The issue of private health insurance premium costs on the rise has given rise to countless debates across various agents in the field. On the one hand, the federal government as represented by former health minister Tanya Plibersek and current Prime Minister Kevin Rudd argues that Australia’s private coverage incentive packs are taking too high a toll on the federal budget. Instead of doling out benefits to the policyholders, the focus should be falling on restoring the budget deficit and bringing back balance to the country’s economy. On the other hand, opposition leader Tony Abbott has decried both expected dropouts from the private system, as well as increased costs on the population – but eventually chose to back the cost-cutting reforms adopted by the government. Caught somewhere in the middle stand representatives of the private health insurers themselves, as well as the population, who is already financially mired by existing credit debt and living costs on the rise. This is why today we take a look at how the latter two parties see the situation of health expenses, in hopes of drawing an alarm signal regarding the status quo.
Some adversaries of private health funds have made affirmations according to which private health funds do little to contribute to Australia’s overall health costs. An industry magazine published a report in June, according to which most of the costs are sustained by the Government and by the consumers themselves, with health funds only making up for 8 per cent of those expenses. The CEO of one of the country’s top insurers responded that such claims are unfounded, especially since the overall contribution made by health funds toward their beneficiaries stands at $15 billion in the year leading up to March 2013. The same executive added that regulations in terms of contribution vary widely from area to area – in some states, private health funds are not allowed to contribute to the costs of visits to general practitioners, for instance. But if and when they can pay up, they do.
According to the insurer’s own reports, Australia’s private health coverage providers paid out $11.6 billion for hospital services and $3.77 billion to cover general treatment expenses between March 2012 and March 2013. These costs went into 51 per cent of all surgeries, 55 per cent of elective surgeries, and 80 per cent of elective surgical procedures sustained in private health care facilities. As a takeaway of these figures, the exec stated that the recently abolished incentives for private health insurance had greatly contributed to the revival of the private health care industry. Now that they are gone, a return to the previous state of decline is in the cards, as consumer confidence is expected to drop, where private medical services are concerned.
Both health funds, government representatives and comparison sites such as HelpMeChoose have repeatedly stressed the importance of choosing one’s private health insurance provider wisely. The population has been advised to shop around for the best cost-to-benefits ratio, but also to closely analyze the exclusions that apply. Yet, after all is said and done, there also exists the issue of unequal access to health care. The situation in the Hunter area is very telling in this respect: most locals there are in a poorer state of health than the rest of the nation. 53 per cent of them suffer from a chronic illness – whereas the ratios in the western inner city of Sydney stands at 34 per cent. 9 per cent postponed or gave up on seeing a general practitioner altogether, simply because they couldn’t afford it. Waiting lists in the area are also known to be comparatively long. Until such disparities are addressed, Australia’s health care system cannot justly call itself universal and equitable.