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

I have been contacted by a number of constituents over the past several weeks in anticipation of the further increases in private health insurance cover which will take effect from 1 April. These private health insurance increases are really having an effect on household budgets. I anticipate that, with the next increase, up to another $150 will be taken from tight household budgets. Medibank Private, for example, is raising premiums by $2.85 a week on one of its most popular family policies.

I recall that this government promised that they would keep private health insurance affordable and put downward pressure on premiums. They can say that, but the reality proves this is yet another broken promise. Since the 30 per cent rebate on private health insurance was introduced back in 1999, premiums have risen by around 46.8 per cent on average. I say ‘average’ because that too does not always apply in reality. Last year, for example, the Minister for Health and Ageing said the average premium increase would be just under eight per cent. Numerous constituents—particularly those covered by the NIB fund—contacted me. When I did a detailed analysis of their insurance premiums, the average increase was in fact 17.3 per cent and not the eight per cent claimed by the government.

I pursued my constituents’ grievances with the Private Health Insurance Ombudsman to no avail. We are told that next week’s increase will be 4.5 per cent on average. That is significantly higher than the general inflation rate and it is the sixth year in a row that this has occurred. Let me just read the figures for the last six years: 2007, 4.5 per cent; 2006, 5.68 per cent; 2005, 7.96 per cent; 2004, 7.58 per cent; 2003, 7.4 per cent; and 2002, 6.9 per cent. These average increases are much higher than the rate of inflation. The government’s promise about health insurance premiums has been broken.

Many constituents, particularly low-income families, pensioners and retirees, are telling me that the cost of private health insurance is so unaffordable it is driving them out of private health coverage. An average family now pays about $2,600 a year for private health insurance. With increases in petrol prices and mortgage repayments, the extra cost of private health insurance is adding pressure to already tight family budgets.