Nick Xenophon (SA, Independent) Share this | Hansard source

I indicate that I will not be supporting this bill—for very different reasons, in a sense, to those of Senator Di Natale, who, I must acknowledge, brings to this chamber a lot of very valuable public policy contribution in the area of health. His work on the issue of Ebola was nothing short of outstanding. His advocacy in respect of that is to be welcomed but on this issue we will disagree, for a number of reasons. But I welcome the debate. I think it is important that we have a debate on these issues in terms of the public and private systems.

I will not be supporting this bill. I have spoken many times in this place about the need for balance between our public and private health systems. In fact, when the ALP was in government, as part of the negotiated agreement in respect of the Medicare surcharge the government and the then health minister Nicola Roxon agreed to the Productivity Commission undertaking to report on public and private hospitals. The report was issued in December 2009 and that did add to our understanding, which was hitherto quite lacking, about the benefit of having an integrated and symbiotic relationship between the public and private systems.

We need a strong private health system in order to provide good and better outcomes for Australians in conjunction with a strong and viable public health system. So I see the issue of a subsidy quite differently from my colleague Senator Di Natale, who I have great respect for in the contribution that he brings. I urge my colleagues to have a very close look at the Productivity Commission's very comprehensive report of December 2009, which indicates the importance of having two systems working in tandem—competing with each other, in a sense, and providing greater initiatives.

In an ideal world, where our public hospitals received all the funding and support they need, getting a balance between public and private would not be an issue but we have to accept that the public system is struggling and that we need to encourage people to take up and retain private health insurance to reduce that burden. It is a careful balancing act between using the rebate to support low- and middle-income earners in their private insurance, and using the levy to discourage higher-income earners from dropping their cover.

It is vital that we get the thresholds right for both the levy and the rebate. According to figures from Private Healthcare Australia more than two million Australians have either dropped or downgraded their private health cover since the former government's decision to means test the rebate in 2012. That is not good news in terms of having a strong private and public hospital system. That is nearly 36 per cent of the policies held during that time. The changes proposed in this bill by a coalition government will only exacerbate the problem. The impact of dropped or downgraded policies is felt by everyone. People who drop or downgrade their policies face significant out-of-pocket costs or long waits in the public system; private health insurers have to raise their costs to offset the drop in coverage; and the public system is put under more strain. The government has estimated that only four per cent of policyholders will be impacted by these changes as they get pushed into lower rebate tiers due to so-called bracket creep. But four per cent means about 520,000 people—over half a million people. If this measure is supposed to save $600 million over the next three years then we can extrapolate that each person will be over $1,150 worse off.

It is also worth noting that, at the coalition campaign launch in August last year, the then Leader of the Opposition, Mr Abbott, promised to fully restore the private health insurance rebate within a decade. In introducing this piece of legislation, which I see as retrograde and short sighted, the government is now even further from achieving that goal.

I would like to put the minister on notice for when we get to the committee stage—and I hope we do have a committee stage where she can answer this—or in her winding up of the second-reading stage of this bill: does the coalition still stand by that policy announced at the campaign launch for the coalition, in August last year, of fully restoring the private health insurance rebate within a decade? And, if so, does the minister acknowledge that this goal, this key election promise, of the coalition will now be even more difficult to achieve because you are actually going backwards? You are actually walking away from that promise made to the people of Australia at the last election.

It is also important to note that the government has sought to justify this move by stating that the savings from this measure will be allocated to the Medical Research Future Fund—a bit like the whole issue of the $7 GP co-payment. All I ask of the coalition is that they talk to some wise heads in the medical profession. Talk to someone like Dr Rodney Pearce—he is not a member of the Labor Party; in fact, I think he may have been a member of the Liberal Party. He is a former president of the AMA in my home state, a very highly regarded general practitioner and co-chair of a national group of GPs. He made the point that, when Michael Wooldridge was health minister, the GPs and the then government, the Howard government, worked together on an immunisation program that cost, I think, $30 million or $40 million, where rates of immunisation dramatically increased amongst children. The money that was saved with fewer kids going to hospital, fewer kids dying and fewer kids' parents having to take time off work because their kids were seriously ill from preventable diseases and illnesses was in the millions, if not billions, of dollars.

Do not turn GPs in this country into an enemy, and do not use this medical research fund as an excuse for some pretty awful policy. I just want to flag to the government, in case there is any ambiguity, that I will not be supporting the $7 co-payment, because it is a retrograde move. Listen to wise heads such as Dr Rodney Pearce, who say there are better ways to save money in the health system and get better outcomes. Respectfully, in terms of this measure and this excuse—this feeble, shallow, sham of an excuse—that we need to bring these changes through for this medical research fund, it is my belief that we should not be funding medical research by punishing people who are trying to do the right thing and protect themselves and their families by taking out private health insurance. We should be funding medical insurance in any event, and we need to be smart about that. As such, I will not be supporting this bill. Further, I call on both the government and the opposition to consider the findings of the 2009 Productivity Commission inquiry into the public and private systems and to come up with comprehensive policies to address the serious problems with our healthcare system.