I move:

That this House:

(1) notes that:

(a) private hospitals perform more than two-thirds of planned surgeries, and deliver essential healthcare across Australia, including in regional areas;

(b) private healthcare exists to provide choice, not to compensate for a public system in logjam;

(c) rising costs relative to revenue have driven hospital closures and sales, with obstetrics and mental health services under particular pressure;

(d) hundreds of thousands of Australians are downgrading their private cover as its value erodes, a trend the Government's cut to the seniors' private health insurance rebate will accelerate, adding further pressure to the public system;

(e) private health regulation was designed for an earlier era of high membership, not-for-profit insurers and larger hospital numbers, and now lacks flexibility to respond to demographic change, contract imbalances and economic shocks;

(f) no dedicated, whole-of-system mechanism exists to balance the interests of patients, doctors, hospitals, insurers and device manufacturers; and

(g) selective contracting and vertical integration increasingly threaten patient choice and the doctor-patient relationship; and

(2) calls on the Government to establish an independent statutory Private Health System Authority within the Health portfolio to:

(a) monitor and report on the sector's financial sustainability, from premiums and benefit payouts to regional hospital viability;

(b) ensure fair insurer-hospital and insurer-practitioner contracting, including sustainable payment arrangements given bargaining power discrepancies;

(c) safeguard against managed care by assessing arrangements on their actual effect, not stated intent, where they restrict patient choice, interfere with clinically appropriate care, or distort clinical decisions, including in emerging hospital-in-the-home care;

(d) advise government on policy levers, including premiums, rebates, product tier design and risk equalisation, to lift coverage and reverse the drift to exclusionary products; and

(e) oversee safe, clinically-led expansion of out-of-hospital care that is properly funded and benchmarked, without shifting cost or risk to patients and families.

Australia's health system is built on a partnership between a strong public system and a substantial private sector. These sectors are interconnected. When one comes under strain, the effects are felt across the entire healthcare system. That's the reality which underpins this motion that I put before the House today. Private hospitals are not a peripheral part of healthcare delivery in Australia. As much as I would like a universal public healthcare system which is appropriately resourced and able to meet the needs of all Australians, the reality is that we currently need private health care. Indeed, private hospitals account for more than 40 per cent of all hospital admissions and perform around 70 per cent of elective surgery nationally. Moreover, almost 13 million Australians hold private hospital cover. Take that capacity away, and the public system simply won't be able to absorb it.

Right now, the warning lights are flashing. The Department of Health, Disability and Ageing's own private hospital sector financial health check found that costs are growing faster than revenue in many parts of the sector. The Australian Private Hospitals Association reports that more than 20 hospitals have closed and more than 80 services have been withdrawn in recent years. Meanwhile, private hospital profitability had hit a 15-year low, with ABS figures showing the sector's operating result went from a $36 million loss in 2023-24 to a $750 million loss in 2024-25. Capital expenditure fell from $782 million to $754 million while demand kept climbing. These figures show a sector in trouble, and the consequences extend well beyond individual businesses. Make no mistake—when a private hospital shuts its doors or stops offering certain services, the patients don't vanish. They turn up at the public hospital down the road, which is already stretched to breaking point. A weakening private sector therefore becomes a public healthcare issue as well.

At the same time, there are consumer concerns about the affordability and value of private health insurance. As of June 2026, almost 46 per cent of Australians, almost 13 million people, held private hospital cover. But, with premiums continuing to rise and cost-of-living pressures continuing to bite, people are asking whether they're getting any value at all. This will be exacerbated if the government gets its way in winding back the private health insurance rebate for over-65s. Plenty will downgrade. Some will walk away entirely. Then the pressure lands on the public system again.

So who's watching the whole picture? There's currently no independent body responsible for monitoring the private healthcare system as a whole. Yes, we have regulators for parts of the system, but no independent body looks at how insurers, hospitals, practitioners, governments and patients actually interact. Nobody connects the dots and nobody is equipped to deal with a sector which, as all the indicators are showing, is plummeting.

That's what this motion seeks to address. It calls for the establishment of an independent statutory private health system authority. The authority would monitor and report on the sector's financial sustainability, including premiums, benefit payouts and the viability of regional hospitals. It would shine a light on contracts between insurers, hospitals and practitioners so that power imbalances don't quietly erode access to care. Importantly, the authority would safeguard against the emergence of managed care arrangements that restrict patient choice, interfere with clinically appropriate care or distort clinical decision-making. Australians rightly expect healthcare decisions to be driven by clinical need, not by an insurer's balance sheet.

The authority would also provide independent advice to government on important policy levers, including premium settings, rebates, product design and risk equalisation arrangements. These policy settings influence both affordability and participation in private health insurance and therefore have implications for the sustainability of the broader healthcare system. Finally, as care moves towards hospital in the home and other out-of-hospital models, there's a need to ensure that innovation remains patient focused. Indeed, with more than 74 per cent of private hospital admissions already same-day episodes of care, emerging models must be clinically led, properly funded and rigorously evaluated.

Let me be clear. This isn't about favouring private over public. A strong public healthcare system must remain the cornerstone of Australia's health care. But a sustainable private sector keeps waiting lists shorter and capacity available when Australians need it. An independent private health system authority gives us transparency, scrutiny and evidence based advice so we spot the risks before they become crises. It would help ensure that Australia's mixed healthcare system remains sustainable, equitable and focused on patient outcomes. I commend the motion to the House.

Is there a seconder for the member's motion?

I second the motion and reserve my right to speak.

I thank the member for Clark for bringing this motion to the House. This is an important motion for us to discuss, and both our federal Labor government and I agree that all Australians deserve access to affordable treatments and devices they need to stay healthy and live full and productive lives. I've given more than half a century of my life to serving patients in need of medical attention and care in both the public and private system. This experience is why I'm standing in front of you today.

We've had a hybrid model of care in Australia for as long as I can remember, and it's served us very well. I can attest to the hybrid model working well across the board for many generations. I've examined health systems throughout the developed world, and that's why I think we need to continue with that hybrid model. However, there is not the degree of transparency regarding private health care that there should be, and I agree with the member for Clark that some sort of independent overview of what is happening in private health care is very important.

We hear on the one hand that private health insurers are making large profits. On the other hand, we hear that private hospitals are struggling to make ends meet. Indeed, I've seen many areas where private hospitals have closed their doors. We've seen that on the New South Wales South Coast. We've seen it recently with the Healthscope private hospital system, which was bought by private equity and had a very strange model of financing. Some of those hospitals have closed their doors. We have a large Healthscope private hospital in my own electorate. If it were to close its doors, it would be devastating for health care across the board.

The Labor government has invested billions of dollars in our public hospital system, and it will reach a record of public hospital funding from the Commonwealth of $220 billion in 2030-31. In New South Wales public hospitals the Labor government has invested an additional $6½ billion over five years, with total public hospital funding of $64 billion over the duration of 2026-27 to 2030-31. We're investing billions of dollars for more beds.

We live in a population that is ageing, and health care is becoming more expensive. Our hybrid healthcare model only works when we make sure that every single dollar for health care is spent efficiently. I've seen quite a number of healthcare so-called innovations developed in the last 10 years that really are very inefficient. We've created silos in things like mental health care and developmental care for children. They are disconnected, and the health dollar is being spent very inefficiently. The Labor government is committed to improving choice and transparency for all Australians with private health insurance, and the recent cutback in the extra rebate for those over 65 is not unreasonable given the efficiency of our spending. Why should someone who is under 65 and has a young family have to spend more for their private health insurance than older people who are over 65, who are more likely to have need of the system? There are really good reasons to make access to private health insurance important, sustainable and equitable.

We're committed to improving choice, as I've said, and that means delivering on our commitment to strengthening Medicare as well as providing hospital care for people who need it. As the member for Clark has already mentioned, there are many new developments in health care such as Hospital in the Home and new treatments for chronic conditions that require some hospital management that need to be funded and provided in an equitable manner around Australia. Private health insurers were previously required to apply to the Minister for Health and Ageing if they wished to change a premium for an existing product. The government's legislative changes now require an insurer to seek ministerial approval for the premium charge for a proposed new product and, where changes are made that reduce cover, a benefit of an existing product. This is important in making our health dollar more efficient.

We're trying to make our health insurance premiums go further in a market where the costs of health care are expanding much more rapidly than the inflation rate, and the government will continue to monitor progress in the private system to ensure that the millions of Australian families that are handing over their hard earned cash every month for their private health insurance are getting value for money. But I do agree that there is not a lot of transparency in the system. The average premium increase under the Liberals was more than four per cent; under us, it's just on three per cent. We are doing better.

I'm really pleased to second this important motion. Every year, Australians with private health insurance feel like they pay more and get less. This year, Australia's average premium rise of 4.4 per cent was the highest in nearly a decade. The five biggest funds raised gold-tier premiums by an average of more than 13 per cent. Out-of-pocket costs keep climbing. The average gap for hospital treatment is now $513, which is up from $437 just two years ago. The share of hospital premiums that were returned as hospital treatment benefits was only 84.2 per cent in 2024-25. Insurer profits, though, rose by nearly 50 per cent in the six years to June 2025 while industry modelling projects that premiums will grow by 17 per cent to 2030 against inflation of only 11 per cent. Meanwhile, many Australians are making the very difficult decision to drop or downgrade their private health cover.

In 2020, four in 10 hospital policies were gold. Today, it's barely one in four. Gold tier is the only tier that's legally required to cover cataract surgery, joint replacements and dialysis. Older Australians dropping their cover from gold to silver tier may lose exactly those parts of the cover that they are most likely to need. In my submission to the economic roundtable last year, I said to the Treasurer that private health insurance has to deliver a public benefit, real access to care and real value for money. But, instead of investing in whole-of-system reforms, the government is undermining value for money by cutting the private health insurance rebate for over-65s. Let's remember that, in 2023, the Department of Health, Disability and Ageing published independent advice which showed that the over-65s rebate represents the highest value for money for governments, hospitals and insured people.

Until I obtained independent analysis from the Parliamentary Budget Office, the government failed to concede that half of the $3 billion it claims will be saved by this measure will be clawed out of the pockets of pensioners. The government has not been transparent about how many Australians will have to downgrade cover that they no longer can afford or the cost of that to our already overburdened public hospitals, nor does it have a plan to monitor or counter the predictable adverse outcomes of this legislation. Even after these proposed changes, the government will still be supporting the private health system by more than $7.6 billion a year, not counting revenue forgone through the Medicare levy surcharge.

The private health insurance rebate has cost this country over a hundred billion dollars since its introduction, but in 27 years its value for money has never been formally assessed. The impact of the rebate is contested. No single body has oversight of our private health care system. Its rebates, its premiums, its product design, hospital viability—no single body has oversight about whether those parts of the system are working for patients and providing value for money. Regulation of private healthcare and private health insurance is too fragmented across the department, Ahpra and other agencies. No single body currently tracks whether the public's contribution is passed through to patients as benefits or whether it's absorbed in insurers' margins and management expenses.

That's why I stand today with the member for Clarke in calling on the government to establish an independent, statutory private health system authority within the health portfolio to monitor the sector's sustainability, ensure fair contracting, guard against managed care and give the government frank, independent advice on the levers that would lift coverage and restore value to our private health insurance system—in short, to ensure that insurance products and services prioritise consumers over shareholders. We can't make rational, evidence based and fair decisions about our private health system while spending remains opaque and benefits decrease. We have to protect Australia's choice and quality and the value of the health care that they receive. We need to avoid another 80 private hospitals closing over the next five years and the downstream impact of those sorts of closures on service provision. Australians who pay for private health cover deserve to know that it will be there when they need it. So I commend this motion to the House.

I want to thank the member for Clarke for this motion and acknowledge the previous speakers, the members for Macarthur and Kooyong, for their contribution to the health of Australians. All Australians deserve access to the affordable health treatments and devices that they need to stay healthy and to live full and productive lives. Our world-leading healthcare system is built on a foundation of strong public and private sectors working together to deliver quality care to all Australians. As my friend Dr Mike, the member for Macarthur, said, our hybrid system only works when we efficiently connect health services for our people, and I'll provide a practical example of this from the north shortly. Private health insurers must ensure their members are getting value for their money. Australians deserve transparency, fair pricing and confidence that their premiums are being directed where they are needed most.

Our government is committed to improving choice and transparency for Australians with private health insurance. Our government is also committed, in a way that I think that no other previous government has been, to the extent of the work that we're doing to ensure that our Aussie public health system is strong and sustainable. The Albanese government is delivering record funding for Northern Territory hospitals, the biggest investment by any federal government ever into Territorians' health: an additional $741 million for NT public hospitals through the National Health Reform Agreement, with total Commonwealth hospital funding reaching $3.5 billion over the five years. This funding will help improve hospital waiting times, reduce ED crowding and free up hospital beds. We're also providing $95.5 million over two years from 2026-27 for primary health care services in remote Northern Territory—the area of the Territory that you so ably represent, Deputy Speaker Scrymgour. There's also a one-time, top-up payment of $66 million in the 2026-27 financial year for the Territory to address many challenges that smaller jurisdictions like ours can face in delivering health services. That's record funding for the Northern Territory from federal Labor.

In addition, our Medicare urgent care clinics are making a real difference in the Territory, helping people get the care that they need while taking pressure off our EDs. As I mentioned in this place previously, our Darwin urgent care clinic opened in May to complement the one in Palmerston, as well as the ones in your electorate, Deputy Speaker. This means not only that Territorians are getting urgent care outside of hospital, but it's also freeing up ED beds for people who really need them. They're fully bulk-billed, open seven days a week, and they are working. That's good for patients and good for Royal Darwin Hospital.

In July, our prime minister came to Darwin and announced $10 million to upgrade maternity services at Royal Darwin Hospital following the closure of Darwin Private Hospital's maternity ward in June last year. The investment will upgrade existing birthing suites, maternity wards and neonatal services to improve facilities and accommodate increased demand. Now why is that needed? Well, it needed an upgrade anyway, but also approximately 250 additional births are expected at Royal Darwin Hospital annually following the closure of private maternity services. While our investment will improve public maternity facilities, it does not replace the private maternity service that was previously available in Darwin.

The NT government were made aware that Darwin Private Hospital would close its maternity services in September 2024, not long after they came to government. Healthscope made this public on 20 February 2025, with the ward ultimately closing on 6 June 2025. At the time, the NT government acknowledged that it had been aware the service was under pressure for months prior to the closure announcement. Last month, the CLP government welcomed Calvary Health Care as the new operator of Darwin Private Hospital, and the Chief Minister of the Northern Territory has promised a return of full private health maternity services at Darwin Private Hospital. We look forward to seeing that full return of a full private maternity service at Darwin Private Hospital becoming a reality. In the meantime, our federal Labor government will continue to have record funding into Territory health.

The time allotted for this debate has expired. The debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.