Richard Di Natale (Victoria, Australian Greens) Share this | Hansard source

by leave—The Greens oppose schedule 1 and schedule 2 in the following terms:

(4) Schedule 1, page 3 (line 1) to page 4 (line 3), to be opposed.

(5) Schedule 2, page 5 (line 1) to page 6 (line 10), to be opposed.

The reason that I'm proposing these amendments is—if we look at what amendment (4) on sheet 8504 does—this seeks to remove schedule 1, relating to increasing the maximum excess levels, from the bill. Under this proposal, what we are looking at is a proposal to increase the excess for singles from $500 to $750 and for families from $1,000 to $1,500.

The supposed point of private health insurance and the enormous subsidies that go towards it are so that people are more inclined to use their private health insurance cover and to ease the pressure on our public health system. That is the intended purpose. We know it has failed to achieve that. We know that, in fact, the huge subsidies—the tens of billions of dollars that have been given to the private health insurance industry in the form of the rebate and a whole range of other penalties, tax concessions and so on—don't take the pressure off our public hospital system. What we do know is that, by increasing the excess for both singles and families, we are going to see people becoming less likely to utilise their cover when the time comes. We know that many people are taking private health insurance out simply to avoid paying the penalties associated with things such as the Medicare levy surcharge. What we also know is that the higher the level of excess, the more likely it is that people won't use their cover when it comes to having a procedure done within the private system. Higher excesses will discourage people from claiming on their products.

What does that mean? It means, in practice, that you have provided an incentive for people to take cover. Some of those people will be liable to receive a rebate—that is, a taxation benefit, a subsidy, that is paid for by people who don't have private health insurance, let me remind you—in order to do what? It is not to use that product so that we have fewer procedures done within the public system. It's done so that more people take out a product they don't use to effectively create a larger pool of customers and to ensure that the risk is spread across those customers. But it provides very little or no benefit to the individuals who might take out that cover as a result of that incentive.

Amendment (4) opposes increasing maximum excess levels. If the principle here is that this is being done to ease some pressure on the public health system—at least, according to the government—then it should be easier for people to use their cover when the time comes for a procedure. Increasing the excess, saying to somebody, 'It's now going to cost you an extra $500 if you want to use your private health cover for a procedure,' makes it harder, not easier. This goes against the very purpose stated by this government about why it seeks to have more people with private health insurance cover.

Amendment (5) seeks to remove the discounts which are aged based—that is, for younger people. This bill allows insurers to offer discounted products to people aged between 19 and 29 of up to two per cent each year before the age of 30. As I said in my speech, this goes against the very principle of community rating, on which private health insurance is based. What it does do is undermine that principle, and it says, 'We're now going to provide incentives for you if you're younger.' Of course, conversely, it may open the door to higher premiums for people who are older and likely to use the product. It undermines the whole principle of community rating. So it's not going to have any positive effect. Indeed, the Grattan Institute's Stephen Duckett—himself a former secretary of the department—said that it's unlikely to have any real impact on premiums.

Consider what this government is doing to young people right now. Right now, if you're a young person in this country, you're being screwed over. You're being priced out of the housing market because we've got a government that's not prepared to tackle negative gearing and investors that are crowding young people out of the housing market. If you're a young person right now and you want to get an education, you're being lumbered with higher up-front costs. The cost of a degree is going up and the threshold at which people have to pay back their HECS has gone down, so a whole generation of young people are being lumbered with debt—and it must be said—by the very same people who benefited from a free education. These are the people who are pulling the drawbridge up behind them.

Of course, it's not just education and housing but climate change. We are dealing with a catastrophic, impending climate disaster because we have a government that now has no energy policy and, according to its own Energy Security Board, no chance of meeting the targets it set for us in Paris. They've effectively walked away from those climate targets. They're saying to younger people, 'You're going to have to clean up the mess that we leave behind.'

They're trying to do the same in health care. In health care they're saying to young people, 'Take out private health insurance. We'll provide a discount for you, even though this won't benefit you; it will benefit those people who are older and who are more likely to need the product.' I say to young people right now: don't get sucked in. Don't do it. If you're a young person right now and you're not going to be penalised for not taking out private health insurance, don't do it. We know from the department—who've said it themselves—that they understand this is a way of increasing the number of people taking out the product but not providing a benefit to the younger people who are less likely to use it. As a doctor I often get asked: 'I'm a young person, should I take out private health insurance?' My advice is very straightforward. If you're a young, fit, healthy person, it's a rort; it's a waste of money. Put that money aside for if you need to see a physio or get a pair of glasses or go to the dentist. It's much better sitting in a bank account than lining the pockets of private health insurance companies.

The reality is that we as a society should be investing in our public health system, providing a much more efficient way of delivering health care for our community, rather than seeking to create a US two-tiered health system, which is what these changes would drive us towards. They are trying to create a bigger pool of people taking out private health insurance, because people are awake to the rort that it's become. The cost of premiums is going up and the level of cover is going down. No wonder people are deserting private health insurance cover. What we should be doing instead is having root and branch reform of our private health insurance system. People have every right to take out private health insurance. However, their choice in taking out private health insurance should not be subsidised by the taxpayer to the tune of billions of dollars. What we have now is people without private health insurance subsidising the private health insurance cover of the people who take it out. That's a massive redistribution of wealth from people who are on lower incomes to people who are on higher incomes. We know that's the reality for people who take out private health insurance. It is skewed towards people on higher incomes.

Even those people who are concerned about the running down of our public health system and make a huge sacrifice to take out private health insurance cover are doing it because they have lost faith in the preparedness of the government to invest in Medicare and in our public hospitals. I understand why they do it. But demand of your governments a well-funded public health system, because tinkering around the edges of private health care won't improve our health system. We know this from experience. Look at the US. They spend on health care nearly double what we spend, because they have a model that this government aspires for Australia to have.

We are putting forward both of these amendments—both amendment (4) so that we remove the increase to the maximum excess, and amendment (5), the age based discounts for hospital cover, because we don't want to see a bad problem made worse. That's what this government is proposing to do. We now have close to $30 billion over the forward estimates going into a system that is failing Australians. If we want to deal with up-front costs, which have become a blight on our health system, if we want to deal with the fact that we have private health insurance ripping off consumers by reducing their level of cover and by making it harder for people to utilise their cover when taking it out, this is not what you do.

A 21st century health system that's based on the principles of equity and efficiency ensures that we have a well-funded, public, universal healthcare insurer. That's what Medicare is, that's what funding our public hospital system delivers, and that is the reform blueprint that will ensure people in this country get access to the health care they need—not these changes, which we know the Labor Party will continue to support. We know that they won't get to the root of the problem, which is this massive rort that has become the huge subsidies that go to prop up an industry that cares about its bottom line but doesn't care for patients.