision to improve access to these programs, even if it is only for private health insurance holders and not the community at large. But more on that in a moment.

Given there is no detail in the bills as to what the rules will be for treatments to qualify under broader health cover, I have strong concerns that, for want of a better term, lifestyle programs may be included. Whilst a very broad range of activities can have preventative health benefits, I would be concerned that any alleged benefit can be substantiated in a clinical setting.

One of my major concerns with the package of bills as introduced is that it does not protect explicitly the clinical independence of medical professionals in determining the most appropriate medical treatment for their patients. I understand that the AMA has raised similar concerns. Labor does not want to see a situation where private health insurance companies are dictating what types of services will be offered to patients solely on the basis of cost to the health insurance companies. Those are decisions to concern doctors, not insurance companies. The member for Gellibrand has addressed this in her second reading amendment to these bills. I call on the government to support that amendment—and to at least think carefully about it. Any failure by the government to support this amendment should be a clear warning to the public that this government’s priority could be seen as industry profit, not patient profit.

My final and paramount concern in relation to broader health cover is that the government has chosen only to provide these services to privately insured patients. The previous speaker, the member for Riverina, put, in her words, a very strong case for why this is probably a good thing. There is a certain benevolence about the way the argument was put: that those people who can afford private health insurance should not be ashamed of having it—well, nobody is claiming they should be—and that they should feel good about the fact that by doing so they are assisting those other poorer folk who cannot afford health insurance.

I do not think the access of health care in this country should be based on benevolence from anybody; it should be based on need, equity and access. Public patients in public hospitals and their doctors deserve to be given the same options for medical treatment as privately insured patients. The member for Riverina—and I am only using her words, because I was here to hear them—made a big call. She described very carefully how it is more comfortable, more secure and better for your health to resort to a home or a close-by community setting to receive particular types of services. Those very same claims could be made by a Medicare patient. They could equally be more safe, more secure, more comfortable and more in tune with their community by receiving these types of treatments at home. The benevolence should be removed out of it. And I say that with the greatest of respect to the member for Riverina and other members who may have that attitude.

We should not have a range of preventative and disease management treatments that are available only to those in our community who can afford private health insurance. The minister opened his second reading speech with the words:

This government is committed to choice in health care.

This government is threatening the universality of our healthcare system by providing choices to private patients that are not available to public patients. The minister went on to say:

This is a groundbreaking change.

My question to the minister is: is this groundbreaking change not suitable for public patients, who are predominantly working families, low-income earners, welfare recipients, older members of our community and many people who make an enormous sacrifice to try to attain private health insurance—the majority of whom, of course, are Medicare or public patients? I ask the question: is it a good thing that we can see that they could be treated as second-class citizens under what now begins to emerge as a two-tiered system of health? Are they to be denied the choices offered to those with private health insurance? If this government is serious about choice, it should fund public hospitals so that the same treatment choices can be offered to public patients as is offered to private patients.

I support a balance in health care between the public and private sectors. I have never said and I never will that there should not be private health insurance. It is a two-pronged approach that this community has managed for many years. My fear with this legislation is that the balance is now beginning to be tipped too far in one direction—the direction of private health insurance policyholders. If public patients do not have access to the same prevention and disease management programs as privately insured patients, surely they will be more likely to be admitted to hospital or seek the services of their local GP.

I note that last week the minister for health was crowing quite loudly about his success in raising the levels of bulk-billing for GP services—fair enough. I would like to congratulate the minister on his government’s efforts. Here in the ACT, bulk-billing rates for non-referred GP attendances in 2005-06 was 21.8 per cent lower—that is right, lower—than in 1995-96. Over the 10 years of this government we have gone backwards on bulk-billing in the ACT. On top of that, ACT residents pay higher out-of-pocket expenses than anyone else in the country when visiting a GP. In fact it is almost double the national average. The figures get even worse when we look at bulk-billing rates for operations. In the ACT less than 22 per cent of operations were bulk-billed to Medicare in 2005-06, down from over 27 per cent when this government came to office—1995-96.

My other concern with the broader health cover provisions is that, with the addition of so many new services, premiums will continue to rise at levels well above inflation, putting further pressure on family budgets or even putting private health insurance out of the reach of many families who are already being squeezed by rising interest rates, the price of petrol—which has been jumping up and down like a yoyo—and grocery bills. The cost of living is increasing. As private health insurers broaden their service base, my fear is that their cost base will broaden also. If recent history is anything to go by, and it usually is, private health insurance premiums have increased twice as fast as the rate of inflation since 1998.

Labor recognise that many families have struggled to meet these increases. I would like to take this opportunity to assure private health insurance customers in my electorate that Labor are committed to keeping the 30 per cent health insurance rebate. Many families and individuals have factored this rebate into their household budgets when it comes to being able to afford private health cover. They rely on the rebate to make ends meet. And Labor are committed to keeping that rebate in place. We will not pull the rug out from under their feet. We have said that constantly. I understand very clearly the efforts to which some older folk and families go to try to have private health insurance. When you look at the sorts of services that they try to get you can understand why they do that.

One element in the package of bills that we on this side of the House are very critical of is the $50 million allocated in the last budget to health insurers to promote their services. This money could and should be spent on more productive areas within the health budget. Disease awareness and prevention programs for the whole community could be well funded with this money. My colleague the member for Gellibrand pointed out in her speech that this money would cover 1.5 million GP visits. That is a lot. That would be money well spent. The $50 million on health insurance advertising is a waste of taxpayers’ money and should be diverted to providing health services for all Australians, not only those with private health insurance. I reiterate: the delivery and receipt of health services in this country has nothing to do with benevolence or helping some part of our community feel good and warm in the tummy about helping others get health services; it is all about equity, access and universality.

I am pleased that these services are now going to be available; they are sensible. The previous speaker, the member for Riverina, made that very clear and I agree with her. They are very sensible ideas but they should not be confined to only those people on private health insurance. That is wrong. The point that has been made by many speakers on the other side is that this will help us get well, make recovery better and deliver services better. Any public patient in my electorate or in any community in this country who is a public patient and requires chemotherapy, dialysis or whatever the other services are, is no less a person by wanting to have it in their home or their community setting like a private health insurance patient will be able to after the passage of these bills.

I say to the government: think very clearly about the path of health care you are taking in this country if you provide these services only to privately insured patients. It is not equitable, it is not accessible, it is not fair and it is not the way health services should be delivered in this country.

As far as I am concerned, the government’s record on the delivery of health is atrocious, and the $50 million of taxpayers’ money going on glossy advertising is crazy. That, in fact, would begin the process that I am talking about in relation to public patients. Of course, we support these bills but I again draw the attention of the House to the amendment to the second reading moved by the member for Gellibrand. It is important, sensible and fair, and would make an enormous improvement to this package of bills should the government have a spark of intelligence and decide that they should support such an amendment. We would be far more comfortable if that were the case.

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

I apologise to the Hansard staff and to you, Mr Deputy Speaker, for my voice. Overnight I have developed quite a bad head cold. I have put my comments in writing to assist Hansard staff. The Private Health Insurance Bill 2006 is the main bill in the legislative package before us, and there will be cognate debate on it. This package was introduced very late during the parliamentary sittings late last year, and from what I can see was rushed through with only one day of public hearings. The bill implements a series of changes to current health insurance provision, including the expansion of private health insurance to cover medical services provided outside hospital—which can either substitute for in-hospital services or are designed to prevent hospitalisation—including health promotion and chronic disease management. This new offering is to be called broader health cover. As indicated, it will for people covered by private health insurance provide services outside hospital. It is probably one of the most significant elements of change in this package.

The other change goes to changes in Lifetime Health Cover rating whereby people who have retained private health insurance for over 10 years will no longer be subject to Lifetime Health Cover loadings. Thirdly, and very importantly, there is the introduction of requirements for private health insurance funds to provide standard product information to consumers.

The Minister for Health and Ageing says that the broader health cover represents the most significant shift in private health insurance policy since the introduction of the rebate and the Lifetime Health Cover scheme back in 2000-01. On behalf of the people I represent who are covered by private health insurance, I believe that these changes will be welcomed. But I do want to draw attention to my fear that the majority of my constituents, who do not have private health insurance, may be left behind.

The changes will mean a significant shift in what private health insurance can do, and subsequently a subtle but important shift in the balance between services funded predominantly through Medicare, such as GP, specialist and public hospital services, and services that in future will be provided and funded through private health insurance. I have always believed that the rationale for private health insurance coverage is that it gives patients additional choice but without necessarily providing a different kind of service per se from that available to non-insured people in the community and what they can obtain through the public hospital system. The notion of universality in quality health provision is, I think, an important principle that begins to be eroded by some of the changes proposed in this bill.

We are told that broader health cover means that private health insurance funds will be able in future to provide cover for medical services provided outside of hospital which are not covered by Medicare. In other words, people will have a broader set of options that will be covered by insurance as opposed to simply augmenting or providing additional services on top of those that currently exist for all people.

As I indicated, I have major concerns that this package represents the shift towards a two-tiered system of health provision. Why do I say this? On my understanding of the legislation, it will potentially make more services and treatment options available but only to people with private health insurance, and those without will not get access to those benefits. The broader health cover provisions in the package, we are told, will make available to private health insurance consumers a range of services not generally available through our public system, professional services for which a Medicare benefit is not payable. The explanatory memorandum indicates these include services such as chemotherapy and dialysis at home as well as preventative and chronic disease management programs. There is an argument that if people with private health insurance have better access not just to out-of-hospital services but also to preventative and chronic disease management programs which are generally not available through the public system, they will indeed end up having access to a better overall quality of health care, thus breaching what I believe is a fundamental principle that universal provision of quality care should apply to all in our community.

Of course the government and the Minister for Health and Ageing and the industry rail against the suggestion that this package represents a shift to a two-tiered system of health care. But if the broader health cover provisions give people with private health insurance access to services and treatment options which people without such insurance will not have access to then in my view the package does exactly that. If it is preferable in certain situations for patients to have access to chemotherapy and dialysis treatments on an outpatient basis, or in fact in their own home, why is the health minister happy to allow this for privately insured patients but not for all public patients?

The area of greatest concern to me in this legislation is the government’s plan to allow private health funds to offer cover for what is called ‘general treatments’. These are defined in the minister’s own words in his second reading speech as:

... tailored programs that support and sustain healthy lifestyles, services such as personalised health checks, dietary guidance, exercise supervision, and support to quit smoking.

With a greater focus on preventive health measures and better management of chronic conditions it may appear this is the way to go in the delivery of cost-effective health care. But this private health insurance cover is only for programs not covered by Medicare and is not available to all in our community. Again I ask: if such programs are deemed by the minister and this government to be important on medical grounds, why are they going to be made available only to those with private health insurance? I am concerned that some of these changes will disadvantage people that I represent, people without private health insurance and people in rural and regional areas who will not have access to many of these services and treatments.

We know from available data and from coverage in my own electorate that people with higher incomes are more likely to have private health insurance. This was confirmed back in 1998 in an ABS survey. More recent data from Roy Morgan Research shows that in the year 2003 having private health insurance cover continued to be strongly associated with higher income levels. When analysed by the income level of the main income earner, Roy Morgan Research showed that 23 per cent of people with an income below $20,000 had insurance while 76 per cent of persons on incomes of $100,000 or more had insurance—23 per cent at the low end of the income scale compared to 76 per cent at the top end of the scale. When analysed by total household income the research data showed that only 19 per cent of people with total household incomes below $20,000 had private health insurance compared to 68 per cent of people with total household incomes of more than $100,000. Interestingly, when I looked at this data I noted that over half—54 per cent—of all persons who hold private health insurance and reported a total household income below $20,000 were over 65, and most likely were aged pensioners. That is certainly the impression I have in terms of the extent of health coverage in my electorate of Throsby. I know that many people on pensions and fixed incomes go to extraordinary lengths to take out private health insurance to provide them with a degree of certainty in the event of any emergencies arising.

I have to ask: why is it that these new provisions will continue to be subsidised through the private health rebate to which all taxpayers contribute? Those with insurance and those without all contribute through the taxation system to the outlays that go to the health rebate. I think this is quite inequitable because not all taxpayers, as I indicated earlier, will receive the benefits of the changes—and we should remember that the private health insurance rebate in 2005-06 was in the order of $3 billion.

We can already see how a two-tiered system operates in the area of dental health provision. If you can afford private health insurance, which some in my community have, your dental costs are partially subsidised through the 30 per cent rebate. But if you cannot afford that option—and the majority of my constituents do not have private health insurance—you could find yourself among the half a million to 600,000 people languishing on our dental health waiting list for attention through the public dental system. The Australian Dental Association recently commented:

People who are disadvantaged by socioeconomic status experience greater levels of oral disease than those from more affluent groups.

It goes on to say that it is acknowledged:

… that “profound disparities exist across socio-economic groups in Australia … [as] the incidence of caries and periodontal disease increases as socio-economic status decreases.”

This, it says, is:

… referred to … as the “polarisation of the burden of [oral] disease”.

From estimates obtained through the Parliamentary Library, it seems that dental care now accounts for around 48 per cent of benefits paid out under ancillary coverage, which amounts in effect to an indirect subsidy in the order of $325 million to $345 million a year. So on the one hand the government, through the rebate, indirectly subsidises the dental health needs of people with private insurance and on the other hand the government turns its back on those most in need by refusing to reinstate and fund a Commonwealth dental program.

As funding has been withdrawn from public patients, subsidies for the oral health needs of privately insured Australians continue to grow. A huge divide has grown such that low-income earners without private dental health insurance are now 25 times more likely to have had all their teeth extracted than high-income earners with insurance. I use that analogy to show the impact of the differential operations of dental care to make the point that, once you move away from government funded universal provisions for all people in the community, it only stands to reason that those who have the means to avail themselves of private health insurance will continue to have better oral and general health outcomes than people who do not have such insurance.

The government and the Minister for Health and Ageing argue that the changes in these bills will not have any impact on premiums. In fact, the minister argued in his second reading speech that, by streamlining regulatory arrangements and enabling funds to operate more efficiently, the provisions in this package will reduce pressures on premiums. I find that amazing, coming from a minister of a government that promised back in 2001 that their policies would keep private health insurance affordable and put downward pressure on premiums. Yet every year since then premiums have increased by well above the rate of inflation—in aggregate, close to 40 per cent since 2001. It stands to reason, I think, that if the funds are able to offer a broader range of products then at least in the short term people will be expected to pay more for these services. This view is confirmed in submissions made by the AMA, who argued:

The health funds will have great difficulty persuading anyone that they can expand the range of services covered by their products without any increase in premiums.

Of course, after the next election, if the government has its way, Medibank Private will be sold. Many of my constituents are currently in that fund. In that transition to its sale, Medibank Private will lose its current not-for-profit status. Given it is Australia’s biggest health insurer, once it becomes a for-profit company this will inevitably lead to premiums rising, not just for the members of Medibank Private but for the whole sector. If the market leader’s premiums are rising then other insurers will surely follow. Community sentiment and expert opinion are against the sale, and that is no doubt why the sale has been put off until after the next election.

I need to alert my constituents with private health insurance to the fact that under this bill there is no restriction on the number of premium rises that can be sought by a health fund in any one year. In the draft exposure bill it was suggested that an annual contract be instituted guaranteeing 12 months protection to consumers on the premium rates that would be charged. Unfortunately, this measure was dropped—probably, I would suggest, due to pressure from the insurers. While in the bill before us the minister retains final authority over premium rises, the bill does not specify that funds must show justification for these rises. Nor does the bill provide details of any criteria to be used by the minister in making his decision, although the minister has previously made a commitment to the development of clear criteria against which premium increases will be considered.

Private health insurance is out of reach for many of my constituents, and that is reflected in the data about those who are covered and those who are not covered. Those who are covered face every annual premium increase with growing levels of trepidation, particularly pensioners and other people on low and fixed incomes. I have many submissions made to me on an annual basis complaining about the justification, or lack thereof, for the constant rises. In fact, I pursued increases charged by one of the insurers and, at a time when the minister was saying that the average rise was in the order of eight per cent, when I looked at the different levels of contribution, the average increase for one fund was in the order of 17 per cent. Many of my constituents also complain that they do not get value for money from their insurance policies.

As part of this cognate debate, we are also dealing with the issue of prosthesis application and listing fees, and I want to bring to the minister’s attention a couple of issues that came to my notice just recently. One case involved a 45-year-old woman who underwent an above-the-knee amputation. As we know, in Australia all amputees are eligible to receive a basic prosthesis, or artificial limb—although the specifics vary from state to state—in the $2,000 to $2,500 price range. This particular constituent of mine, however, was unable to get assistance through her private health fund—even though she was contributing at the highest level—for the fitting of her choice of prosthetic limb, which was a microprocessor-controlled knee joint. This new technology offers amputees much greater safety and function, and has a longer life, but it is expensive. It is important that people here in our community are not denied new technologies that are available to people in other countries.

The other case involved a constituent faced with the necessity of surgery to remove an embolus from an artery. Due to a two-year waiting list at the local public hospital, the procedure was carried out in a local private hospital in January 2006. He tells me he was charged for the titanium coils, as they were not listed at the time, as well as for the costs that he had expected in having surgery in a private hospital. On pursuing his case with the parliamentary secretary, I was surprised to be told:

There is no definition of ‘prosthetic’ in the legislation which supports current Prostheses Arrangements. Such a definition was not included in the legislation as it could become problematic if the way in which health services are provided changes. In addition, there may be a risk of precluding the listing of new technologies if they do not fit the definition.

I think I have gone round in circles in trying to assist both of my constituents in accessing suitable prosthetics to help in the treatment of serious illness.

In conclusion, while there is no doubt that the bill will provide benefits for many of my constituents who are currently covered by private health insurance, I do worry for them about the impact of further rises in their premiums, which, in my view, could only worsen once Medibank Private is sold. I also want to put on the public record my concern that this is possibly the beginning of a two-tiered system of health provision which might end up disadvantaging many of the people I represent who do not have private health insurance. At the core, I think the principle of universality of quality health care for all is certainly at risk as we move in the direction foreshadowed in the ‘broader health cover’ services and provisions.

Tony Abbott (Warringah, Liberal Party, Leader of the House) Share this | Link to this | Hansard source

The Private Health Insurance Bill 2006 and related bills are all about making a good system even better. I say it is a good system and today we have had further evidence of its public appeal. A further 170,000 Australians have become covered by private health insurance over the last quarter. This takes the percentage of the population with private health cover to 43.4 per cent and it is the sixth consecutive quarterly increase in the number of people covered.

Essentially, these bills are about making private health insurance a better product by allowing the funds to cover treatments and programs from their main tables that might prevent or substitute for hospital cover. In addition, it will put in place for the first time a quality and safety regime for privately insured services and it should make it easier for people to work out which product is best for them. So they are good bills.

I welcome the contributions from both sides of this House which have accepted that there is much that is to be welcomed in this bill. I note that these bills are being considered by the Senate Standing Committee on Community Affairs, which is due to report on 26 February. I will carefully consider any recommendations which the committee makes. As well, the government has already indicated that it will be moving amendments in the Senate based on further consultations with the sector. There are some amendments which the opposition wish to move here. I have to say that I think they are unnecessary. If I could address one amendment now—namely, that which seeks to restore the current requirement that the Private Health Insurance Administration Council has as one of its objectives to minimise the level of private health insurance premiums—I think this is essentially redundant, given that the proposed bills retain the public interest test. Nevertheless, in order to provide a belts and braces approach, if you like, I will happily look at putting that back in after having received the recommendations of the Senate committee.

Let me just say, on the subject of premium increases, no-one ever likes premium increases. I like them as little as members opposite, but I do point out that since 1996 premium increases have been significantly less than they were in the previous 13 years. While I certainly am in no position to predict now what the next round of premium increases might be, I do think that they ought to be significantly lower than in recent years given the very large profits or surpluses which the funds have recently made. I commend these bills to the House.

Alex Somlyay (Fairfax, Liberal Party) Share this | Link to this | Hansard source

The original question was that this bill be now read a second time. To this the honourable member for Gellibrand has moved as an amendment that all words after ‘That’ be omitted with a view to substituting other words. The question now is that the words proposed to be omitted stand part of the question.

Question agreed to.

Original question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.