Interviews and Transcripts

Look, we don’t know. We knew that they were tracking up slightly along the lines of CPI until about the pandemic happened, and then after the pandemic, we’ve seen some very deep increases in the median specialist fees for a number of specialist consults, particularly in ECUS fees, but also in some other areas. And this has really outpaced the growth in price of housing, food, and other services. So this is increasing at a rate that’s considerably higher than CPI, which is what’s prompted the government’s consultation paper on excessive fees, and which we argue I think needs to go into a little bit further to look at what’s happening with the market for medical specialist fees overall, so that we can better define what’s meant by excessive fees.

Look, I think we need to leave the private health insurance rebate alone. It’s already been means tested. There are other ways in which, if you want to keep the lid on premiums and save money in private health insurance, that you can do that. One is by reducing some of the extraordinary amounts of money that Australians pay for medical devices and surgical supplies here in Australia. That’s something that we’ve campaigned on for many years about why, in our hospitals we have to pay some of the highest rates in the world for some of these things, and the other thing too is some of the levers that the government has in the tax system. So the Medicare levy surcharge is a tax that people pay if they’re on a high income and they don’t have private health insurance. And one option for the government is actually to increase that, so that people that are choosing to opt out of the system, and if they if they are reasonably wealthy, then they can get to pay their fair share.

Well, it’s been it’s been that way for a very long time. The ability for specialists to charge what they like is enshrined in the Constitution in Australia. But what we’re dealing with here is the department has put out a consultation document about what it describes as being excessive fees, which they say have surged ever since the beginning of the pandemic in 2019. So, doctors’ fees have gone up a considerably faster rate than CPI or inflation.

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.

It works to a point, but the issue with younger people on low incomes is they might be able to get higher incomes over time. If you’re older, over 65 on a pension, you’re on a pension, you’re not going to be getting richer over time. And these are the most vulnerable people in our community, and a lot of them are paying for private health insurance and won’t be able to if this change goes through.

Absolutely, there’s a number of people on very low incomes who are struggling to maintain their private health insurance and pay their premiums. The government has suggested that 44,000 will drop their cover as a result of this measure and you know we’re worried about that because those people will inevitably go and add to public hospital waiting lists. But perhaps more worrying is the number of people who could downgrade their cover and find that they’re not covered for diseases which are quite common in this age group, like joint replacements, and those people will end up using the public hospital system as well. So we really don’t think that this is the right way for the government to try and make savings. What it’s doing is taking money from people who are taking some responsibility for their own health care and having an impact on the public hospital system where inevitably those people who drop out and downgrade are going to end up.

So Oliver, what the Minister has announced is that an extra rebate which is paid for older Australians will disappear. Now there are 358,000 people with private health insurance who are over 65 in Western Australia, so that’s 358,000 people who will be affected. The cost is going to be really quite substantial. So there’s an extra rebate, which is an extra 4% if you’re between 65 and 69, and an extra 8% if you’re over 70. So from the 1st of April next year, your private health insurance will go up the normal amount. This year there was an average of 4%. Plus an extra eight per cent. So if you’re on a typical silver couples policy and you’re over 70, you’re going to get a 12 per cent whack. If you’ve got a gold policy, they’re increasing at a greater rate, and it’s going to be a 20 per cent whack at more than $1,000 extra. Now, I get the minister’s issues around generational inequity and there are plenty of people over 65 who are quite wealthy. We are really, really worried about people on pensions and people on low incomes who just won’t be able to afford their top cover going forward with it. So we’ve asked the government to look at exempting people on lower incomes.

Now private health insurance isn’t allowed to cover specialists out in the community. We are only allowed to cover specialists in hospital, and we know that doctors in hospitals have increased their out of pocket fees, the bits the patient pay themselves, by 22% over the last three years. That’s an average it’s actually gone up a lot more than that, but we’re seeing in the community stories of people with hundreds of dollars of out of pocket costs, and that’s stopping people getting health care at the moment.

Well, it’s going to be very difficult for those people who are going to be hit right in the hip pocket. So it’s going to affect about 3 million people. And for people aged 65 to 69, it will be at least a 5% extra premium increase. And for people aged over 70, at least an 11% premium increase, which is up to about $700 in addition to the amount that they’re already paying. Now, many of these people have paid for private health insurance over their whole lifetime have barely even claimed and now they’re reaching their 60s and 70s and they need to claim. The rug’s been pulled out from under their feet and we know from the government’s modelling that there’s going to be dropouts but what the government hasn’t said is how many people are going to downgrade their cover because they want to hang on to it but it means they’re not covered for key things that are treated in private hospitals so they’ll go public.

o, we found out about it at roughly the same time that everyone else did during Minister’s Press Club address, predominantly on the NDIS. But then this issue of transferring millions of dollars from older Australians into aged care came up. And that is the issue about reducing the government’s premium assistance to older Australians. So what that means in practice is that people aged 65 to 69 from next year are going to have an extra premium increase of 5%, which will be about $250 for a standard policy. But people aged over 70, it’s going to go up to 11% extra premium, which could be anything from $500 to $700 extra. And in a cost of living crisis where you’ve got people on low annuities, 400,000 aged pensioners have private health insurance. That’s really got to hurt in the hip pocket and it will cause some people to drop out. But my fear is it’s going to cause far more people to downgrade their health insurance.