It beggars belief that the Federal Government is standing by its proposal to ditch the age-based private health insurance rebate for Australians aged 65 and over.
Months after the initial announcement, public pushback to the proposal is still flooding in, and not just from the seniors affected. There’s opposition from across the healthcare sector, with industry experts adamant that this will not just impact the older Australians who will be pushed out of private health, but everyone who relies on the already overstretched public health system.
The government’s main argument is that this is about “intergenerational equity”; that everyone’s rebate amount will be based on income alone, not age.
How is it fair to move the goal posts on a group of people who’ve done as the government asked for all these years and prioritised private health insurance in their family budgets? Make no mistake, incentivising private health has long been government policy, both through the carrot of age-based rebates, as well as the stick of Lifetime Health Cover loading for those who delay taking out insurance.
It is not fairness to say everyone will be treated the same; lumping older people in with young on the same income, right when their healthcare needs start to increase. These people have upheld their end of the bargain, acting responsibly and investing in their future healthcare for decades, only to be blindsided by a system that may not care for them after all.
The public agrees. Research commissioned by Private Healthcare Australia (PHA) and conducted by Redbridge Group found focus groups across regions and ages squarely reject the government’s intergenerational fairness argument. Younger Australians understand that a 72-year-old retiree and a 35-year-old worker on the same income face very different healthcare realities, and they don’t want to see the rug ripped out from beneath their grandparents. Younger generations also fear bearing the brunt of over-65s with acute care needs forced out of private hospitals and into public health.
Redbridge found younger people see this as the Government trying to solve its own revenue problems by pitting them against their elders, while doing nothing to fix the structural drivers of intergenerational inequality like housing, tax or wages. In fact, it adds a further financial burden to the ‘sandwich generation’ who are raising their own young families, and may now need to support their older parents who can’t afford rising health costs.
PHA hospital claims data backs this up. In Clark and Franklin, more than 137,000 people are covered by private health insurance, supporting more than 52,000 hospital admissions annually and $205 million in hospital benefits. Hip and knee replacements, cardiac procedures, spinal surgery and ophthalmology dominate St Lukes claims – surgery predominately needed by older Australians.
Consider the impact on Tasmania's public hospitals if even a fraction of elective surgeries shifts from the private system. As of June, more than 9,000 Tasmanians were waiting for elective surgery, with only 45 per cent treated within clinically recommended timeframes. This means issues that are simple when caught early become increasingly complex and burdensome.
Heart health is a prime example – we all know we should prioritise any heart concerns, and yet public patients wait an average of 280 days for urgent cardiac care. The best part of a year! Any increase in demand would prolong these delays.
It’s not simply a private health issue; it’s a whole-of system risk for Tasmania. We simply don’t have the same choice and access to specialists available in larger mainland cities. In a regional state with an ageing population, high levels of chronic disease and 60 per cent of hospital admissions involving people over 65, any decline in private cover will have a much greater impact here than elsewhere in the nation.
St Lukes members are deeply concerned. Our member survey received more than 3,600 responses from over 65s, with 96 per cent worried about the impact, 71 per cent saying the changes would affect their ability to keep private health insurance, and 90 per cent lacking confidence in accessing the care they need through the public system.
Significantly, 77 per cent of the respondents earn less than $55,000 annually. Evidencing even greater vulnerability, 32 per cent earn less than $30,000. These people genuinely can’t afford the significant premium jump this policy will entail.
The legislation will now be scrutinised through a parliamentary review. Policymakers must take seriously the evidence and expert advice highlighting its inevitable consequences, and the community’s input on how this shortsighted policy will impact their reality.
St Lukes is urging Tasmanian federal representatives to stand up for their communities and oppose changes that will reduce access to care and increase pressure on an already stretched system. We encourage every Tasmanian worried about this issue to make your voice heard: head to the Parliament of Australia website and make a submission to the Community Affairs Legislation Committee’s review by August 21.
Paul Lupo is CEO of Tasmanian not-for-profit health and wellness organisation St Lukes.