Dr Dennis Jensen MP

The speech i delivered to our Parliament on this matter:

I begin by drawing the attention of the House to the concerns of my constituents in Tangney. Several have been hung up on when telephoning the former Minister for Health, the member for Gellibrand’s office. Tangney residents were ringing to voice their concerns about this ill guided plan to dramatically change the 30% Private Health Insurance Rebate. All Australians have the right to inform the Minister’s office of their concern without being cut off from engaging with their government. One of my constituents, Mr Charlton from Attadale called the Prime Minister’s office and was transferred to the Minister’s office. Mr Charlton was lucky enough to have his concerns heard but was “unhappy” with his experience with both the Prime Minister’s and Minister Roxon’s offices and found the explanation for the repeal of the rebate less than satisfactory.

I have expressed the concerns of these constituents and the 1687 Tangney residents who signed petitions against this bill to the Shadow Minister for Health and Ageing. The Member for Dickson, I can assure the House was far more interested in the opinions of my constituents… and in the financial burden this legislative change will impose.


West Australian’s en mass have made their feelings clear to the Coalition. WA has one of the highest rates of health insurance in the country with over half of all West Australians holding private hospital cover and many more investing in cover for ancillary services. Our state has a great deal to lose if these measures are passed.

HBF Managing Director Rob Bransby late last year presented Liberal Western Australian Members and Senators in Canberra with a petition of around 35,000 signatures against means testing private health insurance. These signatures were collected in just over four weeks. Australians taking the initiative of providing for their family with private health insurance should not be put in the cross hairs of a government desperate to achieve a pipe dream of a Labor budget surplus.
The Coalition and I oppose this attack on Tangney residents and all Australians who have taken responsibility for their own health care.
 

The Howard Government empowered Australians with choice when it came to private health insurance. The introduction of the private health insurance rebates, the Medicare Levy Surcharge and Lifetime Health Cover saw private health insurance coverage increase significantly from 34 per cent in 1996 to over 44 per cent by 2007. Since 1999 the 30% Rebate has been a key incentive to encourage Australians to take responsibility for their health through private health insurance.
 

Hot on the heels of their election victory in 2007, Labor began swiftly whittling away at these policies of the former competent government. In its first budget income thresholds were raised at which middle and higher income earners paid the additional Medicare levy surcharge if they didn’t take out private health insurance. In its second budget Labor began their battle to means test the private health insurance rebate. But as we know this measure has been knocked back by the Senate and subsequently knocked back again. Yet here we are again having a third go in this chamber.

The Gillard Ministry has been blowing its horn this week about how it helps and supports Australians. Yet on paper their continued efforts to pare back middle income supports instituted by the Howard government speaks volumes in this climate of the much predicted budget surplus.

The proposed means test would mean that many health fund members would see their rebate reduced significantly and many others would lose the rebate altogether. The 2.4 million people directly affected by these changes will face immediate increases in premiums of 14 percent, 29 percent and 43 percent in the respective income tiers. As The Australian reported on the 24 June these Australians will be forced to pay up to $935 a year more for their health cover. Deloitte research shows these premium increases will force significant numbers of health fund members to drop…. or downgrade their cover, resulting in higher premiums for those who remain …and considerable additional pressure on our already strained public health system. In the first year of these amendments 175,000 people would withdraw from private hospital cover and a further 583,000 downgrade. This is considerably more than 27,000 the Minister has claimed will drop their cover throughout the entire sector. Over 5 years 4.3 million people would switch to cheaper policies and 1.6 million would drop their cover altogether if the means-test went through.

In addition, the Deloitte research found 5.7 million people would downgrade important ancillaries cover for services such as dentistry and physiotherapy, while another 2.8 million would drop it all together.

Critically, those who are less likely to claim and those that are younger and healthier are less likely to retain their current level of private health cover in the face of price rises.
It is the healthier individuals who are more likely to decide to drop their cover… leaving an unhealthier group of consumers behind and subsequent rounds of price rises as insurers move to cover rising costs from claims. Because of this All Australians with private health insurance will face higher premiums now and into the future. The government continues to discount the Coalitions dissent of this Bill… with musings that it will only be the wealthy that pay more for health insurance under this policy.

This just isn’t the case.

It is predicted by 2016, consumers will face premiums that are on average 10 per cent higher than they otherwise might have been. For the government to discount out of hand such analysis…as they have… is without belief. These figures are damning of a government that has Health in its sights for cuts and no doubt bungles and back flips. Those who are unable to meet the cost impost of this policy are also many of the most vulnerable Australians… and will be forced into an already overstretched public system.
 

I reference again the Deloitte research…. the Government’s proposed changes will lead to $3.8 billion in extra costs for the public system, a 400 percent increase in elective surgery waiting times and an additional 10 percent rise in premiums.
Our public hospitals are already operating above capacity.

Any additional demand for public healthcare will only translate into longer waiting list times and will likely require investment in new public sector capacity. Patients already face long delays for elective surgery and Emergency Department treatment… this bill will only make this worse. I understand that universal healthcare can be one of the greatest sources of pressure for rising taxes for any government…State or Federal. But getting more people into private insurance will only relieve pressures on our public hospitals and on our hard working nurses and doctors. I fail to see why the government persists with this policy despite every dollar of funding provided for the private health insurance rebate saving $2 dollars of costs that are paid by private health insurers.

It makes no sense.

The Member for Dickson was spot on when he said of the Gillard Government: “They are intent on taking money out of the pockets of Australians to pay for their phoney surplus in the next Budget.” This policy change is set to offer the government a short term windfall in the first four years…enough time to work on that budget surplus. But beyond that total savings resulting from the proposed policy change will be less than the additional costs of servicing additional demand in the public health facilities. But the Gillard government knows by that time it won’t be their problem.
 

More fundamentally …This is a blatant cost shifting measure from the Commonwealth to the States. Remember it wasn’t that long ago that the states provided 100% of the funding for both health and education. And a quick check of the executive powers section in our constitution shows health does not appear on the Federal Government’s lists of things to do. But the states are left duly unprepared after decades of policy and funding centralisation.

This place has twice rejected the Government’s plan to means test private health insurance rebates. So why won’t this Government heed this message and finally abandon these ill-conceived changes. Our new Minister for Health , the member for Sydney said on the ABC’s AM program on the 19th of January this year :
 

“This is a very good time to introduce a means test for the private health insurance rebate.”
 

From this statement the Minister has quite obviously been absent from her electorate. Cost of living pressures are high… and for a government to increase the cost of health care, a staple function of competent government is beyond belief. There will not only be a direct cost impact to the consumer when the rebate is repealed but ultimately also a negative impact to the budget bottom line as the government scrambles to inject more funds into a haemorrhaging public health system.

The Coalition has always supported a strong public system and a strong private system and will continue to do so. But there must be a good balance between the two… a status quo that is maintained as legislation stands. This Bill is yet another set back for families in Tangney already struggling with increased cost of living pressures from a Government that has lost its way and has done nothing to enhance private health insurance and health in general in our country.

I along with my Coalition colleagues will continue to oppose this and all bad Labor policy and we are committed to ensuring all Australians have access to affordable healthcare.