The future of the Private Health Insurance Rebate has become an election focus with health minister Greg Hunt slamming Labor for refusing to rule out changes to or even scrapping the program.
In response to a question about the fate of the rebate under Labor during last week's election health debate in Canberra, shadow health minister deferred to its previously announced commitment to establish a Productivity Commission inquiry into the private health insurance sector.
The Greens have already committed to abolishing the rebate.
The rebate was originally established as a 30 per cent government contribution to private health insurance premiums. It has already undergone a series of reforms under successive governments that have combined to reduce its share of premiums.
"Bill Shorten and Shadow Health Minister Catherine King have repeatedly refused to rule out scrapping the private health insurance rebate, which reduces the cost of cover, ensures that people remain in the scheme, taking pressure off the public hospital system," said Mr Hunt.
"Removing the $6 billion a year patient rebate for health insurance will lead to a drastic price hike for pensioners and families and result in people dropping their health insurance.
"Modelling has now shown that if private hospital cover drops to 30% of the population waiting lists for common essential procedures like knee and hip surgery in public hospitals will blow out by 91%, even taking into account significant increased funding for public hospitals."
Private Healthcare Australia has called on both major political parties to restore the rebate to 30 per cent for low and middle-income Australians to avoid an exodus of people to the already overstretched public hospital system.
“The means-tested rebate helps keep premiums affordable for battlers and creating uncertainty about its future during the election campaign will cause great anxiety among those Australians who need it most," said chief executive Dr Rachel David.
“It’s a myth that PHI is for the wealthy. More than half of the 13.5 million people who hold PHI have disposable incomes under $50,000 per annum. Many of these are full pensioners and superannuants who are making considerable sacrifices to maintain their health insurance."
Dr David continued, “If the rebate continues to be eroded (it is now at 25%) low and middle-income earning Australians, the people who benefit from the means-tested rebate, will be forced out of the private system and add enormous pressure to public hospital wait lists.
“In fact if the rebate is removed it will mean seven million Australians will see their premiums increase by 20-25%. If hospital cover drops to 30% of the population which is possible if the rebate is removed, research shows that wait lists for common procedures like knee procedures in public hospitals will blow out by 91%, even taking into account forecast increases in public hospital funding."