Dr Rachel David spoke with 3AW about the Albanese Government’s plan to reduce the higher health insurance rebate for people aged 65+

26 Aug 2026Interviews and Transcripts

Transcript

Station: 3AW
Program: 3AW Mornings
Date: 26/8/2026
Time: 9:14 AM
Compere: Tom Elliott

Interviewee: Dr Rachel David, CEO, Private Healthcare Australia

Tom Elliott	Our next guest, CEO of Private Healthcare Australia, Rachel David, good morning.
Dr Rachel David	Morning Tom.
Tom Elliott	Were you surprised as I was on budget night that the rebate for private health insurance for pensioners was cut back so much? I actually couldn’t see the purpose behind it and they save a bit of money up front but they force more pensioners onto the public healthcare system which means it’ll cost money down the track. So were you surprised by that move?
Dr Rachel David	We were told a little bit prior to the budget when Minister Butler was making his press club statement, but in advance of that we weren’t given any warning whatsoever, so we were blindsided by the measure. And again, it will end up costing public hospitals. We estimate in the first year that public hospitals will have to find an additional $260 million to be able to cope with the overflow of patients that will occur as a result of people dropping their cover.
Tom Elliott	Yeah, because I mean, the budget figures we tried to look at after the budget suggested that 44,000 pensioners would drop their private health insurance as a result of this change. But new figures that I’ve read today suggest it’s more than twice as many. It’ll be 91,000 people.
Dr Rachel David	Yes, and we were also shocked by how little modelling or forecasting had gone into this. So it hasn’t even looked at the number of people that could downgrade their cover, which we think is in the order of about 200,000 people who are currently on top hospital cover who will no longer be-
Tom Elliott	Oh, I see. So they won’t necessarily scrap their health insurance, their private health insurance altogether, but they’ll go from gold down to silver or bronze.
Dr Rachel David	Yeah. And in the process, possibly miss out on being covered for things that will only be available to them if they join a public hospital waiting list.
Tom Elliott	See, part of me wonders if they’re like, okay, as the federal government, we reduce the subsidy, we save money. But when we force more older people into the public health care system, that costs the state governments money and the federal government doesn’t care about that. Do you reckon that was the thinking?
Dr Rachel David	Look, unfortunately, it does appear to have been part of the thinking and we’ve seen a number of state governments come out and condemn the proposal, the last person being like the South Australian Health Minister, who was absolutely scathing about it in the last 24 hours, because it is a direct cost shift to older consumers, but also to state governments and the public hospital system.
Tom Elliott	Yeah, and of course, the South Australian state government is a Labor government, isn’t it?
Dr Rachel David	Yeah. So, you know, if they’re upset about it then they’re really upset.
Tom Elliott	Right. So is it too late to do anything? Is it already locked in place and that’s just it? We just have to grin and bear it.
Dr Rachel David	It is very difficult to get budget measures changed but this bill is taking some time to get through. The Senate has called a committee to look into the bill and receive public submissions and that’s going on at the moment. So we are going to continue to push for changes and to ensure that at the very least, the 1.32 million pensioners that are going to be paying the penalty are quarantined.
Tom Elliott	Okay, all right, thank you for your time. Rachel David there, CEO of Private Healthcare Australia.
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