New survey data from St Lukes shows overwhelming concern among older Tasmanians about proposed changes to the Private Health Insurance (PHI) Rebate, with the leading not-for-profit health and wellness organisation warning the changes pose a whole-of-system risk for Tasmania.
St Lukes received more than 3,600 responses from members aged 65 and over, with the survey showing 96 per cent are worried about the impact, 71 per cent say the changes would affect their ability to keep private health insurance, and 90 per cent lack confidence in accessing the care they need through the public system.
The findings come as St Lukes calls on Tasmania’s federal Senators and MPs to oppose the proposed rebate changes ahead of this week’s Senate Budget Estimates hearings, warning the policy will place significant strain on the state’s already stretched health system.
The results also highlight the financial vulnerability of the cohort most affected, with 77 per cent of respondents earning less than $55,000 annually, and of those, 32 per cent earning less than $30,000.
Stuart Auckland, 66, a Tasmanian retiree living with prostate cancer, is among those who would be directly impacted. After maintaining private health insurance for more than 40 years, he now relies on a fixed income while managing ongoing medical needs and rising living costs.
Proposed changes would increase Stuart’s premiums by around $250 per year – a cost he says he cannot absorb, leaving him facing the prospect of downgrading or dropping his cover altogether.
“Being forced to downgrade or opt out would mean I may no longer be covered for procedures I need,” Stuart said.
“In a state like Tasmania, private health insurance is critical. If I were forced to downgrade or opt out, I may no longer be able to access the procedures I need to manage my chronic illness.”
Based on more than 2,100 comments, key survey themes included financial hardship on fixed incomes, fears about increased pressure on the public health system, concerns about fairness given a lifetime of contributions, and perceptions of age-based discrimination.
St Lukes CEO Paul Lupo said the impacts would extend well beyond individual PHI policyholders, with system-wide consequences across Tasmania’s healthcare system.
“For the year ending December 2025, around 295,000 Tasmanians were covered by private health insurance, supporting 108,909 hospital admissions[1],” he said.
“Private health insurance funded approximately $405 million in hospital benefits across the state, including more than 15,000 admissions in public hospitals.
“This demonstrates the critical role private health insurance already plays in supporting both private and public capacity.”
Throughout his working life, Stuart made financial sacrifices to maintain private cover, recognising it as essential to his long-term care. With increasing health challenges, he now depends on that cover more than ever.
“These changes increase the financial burden on older Australians and risk reducing the quality of care available to us,” he said.
Tasmania’s demographic profile further amplifies the risk, with around 60 per cent of hospital admissions involving people aged over 65 – the highest proportion in the country. This same cohort is also the primary user of services such as orthopaedics, cardiology and other surgical procedures.
“Reducing rebate support will push demand into an already constrained public system, increasing wait times, limiting access and shifting costs onto the state,” Mr Lupo said.
“We are calling on Tasmania’s 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.”
“This is not simply a private health insurance issue, it is a whole-of-system risk for Tasmania,” Mr Lupo said.
ENDS
For further information: Jacquie Ray | Timmins Ray Public Relations | 0429 683 779
[1] Data is obtained from Private Healthcare Australia’s member funds. Health fund coverage pertains to APRA figures as of 31 December 2025.