Labor says it is not backing down on its plan to impose a two-year two percent cap on private health insurance premium increases.
Despite further speculation that it will not apply the cap to small health funds, and in direct response to questions regarding a potential backdown during a doorstop in Tasmania yesterday, Labor leader Bill Shorten said, "No. No, I just want to put NIB and Bupa and Medibank Private on notice that the party is over."
Mr Shorten said, "When Labor gets in, we're not going to just rubber stamp massive price increases to health insurance premiums. And just as we made clear on February the 4th, and again to the small not-for-profit private health insurers, we will work with the regulator and them and we will consult to make sure there is no unintended consequences."
He added, "...we've indicated, working with the small and not-for-profit funds, that we will listen to them. We will work with them and work with the APRA, who is the financial regulator, to make sure there are no unintended consequences.
"But one thing I also want to be very clear on, the small funds are not the target of this issue, but those big funds are not going to use the small funds as human shields to deter us from making the big funds accountable."
Private health insurers have consistently warned against the impact of the proposal.
According to Private Healthcare Australia CEO, Dr Rachel David, "An enforced premium pathway will immediately put at risk a number of small, employee-based and regional mutual health funds who are already close to breaching prudential reserves.
"These health funds have been serving their local communities for decades and this election-focused policy will directly threaten their future and competition in the sector. With this level of interference bankruptcies will occur. Further, the Opposition Leader should explain how Labor intends to override APRA’s strict prudential requirements."