Changes to the private health insurance rebate will burden Tasmania’s already overwhelmed public health system, with leading not‑for‑profit health and wellness organisation St Lukes warning the policy will unfairly push older Tasmanians out of private care and place additional strain on the state’s already overstretched public hospitals.
St Lukes is calling on all Tasmanian Senators to vote against changes to the private health insurance rebate for Australians aged 65 and over and is urging Tasmanian MPs across all parties to publicly stand up for older Tasmanians and the long‑term sustainability of the state’s health system.
CEO Paul Lupo said the Federal Government’s decision to remove higher private health insurance rebate tiers for Australians aged 65 and over would increase the proportion of premium a member pays, with government now paying less.
“This move would disproportionately impact Tasmanians in regional communities who already face limited access to public hospitals and unacceptably long waiting times for surgery,” Mr Lupo said.
Mr Lupo said the change undermined the delicate balance between the public and private health systems – a balance essential to ensuring timely access to care for Tasmania’s ageing population.
“This rushed and ill-considered policy effectively punishes older Tasmanians for doing exactly what governments have encouraged for decades – maintaining private health insurance to reduce pressure on the public system,” he said.
“Many of our members have paid premiums for decades so they could rely on private care as they age. Now, just as their health needs increase, they’re being told to pay more or walk away.”
Older Tasmanians are more likely to live on fixed incomes and already face systemic barriers to accessing care, including long public hospital waitlists, limited specialist availability and higher travel costs associated with living in a regional state.
“Ageing in Tasmania already comes with challenges that people in major cities simply don’t face,” Mr Lupo said.
“If the Federal Government makes private health insurance less accessible by withdrawing support, demand for care doesn’t disappear – it moves into the public system.”
Independent actuarial analysis commissioned by the Commonwealth Government confirms the proposed changes would shift approximately $550 million in additional costs into the public hospital system nationally, further straining state‑run hospitals that are already struggling to keep up with demand.
With the oldest population in the country and the lowest average income, Tasmania is expected to be among the hardest hit.
Public hospital waiting times in the state are already significant, with Tasmanians waiting an average of 215 days for urgent heart care and more than 500 days for semi‑urgent cardiology, while orthopaedic patients wait around 76 days for semi‑urgent assessment and up to 270 days for non‑urgent care, delaying access to hip and knee replacement surgery.[i]
“These are exactly the services most commonly needed by older Australians,” Mr Lupo said.
“When long‑term private health members are forced out of the private system, their care doesn’t disappear, it moves directly onto public hospital waitlists.”
St Lukes’ own claims data reflects this reality, with the highest service demand among members aged 65 and over relating to cardiac care, hip and knee replacements and other age‑related procedures.
St Lukes is Tasmania’s largest provider of private health insurance, with people aged 65 and over accounting for around 29 per cent of its 100,000 members. Most are retirees living on average or below‑average incomes rather than high‑income earners.
“For many older Tasmanians, these increases will be the breaking point,” Mr Lupo said.
“People who have carefully planned their retirement around stable health costs will be forced to choose between paying more or losing cover they’ve relied on for years.”
Mr Lupo said the lack of detail from the Federal Government on implementation, timing and state‑based modelling was also deeply concerning.
“This decision appears to have been made with little regard for the real‑world consequences – particularly in a regional state like Tasmania,” he said.
“All this does is shift hundreds of millions of dollars in costs from the Commonwealth to state governments for no reason other than balancing the federal budget.”
St Lukes is calling on Tasmanian federal representatives to stand up for older Tasmanians and oppose changes that would undermine the sustainability of the state’s health system.
“Tasmanians simply cannot afford policy decisions that push more people onto public hospital waitlists,” Mr Lupo said.
“Health policy must reflect the realities of ageing in regional Australia. We should be supporting older Tasmanians to stay insured and access care when they need it most – not forcing them out of the system at the most vulnerable stage of their lives.”
ENDS
For more information: Jacquie Ray, Timmins Ray Public Relations – 0429 683 779.
[i] Wait times | Tasmanian Department of Health