Guy Barnett (Tasmania, Liberal Party) Share this | Hansard source

and it is operated on a for-profit basis. In my view, the Australian government’s ownership of Medibank Private has no positive influence or bearing on private health insurance premiums or the increasing take-up of private health insurance. Medibank Private provides no universal service obligation, as I indicated earlier. That is another point that has been omitted from the opposition’s assertions. All health funds are strictly regulated—the opposition know that; they know the process—no matter who owns them. The government’s 30 per cent private health insurance rebate benefits more than 10 million Australians, or well over 40 per cent of the Australian population. That includes both hospital and ancillary cover. Medibank Private members receive this rebate, and the additional rebate of up to 35 per cent for those aged 65 or 40 per cent for those aged 70 and over, notwithstanding the Labor Party’s opposition to government policy in this area. In theory, government policy could be designed to provide particular benefits for Medibank Private members. That possibility can, of course, be avoided altogether by its sale.

According to its annual report, Medibank Private’s profit has improved by more than $306 million over the past three years. And, as I have indicated, it is improving still. While it says that 88.4 per cent of contributions by members are returned as benefits paid, the insurer matches that return on membership equity against what it says is an industry average of 87.2 per cent. However, as a government owned and funded asset with no requirement to pay a dividend, it is no wonder that Medibank Private holds a dominant position in the market. It should be sold in order to free up the marketplace and not constrain and hinder it, as Labor would like. Medibank Private is one of 38 private health insurance funds, and consumers have many choices about whom they insure with. The government—and this is an important point—is retaining the ministerial premium approval process so that any unjustifiable increase can be rejected. Senator McLucas and the Labor Party make much of that fact.

I want to refer to someone who actually runs a health fund. The CEO of NIB health insurance, Mark Fitzgibbon, has said, ‘The pressure on premiums will be reduced if Medibank goes private.’