Katie Allen (Higgins, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021. Australia has a two-tiered system of private and public health funding. The private health sector acts as both a complement and a substitute for the public health system. It is about ensuring we have a great quality safety net for all but choice and opportunity for those who want it. Australia's private healthcare system is community rated and relies on a mix of consumers with different risk profiles to remain financially viable. However, recently, risk profiles have been shifting, as young people have opted out of private health insurance. That is why I welcome this legislation.

The imbalance that is occurring in the private health insurance industry needs to be addressed to ensure that the private health insurance sector can flourish and continue to offer choice and flexibility for consumers. That is why the Morrison government is working hard to make sure our nation's private health insurance is simpler and more affordable for younger Australians. As they say, it's about easing the squeeze for private health insurance. I'm delighted that young people right across Australia and those in my electorate of Higgins will be able to stay on their parents' private health insurance policy for longer, with our landmark reforms. That is good news for them and it's good news for their future.

I'd like to provide an example of how this legislation will affect people within my electorate. There is a young constituent, a 24-year-old man, who lives in Higgins who has juvenile myoclonic epilepsy. He recently turned 24. This young man travelled overseas to spend time with his girlfriend and her family in Chile. He had been waiting for a public-listed appointment for his epilepsy. He had become independent from his family. He wanted to live in a way that enabled him to do things his way, and he was waiting for a public-listed appointment. He had a fit when he was overseas in Chile. It was quite a serious fit—life-threatening. He then came home to Australia and realised that his private health insurance had lapsed, and he was unable to get an appointment.

This young man had been waiting for a long period of time in the public health system, and what he had done was not continue his private health insurance. That is because he had just commenced work. He had finished university and was in the first year of his job. It wasn't one of his financial priorities. That's very understandable for young people. When they first get a job, that job is very, very important to them and every penny counts. This young man decided that private health insurance wasn't a priority for him. But, as a result, he'd waited longer than was necessary. He ended up not getting the medication adjustment that was needed, and he developed a fit.

That young man happened to be my son Monty Allen, so I was delighted to see that this legislation would apply to him and that, at the age of 24, he would be able to be brought under my family private health insurance until the age of 31. As a mother, it gives me comfort that he will be able to continue to have private health insurance, continue to have choice and opportunity, and access a quicker appointment to make sure that his epilepsy is kept under control. We also know that research shows that individuals who have been introduced to private health insurance have a higher likelihood of renewing their insurance in the future, and I'm hopeful that Monty will get used to having his private health insurance and enjoy the benefits, and that, when he gets to the age of 31 and can no longer be covered under our family private health insurance, he'll be at an age when he wishes to invest in his own health future through private health insurance. Now that we've had these sensible and reasonable changes to our legislation, young adults are more likely to take out insurance after making use of it on a family plan. It's at a time of their life when they're starting to look at starting their own family and taking on the private health responsibilities that they may like to have for their partner, whoever that may be, and their children, if they are to have them.

As a member of parliament representing a vibrant, younger electorate, and as a mother of four young adults, I know how important reforms to ensure a successful private health insurance system are. We on this side of the House are firmly committed to strengthening and simplifying private health insurance and making it more accessible. We understand that we have a very unique health and education system in Australia, one that benefits from the private-public balance. Whether it's health or education, we take the best from the European system, which is more socialised, and the best from the private system in the US. We have a very good system which provides a good, high-quality baseline level of health and education, as well as choices and options for those who wish to pay more for flexibility and accessibility in their insurance. Under the reforms proposed in this bill, the maximum age of dependency for private health insurance policies will be increased from 24 to 31 years of age. It is a very practical measure to support the private health insurance sector. It means young adults will be able to stay on their parents' private health insurance policy for longer, at a time when many younger adults may consider opting out of private health insurance altogether.

For the first time, there will also be an opportunity for insurers to offer policies with no age limit for dependants with a disability. Again, it's simplifying the system and making it fairer. As a paediatrician, I would hear, over and over again, about people with chronic health conditions and disabilities moving into the adult sector and how difficult it is for them to move into a sector which doesn't see them in the same way as the paediatric sector does. It is very encouraging that this change to our legislation is being proposed. Particularly for young children with a disability growing into adults, it's very important that they continue to have support, as they are often still dependent on their family and their parents. People with a disability can be confident they will be provided with the opportunity to access more affordable private health insurance without age limits, as they can be covered under a family policy at a lower cost, rather than having to purchase a standalone policy. I think both sides of the House should welcome this change to our policy and legislation, because it helps those who need help the most.

Further to that, we have also simplified the definition of 'disability' for the purposes of private health insurance such that a person living with a disability is any person who is a participant in the NDIS. We're bringing the NDIS definition of disability in line with the PHI definition. That's been welcomed by the insurers and the sectors. However, private health insurers will have the flexibility to go beyond this to offer coverage to those who do not meet the NDIS eligibility requirements. It will provide the opportunity to those PHIs who want to step up and support the disability sector to do just that.

While this reform primarily benefits younger Australians, who can remain on their parents' insurance policy for longer, it will also contribute to making our private health insurance more sustainable in the longer term by helping transition more young people to their own adult cover when they turn 31 years of age. This is good for the sector. It's good for the stability and the long-term viability of the sector. This bill reflects the Morrison government's ongoing reforms to private health insurance to ensure that it is more affordable, more accessible and more attractive to all Australians. Acting on our commitments, these reforms have delivered the lowest annual average industry premium rise for consumers in two decades. At just 2.74 per cent, this figure is over 50 per cent lower than it was under the previous Labor government. Young people particularly stand to benefit, with 425,000 people aged 18 to 29 receiving discounts of up to 10 per cent on their premiums since 1 April 2019, when those measures were introduced. With the Morrison government committed to improving private health insurance for all Australians, more than 13.7 million Australians have now bought policies, receiving a record $21.9 billion in benefits for medical services through the private health system.

From the financial side of things, the private health system is really doing some significant heavy lifting with regard to our healthcare system. It's a very important part of the system, which includes the public and the private sectors. Private does do a lot of heavy lifting with regard to service provision for Australians.

Further, as a doctor, I'm a passionate advocate for better health outcomes, which is why I'm particularly proud that this reform will further assist in the access to mental health services for young people. Almost half the population—45 per cent—aged between 16 and 85 will experience some form of mental health difficulty in their lifetimes. I don't think that's a surprise to anyone in this House; I'm sure it's not a surprise to anyone listening to this speech. We know mental health issues are on the rise. They're more recognised. They're more concerning. We need to do more to support people who need to access the services, both in a preventative capacity and in a treatment capacity. Typically, onset is around mid to late adolescence, with young people having the highest prevalence of any age group. So we need to do more to help our young. In these darkest moments, we must ensure access to vital psychiatric services, particularly as our younger generations have faced the challenges that the COVID pandemic has delivered.

Supporting young people around Australia and their mental health is a priority for the Morrison government, and instrumental to this plan is lowering the cost of private health insurance for young Australians so they can use that in that way. The government's reforms to private health insurance are improving access to medical services for young people, including mental health services, and that is a good reason in itself to continue to support your own private health insurance, if you have indeed been part of a family private health insurance plan. This is in conjunction with our commitment as a government of $509 million towards the Youth Mental Health and Suicide Prevention Plan, the most substantial strategy of its kind in Australian history. We recognise the difficulties Australians face with regard to mental health, and we have Australia's back when it comes to delivering services for mental health.

The coronavirus pandemic has shown us all the importance of a world-class health system. Indeed, Australia's health system continues to be one of the best in the world. I think Australians knew that before the COVID pandemic, but now they are certain of it. That is because we can see in our public health response, in our health delivery—whether it comes to PPE provision, COVID testing or now the COVID vaccine rollout—that the Australian healthcare system has what it takes to deliver great outcomes for all Australians. The private health insurance system is a very important part of that sector.

The Australian government's longstanding and robust relationship with the private health insurance sector ensured that resources could be mustered in the response to the COVID pandemic. I know that in Victoria in particular there was a very good arrangement made between the private healthcare system and the public healthcare system, where both systems worked together in tandem to increase the capability of our intensive care beds—from 2,200, tripling to 7,500 in preparation for what never eventuated, in preparation for what was going to be if we didn't take the actions that we took to close our borders internationally and activate quarantine and contact tracing. If those hadn't worked, then we would have had a very rapid rise in our intensive care beds. The private and public healthcare sectors worked hand in glove, along with the national cabinet and the work between the federal government and the Victorian state government, to ensure that we could triple our ICU capacity in the event of a pandemic spiralling out of control here in Australia. Thank goodness that was not required, but the preparedness in the system—the preparedness to work together across the private and public health sectors and across the state and federal divisions—is to be celebrated.

So I think that, as Australians, we can all feel very grateful. There was a recognition that COVID was providing us with very unique challenges, but Australia had a very unique response—a very good response; a par excellence response—to the pandemic as it was emerging around the globe. Australia responded in a very swift, a very effective and a very appropriate way with regard to both the health and economic issues that faced our country. We did this together, as a country.

Continued investment by the Morrison government into private health insurance, with over $6.3 billion via the private health insurance rebate, proves our commitment to affordable and flexible options for all Australians when choosing private health insurance. This bill reflects the hard work of the Morrison government to ensure the improvement of our private health system as an accessible, affordable and fair system for all Australians. I commend this bill to the House.

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

I certainly echo some of the comments already made by the shadow minister for health and now by the member for Higgins. Of course, I fully agree to support this bill, the Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021, which is a very, very important one. One can only ask why it has taken the government eight years to bring this measure in. We know that rates of private health insurance have been falling over the term of the present government and that we are seeing the development of a very fractured health system. Even though we have coped well so far in preventing the types of pandemic problems that have occurred in other areas, we are seeing increasing healthcare costs, more people dropping out of private health insurance, growing gap costs for out-of-hospital visits and, in New South Wales, the collapse of the public hospital outpatient system. So it's not all roses, and this measure will play a small part in trying to reverse the trend. We need to ask ourselves why it's taken so long for this legislation to be brought in and what we can do to try and make the system even better.

This legislation, as has already been mentioned, will increase the age that dependants can be covered by family private health insurance, up to the age of 31. Most importantly it will allow people with disability, as defined by eligibility for the NDIS, to get lifetime private health insurance cover from their family, which is a very important change for many of the families I have cared for and continue to care for in my electorate of Macarthur.

We do need to ask ourselves several questions about this legislation. The first is: why do we need to do this? This is a pretty dramatic change, compared to health insurance previously. When we were growing up, we could only remain on our parents' private health insurance billing until the age of 18, until we left school. It has gradually been increased to age 25, and now this legislation will increase it to 31. For anyone with a disability, the same definitions apply. So this has been a really dramatic change. We need to do this for several reasons. Firstly, younger people are needing to stay at home for much longer because housing affordability has deteriorated so much. It is very important that we try and improve measures to make affordable housing available to those on modest incomes. At present that is not the case. People are needing to stay at home longer because they can't afford to buy or rent accommodation, particularly in our capital cities, and little has been done to change that. In fact, it has been getting worse over the eight-year period of the present government. That's one thing.

Secondly, younger people in education are accruing much higher debt than previously. With the increases in HECS payments required for many university degrees, many people are accruing HECS debts equivalent to the debts that we used to accrue for mortgages. It's a double whammy—housing affordability is poor and HECS debts are increasing. We know that, in the last five years, young people's HECS debts have increased by significant amounts around the country. So the affordability of housing and education has become much worse in the eight years of this government. Young people have been leaving private health insurance in droves. This legislation may do a little bit to change that trend, but it's taken the government eight years to bring it in.

Why are 31-year-olds still to be seen as dependants? It's because of housing affordability, HECS debts and the fact that the jobs that young people are getting are often relatively low paid, and growth in wages, under this government, is worse than it has been for many decades. These three reasons are causing young people to need to stay at home for longer and be dependent on their parents for longer, and they have less ability to pay for private health insurance.

Why is private health insurance so important? It is so important because private health cover and private health insurers provide access to volume based medical services very efficiently. Interventional treatments, ENT surgery, ophthalmology and gastroenterology are done very efficiently in the private system. We are lucky in Australia that we live in a system balanced between private health care and public health care. I believe that private health insurance is very important for people who can afford it, because private health insurance provides access to volume based care in a much more efficient way than does the public system, while the public system does chronic and complex care much better than the private system. So we need to keep this balance of health care if we are going to continue to have a healthcare system that is amongst the best in the world. This government has done very little to promote private health insurance. This is a small measure, but it's taken them eight years to do it. It's very important that we continue this balance of both systems.

As a paediatrician, I have also seen the difficulties people with disabilities, particularly adolescents and young adults, have in accessing interventional care. I've been a paediatrician now for 40 years, and in those 40 years we've seen dramatic changes in the way that people with disabilities have been cared for. People are surviving longer. Their quality of life is improving. With the advent of Julia Gillard's NDIS, we've had really dramatic changes in people's quality of life and access to services.

The one difficulty has been getting interventional services for people over the age of 18 with disabilities. For example, people with cerebral palsy have access to injections of botulinum toxin, or botox, which has proved very useful in managing spasticity and mobility issues for people with cerebral palsy. However, once someone turns 18, access to these services is very limited. People will now be able, if they stay on their parents' private health insurance billing, to get access as adults to botox and also to the orthopaedic surgery that they may require to maintain mobility. That has been very important in trying to get those sorts of services. We know, for example, that children with autism have a higher risk of mental health disorders. If they remain on their parents' private health list, they will be able to access mental health services in a much more timely manner than if they have to go on public waiting lists.

This will be very important for some of the people I have cared for over many, many years and will really lift a great and dramatic weight from their parents' shoulders. So these are very important measures. They will be very important for children with neurological disorders, such as spina bifida, who throughout their lives may require ongoing neurosurgery and orthopaedic surgery to maintain their health and their mobility. So these are very important issues.

One has to ask: why has it taken the government so long to bring this in? There are many challenges in our public hospital system for people with disabilities once they turn 18, and there's been an ongoing difficulty in transitioning care from the paediatric age group to the adult age group. It's been very difficult and has been limited by access to services. This will actually make quite a dramatic change to many of those kids and I thoroughly welcome it. Whilst I do congratulate the government on bringing this legislation in, I wonder about why it has taken so long. We know during the pandemic that there have been difficulties in accessing the public hospital system for elective and semi-elective surgery.

Once again, these private health insurance changes will make dramatic differences to young people with disabilities accessing the private health system and the interventional and procedural type health care that the private health system does very well. I welcome the fact that this may well increase the number of young people staying in private health insurance and transitioning into their own private health insurance once they turn 31. I certainly know that I welcome it in terms of my own children, who are under 31, and getting them access to private health insurance. I welcome it on behalf of my many patients with disabilities, and I think it's something that we now need to be very actively exploring for those kids and their access to care.

I support the legislation and I do thank the government for bringing it in, but I think we need to look at the reasons why it is so important and the fact that for many people in our economy, we are working at a two-tiered level. Some people are doing very well, and some people, particularly young people, are really struggling in a whole range of areas, including housing, education and work. In conclusion, I welcome the legislation, but I do think we need to look at why this legislation is necessary and the reasons why young people are finding it so difficult, even at ages that might seem quite old, to get into the housing market, to get adequate jobs and to provide for themselves.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

It's a privilege to be able to speak in support of the Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021. The reason I speak in support of this bill is because it is such a simple but critically important measure in understanding the slipstream of young Australians' lives and the relationship and the bond that we have to each other. Many young Australians, logically, will be raised under the protection of their parents' private health insurance, they will finish school, go on to tertiary education or some other form of skills or trade or apprenticeship, and they will continue to be covered by their parents' private health insurance. Of course, once they hit the age of 21 or cease to study, they will then lapse out of the system, exactly when we need them to be taking responsibility for their health care as part of a holistic healthcare protection of themselves over their whole lives. Many young people only re-opt in to the system when they find there's a financial penalty if they choose not to around the age of 30.

This legislation is bridging that divide, that gap, where young Australians who either continue to study, or whose parents are happy to support and assist them in the coverage of their private health insurance as dependants, can walk the bridge to the age of 30 and be able to pay for it themselves. I say that as the member for an electorate which has one of the highest concentrations of private health insurance in the country, where almost everybody, young or old, has some form of private health coverage. In fact, it was once was pointed out to me by the private health insurance industry that there are more private health insurance policies in my electorate than constituents, which shows you how much the people of Goldstein value their private health insurance. I suspect that's partly because there are non-citizens who have private health insurance as well. Many of those young people in the Goldstein community, from Bayside and Glen Eira, will go through their secondary education covered by their parents' private health insurance, they'll go off and live somewhere more proximate to tertiary education and, at that time, while they're there, they'll have coverage until they go into the workforce. While they are starting out with other competing pressures, as the previous speaker said, private health insurance might be the first thing on the chopping block because at that age of 21 or 22, all the way through to your mid-20s—I'm 41 and I still think I'm invincible—you're generally are less concerned about your healthcare unless you have a pre-existing condition. This legislation will help those young Australians bridge that divide so they can continue to be covered by private health insurance. If they need assistance and care at that time, they will be able to get it through the benefits of their parents, who continue to recognise them as dependants for this purpose.

But the previous speaker made a critical point. If you've got private health insurance and you have a pre-existing condition, particularly if you are young, even as you are going into adulthood, you may need to continue to get that support and that service. So, for young people with a disability who may need extra assistance, we are here and we are backing them. If you have another condition, which may have occurred in your youth and continues through to your adolescence and young adulthood, you will continue to get the support from your parents' private health insurance, because the Morrison government is backing you in being able to access the services that you need.

More critically, it will help the sustainability of the private health system for every Australian. Most young Australians contribute to private health insurance and don't need to draw much down on it until they get older. Of course, older Australians tend to need to draw down on it more. They've invested in their health insurance at a younger point in their lives, when they know there's a lower profile of risk, and carry that all the way through to the latter stage of their life, where they know there's a higher degree of risk. That journey is not dissimilar for the overwhelming number of Australians who are dependent on private health insurance. So this helps us in not just supporting young Australians today but supporting young Australians as they reach the age where they have children themselves, or get married, and have dependants. And, of course, it helps ensure there is sustainable private health insurance in the latter arc of their life, where they can continue to rely on a system that's affordable and accessible.

The previous speaker actually did raise a legitimate issue, the economic challenges facing young Australians, which led me then to wonder whether, between the early ages of 20 to 30, private health insurance is at the top of young Australians' priority lists. Of course, this is because young Australians face challenges, particularly economic challenges, because of employment arrangements and needing to pay rent while they are concurrently trying to save to buy their first home. But, conveniently, the previous speaker forgot one factor, which is the compulsion of having 10 per cent of their wage taken from them and locked up into a fund controlled by—in many cases—those on the other side of the chamber and their allies. Of course, the more money that's locked away from them, the more of their savings that are taken away from them, the more it impacts on their wages today. It also means they can't save for the biggest and most important financial decision in their life, homeownership. That is because, by law, we have engaged in a form of economic social engineering where we have prioritised superannuation and the savings for your second most important financial decision ahead of your first. Whenever you hear the crocodile tears from Labor members who talk about how young Australians are finding it harder to buy a home, it is laced with hypocrisy, because Labor want more of the savings of young Australians to be taken away from them—whether it's to pay for their private health insurance or to be able to save to buy their own home—to build up the nest eggs from which their friends then profit through fees and bonuses. And they won't even report to this parliament what they're getting up to, even though they demand more of working Australians' hard earned cash. Of course, it does come at an expense. It comes at the expense of homeownership.

And the hypocrisy doesn't just end there with their claims of concern for young Australians trying to buy their own homes when their money is locked up in superannuation. The hypocrisy extends further. The member for Macnamara this week wrote a paper about how young Australians' superannuation savings should be spent on building projects for houses that super funds own and that young Australians can then rent, to become serfs to their own super. This is the most despicable shift in economic power in this country's history, where we are seeing the concentration of economic power—

Kevin Andrews (Menzies, Liberal Party) Share this | Link to this | Hansard source

The member for Goldstein has to relate his comments to the bill before the House. I've allowed him to go on for a little while, but I think he should bring it back to the bill.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

Of course I am acting utterly consistently with the proposition that, when you take money from young Australians and lock it up in super, they can't do other things, like afford private health insurance or homeownership. When you concentrate a huge shift in economic power, it means the choices of young Australians are sacrificed in the process. It doesn't matter whether it's private health or saving to support their family and buy a home; the principle that sits behind it remains the same. That's why it's the biggest shift of economic power in this country's history, away from the many in the favour of the few, forcing the second-most important financial decision—or other important financial choices, like private health insurance—ahead of the most important financial decision that young Australians will make, which is to secure their own home, which is the foundation of their economic security during their working life and through to their retirement, so that, on balance, they have fewer costs in their retirement, so they can do things like support the ongoing payment of private health insurance. It reduces the volume of super that they would then need to be able to do things like afford their living costs and health insurance.

That's why this issue is so critical. We're trying to bridge a gap between one stage of life and another. What this will do is to build a bridge across that gap for Australians across their entire life cycle, to secure their health. Now we need to do the same in other policy areas, to respect the natural progress of life. You're born, you get educated, you're raised; you then go into tertiary education, a trade or a skill or into the workforce; you find a spouse and have children; you wish to buy your own home, as the foundation—the most important financial decision you make in your life—and then, following that, you start to look at issues like how to secure your retirement, because of course you can save for your retirement after you buy a home but you can't afford to save for a home once you're in retirement. It's out of respect for that natural progression of life. This bill, in acknowledging the contribution of private health insurance, helps to bridge that gap on one factor: the security that people need in their life, not just in their working life but in their retirement, and it goes to the heart of their sense of physical security for themselves through their health care. I have consistently said that we need to do the same in other areas.

But of course we have the Labor Party who are quite happy for young Australians' savings to be spent on housing that they can rent from super funds but who do not support young Australians using their own savings to buy their own home. They want Australians to be serfs to their super, like all other government systems. This is not a sustainable way for a country to go forward—unless, of course, you're part of the select few who enjoy the benefits, like IFM Investors, a big financial services firm that pays bonuses in excess of $36 million to single fund members. But we never hear any cries of outrage from members opposite.

It's about time we got serious and a bit honest about what's actually happening in this country, where we're seeing the concentration of power going from individuals to big fund managers, and, of course, the political interests associated with them, and that makes it harder for people to afford private health insurance and to be able to afford their own home. That's why it should be home first, super second. But a critical part of that is private health insurance as well.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

I'm sure we all gained a lot from the ideological approach from the member for Goldstein—particularly the young people up there, who I welcome to Parliament House. It's great to see young people back in this place.

Unlike the people he's been talking about, he left himself out of that. While he might describe himself as a 41-year-old and happy to be a parliamentarian, he's lucky to be on a very favourable superannuation system himself, and I'm not sure that he's taken the same view when it comes to his super as he has when it comes to others'. But, before you interrupt me, Mr Deputy Speaker, I will contain myself to the bill.

I think this bill is something actually worth supporting and something I think members of this House could be proud of in its passage. Therefore, to try to politicise it, with his long-held views—erroneous ones on aspects of superannuation in this country—I think really demeans him and, quite frankly, the people he purports to represent, the good burghers of Goldstein.

I make my contribution in terms of the Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021. We support this piece of legislation because this is good and it's decent. The bill makes sensible improvements to private health insurance, effectively making it simpler and more affordable for all Australians.

In essence, the bill makes two fundamental changes. First, it changes the maximum allowable age for people to be covered under a family private health insurance policy, taking the dependent age from 24 to 31. The increase to the maximum allowable age for those covered by the family health policy means that people have the option of family health coverage until they reach the age of 31, when the government's lifetime health cover policy applies. That is significant. That means we can have more people covered by private health insurance over that period.

For many younger adults, this will mean that they can stay on their parents' health insurance policy at a time when they would otherwise be opting out of private health insurance. When that occurs, it is a problem for our general health system. For younger people, it would mean that those struggling with expenses—because many are still at university or in the early years of employment, which, if you're a young apprentice, does have an impact on your wages, so you would be struggling financially with private health insurance—are able to be included on their parents' private health insurance policy.

On the face of it, the reform seems to be of benefit to younger people. The contributions of these young adults, once they turn 31, means they will have access to the government's lifetime health cover. Ultimately, the goal is to make private health insurance more sustainable for everybody, and being more sustainable for everybody means having greater efficiencies within our system.

The second aspect of the bill, which is one I'm particularly pleased to see, is that it also makes significant changes in terms of private health insurance coverage for people with a disability. The bill allows people with a disability, regardless of their age, to be covered under the family private health insurance policy as a dependant. Effectively, this mean that people with a disability will be covered by the family policy at no or low cost, rather than having to purchase a standalone policy. This is a really significant development for everybody here, because, I imagine, of the 151 electorates represented in this chamber, we all know families with members that live with a disability. In my case, being in Western Sydney, my community's actually overrepresented with families with members living with a disability, which is not a reflection on the water we drink or the air we breathe but rather, probably, on the lower cost of housing in Western Sydney, which families that have to make compromises when raising children with disabilities gravitate towards. This is something that will be of significant benefit to many residents in my community.

While I note that the amendments do not make it mandatory for private health insurance companies to offer increased coverage for family products, we welcome the readiness of many of the insurers to date that have shown their willingness to participate and offer these changes.

Accordingly, I support the passage of this bill. I think it's commendable. For those here who take seriously their responsibility to represent everybody in their electorate, particularly those most vulnerable families living with disabilities, this is certainly a major development.

Celia Hammond (Curtin, Liberal Party) Share this | Link to this | Hansard source

I'm pleased to speak in support of the Private Health Insurance Legislation Amendment (Age of Dependants) Bill. I want to start by acknowledging the incredible work which all those involved in health care provide to our country. It's been more acutely visible than ever over the course of the last 12 months. We, in Australia, have the benefit of a great system. It's not perfect, but it is so much better than in so many other countries. We have highly competent and well-qualified professionals. We have a well-regulated system which ensures quality of patient care is rightly prioritised. While the funding of health care can, at times, become the subject matter or focus of political debate, the truth is that governments of all varieties and at all levels are fully committed to ensuring a quality of care and service throughout our health system, and it is pleasing that this bill is being supported across the entire chamber.

Our public health system is strong. It is stretched, but it is strong. Our private healthcare system is much the same; it is strong, but it is stretched. And we need both. Encouraging private health care for those who can afford it eases the burden on the public healthcare system and improves its capacity to deliver. It also gives scope for innovative new ideas and concepts to be developed and delivered through the public health system.

One example of this is the medihotel, which has been established at Royal Perth Hospital. Developed as a pilot program, this facility, jointly funded by state and federal governments, provides short-term accommodation for people who have finished their hospital stay and are waiting for transport home to regional WA or need to visit the hospital for an appointment prior to their hospital stay. The overall goal of the medihotel is to ensure that there's appropriate care for people while freeing up the necessary beds for acute cases. We need to explore ideas such as these, and we need to continue to innovate to ensure that the quality of health care we enjoy in this country continues.

This bill is designed to encourage private health care insofar as it addresses the reality that many young people are dropping healthcare cover and have been doing so at a steady rate for the past five years. As part of this reform program, the maximum age of dependants for private health insurance policies will be increased from 24 to 31 years, and there will be the opportunity for insurers to offer policies with no age limit for dependants with a disability. As other members have noted, it is pleasing that a number of insurers have already indicated that they are ready and willing to start offering this expanded coverage.

What this means is that young people—students, apprentices—can stay on their parents' policy for longer. It will be easier for adults to transition from being on their parents' cover to buying their own lifetime health cover, which will commence at the age of 31. People with a disability will be provided with the opportunity to access more affordable private health insurance without age limits, as they can be covered under a family policy at a lower cost rather than purchase a standalone policy. And the definition of a person with a disability for the purpose of private health insurance will be a participant in the NDIS, but insurers will also have the flexibility to go beyond this definition when offering cover.

Just by way of observation here, it's really relevant to note that the age at which young people leave home and become independent has, over the last two decades, been rising. According to the Housing, Income and Labour Dynamics in Australia Survey of 2017, 56 per cent of men aged 18 to 29 lived with one or both parents and 54 per cent of women of the same age group lived with one or more parents. These stats are similar to those produced by the Australian Institute of Family Studies.

It's difficult to pin down exactly the median age at which people leave the family home, and I have to admit that when my youngest son was only eight someone told me that the average age for a man to leave home was 28, and knowing that my son will never watch this and will never read this speech, I can honestly say that I had a very mixed reaction to the thought that he would still be under the same roof as me for another two decades. He's now 15 and six foot five, and, if I still have another 12 years of him in the house, I'll have to either raise the ceilings or triple the size of the kitchen! There are numerous reasons as to why young people stay home longer—housing costs, staying longer in education and training, casual work and choosing to live a little before settling down. As with most things in this world, it's probably due to a mix of reasons and all very dependent on their individual circumstances. The reality is they do remain dependent and at home for longer. The reality is also that there has been a sustained period of decreasing uptake of private health care by young people, and it is something we need to address for the sake of our entire health system.

This reform benefits the younger adults who will be covered as dependants, but it will also contribute to making private health insurance more sustainable in the longer term by helping the transition of more young people to their own adult cover when they turn 31. On that basis, I'm very happy to support this bill.

Andrew Wallace (Fisher, Liberal Party) Share this | Link to this | Hansard source

I rise in support of this bill, the Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021. But this bill is good news and bad news. As the father of four daughters I can distinctly remember having the conversation with each of them that has gone on and become 'independent'—and I use that in inverted commas, as any parent would know!—about the merits of continuing with private health insurance, and each has complained bitterly about having to themselves fund what they once enjoyed for free from Mum and Dad's wallet. We all know, of course, that the more people—in particular, young people—we keep in private health the better it is for everybody. Young people are, by their very nature, less likely to need private health insurance because most of them don't get sick. But having it is very, very welcome when things go wrong, and sometimes they go badly wrong.

I remember having a conversation with one of my daughters, who had left home and was over 24, who said, 'Dad, I just can't afford to pay for private health insurance.' The bad side of this bill is that we as parents all know we're going to pick up the tab. We want to make sure that our kids, whether they are dependent or independent, have that health cover for as long as they possibly can—for those parents who can afford it. So this is very, very sensible reform, and I'm very pleased to see that members opposite are on board with this reform, because, as I said, the more people, particularly young people, we have in private health insurance, the better it is for all of us. It keeps costs down. It keeps premiums lower than would otherwise be the case.

For young people who are living as dependants, this reform will see the age at which they will be able to remain on the family health insurance policy go from 24 to 31. This will see, I believe, a significant number of families, mums and dads, being able to contribute and help out, and maybe the young people will be able to help as well to pay for some of their own health insurance—because we all know that a family health policy will be far cheaper, even when you add another person to it, than a standalone policy for a young person.

One of the great reforms to come out of this bill will impact on the tens of thousands of families—and I'm very pleased to say it will actually help the Wallace family as well—who have a disabled child. These reforms will ensure that a child or a young person, a dependant who lives with a disability, will be able to remain on that private family health cover for the life of that young person or the life of the dependant person who lives with a disability.

What does living with a disability mean? Clearly, in the first instance, anybody who's receiving benefits under the NDIA will be classified as someone who lives with a disability, but I understand that that definition could grow in time. This is, once again, very, very sensible reform, which I'm pleased is a bipartisan reform and which gives parents in particular, and not least also the person living with a disability, the sort of comfort that comes from knowing that the person who lives with a disability will have and enjoy the fruits of private health insurance. This is very, very important, particularly for people who live with a disability, so that they know that, if they fall ill, they can choose their own doctor, they can choose their own hospital, and the time in which they will be able to access that treatment is usually much quicker, particularly for elective surgery, than what it would otherwise be if they were in the public health system.

As the father of a young lady who lives with a disability, I can say that this will bring great peace of mind to parents. It's hard enough being a parent with a child of any age with a disability, but, once a young person reaches the age of 24, without these reforms, parents would more than likely have to pay for a separate standalone policy, if they can afford it. Maybe they can't afford it. But this reform will enable parents to keep their disabled children on a family policy, and there will be very significant cost savings to them doing so.

So I commend the bill to the House. It is sensible reform. I thank those opposite for supporting this bill.

David Coleman (Banks, Liberal Party, Assistant Minister to the Prime Minister for Mental Health and Suicide Prevention) Share this | Link to this | Hansard source

I thank all members for their contributions to the debate on this Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021.

Under this bill, the maximum age of dependants for private health insurance policies will be increased from 24 to 31 years. Insurers will be able to offer policies with no age limit for dependants with a disability. These are great outcomes for Australian families that are looking for ways to continue to assist with the health care of their children. Younger adults will be able to stay on their parents' private health insurance policies for longer, at a time when many young adults may otherwise consider opting out of private health. It'll be easier for adults to transition from being on their parents' cover to buying their own when the provisions of Lifetime Health Cover commence. People with a disability will be provided with the flexibility to access more affordable private health insurance without age limits, as they can be covered under a family policy at no or low cost rather than purchase a standalone policy.

This reform benefits young Australians and Australians with a disability, but it also helps everyone with private health insurance, because, by increasing participation, it will contribute to improving the affordability and sustainability of private health care. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.